[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]
WHERE'S MY STUFF? EXAMINING THE ECONOMIC, ENVIRONMENTAL, AND SOCIETAL
IMPACTS OF FREIGHT TRANSPORTATION
=======================================================================
(116-45)
JOINT HEARING
BEFORE THE
SUBCOMMITTEE ON HIGHWAYS AND TRANSIT
AND THE
SUBCOMMITTEE ON RAILROADS, PIPELINES,
AND HAZARDOUS MATERIALS
OF THE
COMMITTEE ON
TRANSPORTATION AND INFRASTRUCTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTEENTH CONGRESS
FIRST SESSION
__________
DECEMBER 5, 2019
__________
Printed for the use of the
Committee on Transportation and Infrastructure
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Available online at: https://www.govinfo.gov/committee/house-
transportation?path=/browsecommittee/chamber/house/committee/
transportation
______
U.S. GOVERNMENT PUBLISHING OFFICE
43-121 PDF WASHINGTON : 2020
COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE
PETER A. DeFAZIO, Oregon, Chair
SAM GRAVES, Missouri ELEANOR HOLMES NORTON,
DON YOUNG, Alaska District of Columbia
ERIC A. ``RICK'' CRAWFORD, Arkansas EDDIE BERNICE JOHNSON, Texas
BOB GIBBS, Ohio RICK LARSEN, Washington
DANIEL WEBSTER, Florida GRACE F. NAPOLITANO, California
THOMAS MASSIE, Kentucky DANIEL LIPINSKI, Illinois
MARK MEADOWS, North Carolina STEVE COHEN, Tennessee
SCOTT PERRY, Pennsylvania ALBIO SIRES, New Jersey
RODNEY DAVIS, Illinois JOHN GARAMENDI, California
ROB WOODALL, Georgia HENRY C. ``HANK'' JOHNSON, Jr.,
JOHN KATKO, New York Georgia
BRIAN BABIN, Texas ANDRE CARSON, Indiana
GARRET GRAVES, Louisiana DINA TITUS, Nevada
DAVID ROUZER, North Carolina SEAN PATRICK MALONEY, New York
MIKE BOST, Illinois JARED HUFFMAN, California
RANDY K. WEBER, Sr., Texas JULIA BROWNLEY, California
DOUG LaMALFA, California FREDERICA S. WILSON, Florida
BRUCE WESTERMAN, Arkansas DONALD M. PAYNE, Jr., New Jersey
LLOYD SMUCKER, Pennsylvania ALAN S. LOWENTHAL, California
PAUL MITCHELL, Michigan MARK DeSAULNIER, California
BRIAN J. MAST, Florida STACEY E. PLASKETT, Virgin Islands
MIKE GALLAGHER, Wisconsin STEPHEN F. LYNCH, Massachusetts
GARY J. PALMER, Alabama SALUD O. CARBAJAL, California,
BRIAN K. FITZPATRICK, Pennsylvania Vice Chair
JENNIFFER GONZALEZ-COLON, ANTHONY G. BROWN, Maryland
Puerto Rico ADRIANO ESPAILLAT, New York
TROY BALDERSON, Ohio TOM MALINOWSKI, New Jersey
ROSS SPANO, Florida GREG STANTON, Arizona
PETE STAUBER, Minnesota DEBBIE MUCARSEL-POWELL, Florida
CAROL D. MILLER, West Virginia LIZZIE FLETCHER, Texas
GREG PENCE, Indiana COLIN Z. ALLRED, Texas
SHARICE DAVIDS, Kansas
ABBY FINKENAUER, Iowa
JESUS G. ``CHUY'' GARCIA, Illinois
ANTONIO DELGADO, New York
CHRIS PAPPAS, New Hampshire
ANGIE CRAIG, Minnesota
HARLEY ROUDA, California
CONOR LAMB, Pennsylvania
Subcommittee on Highways and Transit
ELEANOR HOLMES NORTON, District of
Columbia, Chair
RODNEY DAVIS, Illinois EDDIE BERNICE JOHNSON, Texas
DON YOUNG, Alaska STEVE COHEN, Tennessee
ERIC A. ``RICK'' CRAWFORD, Arkansas JOHN GARAMENDI, California
BOB GIBBS, Ohio HENRY C. ``HANK'' JOHNSON, Jr.,
DANIEL WEBSTER, Florida Georgia
THOMAS MASSIE, Kentucky JARED HUFFMAN, California
MARK MEADOWS, North Carolina JULIA BROWNLEY, California
ROB WOODALL, Georgia FREDERICA S. WILSON, Florida
JOHN KATKO, New York ALAN S. LOWENTHAL, California
BRIAN BABIN, Texas MARK DeSAULNIER, California
DAVID ROUZER, North Carolina SALUD O. CARBAJAL, California
MIKE BOST, Illinois ANTHONY G. BROWN, Maryland
DOUG LaMALFA, California ADRIANO ESPAILLAT, New York
BRUCE WESTERMAN, Arkansas TOM MALINOWSKI, New Jersey
LLOYD SMUCKER, Pennsylvania GREG STANTON, Arizona
PAUL MITCHELL, Michigan COLIN Z. ALLRED, Texas
MIKE GALLAGHER, Wisconsin SHARICE DAVIDS, Kansas
GARY J. PALMER, Alabama ABBY FINKENAUER, Iowa, Vice Chair
BRIAN K. FITZPATRICK, Pennsylvania JESUS G. ``CHUY'' GARCIA, Illinois
TROY BALDERSON, Ohio ANTONIO DELGADO, New York
ROSS SPANO, Florida CHRIS PAPPAS, New Hampshire
PETE STAUBER, Minnesota ANGIE CRAIG, Minnesota
CAROL D. MILLER, West Virginia HARLEY ROUDA, California
GREG PENCE, Indiana GRACE F. NAPOLITANO, California
SAM GRAVES, Missouri (Ex Officio) ALBIO SIRES, New Jersey
SEAN PATRICK MALONEY, New York
DONALD M. PAYNE, Jr., New Jersey
DANIEL LIPINSKI, Illinois
DINA TITUS, Nevada
STACEY E. PLASKETT, Virgin Islands
PETER A. DeFAZIO, Oregon (Ex
Officio)
------ 7
Subcommittee on Railroads, Pipelines, and Hazardous Materials
DANIEL LIPINSKI, Illinois, Chair
ERIC A. ``RICK'' CRAWFORD, Arkansas ALBIO SIRES, New Jersey
SCOTT PERRY, Pennsylvania DONALD M. PAYNE, Jr., New Jersey
RODNEY DAVIS, Illinois LIZZIE FLETCHER, Texas
BRIAN BABIN, Texas ANDRE CARSON, Indiana
MIKE BOST, Illinois FREDERICA S. WILSON, Florida
RANDY K. WEBER, Sr., Texas MARK DeSAULNIER, California
DOUG LaMALFA, California STEPHEN F. LYNCH, Massachusetts
LLOYD SMUCKER, Pennsylvania TOM MALINOWSKI, New Jersey
PAUL MITCHELL, Michigan GRACE F. NAPOLITANO, California
BRIAN K. FITZPATRICK, Pennsylvania STEVE COHEN, Tennessee
TROY BALDERSON, Ohio JESUS G. ``CHUY'' GARCIA, Illinois
ROSS SPANO, Florida ELEANOR HOLMES NORTON,
PETE STAUBER, Minnesota District of Columbia
GREG PENCE, Indiana EDDIE BERNICE JOHNSON, Texas
SAM GRAVES, Missouri (Ex Officio) ALAN S. LOWENTHAL, California
COLIN Z. ALLRED, Texas, Vice Chair
ANGIE CRAIG, Minnesota
CONOR LAMB, Pennsylvania
PETER A. DeFAZIO, Oregon (Ex
Officio)
CONTENTS
Page
Summary of Subject Matter........................................ vii
STATEMENTS OF MEMBERS OF THE COMMITTEE
Hon. Eleanor Holmes Norton, a Delegate in Congress from the
District of Columbia, and Chairwoman, Subcommittee on Highways
and Transit:
Opening statement............................................ 1
Prepared statement........................................... 2
Hon. Rodney Davis, a Representative in Congress from the State of
Illinois, and Ranking Member, Subcommittee on Highways and
Transit:
Opening statement............................................ 3
Prepared statement........................................... 3
Hon. Daniel Lipinski, a Representative in Congress from the State
of Illinois, and Chairman, Subcommittee on Railroads,
Pipelines, and Hazardous Materials:
Opening statement............................................ 4
Prepared statement........................................... 5
Hon. Eric A. ``Rick'' Crawford, a Representative in Congress from
the State of Arkansas, and Ranking Member, Subcommittee on
Railroads, Pipelines, and Hazardous Materials:
Opening statement............................................ 6
Prepared statement........................................... 7
Hon. Peter A. DeFazio, a Representative in Congress from the
State of Oregon, and Chairman, Committee on Transportation and
Infrastructure:
Opening statement............................................ 7
Prepared statement........................................... 8
Hon. Eddie Bernice Johnson, a Representative in Congress from the
State of Texas, prepared statement............................. 93
Hon. Steve Cohen, a Representative in Congress from the State of
Tennessee, prepared statement.................................. 94
WITNESSES
Erin Aleman, Executive Director, Chicago Metropolitan Agency for
Planning, and Board Member, Coalition for America's Gateways
and Trade Corridors:
Oral statement............................................... 9
Prepared statement........................................... 11
Chuck Baker, President, American Short Line and Regional Railroad
Association:
Oral statement............................................... 16
Prepared statement........................................... 18
Anne Goodchild, Ph.D., Founding Director, Supply Chain
Transportation and Logistics Center, University of Washington:
Oral statement............................................... 24
Prepared statement........................................... 26
Ian J. Jefferies, President and Chief Executive Officer,
Association of American Railroads:
Oral statement............................................... 31
Prepared statement........................................... 32
Jason Mathers, Director, Vehicle and Freight Strategy,
Environmental Defense Fund:
Oral statement............................................... 39
Prepared statement........................................... 41
Jim Tymon, Executive Director, American Association of State
Highway and Transportation Officials:
Oral statement............................................... 48
Prepared statement........................................... 50
SUBMISSIONS FOR THE RECORD
Post-hearing Correction of Remarks Submitted for the Record by
Erin Aleman, Executive Director, Chicago Metropolitan Agency
for Planning, and Board Member, Coalition for America's
Gateways and Trade Corridors................................... 83
Statement of Erin Aleman, Executive Director, Chicago
Metropolitan Agency for Planning, and Board Member, Coalition
for America's Gateways and Trade Corridors, Submitted for the
Record by Hon. Peter A. DeFazio................................ 94
Submissions for the Record by Hon. Eleanor Holmes Norton:
Letter of December 4, 2019, from Catherine Chase, President,
Advocates for Highway and Auto Safety et al................ 95
Statement of Chris Spear, President and Chief Executive
Officer, American Trucking Associations.................... 98
Statement of the Association of Equipment Manufacturers...... 103
Letter of December 3, 2019, from Allen R. Schaeffer,
Executive Director, Diesel Technology Forum................ 104
Letter of December 16, 2019, from David French, Senior Vice
President, Government Relations, National Retail Federation 108
Article entitled ``The Significance of Li-ion Batteries in
Electric Vehicle Life-cycle Energy and Emissions and
Recycling's Role in its Reduction''........................ 111
Statement of Stephen Gardner, Senior Executive Vice President,
Chief Operating and Commercial Officer, National Railroad
Passenger Corporation (Amtrak), Submitted for the Record by
Hon. Daniel Lipinski........................................... 111
APPENDIX
Question from Hon. Daniel Lipinski to Erin Aleman, Executive
Director, Chicago Metropolitan Agency for Planning, and Board
Member, Coalition for America's Gateways and Trade Corridors... 115
Questions from Hon. Eddie Bernice Johnson to Chuck Baker,
President, American Short Line and Regional Railroad
Association.................................................... 116
Questions to Anne Goodchild, Ph.D., Founding Director, Supply
Chain Transportation and Logistics Center, University of
Washington, from:
Hon. Peter A. DeFazio........................................ 116
Hon. Steve Cohen............................................. 117
Questions to Ian J. Jefferies, President and Chief Executive
Officer, Association of American Railroads, from:
Hon. Peter A. DeFazio........................................ 117
Hon. Eddie Bernice Johnson................................... 120
Question from Hon. Peter A. DeFazio to Jason Mathers, Director,
Vehicle and Freight Strategy, Environmental Defense Fund....... 121
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
December 2, 2019
SUMMARY OF SUBJECT MATTER
TO: LMembers, Subcommittee on Highways and Transit and
Subcommittee on Railroads, Pipelines, and Hazardous Materials
FROM: LStaff, Subcommittee on Highways and Transit and
Subcommittee on Railroads, Pipelines, and Hazardous Materials
RE: LJoint Subcommittee Hearing on ``Where's My
Stuff?: Examining the Economic, Environmental, and Societal
Impacts of Freight Transportation''
_______________________________________________________________________
PURPOSE
On Thursday, December 5, 2019, at 10:00 a.m., in 2167
Rayburn House Office Building, the Subcommittee on Highways and
Transit and the Subcommittee on Railroads, Pipelines, and
Hazardous Materials will jointly hold a hearing on ``Where's My
Stuff?: Examining the Economic, Environmental, and Societal
Impacts of Freight Transportation.'' The purpose of the hearing
is for Members of the Subcommittees to explore the importance
of freight transportation, investment needed to support freight
transportation, and the ways in which demand for goods movement
is growing and changing. The Subcommittees will hear from
representatives of the Coalition for America's Gateways and
Trade Corridors (CAGTC), the American Short Line and Regional
Railroad Association (ASLRRA), the University of Washington
Supply Chain Transportation and Logistics Center, the
Association of American Railroads (AAR), the Environmental
Defense Fund (EDF), and the American Association of State
Highway and Transportation Officials (AASHTO).
BACKGROUND
Freight transportation and related industries significantly
contribute to the U.S. economy. The nation's freight system
transports, on average, 51 million tons of freight, valued at
approximately $55 billion, on a daily basis, which amounts to
approximately 17.7 billion tons of freight, valued at
approximately $16.8 trillion, annually.\1\ In 2016, the demand
for transportation accounted for 8.9 percent of U.S. Gross
Domestic Product.\2\ Demand for freight transportation is
rising at a disproportionate rate to freight system
capacity.\3\ The U.S. Department of Transportation (U.S. DOT)
estimates that freight movements are expected to grow across
all modes, and by 2040, will increase by 42 percent.\4\
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\1\ TRIP, ``America's Rolling Warehouses: Opportunities and
Challenges with the Nation's Freight Delivery System'', October 2019.
\2\ Bureau of Transportation Statistics, Transportation Economic
Trends 2018 (https://www.bts.gov/transportation-economic-trends/tet-
2018-chapter-2-contribution-economy).
\3\ FHWA, Urban Goods Movement, https://ops.fhwa.dot.gov/freight/
technology/urban_goods/index.htm.
\4\ U.S. DOT, National Freight Strategic Plan, Draft for Public
Comment, p. 15.
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FREIGHT RAILROADS
The U.S. freight railroad industry operates a 140,000-mile
network across the country, delivering on average five million
tons of goods every day. This industry is composed of varying
sized railroads measured by their annual operating revenues
into three different classes. The largest railroads include the
seven Class Is, which are the biggest railroads that
collectively provide long-haul operations in 44 states and
D.C.\5\ The Class Is account for nearly 69 percent of the
industry's mileage.\6\
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\5\ The seven Class railroads include Burlington Northern Santa Fe
Railway (BNSF); Union Pacific Railroad (UP); Norfolk Southern Railway
(NS); CSX Transportation; Canadian National Railway (CN); Canadian
Pacific Railway (CP); and Kansas City Southern (KCS).
\6\ Association of American Railroads https://www.aar.org/railroad-
101/.
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The 603 short line and regional railroads operate nearly
40% of the nation's rail network by mileage.\7\ Short lines are
often the only way rural America can connect to the rest of the
national freight rail network--playing an important role in
providing first-mile and last-mile service that extends the
reach of the rail network to rural communities, manufacturers,
farmers, and others.\8\ These smaller railroads range in size
from small operators handling just a few carloads a month, to
others that cross state lines and approach the size of the
large Class I railroads. These railroads operate 100 percent of
the rail network in five states; and 50 percent of the rail
network in another 15 states.\9\
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\7\ American Short Line and Regional Railroad Association https://
www.aslrra.org/web/About/About/web/About/About.aspx?hkey=ffdbe611-bc49-
4db1-902b-1ac672226682.
\8\ American Short Line and Regional Railroad Association https://
www.aslrra.org/web/About/Industry_Facts/web/About/
Industry_Facts.aspx?hkey=bd7c0cd1-4a93-4230-a0c2-c03fab0135e2.
\9\ American Short Line and Regional Railroad Association https://
www.aslrra.org/web/About/About/web/About/About.aspx?hkey=ffdbe611-bc49-
4db1-902b-1ac672226682.
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VOLUME OF FREIGHT MOVED BY RAIL
In 2018, the freight railroads operating in the U.S.
transported 17,910,549 carloads, including 17,708,351 moved by
the Class Is and 202,198 moved by the short lines. Transported
inside those carloads were a range of commodities such as:
agricultural and food products; chemicals and petroleum; coal;
forest products; metallic ores and metals; motor vehicles and
parts; nonmetallic minerals and products; waste, scraps, and
other products. Additionally, the freight railroads transported
18,066,668 intermodal units, which are shipping containers and
truck trailers that are transferred to the railroads and moved
on rail cars.
ENVIRONMENTAL IMPACTS
In 2018, the freight railroads, on average, moved one ton
of freight 473 miles on one gallon of fuel. This efficiency is
a 101 percent improvement compared to 1980 and a 19 percent
improvement from 2000.\10\ As a result, the freight railroads
reduced their consumption of fuel by nine billion gallons and
emitted 100 million fewer tons of carbon dioxide.\11\ In total,
the freight railroads comprised just 2 percent of all
transportation-related greenhouse gas emissions in 2017 and
just 0.6 percent of total U.S. greenhouse gas emissions in
2017.\12\
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\10\ Association of American Railroads, Freight Railroads Help
Reduce Greenhouse Gas Emissions, April 2019, Available at https://
www.aar.org/wp-content/uploads/2018/07/AAR-Railroads-Greenhouse-Gas-
Emissions.pdf.
\11\ Id.
\12\ U.S. Environmental Protection Agency (2019, April). Inventory
of U.S. Greenhouse Gas Emissions and Sinks. Publication No. EPA 430-R-
19-001. Accessible at: https://www.epa.gov/sites/production/files/2019-
04/documents/us-ghg-inventory-2019-main-text.pdf, page 38.
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The freight railroads use various technology systems to
help achieve such levels of sustainability and efficiency. For
example, fuel management systems are integrated into
locomotives and draw on data about topography, track curvature,
etc., providing the engineers with real-time instructions on
how to operate the train to gain maximum fuel efficiencies that
can net up to a 14 percent increase in fuel efficiency. The
most advanced locomotives, Tier 4s, include hundreds of sensors
that generate thousands of data points about the performance of
the locomotives. That data is monitored from operations centers
that alert the railroad of performance issues when necessary.
These technologies reduce diesel locomotives' particulate and
nitrogen oxide emissions by as much as 90 percent and 80
percent, respectively.\13\
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\13\ Association of American Railroads, Putting Technology to Work,
How Freight Rail Delivers the 21st Century, Available at https://
www.aar.org/wp-content/uploads/2018/05/RailxTech-AAR-White-Paper-Final-
Web.pdf Page 6.
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The industry is also pursuing initiatives to reduce
emissions in freight rail yards. This includes technologies
that turn off locomotives that have idled for too long or
automatically restart it if temperatures are low. Small diesel
engines also may be used to keep the main locomotive engine
warm when it is powered down to prevent freezing. These
technologies reduce fuel that is wasted while locomotives
idle.\14\
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\14\ Id at 7.
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FEDERAL FUNDING OPPORTUNITIES
The short line and regional railroads, and any rail carrier
(including Class Is) in partnership with at least one state
entity, public agency, and/or local government, are eligible
for grants under the FRA's Consolidated Rail Infrastructure and
Safety Improvements (CRISI) grant program.\15\ These
discretionary grants fund projects that improve the safety,
efficiency, or reliability of freight (and passenger) rail
transportation systems. Activities eligible for CRISI funds
include capital projects that improve short line and regional
railroad infrastructure; highway-rail grade crossing
improvements projects; and rail line relocation and improvement
projects, among others. The maximum Federal share of total
project costs under the program is 80 percent. The Fixing
America's Surface Transportation Act (FAST Act) (P.L. 114-94)
authorized CRISI at $255 million in Fiscal Year 2019 and $330
million in Fiscal Year 2020. In addition, the Short Line Tax
credit, known as 45G, allows a credit of 50 cents for each
dollar short line railroads invest in track and bridge
improvements, up to $3,500 per mile. The credit, first enacted
in 2005, expired in December 2017.
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\15\ 49 USC Section 24407. In addition to short line and regional
railroads, states, Amtrak and other intercity rail passenger
transportation provider, the Transportation Research Board, and others
are eligible for CRISI.
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The Railroad Rehabilitation and Improvement Financing
(RRIF) program offers long-term, low-interest loans for
improving rail infrastructure. Eligible recipients include
railroads, state and local governments, government-sponsored
corporations, and joint ventures that include at least one
railroad. RRIF-eligible projects include the following:
acquiring, improving, and rehabilitating track, bridges, rail
yards, buildings, and shops; preconstruction activities;
positive train control (PTC); transit-oriented development
projects; and new rail or intermodal activities. Under this
program, the U.S. DOT is authorized to provide direct loans and
loan guarantees up to $35 billion to finance development of
railroad infrastructure. To date the RRIF program has provided
$6.286 billion in financing since 2002. There is currently
about $30.2 billion available in loan authority under the RRIF
program.\16\
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\16\ RRIF was originally established by Congress in Title V of the
Railroad Revitalization and Regulatory Reform Act of 1976 and later
amended in the Transportation Equity Act for the 21st Century.
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TRUCKING
Freight moves by truck on more than four million miles of
public roads (including 223,000 miles on the National Highway
System) and 616,000 bridges. The trucking industry is made up
by over 700,000 trucking companies and more than 3.5 million
commercial drivers.\17\
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\17\ https://www.census.gov/library/stories/2019/06/america-keeps-
on-trucking.html.
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VOLUME OF FREIGHT MOVED BY TRUCK
Trucks carried 11 billion tons of freight in 2017 \18\, and
trucking accounts for approximately 72 percent of all freight
tonnage by value and 66 percent by weight.\19\ According to the
Bureau of Transportation Statistics, long-haul freight truck
traffic is projected to increase ``dramatically'' on the
National Highway System over the next three decades, from 311
million miles per day in 2015 to 488 million miles per day by
2045.\20\
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\18\ BTS, Freight Facts and Figures, (https://
data.transportation.gov/stories/s/Moving-Goods-in-the-United-States/
bcyt-rqmu).
\19\ TRIP, p.17.
\20\ Bureau of Transportation Statistics, ``Freight Transportation
System Extent and Use'' (https://data.transportation.gov/stories/s/
Freight-Transportation-System-Extent-Use/r3vy-npqd).
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In recent years, online retail has fundamentally changed
how products are purchased and distributed. According to the
U.S. Census Bureau, e-commerce sales have grown from just over
4 percent of total retail sales in the first quarter of 2010 to
over 11 percent of total retail sales in the third quarter of
2019.\21\ From 2014 to 2018, e-commerce increased by 69 percent
to $505 billion, and is expected to increase another 39 percent
by 2022, to $706 billion.\22\ As a result of this trend, the
demand for freight movements by truck, and the requirement for
more timely and efficient deliveries, have grown significantly.
This has also prompted changes to supply chains and increased
the focus on last-mile delivery of freight, particularly in
congested urban centers.
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\21\ U.S. Census Bureau, Quarterly Retail E-Commerce Sales, 3rd
Quarter 2019 (https://www.census.gov/retail/mrts/www/data/pdf/
ec_current.pdf).
\22\ TRIP, ``America's Rolling Warehouses: Opportunities and
Challenges with the Nation's Freight Delivery System'', October 2019, p
4.
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ENVIRONMENTAL IMPACTS
Medium and heavy-duty trucks contributed 23 percent of all
transportation-related greenhouse gas emissions in 2017, and
6.7 percent of total U.S. greenhouse gas emissions in 2017.\23\
Greater congestion on roadways can exacerbate idling,
emissions, and increase fuel use. More than two out of every
five miles of America's urban interstates are congested.\24\
Congestion cost the trucking industry $74.5 billion in 2017,
$66.1 billion of which occurred in dense urban areas.\25\ The
cost of congestion for truck drivers grew by 40 percent between
2012 and 2017, compared to a 14 percent increase in congestion
costs for non-commercial drivers.\26\
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\23\ U.S. Environmental Protection Agency (2019, April). Inventory
of U.S. Greenhouse Gas Emissions and Sinks. (https://www.epa.gov/sites/
production/files/2019-04/documents/us-ghg-inventory-2019-main-
text.pdf).
\24\ ASCE Report Card, 2017.
\25\ ``Cost of Congestion to the Trucking Industry.'' American
Transportation Research Institute, Oct. 2018. https://atri-online.org/
wp-content/uploads/2018/10/ATRI-Cost-of-Congestion-to-the-Trucking-
Industry-2018-Update-10-2018.pdf.
\26\ Texas A&M Transportation Institute, Urban Mobility Report
2019, https://mobility.tamu.edu/umr/.
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FEDERAL FUNDING & FAST ACT FREIGHT PROVISIONS
Federal investments in roads and bridges are funded through
Federal excise taxes levied on motor fuels (gas and diesel) and
on related products such as tires, which are deposited into the
Highway Trust Fund (HTF). Congress has not adjusted these taxes
on gas and diesel since 1993, and the purchasing power of these
taxes have fallen over 40 percent in the last 25 years.
Improved vehicle fuel efficiency, due to higher Corporate
Average Fuel Economy standards required by law, has further
eroded Federal revenues. As a result, revenues coming into the
HTF have not kept pace with expenditures from authorized
programs. Congress has had to transfer $144 billion from the
General Fund and other funds to keep the HTF solvent since
2008. The Congressional Budget Office (CBO) estimates that over
the next 10 years, the HTF will fall $171 billion short based
on continuing currently-authorized highway, transit, and safety
program levels. An additional $5 billion is necessary to ensure
that there is a prudent balance in the HTF, which brings the
shortfall to $176 billion. This does not include any higher
investment levels to meet growing surface transportation needs.
According to U.S. DOT's Conditions & Performance Report,
there is a $836 billion backlog of unmet capital investment
needs for highways and bridges \27\. One in three interstate
U.S. bridges have repair needs, and over 47,000 of the nation's
bridges are structurally deficient.\28\ Nearly one out of every
five miles of highway pavement is in poor condition
nationwide.\29\
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\27\ U.S. DOT, 2015 Status of the Nation's Highways, Bridges, and
Transit: Conditions and Performance.
\28\ ARTBA Bridge Report, 2019 (https://artbabridgereport.org/).
\29\ U.S. DOT, 2015 Status of the Nation's Highways, Bridges, and
Transit: Conditions and Performance.
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The FAST Act, the last major surface reauthorization bill
enacted by Congress in 2015, included several provisions to
support and invest in the movement of freight.
The FAST Act established a new formula program to fund
surface transportation freight improvements and provided $6.3
billion over the five-year bill. States may use the funds for a
variety of projects related to freight movement for road and
bridge segments in States that are designated on the National
Highway Freight Network. Up to 10 percent of the funds each
year may be used for freight intermodal or freight rail
projects, including projects within the boundaries of public
and private freight rail and port facilities and projects that
facilitate intermodal operations.
The FAST Act also created a new competitive grant program,
providing $4.5 billion over the life of the bill, to assist
states in funding nationally-significant highway, bridge, and
freight projects. The Nationally Significant Freight and
Highway Projects program (referred to as INFRA by this
Administration and FASTLANE by the previous Administration) is
generally aimed at large-scale and multi-jurisdictional
projects that cannot be funded with highway funding apportioned
to the states. At least 25 percent of the funding is reserved
for projects in rural areas, and 10 percent of the funding are
reserved for smaller projects (project costs of less than $100
million). Up to $500 million over the life of the FAST Act may
be used to fund freight rail or intermodal projects if the
projects will significantly improve freight movements on the
National Highway Freight Network.
The FAST Act modified the National Highway Freight Network
established by the Moving Ahead for Progress in the 21st
Century Act (MAP-21) (P.L. 112-141) to specify that the core
portion of the network will be comprised of a 41,518-mile
highway network previously identified by the U.S. Department of
Transportation. The FAST Act allowed States and metropolitan
planning organizations to add to the network by designating
urban and rural freight corridors. The FAST Act also encouraged
each State to establish a freight advisory committee and
required each State to develop a comprehensive freight plan,
which can be done separately or incorporated into the State's
transportation improvement plan (STIP).
In addition, the FAST Act established goals for a national
multimodal freight policy and directed the Secretary to develop
a National Multimodal Freight Network. U.S. DOT issued an
Interim Network, published in the Federal Register, on June 6,
2016, and re-opened the comment period through February 22,
2018, in a notice published on October 25, 2017, but has not
finalized the Network.
U.S. DOT was also required to develop a national freight
strategic plan to identify bottlenecks on the multimodal
freight network, including the cost to address each bottleneck
and strategies to improve intermodal connectivity. U.S. DOT
issued a draft plan for comment in December 2015.\30\ The
Strategic Plan has not yet been finalized. The draft plan
identified several key trends and challenges facing the U.S.
freight transportation system, including:
---------------------------------------------------------------------------
\30\ https://www.transportation.gov/sites/dot.gov/files/docs/
DRAFT_NFSP_for_Public_
Comment_508_10%2015%2015%20v1.pdf
LHigh expected growth in freight traffic over the
next three decades
LUnderinvestment in the freight transportation
system
LDifficulty of planning and implementing freight
projects under current Federal programs
LSafety and security concerns with freight
movement and facilities
LImpacts on our system of increasing international
trade
LNew technologies are revolutionizing freight
movements
WITNESS LIST
LMs. Erin Aleman, Executive Director, Chicago
Metropolitan Agency for Planning, on behalf of the Coalition
for America's Gateways and Trade Corridors
LMr. Chuck Baker, President, American Short Line
and Regional Railroad Association
LMs. Anne Goodchild, Ph.D., Founding Director,
Supply Chain Transportation and Logistics Center, University of
Washington
LMr. Ian Jefferies, President & CEO, Association
of American Railroads
LMr. Jason Mathers, Director, Vehicles & Freight
Strategy, Environmental Defense Fund
LMr. Jim Tymon, Executive Director, American
Association of State Highway and Transportation Officials
WHERE'S MY STUFF? EXAMINING THE ECONOMIC, ENVIRONMENTAL, AND SOCIETAL
IMPACTS OF FREIGHT TRANSPORTATION
----------
THURSDAY, DECEMBER 5, 2019
House of Representatives,
Subcommittee on Highways and Transit, joint with
theSubcommittee on Railroads, Pipelines, and
Hazardous Materials,
Committee on Transportation and Infrastructure,
Washington, DC.
The subcommittees met, pursuant to notice, at 10:02 a.m. in
room 2167, Rayburn House Office Building, Hon. Eleanor Holmes
Norton (Chairwoman of the Subcommittee on Highways and Transit)
presiding.
Ms. Norton. This is an unusual hearing because we are
combining two subcommittees, and I think that says a great deal
about the importance of this hearing today. So I want to
welcome all of our guests, and all of you to a topic that has
an effect on the daily lives of all Americans. Yet, as it turns
out, few think about this subject: freight transportation.
Goods appear magically. Nobody wants to think about how they
got there and what it takes.
I want to thank Chairman Lipinski, my counterpart on the
Subcommittee on Railroads, Pipelines, and Hazardous Materials,
for joining with me to hold this joint hearing.
Facilitating commerce and goods movement is a fundamental
role the Federal Government is supposed to do, and it is one of
the essential responsibilities of this committee.
Remember, we are preparing for a surface transportation
reauthorization in 2020. This hearing will help the committee
understand the improvements that Congress can help make to
facilitate and ensure our infrastructure is able to handle
freight transportation needs.
And those needs are growing very rapidly. They are not only
growing, they are changing. The well-established supply chains
are now being challenged and reimagined as the rise of e-
commerce--we didn't even talk about e-commerce 4 years ago,
when the last transportation bill was passed.
Since then we have had the rise of e-commerce, and that has
forced a fundamental shift. Consumers now expect that anything
can be delivered to their doorstep in a few days, sometimes a
few hours. This amazing leap, in only the 4 years since we had
our last reauthorization, comes at a cost. Without appropriate
planning for last-mile infrastructure, we run the risk of not
only congestion, which is clearly a major problem that we have
discussed in this committee, but total gridlock in urban areas,
where 80 percent of the American people now live.
We will also hear testimony that freight is a significant
and growing source of greenhouse gas emissions. The freight
sector will emit 535 million metric tons of carbon dioxide
emissions in just 1 year, 2020, a figure that is expected to
grow annually unless we take some very serious steps to reverse
that trend.
I am committed to looking at a range of solutions under the
purview of this committee to move trucking towards zero
emissions. It is already too late. That is not a goal that is
too steep to make.
We will also hear on a topic that I have long championed:
strong support for intermodal and multimodal investments.
We understand, while Federal programs are currently and
have been stovepiped since the beginning of this committee--and
that is because of the unique funding streams for different
modes. But we certainly can do more to provide flexible ways
for our State and local partners to invest in their most
pressing freight supply chain needs, regardless of mode, and to
support seamless transitions between modes--nothing could be
more important than not losing time going from one mode of
transportation to another.
In the last surface transportation bill, Congress laid the
foundation for policies and resources to address the needs of
our freight network. Today, as needs are rapidly evolving, we
must not be constrained by the transportation network we have.
This is the transportation network we have had since the very
beginning. But rather, we have to explore and evaluate policies
that will develop the network we need for the future. This
hearing is the first step to support the committee in doing
that work.
[Ms. Norton's prepared statement follows:]
Prepared Statement of Hon. Eleanor Holmes Norton, a Delegate in
Congress from the District of Columbia, and Chairwoman, Subcommittee on
Highways and Transit
Welcome to this hearing on a topic that impacts the daily lives of
all Americans, yet that few think about--freight transportation. Thank
you to Chairman Lipinski, my counterpart on the Railroads Subcommittee,
for holding this joint hearing.
Facilitating commerce and goods movements is a fundamental role of
the Federal Government, and one of the essential responsibilities of
this Committee. As we prepare our surface transportation
reauthorization bill, this hearing will help the Committee understand
the necessary improvements that Congress can help facilitate to ensure
our infrastructure is able to handle freight transportation needs.
Those needs are growing and changing. As we will hear from Dr.
Goodchild's testimony, well established supply chains are now being
challenged and reimagined as the rise in e-commerce has forced a
fundamental shift. Consumers now expect that anything can be delivered
to their doorstep in days, or sometimes hours. This amazing leap in
convenience, however, comes at a cost. Without appropriate planning for
last mile infrastructure, we run the risk of not just congestion but
total gridlock in urban areas, where 80 percent of Americans live.
We will also hear from Mr. Mathers' testimony that freight is a
significant and growing source of greenhouse gas emissions. In the
U.S., the freight sector will emit 535 million metric tons of carbon
dioxide emissions in 2020, a figure that is expected to grow annually
unless we take some serious steps to reverse the trend. I am committed
to looking at a range of solutions under the purview of this Committee
to move trucking toward zero emissions.
We will also hear from Ms. Aleman on a topic that I have long
championed--strong support for intermodal and multimodal investments.
While I understand why our Federal programs are currently stovepiped,
because of unique funding streams for different modes, we certainly can
do more to provide flexible ways for our State and local partners to
invest in their most pressing freight supply chain needs, regardless of
mode, and to support seamless transitions between modes.
In the last surface transportation bill, Congress laid the
foundation for policies and resources to address the needs of our
freight network. Today, as needs are rapidly evolving, we should not be
constrained by the transportation network we have, but rather we should
explore and evaluate policies that will develop the network we need for
the future.
This hearing is the first step to support the Committee in doing
that. I thank our witnesses for joining us and to educate us in this
important charge.
Ms. Norton. Again, I thank our witnesses, and I ask
unanimous consent that the chair be authorized to declare
recesses during today's hearing.
Without objection, so ordered.
I also ask unanimous consent that Members not on the
subcommittee be permitted to sit with the subcommittee at
today's hearing and ask questions.
Without objection.
I will proceed now to ask our ranking member, Mr. Davis,
for his opening statement.
Mr. Davis. I thank you, Madam Chair. And I would also like
to thank Chairman DeFazio, Chairman Lipinski, and also our
ranking member of the Subcommittee on Railroads, Pipelines, and
Hazardous Materials, Mr. Crawford, for having this joint
hearing today. And it is a great opportunity to welcome all of
our witnesses, too. I look forward to hearing your testimony.
One of the key factors to America's economic
competitiveness is the ability to effectively transport goods
and products from where they are made, from where they are
harvested, from where they are produced or processed, and
eventually to where they are sold and consumed.
The strength of our freight system in my home State of
Illinois' position as the Nation's premier freight hub, relies
upon a dependable system of highways, roads, bridges, rail
tracks, and open skies. This is important because nearly every
load of freight will be transported on a truck at some point in
the journey, too.
Over the next coming decades, demand for freight moved by
truck is expected to increase significantly. Coupled with the
dynamic nature of supply chains and changing consumer demands,
we must focus on not only improving existing infrastructure,
but also planning for a system that will take us into the
future.
I look forward to hearing from each of you about how
Congress can improve freight programs and increase efficiency
and productivity for our freight transportation system.
[Mr. Davis' prepared statement follows:]
Prepared Statement of Hon. Rodney Davis, a Representative in Congress
from the State of Illinois, and Ranking Member, Subcommittee on
Highways and Transit
One of the key factors to America's economic competitiveness is the
ability to efficiently transport goods and products from where they are
made, harvested, or processed to where they are ultimately sold and
consumed.
The strength of our freight system, and Illinois' position as the
Nation's premier freight hub, relies on a dependable system of
highways, roads, and bridges. This is important because nearly every
load of freight will be transported on a truck at some point in its
journey.
Over the coming decades, demand for freight moved by truck is
expected to increase significantly.
Coupled with the dynamic nature of supply chains and changing
consumer demands, we must focus not only on improving existing
infrastructure, but also planning for the system of the future.
I look forward to hearing from our witnesses about how Congress can
improve freight programs and increase the efficiency and productivity
of our freight transportation system.
Mr. Davis. And Madam Chair, I yield back the balance of my
time.
Ms. Norton. Thank you, Mr. Davis, for your opening
statement.
Remember, I said this was a joint hearing. It is a joint
hearing with the Subcommittee on Railroads, Pipelines, and
Hazardous Materials. I now call on the chair of that
subcommittee, Mr. Lipinski, for an opening statement.
Mr. Lipinski. Thank you, Chairwoman Norton. As we work now
on the surface transportation reauthorization bill, I always go
back and think that--oftentimes people refer to this as the
highway bill, sometimes the highway and transit bill. But it is
important to recognize that, in the FAST Act, we clearly made
it highway, transit, and rail.
And so I think it is important and very fitting that the
Subcommittee on Railroads, Pipelines, and Hazardous Materials
is included in this hearing. And I expect that this
reauthorization that we are working on right now will not only
include Amtrak reauthorization and other passenger rail
provisions, but also a robust investment in freight rail
infrastructure.
I am a strong proponent of this investment, because it will
make freight movement faster and more efficient. This
investment would have far-reaching positive impacts by
increasing jobs, many of them good-paying union jobs; making
businesses more competitive; and decreasing greenhouse gas
emissions.
I represent part of Chicagoland, which is the freight rail
hub of North America. Six Class I railroads intersect in the
region. About 25 percent of all freight trains and 50 percent
of intermodal trains in the Nation pass through. The congestion
in this region and its impact on freight movement in our
country is well known.
In addition, Will County, just south of Chicago and
partially included in my district, is the largest inland port
in North America, with major intermodal facilities which cause
significant congestion and safety issues on Interstate 80 and
surrounding roads. This year, the State of Illinois committed
to raising the revenue needed to invest in a nationally
critical I-80 corridor.
It is time for the Federal Government to step up on this
project and others like it across the country, and this
reauthorization is the time to do it. As Ms. Aleman mentions in
her testimony, the CREATE rail modernization program in
Chicagoland, which has been ongoing for about 15 years, is a
unique $4.6 billion public-private partnership designed to
address the freight and passenger rail congestion, and to ease
congestion on roads crossing rail lines. Through the years
CREATE has been funded through Federal, State, local, and
private sources.
I have long been a champion of this program. I am able to
earmark money to it as one of the 25 projects of national and
regional significance in SAFETEA-LU. This is how megaprojects
were funded in SAFETEA-LU, and I have no problem talking about
earmarks.
The FAST Act fund for megaprojects comes through
Infrastructure for Rebuilding America, or INFRA grants, which
are specifically for freight movement projects. INFRA grants
have a $500 million aggregate cap for port, rail, and
intermodal projects. This was a hard-fought compromise. The
original proposal would have excluded multimodal projects
altogether. This would have been a major mistake, because these
projects clearly are critical to improving the movement of
freight in our country.
In its upcoming reauthorization, the aggregate cap needs to
be eliminated or greatly raised. We also need to talk about the
structure of the program through which the money for
megaprojects is going to be disbursed. I do not believe we
should continue to hand over the money to do this to any
Presidential administration, not just this one. I don't think
we should be handing it over for these decisions to be made
over there.
One thing I hope we can all agree upon, though, is that we
need a robust level of funding for megaprojects which are
critical to freight movement in our country and other projects
critical to transportation in the country that, really, cannot
be addressed by the States alone.
Climate change is one of the most pressing challenges
facing us today, and there is an urgent need for bipartisan
solutions. The U.S. Environmental Protection Agency reports
that the transportation sector is the largest emitter, by
sector, of greenhouse gases, with 29 percent of the United
States greenhouse gases in 2017 emitted by the transportation
sector. One topic that I would like to hear about from our
witnesses today is how we can mitigate the impact of freight
movement on climate change.
Finally, we need to permanently authorize the 45G tax
credit to give the short line rail industry the investment
certainty they need. This tax credit has been expired since the
end of 2017, and it is time we take care of this issue once and
for all.
I look forward to hearing from our witnesses today on how
we can make the U.S. freight network more robust, multimodal,
and climate friendly.
[Mr. Lipinski's prepared statement follows:]
Prepared Statement of Hon. Daniel Lipinski, a Representative in
Congress from the State of Illinois, and Chairman, Subcommittee on
Railroads, Pipelines, and Hazardous Materials
Good morning. Today's joint hearing continues a series of hearings
that the Rail Subcommittee has been conducting as we work on the
surface transportation reauthorization. Our subcommittee is playing a
significant role in the reauthorization because a rail title will once
again be included in this bill as it was in the FAST Act. I expect this
title to not only include Amtrak reauthorization and other passenger
rail provisions, but also a robust investment in freight rail
infrastructure. I am a strong proponent of this investment because it
will make freight movement faster and more efficient. This investment
would have far-reaching, positive impacts by increasing jobs--many of
them good-paying union jobs, making our businesses more competitive,
and decreasing greenhouse gas emissions.
I represent part of Chicagoland which is the freight rail hub of
North America. Six Class I railroads intersect in the region and about
25 percent of all freight trains and 50 percent of all intermodal
trains in the nation pass through. In addition, Will County, just south
of Chicago and partially included in my district, is the largest inland
port in North America with major intermodal facilities which cause
significant congestion and safety issues on Interstate 80 and
surrounding roads. This year the State of Illinois committed to raising
the revenue needed to invest in the nationally-critical I-80 corridor;
it's time for the federal government to step up on this project and
others like it across the country and this reauthorization is the time
to do it.
As Ms. Aleman mentions in her testimony, the CREATE rail
modernization program in Chicagoland, which has been ongoing for about
15 years, is a unique $4.6 billion Public-Private Partnership (PPP)
designed to reduce delays for freight and passenger trains and ease
congestion on roads crossing rail lines. Through the years, CREATE has
been funded through federal, state, local, and private sources. I have
long been a champion of this program since I was able to earmark money
to it as one of 25 Projects of National and Regional Significance
Program. This was how megaprojects were funded in SAFETEA-LU.
The FAST Act funds for megaprojects come through Infrastructure For
Rebuilding America or INFRA, grants, which are specifically for freight
movement projects.
INFRA grants have a $500 million aggregate cap for port, rail, and
intermodal projects. This was a hard fought compromise as the original
proposal would have excluded multimodal projects altogether. That would
have been a major mistake because these projects clearly are critical
in improving the movement of freight. In this upcoming reauthorization,
the aggregate cap needs to be eliminated or greatly raised. We also
need to talk about the structure of the program through which the money
for megaprojects is going to be disbursed. I don't believe we should
continue to hand the money over to this or any presidential
administration to make these decisions. But one thing I hope we all can
agree upon is that we need a robust level of funding for megaprojects.
Climate change is one of the most pressing challenges facing us
today and there is an urgent need for bipartisan solutions. The U.S.
Environmental Protection Agency reports that the transportation sector
is the largest emitter by sector of greenhouse gasses with 29 percent
of the United States greenhouse gasses in 2017 emitted by the
transportation sector. One topic I would like to hear about from our
witnesses today is how we can mitigate the impact of freight movement
on climate change.
Finally, we need to permanently authorize the 45G tax credit to
give the short line rail industry the investment certainty they need.
This tax credit has been expired since the end of 2017 and it is time
we take care of this issue once and for all.
I look forward to hearing from our witnesses today on how we can
make the US's freight network more robust, multi-modal, and climate
friendly. Thank you.
Mr. Lipinski. Thank you, and I yield back.
Ms. Norton. Thank you. Thank you, Mr. Lipinski.
I want to ask the ranking member of the Subcommittee on
Railroads, Pipelines, and Hazardous Materials, Mr. Crawford,
for his opening statement.
Mr. Crawford. Thank you. I thank the chair for recognizing
me.
Modern freight network means a strong, secure America.
Farmers and businesses across my State--indeed, across the
country--depend on our Nation's freight railroads to safely
transport their goods throughout the country and the world.
Important to Arkansas are short line railroads, who most
often provide first- and last-mile service for farmers,
manufacturers, and other industries. I am proud to support H.R.
510, the BRACE Act, which would permanently extend the tax
credit for short line railroad track maintenance, thereby
increasing private investment in important rail transportation
infrastructure.
As total freight demand grows, the critical investments
made by the railroads in both their people and in their
infrastructure help ensure a safe and efficient transport
system for our goods. This investment helps spur economic
activity, drive innovation, and make operations safer and more
efficient.
In turn, the rail network can handle increased freight
demand and help relieve congestion on our roads. I look forward
to hearing about freight programs in the FAST Act and how
Congress can improve the efficient flow of goods.
[Mr. Crawford's prepared statement follows:]
Prepared Statement of Hon. Eric A. ``Rick'' Crawford, a Representative
in Congress from the State of Arkansas, and Ranking Member,
Subcommittee on Railroads, Pipelines, and Hazardous Materials
A modern freight network means a strong, secure America.
Farmers and businesses across my state depend on our Nation's
freight railroads to safely transport their goods throughout the
country and the world.
Important to Arkansas are our short line railroads, who most often
provide first and last mile service for farmers, manufacturers, and
other industries. I am proud to support H.R. 510, the BRACE Act, which
would permanently extend the tax credit for short line railroad track
maintenance, thereby increasing private investment in important rail
transportation infrastructure.
As total freight demand grows, the critical investments made by the
railroads--in both their people and in their infrastructure--help
ensure a safe and efficient transport system for our goods. This
investment helps spur economic activity, drive innovation, and make
operations safer and more efficient. In turn, the rail network can
handle increased freight demand and help relieve congestion on our
roads.
I look forward to hearing about freight programs in the FAST Act
and how Congress can improve the efficient flow of goods.
Mr. Crawford. Thank you to all of our witnesses for being
here today, and I yield back the balance of my time.
Ms. Norton. Thank you, Mr. Crawford. I would like to ask
the chairman of the full committee, Mr. DeFazio, if he has an
opening statement.
Mr. DeFazio. Thank you, Madam Chair. Yes, I do have a brief
opening statement. I want to thank both the chairs and ranking
members for holding this important hearing.
We just had Black Friday, Cyber Monday, and Americans
think, just one click, and the goods magically appear. But they
don't realize the complexity of the network upon which they are
dependent for those goods to appear at the doorstep.
In addition to those sorts of issues, we obviously have the
supply chain for industry. Our national freight system is
crucial to connecting farmers' produce with kitchen tables,
bringing logs out of the mountains to the sawmills in my State.
The U.S. freight transportation network is critical to the
economy of this Nation: 17.7 billion tons of freight valued at
$16.8 trillion every year.
But we have challenges ahead of us. By 2040 we expect
volumes to grow by 40 percent. How are we going to meet those
demands? Our existing infrastructure is at capacity, nearing
the end of--or, in many cases, has already passed--its useful
life, but still limping along.
And how are we going to deal with this in the future? How
are we going to reduce the environmental burden of the freight
industry, both in terms of pollution in urban areas, and also
in terms of the carbon that it contributes to climate change?
Medium and heavy-duty trucks contributed 23 percent of all
transportation-related greenhouse gas emissions in 2017. And I
hope to hear today ideas about how we are going to reduce that
burden.
The freight railroads have been working to deploy
technologies. They have been upgrading their fleets, reducing
idling and fuel consumption, and they are, obviously, a more
efficient per-gallon, per-freight-mile deliverer of goods. And
so they have done quite a bit. Between 2000 and 2018, the
freight railroads consumed 9 billion fewer gallons of fuel and
emitted 100 million fewer tons of carbon dioxide, but can we
move beyond that? I think we need to.
As we will hear in testimony today, a significant portion
of freight growth and a disproportionate share of the cost of
freight movements come from the last mile. We have been reading
some articles about congestion in our urban areas. It is
extraordinary, because of this delivery adding new burdens to
an already overburdened system.
Normally, these areas were not considered integral to
freight movement, but they have become so. So we are going to
have to figure out how we are going to deal with that--again,
the pollution, the carbon, and so forth.
In the last reauthorization bill was the first time, in the
FAST Act, really, that we established a dedicated funding
source for freight. As important as it is, it has been
neglected, in terms of our investment, as has the whole system
been neglected by our levels of investment. And I am trying and
hoping that we will do much better in our reauthorization.
The DOT implements the INFRA program, Nationally
Significant Freight and Highway Projects program. But
basically, the money is insufficient, and there is a huge line
of very meritorious projects waiting for funding. So, we are
going to have to both tighten up the criteria for grants that
are coming out of DOT, but also we are going to need to put
more money into those programs.
[Mr. DeFazio's prepared statement follows:]
Prepared Statement of Hon. Peter A. DeFazio, a Representative in
Congress from the State of Oregon, and Chairman, Committee on
Transportation and Infrastructure
Thank you for holding this joint Subcommittee hearing to consider
how our trucking and freight rail transportation systems are growing
and changing, and how the recent surge in goods movement is impacting
transportation investment needs.
This hearing is timely, with consumers across the country preparing
for the holiday season. Whether they realize it or not, shoppers who
took advantage of Black Friday and Cyber Monday deals are relying on a
vast and complex freight network to provide and deliver their
purchases.
Our national freight system is crucial to our lives every day of
the year, providing vital support to a functioning supply chain,
transporting raw materials to factories and finished products to
market, and connecting farmers' produce with kitchen tables. Today, the
U.S. freight transportation system already moves 17.7 billion tons of
freight, valued at $16.8 trillion, every year. By 2040, freight volumes
are expected to grow by 42 percent.
We need to be proactive in preparing to meet these growing demands
on existing infrastructure, much of which is at capacity and nearing
the end of--or past--its useful life. We also need to actively work to
reduce the environmental impacts of freight transportation.
Today, more than two out of every five miles of America's urban
interstates are already congested, imposing costs on the trucking
industry and non-commercial drivers, driving up fuel usage, and
contributing significantly to greenhouse gas emissions. Medium and
heavy-duty trucks contributed 23 percent of all transportation-related
greenhouse gas emissions in 2017.
Freight railroads have been deploying various technologies and
upgrading fleets to reduce idling and fuel consumption. As a result of
these efforts, between 2000 and 2018, the freight railroads consumed 9
billion fewer gallons of fuel and emitted 100 million fewer tons of
carbon dioxide.
As we will hear in testimony today, a significant portion of
freight growth--and a disproportionate share of the cost of freight
movements--comes from the last mile of deliveries. As Americans do more
of their shopping online--and expect goods to show up the day after
they click a button or sooner, these new patterns rely on the use of
infrastructure not typically considered as integral to freight
movement.
Recent press accounts have documented that in already heavily
congested cities and urban areas, there is a cost to this new
convenience in the form of gridlock, the degradation of safety, and
pollution. We need to figure out how best to balance the benefits of
convenience with the numerous costs.
In the last reauthorization bill, Congress attempted to support
goods movement by establishing formula and competitive grant programs
to fund freight improvements. Today we will hear in witness testimony a
call for greater transparency in the selection process in discretionary
grant programs administered by the U.S. Department of Transportation.
The Nationally Significant Freight and Highway Projects Program (known
by the Administration as INFRA), created by Congress in the FAST Act,
has proven to be dramatically oversubscribed. This points to a
significant need for greater funding to be made available for freight
projects. It also underscores that Congress needs to enact tighter
rules around grant allocations to ensure the most worthy projects are
funded, which I intend to look at in reauthorization.
I look forward to hearing from our witnesses today and learning how
Congress can help address current and future freight needs in a surface
transportation.
Mr. DeFazio. So with that, Madam Chair, I look forward to
hearing from the witnesses, and thank you for holding the
hearing.
Ms. Norton. Thank you, Mr. DeFazio. I would now like to
welcome our witnesses, and I am going to go first to Erin
Aleman. She is the executive director of the Chicago
Metropolitan Agency for Planning. She is here on behalf of that
agency and the Coalition for America's Gateways and Trade
Corridors.
Ms. Aleman?
TESTIMONY OF ERIN ALEMAN, EXECUTIVE DIRECTOR, CHICAGO
METROPOLITAN AGENCY FOR PLANNING, AND BOARD MEMBER, COALITION
FOR AMERICA'S GATEWAYS AND TRADE CORRIDORS; CHUCK BAKER,
PRESIDENT, AMERICAN SHORT LINE AND REGIONAL RAILROAD
ASSOCIATION; ANNE GOODCHILD, Ph.D., FOUNDING DIRECTOR, SUPPLY
CHAIN TRANSPORTATION AND LOGISTICS CENTER, UNIVERSITY OF
WASHINGTON; IAN J. JEFFERIES, PRESIDENT AND CHIEF EXECUTIVE
OFFICER, ASSOCIATION OF AMERICAN RAILROADS; JASON MATHERS,
DIRECTOR, VEHICLE AND FREIGHT STRATEGY, ENVIRONMENTAL DEFENSE
FUND; AND JIM TYMON, EXECUTIVE DIRECTOR, AMERICAN ASSOCIATION
OF STATE HIGHWAY AND TRANSPORTATION OFFICIALS
Ms. Aleman. Thank you this morning for the opportunity to
testify. I am here on both behalf of the Chicago Metropolitan
Agency for Planning, and also on behalf of the Coalition for
America's Gateways and Trade Corridors, a coalition of public
and private partners who are dedicated to investing in
America's multimodal freight infrastructure.
Thank you for your leadership, Chair Norton, Chairman
Lipinski, Ranking Member Davis, and Ranking Member Crawford,
and members of the subcommittees for the opportunity to share
my views today.
Investment in multimodal freight infrastructure is critical
to this Nation's economy. Our Nation's ability to move goods
safely, reliably, and responsibly to consumer demands will keep
American businesses competitive in a global marketplace.
Chronic underinvestment in our Nation's transportation system
has resulted in companies spending $27 billion annually in
expenses due to freight congestion.
Ms. Norton. Speak up a little more, please. Would you speak
up a little?
Mr. DeFazio. Just pull it closer.
Ms. Aleman. I am sorry, a little----
Mr. DeFazio. There you go.
Ms. Aleman. Sorry. With the FAST Act reauthorization around
the corner, I am here today to ask you to include a robust
freight program.
I applaud members of this committee for prioritizing
freight infrastructure in the FAST Act. The program sparked an
important dialogue, and brought into focus the incredible
magnitude of freight needs across our country.
I would like to highlight how the FAST Act supported the
Chicago region, changing how we pursue competitive funds,
leveraging additional resources, and ensuring the projects that
we put forth provide the greatest return on investment.
Prior to CMAP, I was on the team at the Illinois Department
of Transportation, working closely with CREATE partners as we
developed our INFRA application for the 75th Street Corridor
Improvement Project. By untangling one of the worst bottlenecks
in the Nation, $3.8 billion of economic benefits will be seen
upon completion. Because the economic benefit was so great, and
the need was so significant, we came together to prioritize
this project amongst individual needs.
Together, the CREATE partners, both public and private,
matched more than 2\1/2\ times the Federal INFRA ask. While
more funding is necessary to complete the project, this project
and investment will improve the reliability of 200 freight, 30
passenger, and 10 Amtrak trains daily.
Many of the largest and most complex freight improvements
across our country cross State boundaries, and occur where
multiple modes come together. These projects require a
partnership at the Federal level to untangle choke points that
burden our community and slow commerce.
Our region has successfully shown that prioritizing
multimodal freight investment leads to success. For example,
whereas it once took 40 hours for freight trains to get through
Chicago, it now takes 25 to 30 hours. But more improvement is
necessary. While we have been able to address some of these
problems on our own, the fact is that States cannot and should
not shoulder the burden of nationally significant freight
movement alone.
Freight isn't confined to a single community or State. More
than 77 percent of U.S. freight crosses State lines. I have
often said that the public doesn't care who has jurisdiction
over the roads they are driving on. The same can be said about
our freight network. Businesses and consumers simply want a
reliable system that gets their goods to market, or delivers
their packages to their houses on time.
To address our urgent freight needs and build on successes,
the coalition respectfully submits four recommendations.
First, a national strategy that guides long-term planning.
An office of multimodal freight should be established within
U.S. DOT's Office of the Secretary, emphasizing nationally
significant projects.
Second, dedicated, sustainable, and flexible funding. In
2018 the INFRA program received $12 of unique requests for
every $1 available. Given this level of oversubscription, we
request $12 billion be invested annually in multimodal freight
throughout the competitive programs. Congress should also
eliminate caps on nonhighway spending.
Third, projects should be selected through a performance-
based program and framework that allows us to prioritize
projects that improve national freight efficiency. Oversight
and transparency in the decisionmaking process is critical to
the program's integrity.
And finally, funding should leverage private participation
and support a variety of financing options.
The FAST Act's programs are increasing the safety,
efficiency, and reliability of how we move our goods. Consumer
demands have shifted dramatically over the years, and the
planner in me knows that more change is on the horizon. We must
be proactive about investing and prioritizing our critical
freight infrastructure needs.
On behalf of the coalition and CMAP, I thank the
subcommittees for their time and attention to this critically
important topic.
[Ms. Aleman's prepared statement follows:]
Prepared Statement of Erin Aleman, Executive Director, Chicago
Metropolitan Agency for Planning, and Board Member, Coalition for
America's Gateways and Trade Corridors
I appreciate the opportunity to testify before two distinguished
panels and thank the Subcommittee on Highways and Transit and the
Subcommittee on Railroads, Pipelines, and Hazardous Materials for
joining together on this important subject--after all, efficient
freight movement requires multiple modes working together seamlessly
and reliably. Improving the freight system to meet our growing freight
needs is critical to our nation's economic competitiveness. Thank you
for your leadership, Chair Norton, Chairman Lipinski, Ranking Member
Davis, and Ranking Member Crawford.
I am representing both the Chicago Metropolitan Agency for Planning
(CMAP) and the Coalition for America's Gateways and Trade Corridors
(CAGTC), a diverse coalition of more than 60 public and private
organizations dedicated to increasing federal investment in America's
multimodal freight infrastructure.
CMAP is the federally-designated Metropolitan Planning Organization
for the northeastern Illinois counties of Cook, DuPage, Kane, Kendall,
Lake, McHenry, and Will. We represent a region of nearly 8.5 million
people, working closely with the region's 284 communities to address
transportation, housing, economic development, open space, environment,
and quality of life issues. Our most recent plan, ON TO 2050, calls for
bold steps toward a well-integrated, multimodal transportation system
that seamlessly moves people and goods within and through metropolitan
Chicago. To strengthen our economic competitiveness while improving
quality of life, freight recommendations in the plan emphasize
strategic investment in the freight network, improving local and
regional truck travel, and mitigating the negative impacts of freight--
congestion, safety, and air quality--on adjacent communities.
The CMAP region is North America's freight hub. Six of the seven
Class I railroads operate in our region, with one-fourth of the
nation's freight rail traffic and nearly half of all intermodal trains
passing through Chicago. Approximately 18 million twenty-foot
equivalent units (TEUs) of cargo moved through the region's twenty
rail-truck intermodal facilities in 2018, an increase of 52 percent
since 2009.\1\ In short, our region moves more freight than the busiest
seaports in the country.
---------------------------------------------------------------------------
\1\ Chicago Metropolitan Agency for Planning, Chicago Intermodal
Facility Lift Counts and Regional TEU Estimate, November 2019.
---------------------------------------------------------------------------
As national freight demands grow, so too does the stress on our
regional infrastructure. In 2003, the nationally and regionally
significant Chicago Region Environmental and Transportation Efficiency
(CREATE) program was formed. This innovative partnership between the
U.S. Department of Transportation, the State of Illinois, Cook County,
the City of Chicago, Metra, Amtrak, and U.S. freight railroads is a 70-
project, $4.6 billion plan to improve the efficiency and effectiveness
of freight, commuter, and intercity passenger rail and to reduce
highway delay in the Chicago region.
Chicago has been a national rail hub for almost 150 years. Every
day nearly 500 freight trains and more than 760 passenger trains
operate in the region. But the rail lines, built over a century ago,
were not built for the volumes nor the types of freight being carried,
turning Chicago into the nation's largest freight rail chokepoint. Rail
congestion, resulting in delays and unreliable transit times, can be
exacerbated by increased demand and severe weather. In 2014, for
example, congestion in Chicago caused lingering service disruptions for
farmers across the Upper Midwest. Revenues decreased due to increased
transportation and storage costs and losses caused by spoilage.\2\
CREATE aims to address such bottlenecks to increase the reliability and
efficiency of the region's rail infrastructure. More than $1.6 billion
has been spent or committed, with an estimated $3 billion needed to
complete the full program. To date, federal sources have provided 40
percent of spent and committed funds.
---------------------------------------------------------------------------
\2\ U.S. Department of Agriculture, Rail Service Challenges in the
Upper Midwest: Implications for Agricultural Sectors--Preliminary
Analysis of the 2013-2014 Situation, January 2015.
---------------------------------------------------------------------------
CREATE includes 25 rail grade separation projects to reduce freight
and motorist delay and improve safety. Although only seven of the
separations have been completed thus far due to insufficient funding,
the success of CREATE cannot be underestimated. Whereas it once took
freight trains more than 40 hours to pass through the Chicago region,
due to implementation of CREATE, this is down to 25-30 hours. With
continued funding, delays can be further reduced.
Our nation's ability to move goods safely, reliably, and
expeditiously keeps U.S. businesses competitive in the global
marketplace and supports a higher standard of living for all. In 2015,
this Committee created the first-ever dedicated freight program in the
Fixing America's Surface Transportation (FAST) Act. The program began
an important dialogue and has taught us much in the intervening years
since passage. Most importantly, it brought into focus the incredible
magnitude of freight needs across the country, setting the stage for
the 2020 reauthorization. I urge you to make a robust freight program
the hallmark of this upcoming reauthorization.
All infrastructure investment has well-documented economic
benefits, but freight infrastructure investment is inextricably linked
to the long-term health of our national economy. The multimodal freight
network directly supports 44 million jobs and impacts every American's
quality of life.\3\ Unfortunately, chronic underinvestment in our
national transportation system has resulted in a ``dysfunction tax.''
U.S. companies spend around $27 billion annually in extra freight
transportation expenses due to congestion,\4\ and the total cost of
congestion is estimated at $1 trillion annually--roughly seven percent
of U.S. economic output.\5\
---------------------------------------------------------------------------
\3\ U.S. Department of Transportation, National Freight Strategic
Plan, October 2015.
\4\ U.S. Department of Transportation, National Freight Strategic
Plan, October 2015.
\5\ Ibid.
---------------------------------------------------------------------------
Population growth will present capacity challenges across our
multimodal system, which currently moves 55 million tons of goods
daily, worth more than $49 billion.\6\ That's roughly 63 tons per
person annually; meanwhile, the U.S. population is expected to increase
by 70 million by 2045 to reach a total of 389 million people.\7\
---------------------------------------------------------------------------
\6\ Ibid.
\7\ Ibid.
---------------------------------------------------------------------------
But it's not just population growth that is putting stress on our
systems. Consumer demands have shifted dramatically over the last
decade. Notably, the rise in e-commerce and quick delivery is shifting
supply chains and requiring metropolitan areas to refocus their plans
with these trends in mind. CMAP is currently undertaking a research
project to better understand and respond to the impacts of growing e-
commerce on the transportation system, land use, and fiscal condition
of communities. We look forward to sharing the results of this project
with the Committee next year.
Public investment in our nation's multimodal freight infrastructure
is chronically inadequate to meet the system's demands. States and
localities have attempted to increase their infrastructure funding--
since 1993, 42 states have raised their own gas taxes.\8\ \9\ My home
state of Illinois, for example, this year increased the gasoline tax by
19 cents per gallon and the diesel tax by 24 cents per gallon; both are
now indexed to inflation. However, states and localities cannot, and
should not, shoulder the burden of nationally-significant freight
movement alone. Through the Commerce Clause of the Constitution, the
Federal Government is tasked with supporting interstate commerce. More
than 77 percent of U.S. freight crosses state lines, illustrating the
need for a federal role in freight planning and investment.\10\ At its
peak, the Federal Government provided 38 percent of public
infrastructure funding, but that number has fallen to just 25 percent
in recent years.\11\ This places a strain on communities and local
governments, many of whom have already raised user fees and are
struggling to determine where to find additional funds.
---------------------------------------------------------------------------
\8\ Institute on Taxation and Economic Policy, How Long Has It Been
Since Your State Raised its Gas Tax?, May 2019.
\9\ Institute on Taxation and Economic Policy, Most States Have
Raised Gas Taxes in Recent Years, June 2019. < https://itep.org/most-
states-have-raised-gas-taxes-in-recent-years-0419/ >
\10\ Tomer, Adie and Joseph Kane, Brookings and JP Morgan Chase
Global Cities Initiative, Mapping Freight: The Highly Concentrated
Nature of Goods Trade in the United States, November 2014.
\11\ Council on Foreign Relations, The State of U.S.
Infrastructure, October 2017.
---------------------------------------------------------------------------
While Congress and infrastructure advocates have contemplated a
variety of federal funding solutions for transportation infrastructure,
our group has coalesced around a waybill fee dedicated to freight
infrastructure improvements, such as the one proposed by Congressman
Lowenthal of this Committee. A waybill fee assessed on the cost of
surface transportation movements would not skew the market for services
and would grow along with the demand for freight transportation.
Freight infrastructure needs are significant and continue to grow;
CAGTC remains committed to exploring solutions that will provide robust
and dependable funding.
Many of freight infrastructure's largest, most complex, and most
desperately needed improvements cross local and state boundaries and
occur where multiple modes come together. These instances frequently
require a partnership at the federal level to untangle chokepoints that
burden our communities and slow commerce.
The FAST Act created a number of much-needed tools to address the
challenges described. The Nationally Significant Freight and Highway
Projects Program, or INFRA program, is a competitive grant program
designed to target investments in large freight and highway projects
and contains criteria written into law that focus on goods movement
infrastructure. The FAST Act also authorized the Consolidated Rail
Infrastructure and Safety Improvements (CRISI) Program, which provides
grants for projects that improve the safety, efficiency, and
reliability of intercity passenger and freight rail systems.
According to a 2019 study by the Congressional Research Service,
``discretionary grants may be more effective in providing large amounts
of federal funding for very costly freight-related projects,
particularly those requiring interstate cooperation.'' \12\ Competitive
grant programs such as INFRA and CRISI assist in funding large-scale
infrastructure projects, which often span modes and jurisdictional
borders and are difficult, if not impossible, to fund through
traditional distribution methods such as formula programs.
---------------------------------------------------------------------------
\12\ Congressional Research Service, Freight Issues in Surface
Transportation Reauthorization, January 2019.
---------------------------------------------------------------------------
While formula programs typically invest through a standard 80
percent federal to 20 percent non-federal match, competitive grant
programs encourage states and localities to bring their best possible
deal to the table, driving innovative and creative funding and
financing arrangements. Through the INFRA grant program's four rounds,
USDOT awarded $2,394,979,933 to projects with a strong freight
component. Those monies combined with funds from various other sources
to result in $11,089,207,231 in total project investments--meaning 78.4
percent of funds came from sources other than the INFRA grant program.
Prior to joining CMAP, I was the director of planning and
programming at the Illinois Department of Transportation (IDOT),
responsible for long range multimodal planning and setting priorities
for spending federal funds. I was at the table when IDOT and the CREATE
partners were developing the INFRA application for the recently funded
75th Street Corridor Improvement Project (CIP). Recognizing the
national significance of the CREATE program, USDOT awarded the 75th
Street CIP, located on the south side of the City of Chicago, $132
million through the INFRA program's FY17/18 funding round.
Historically, IDOT submitted several applications for USDOT's
competitive programs from across the state. What was different this
time was that CREATE partners agreed to only submit one INFRA
application from the region--everyone's top priority. CREATE partners
leveraged the federal INFRA ask with $342 million in local funds to pay
for the first portion of this project to separate several freight and
passenger rail lines. While more funding is necessary to complete the
project, this investment will ultimately improve the reliability and
travel time for more than 200 freight trains, 30 Metra commuter trains,
and 10 Amtrak trains daily. Benefits will begin to accrue upon
completion of the first portion; however, $474 million represents less
than half the funds needed to complete the project. Completion of the
full project will result in an anticipated $3.8 billion of economic
benefits.
The INFRA program's ability to leverage federal dollars is
impressive; but a small federal ask, or likewise, a significant private
contribution should not be the primary considerations when deciding to
fund a project. Perhaps more important are project outcomes--USDOT must
consider the national benefits of a project, not just the source of the
matching funds. Projects should first be evaluated on their ability to
meet the program's goals, based on measureable and objective criteria
defined by Congress. Just because a project requires less federal
investment, does not make it the most valuable investment for the
nation.
Complementary to the INFRA competitive grant program is the FAST
Act's freight formula program, which allows state departments of
transportation to target freight system improvements, like first and
last mile connectors. Some states, such as California and Illinois,
have distributed the federal freight dollars through a state-level
competitive program.
To make the most out of FAST Act funds, IDOT developed a
transparent, performance-based, competitive program to ensure the
dollars allocated provided the greatest return on investment. One of
the challenges the agency had to overcome was an internal one--changing
the internal conversation about transparency and performance metrics
related to programming. Would we get an unwieldy number of projects if
we posted the project evaluation criteria, or would we get better
projects? In the end, it was the latter. Of 23 projects selected, 17
went to local agencies, and the non-federal match across the program
was 35 percent. $17 million was awarded to intermodal projects that do
not traditionally have access to federal funding sources.
In order to increase the flexibility afforded to state departments
of transportation, we encourage Congress to eliminate the cap on non-
highway projects, currently set at 10 percent of total funds, so each
state can invest in its most pressing supply chain needs, regardless of
mode. It should be noted, that even administered as a state-level
competitive grant program, the formula program is not a replacement for
INFRA, which funds nationally and regionally significant projects that
frequently span multiple states and jurisdictions. As stated
previously, such freight projects require a federally-administered
competitive approach.
Recommendations
We need a strategic freight mobility program that prioritizes the
current economic needs of our country while planning for generations to
come. This campaign of strategic investment should expand capacity and
increase efficiency, regardless of mode or political jurisdiction.
Without such a campaign, U.S. productivity and global competitiveness
will suffer.
To address these needs, we respectfully ask that Congress:
Develop a national strategy that guides long-term planning
We need a national ``vision'' and strategy to shape and guide our
freight infrastructure needs. Such a strategy should have active
coordination among states, regions, and localities and should endeavor
to anticipate freight needs extending over multiple decades to allow
for a smooth path for free-flowing freight both today and into the
future.
Planning tools, such as the National Freight Strategic Plan (NFSP),
the National Freight Network, and the National Multimodal Freight
Program, should account for resiliency, route redundancy, and shifting
trade patterns. The NFSP would be enhanced by the inclusion of a
comprehensive analysis of our system's freight infrastructure
investment needs, created with high-quality data sets. Currently,
planning is often frustrated by incomplete and outdated publicly
available data sets. Recognizing that developing this analysis is a
challenge, due to factors such as mixed-use infrastructure and
intertwined public and private infrastructure, it is nevertheless a
critical tool.
An office of multimodal freight should be established within the
U.S. Department of Transportation's Office of the Secretary to guide
freight mobility policy and programming with a particular focus on
projects of national significance that aid in the movement of commerce.
Because the movement of goods spans different modes of infrastructure,
specialized knowledge at the federal level is essential. An office of
multimodal freight will allow experts in the unique operational and
economic needs of each mode to work together to make the best
investments in our system. Additionally, this investment strategy
should include innovative and flexible approaches to structuring
federal financial assistance in a manner that encourages private sector
investment.
Provide sufficient levels of funding that are dedicated, sustainable,
and flexible
An investment program dedicated to multimodal freight
infrastructure is necessary to ensure that public agencies can invest
in their most critical goods movement needs--regardless of mode.
Federal funding should incentivize and reward state and local
investment and leverage the widest array of public and private
financing. Funding should be based on revenue sources that are
predictable, dedicated, and sustained. Because they are the primary
beneficiaries of any system improvements, owners of goods should be
part of the revenue user-base.
Existing programs available to freight infrastructure, like the
INFRA competitive grant program, are oversubscribed. For example, in
the combined FY17/18 round, the INFRA grant program saw $12 in unique
requests for every $1 available. Currently funded at an average of $900
million annually, given this level of oversubscription, CAGTC calls for
an annual investment of $12 billion in multimodal freight investment
through a competitive grant program.
As we approach the FAST Act's reauthorization next year, we
encourage Congress to not only increase the funding levels of both the
freight formula program and the INFRA grant program, but to also
eliminate the caps on non-highway spending under both programs. Freight
does not move on highways alone--where public benefit is derived,
public investment must be made. Intermodal freight is one of the
fastest-growing sectors of the freight market.\13\ And, it is often in
the places where various modes come together that public assistance is
needed to close the funding and infrastructure gaps, which result in
capacity inefficiencies and bottlenecks. Examples include highway-rail
grade crossings, rail spurs to access cargo, logistics or transfer
facilities, tunnels and bridges for port access, border crossing
capacity enhancements, and air-freight connectors.
---------------------------------------------------------------------------
\13\ U.S. Department of Transportation, Beyond Traffic, February
2015.
---------------------------------------------------------------------------
Implement a set of merit-based criteria for funding allocation
Projects should be selected through the use of merit-based criteria
that identify and prioritize projects with a demonstrable contribution
to national freight efficiency. Goals should include increasing
national and regional economic competitiveness, improving connectivity
between freight modes, reducing congestion and bottlenecks, and
improving the safety, efficiency, and reliability of the movement of
freight and people. Long-term funding must be made available to ensure
that, once a project is approved, funds will flow through to project
completion. Funds should be available to support multi-jurisdictional
and multi-state projects, regardless of mode, selected on the basis of
objective measures designed to maximize and enhance system performance,
while advancing related policy objectives. The U.S. Department of
Transportation's decision-making process should be made transparent to
ensure the integrity of the evaluation process.
Form a partnership with the private sector
Private participation in the nation's freight infrastructure is
vital to system expansion. Federal funding should leverage private
participation and provide transportation planners with the largest
toolbox of financing options possible to move freight projects forward
quickly and efficiently. We recommend that Congress consider
establishing an advisory council made up of freight industry members
and system users who could assist and partner with the U.S. Department
of Transportation in order to optimize results from planning,
coordination, and evaluation processes.
Provide oversight of existing freight programs
We recommend Congress oversee execution of the INFRA program to
ensure projects are evaluated against criteria codified in law. We
commend Congress' foresight in mandating that the Government
Accountability Office (GAO) publish a report on the decision-making
process for the first round of the INFRA grant program and encourage
Congress to continue such oversight to aid decision-making transparency
and adherence to Congressional intent.
The FAST Act's freight programs are increasing the safety,
efficiency, and reliability of our nation's goods movement system, but
they are only a beginning. On behalf of CAGTC and CMAP, I encourage you
to implement these recommendations to improve the nation's
competitiveness and respond to a changing economy. I thank Members of
the Transportation and Infrastructure Committee for their time and
attention to this critically important topic.
Ms. Norton. Thank you, Ms. Aleman.
We go now to Chuck Baker, president of the American Short
Line and Regional Railroad Association.
Mr. Baker. Thank you, Chairman, Chairwoman, Ranking
Members, and members of the subcommittees. I am Chuck Baker,
and I am president of the American Short Line and Regional
Railroad Association, representing the Nation's 603 small
railroads.
This hearing will explore the economic, environmental, and
societal impacts of freight transportation. And you have asked
me to tell you where's my stuff, as it relates to the short
line railroad industry.
Well, I am happy to report that short line railroads have
lots of stuff. It is the right stuff. And we are here to
transport America's stuff in a safe, efficient, and
environmentally friendly manner. Together, short line railroads
operate nearly 50,000 miles of track, or approximately 30
percent of the national rail network, and employ more than
17,000 hardworking Americans. We operate in 49 States. Short
lines are often called the first mile and last mile of the
Nation's railroad system.
The name ``short line'' can create the mistaken impression
that all of these railroads are very short in length. The fact
is we come in all sizes. The Peru Industrial Railroad in
Illinois is 3 miles long. The Portland and Western is 516 miles
long. Pan Am Railways operates 1,700 miles, and provides the
majority of rail service in New England. Our common
denominators are that we operate track that was not viable
under the structure of the previous owners; we run lean and
mean; we stay very close to our customers; we are dedicated to
safety; and we hustle, scratch, and claw for every last carload
of stuff we can help move.
Short lines have the right economic stuff. Short lines
preserve service over track that was previously headed for
abandonment. Particularly for smalltown and rural America,
short line railroad service is the only connection to the
national network. For the businesses and farmers in those
areas, our ability to take a 25-car train 75 miles to the
nearest Class I interchange is just as important as the Class
I's ability to attach that block of traffic to a 100-car train
and move it across the country.
Railroads are an all-American proposition. Virtually
everything we buy for infrastructure improvement--the ties, the
rails, the ballasts, the locomotives, the freight cars--it is
made in America. So every dollar we spend is spent in America.
As those of you who represent rural areas know, it is
difficult to create jobs in rural America. Short lines and the
shippers we serve are a significant source of good-paying jobs
in rural America.
Short line railroads lower transportation costs for our
shippers, because one railcar holds the equivalent of three to
four truckloads worth of stuff, and we use fuel more
efficiently than trucks. Using an example from Oklahoma, moving
1 ton of freight 95 miles from Clinton to Enid via rail
provides a 40-percent savings per mile versus truck. That level
of savings exists across the country, and is a very meaningful
number for the businesses we serve.
I will not pretend that the numbers I am talking about are
a huge deal in an economy measured in the trillions. However,
for those shippers we keep connected, for those communities
where we create economic activity, for the employees we hire,
these are meaningful numbers. It is not the biggest stuff, but
it is important stuff.
Short lines have the right environmental stuff. Railroads
are the most fuel-efficient way to move freight over land,
three to four times more fuel-efficient than trucks. Today, a
freight train can move 1 ton of freight an average of more than
470 miles on 1 gallon of diesel. The EPA has measured the
sources of transportation-related greenhouse gas emissions, and
rail is a big success story. Cars and light trucks account for
60 percent. Heavy trucking is 23 percent. Air travel is 9
percent. And freight rail is only 2 percent.
Highway congestion, in addition to being a soul-destroying
way to spend your time, is also a significant contributor of
harmful emissions. The average railcar holds the equivalent of
three to four truckloads, and removing those trucks from the
highway helps reduce congestion.
Finally, short lines have the right societal stuff. Rail is
the safest option for moving freight by land in America.
Measured on a comparable ton-mile basis, rail is approximately
three to five times safer than trucking. Short lines are proud
of our safety culture, and work diligently to reduce and
eliminate injuries. In 2018, 265 of our short lines reported
zero accidents. The average accident rate that year was a near
record low of 1.84 per million train-miles. Because rail is the
safest option for moving freight by land, any policies that
Congress enacts that affect the balance between rail and
trucking also affect public safety, and have major societal
impacts.
As this committee considers a surface transportation bill,
my written testimony offers specific policy recommendations
that we believe will improve the economic, environmental, and
societal impacts of freight transportation in America, such as
supporting the CRISI grant program, improving the INFRA and
State freight formula programs by making them more multimodal,
maintaining the current truck size and weight limits,
refraining from an unnecessary Federal law on train crew sizes,
returning the Highway Trust Fund to something resembling a
user-funded system, and, of course, our favorite topic,
extending the short line rehabilitation tax credit. Thank you.
[Mr. Baker's prepared statement follows:]
Prepared Statement of Chuck Baker, President, American Short Line and
Regional Railroad Association
Thank you Chairman DeFazio, Ranking Member Graves, Chairs Lipinski
and Norton and Ranking Members Crawford and Davis, and Members of the
Subcommittees for inviting me to testify as part of this important
hearing. My name is Chuck Baker and I am President of the American
Short Line and Regional Railroad Association (ASLRRA), the national
trade association representing the nation's 603 Class II and Class III
railroads (referred to here collectively as ``short lines'').
This hearing will explore the economic, environmental and societal
impacts of freight transportation and you have asked me to tell you
``where's my stuff'' as it relates to the short line railroad industry.
Well, I am happy to report that short line railroads have lots of
stuff, it's the right stuff, and we are here to transport America's
stuff in a safe, efficient, and environmentally friendly manner.
Together, short line railroads operate nearly 50,000 miles of
track, or approximately 30% of the national railroad network and employ
more than 17,000 hard-working Americans. We operate in 49 states and in
36 of those states we operate at least one quarter of the state's total
rail network. In five states, short lines operate 100% of the state's
rail network. In the states represented by the Members of the two
Subcommittees holding this hearing, there are 450 short lines operating
over 38,000 track miles. Short lines are often called the first mile/
last mile of the nation's railroad system and handle in origination or
destination one out of every five rail cars moving on the national
system.
Although short lines are most often associated with small town and
rural America, we also serve large urban areas and many of the nation's
busiest ports, including Miami, Los Angeles and Long Beach, Hampton
Roads, and New York/New Jersey. Likewise various short line railroads
operate as neutral terminal switch carriers for multiple Class I
railroads in Chicago, New Orleans and St. Louis. The nation's short
lines are much more than a quaint name on the Monopoly Board.
The name ``short line'' can create the mistaken impression that all
of these railroads are very short in length. The fact is we come in all
sizes. The Peru Industrial Railroad in Congressmen Lipinski's and
Davis's state of Illinois is three miles long. The Portland and Western
in Congressman DeFazio's state of Oregon is 516 miles long. Pan Am
Railways, headquartered in Massachusetts, is the nation's longest short
line, operating approximately 1,700 route miles and providing the
majority of rail service in New England. Our common denominators are
that we operate track that was not viable under the structure of the
larger national Class 1 railroads, that we run lean and mean, that we
stay very close to our customers, that we are dedicated to safety, and
that we hustle, fight, scratch and claw for every last carload of stuff
we can help move.
Short Lines Have the Right Economic Stuff
Short line railroads preserve service and jobs over track that was
headed for abandonment under previous Class I ownership. These were low
density branch lines that could not generate enough profit under the
cost structure of the big national carriers. Because these were
marginal or money losing lines, they received little investment prior
to their sale, resulting in significant deferred maintenance. To be
successful, short line owners have worked hard to not only bring their
tracks and bridges up to a state of good repair but to upgrade them to
handle the heavier, longer trains that are becoming the national
standard. To do that, short lines invest on average from 25 to 33% of
their annual revenues in rehabilitating their infrastructure and this
makes short line railroading one of the most capital-intensive
industries in the country. To provide some dollar perspective, to
upgrade one mile of typical 90-pound track up to the 115-pound rail
needed to handle today's modern railcars costs more than $500,000 per
mile and while short lines have been working hard to update their
lines, we still need to do that across a large percentage of the
50,000-mile network.
The economic importance of this investment cannot be overstated.
For large areas of the country, especially in small town and rural
America, short line railroad service is the only connection to the
larger national railroad network. For the businesses and farmers in
those areas, our ability to take a 25-car train 75 miles to the nearest
Class I interchange is just as important as the Class I's ability to
attach that block of traffic to a 100-car train and move it across the
country. While these shippers cannot complete the journey to their
markets across the country without Class I railroad service, they
cannot start or end the journey without short line service. This is
especially true for much of the ``merchandise'' or ``carload'' traffic
that comes from manufacturing, paper and agricultural shippers that
does not typically move in unit train quantities. We are crucial in
providing those shippers access to the economic benefits of shipping by
rail.
Short lines serve over 10,000 shippers in thousands of communities
nationwide and we find those shippers quite willing to testify to the
importance of this first mile/last mile service. I have attached at the
end of my testimony a list of quotes from short line customers. We have
selected a wide variety from across the country to give you a sense of
the important relationship between shippers and their short lines. In
general, they sound like this: ``Our serving short line railroad is
truly a partner for our paper mill. The services provided, including
freight haul in and out, daily switches, and rail car maintenance help
us keep our mill running successfully day in and day out. It is
critical to the 400 plus people employed here that our short line
railroad be able to continue to operate successfully.''
The money invested by short lines also results in economic benefits
beyond preserving local rail service.
Investing in better track leverages significant additional
investment by railroad customers. For example, in South Dakota the
improvements made by the 670-mile Rapid City, Pierre & Eastern Railroad
since it began operations in 2014 have already attracted over $311
million in new facility investments by six South Dakota companies.
Those facilities employ 260 workers. This result is being duplicated in
the 49 states that are served by short line railroads.
Railroads are an all-American proposition. We can not take our
operations or jobs overseas. Virtually everything we buy for
infrastructure improvement--the ties, the steel rail, the ballast, the
locomotives and the freight cars--is made in America, so every dollar
we spend is spent in America.
Railroad rehabilitation is a labor-intensive effort. As small
businesses, most short lines do not have the necessary in-house labor
force or specialized equipment to complete major rehabilitation
projects so we staff up or hire contractors and lease heavy machinery
for new projects, so that new investment typically results immediately
in new jobs. The FRA estimates that half of every dollar spent on short
line track rehabilitation goes to pay workers.
As those of you who represent rural areas know, it is difficult to
create jobs in rural America. According to the US Department of
Agriculture, from its post-recession low in 2010 through 2017, rural
employment grew at an average annual rate of only 0.5%, compared to
1.8% in urban areas. In urban areas, the prime-age labor participation
rate was just 0.8 percentage points below its 2008 level while in rural
counties the prime-age participation rate in 2017 was 2.7 percentage
points below its 2008 level. Short lines and the shippers we serve are
a significant source of good paying jobs in rural America. In the case
of short lines themselves, these jobs also include health care benefits
and a generous Railroad Retirement program.
Short line railroads lower transportation costs for their local
shippers. The economics stem from the fact that one rail car holds the
equivalent of three to four truckloads worth of stuff and also that
railroads use fuel much more efficiently than trucks. In testimony we
recently submitted to the House Ways & Means Committee in support of
the short line rehabilitation 45G tax credit, we cited an example from
an Oklahoma short line, Farmrail. The cost of moving a ton of freight
95 miles from Clinton to Enid, Oklahoma is $2.24 per mile on the
railroad versus $3.75 per mile for comparable truck service. That level
of savings can be cited with most short lines across the country and is
a very meaningful number for the businesses we serve, which lets them
compete effectively in both the domestic and global markets. Without a
viable rail service option, some of these businesses would just
disappear.
Last year the ASLRRA engaged Pricewaterhouse Coopers (PwC) to take
an independent look at the 45G tax credit and the economic
contributions of the short line industry. I have attached a copy of
that report. Among the study's findings:
The short line industry directly provides 17,000 jobs
annually, paying labor income of $1.1 billion and adding $2.2 billion
to the nation's GDP;
Operational spending by the industry supported 33,730
indirect and induced jobs and capital spending supported another 10,240
jobs;
Across the US economy .51% of business inputs rely on
transportation services provided by short lines, amounting to 478,820
jobs, $26.1 billion in labor income and $56.2 billion in value added.
I will not pretend that the numbers I am talking about are a huge
deal in an economy measured in the trillions of dollars. However, for
those shippers we keep connected, for those communities where we create
economic activity, for the employees we hire, these are meaningful
numbers. It is not the biggest stuff but it is important stuff.
Short Lines Have the Right Environmental Stuff
As my colleague at the AAR has said, railroads are the most fuel-
efficient way to move freight over land--three to four times more fuel
efficient than trucks. Today, a freight train can move one ton of
freight an average of more than 470 miles on one gallon of diesel fuel,
double the average in 1980. The EPA has measured the sources of
transportation-related greenhouse gas emissions and rail is a big
success story. Of the greenhouse gas emissions from transportation,
cars/light trucks/motorcycles account for 60.5%, trucking is 23.1%,
aircraft 9.1%, and freight rail is only 2%.
Highway congestion, in addition to being soul-crushing and quality-
of-life-destroying, is a significant contributor to harmful emissions.
Motor vehicles idle for hours on overcrowded roads--in total there were
more than 8.8 billion hours wasted in traffic in the last year
measured--that's the equivalent of a full working year from 4.4 million
Americans! The average railcar holds the equivalent of three to four
truckloads and removing those trucks from the highway helps reduce that
congestion. The short line industry handles over 12 million carloads
annually which equals about 40 million truckloads not on the highway.
Short lines are often custodians of expensive infrastructure, such
as bridges and tunnels that were originally built by the much larger
railroads and are reaching the end of their useful life. Rehabilitation
or replacement of this legacy infrastructure can be very challenging
for small companies, but the benefits are substantial. These benefits
are documented through the cost benefit analysis required by the BUILD
(formerly TIGER) program. As an example, a federal grant award made
through the TIGER program in 2014 enabled replacement of a failing
strategic short line bridge in southwestern Indiana. This investment
prevented over 45 million truck miles from being added to the regional
road network over a 20-year period. This saved the public over $11
million in truck traffic costs through avoided emissions, accidents,
congestion and local road damage. Some 3.2 million gallons of diesel
fuel consumption were also avoided.
While advances in fuel efficient locomotives do not garner the
headline grabbing attention of Tesla's electric cars, the railroad
industry is making steady progress in that regard. Tier 4 locomotives
maximize locomotive performance and reduce emissions. As you know, Tier
4 diesel engine standards are the strictest EPA emissions requirements
for off-highway diesel engines and the railroad industry is
increasingly incorporating Tier 4 locomotive into its fleet. I am
pleased to report that one of our short line members, Knoxville
Locomotive Works, has earned EPA's Tier 4 certification for its SE
series four and six axle locomotive designs and is providing these
locomotives to short lines for switching operations. These locomotives
reduce existing emission levels by more than 90%. The Chairman of
Knoxville Locomotive Works is Pete Claussen who is also the Chairman of
short line company Gulf and Ohio Railways and his son Doc is President
of that railroad and is currently serving as Chairman of our Short Line
Association.
Short Lines Have the Right Societal Stuff
Rail is the safest option for moving freight by land in America.
Using USDOT data and measuring on a comparable ton-miles basis, rail is
approximately 3-5 times safer than trucking.
Short lines are proud of our safety culture and work diligently to
reduce and eliminate injuries. In 2018, 265 short lines reported zero
accidents to the FRA. The average accident rate that year was a near
record low of 1.84 per million train miles. We are also proud of the
Short Line Safety Institute, which exists to provide voluntary intense
safety culture assessments on short lines all over the country as we
continually strive for zero accidents, injuries, and fatalities.
Because rail is the safest option for moving freight by land, any
policies that Congress enacts that affect the balance between rail and
trucking also affect public safety and have major societal impacts.
The Right Legislative Stuff
As evidenced by the discussion above, short line railroads have the
right stuff when it comes to moving America's stuff, and we would like
to share with the Committee several legislative recommendations that we
believe will help our industry provide more of that stuff in the
future.
As you likely know, our number one legislative priority is the
extension of the Short Line Rehabilitation Tax Credit known as 45G. I
will mention this only briefly for three reasons. First, it is not in
the jurisdiction of this committee. Second, you are no doubt as tired
of hearing us talk about it as I am of talking about it. Third, 49 of
the 62 Members of these two Sub-Committees are co-sponsors of this
legislation so I'd only be preaching to the choir. Suffice it to say
that this credit allows short lines to maximize infrastructure
investment that is critical to producing the kind of economic,
environmental, and societal results described above, and to the extent
that any of the members of this committee are able to work with your
colleagues on Ways & Means and in leadership to ensure that an end-of-
the-year tax package advances that includes 45G, that would be a big
win for the thousands of communities and shippers that count on short
lines. The credit has been expired since December 31, 2017 and we
respectfully call on Congress to address this before the end of this
year. The negative consequences of the credit being lapsed are becoming
more apparent by the day.
We strongly support the Consolidated Rail Infrastructure and Safety
Improvements (CRISI) grant program as it specifically provides for
short line eligibility and puts a focus on benefit-cost analysis. We
have seen that with this level playing field, short line projects fare
well. Further, it includes a special focus on the deployment of
railroad safety technology, which can potentially help our work
implementing positive train control (PTC) in compliance with the
federal mandate. The yearly authorized level for the program should be
increased--we suggest to $592 million, which was the high-water mark
appropriated in fiscal year (FY) 2018. We also recommend that program
eligibility be tweaked to include non-profit associations representing
short line railroads. These types of associations have previously been
eligible for similar grant programs and successfully received grants
that provided safety support to many short line railroads. The current
FY20 House THUD Appropriations bill includes language to this effect.
We believe CRISI is an important and effective program that should be
continued in the next surface transportation authorization bill.
We are also supportive of the INFRA grant program. There is value
in a merit-based discretionary grant program open to multiple modes of
transportation, especially one that is focused on freight and goods
movement, but we do recommend two changes to this program:
1) Allow the program to support the most efficient and effective
freight projects by fully removing or at least significantly increasing
the $500 million cap on non-highway portions of the multimodal freight
projects. Such a cap is particularly anachronistic now that the highway
trust fund has been subsidized by more than $140 billion(!) in general
funds since 2008.
2) Ensure that the program is able to fund all efficient and
effective projects by increasing the ``small projects'' set aside.
Currently, the 10% cap on small projects, defined as projects that do
not meet the $100 million project minimum, does not provide enough
opportunity for INFRA grants to be used to help with most short line
infrastructure projects. The 10% set aside should be increased to 25%
to more accurately represent the many needs in small town and rural
America and the small but effective projects that are possible
everywhere.
Similar to the INFRA grant program, the state freight formula
program is also a beneficial program that could be improved by
increasing the percentage of the grants that can go to the non-highway
portions of multimodal freight projects. Again, artificially limiting
the types of projects that can be funded results in less than optimal
projects being selected, and it also makes no sense in a world where
road user fees are not funding anywhere near the full cost of the
highway trust fund.
We also support the BUILD program. While BUILD has traditionally
not been an authorized program, if this committee is inclined to
authorize the program going forward, we would suggest including
language that encourages the USDOT to select projects that are multi-
modal in nature and not just projects that could just as easily be done
within the normal state highway allocation. And the committee could
also strengthen language around prioritizing the environmental and
societal benefits of projects.
The RRIF loan authorization of $35 billion is viewed by many as a
potential solution to railroad rehabilitation. That has unfortunately
not been the case so far. Since its inception in 1998, the program has
provided miniscule support for short line rehabilitation.
Notwithstanding its relatively limited utility, we wake up optimistic
every day and believe there are ways to improve the program and thus
offer the following suggestions.
Provide subsidies for RRIF loan credit risk premiums,
along the same lines as TIFIA;
Provide assistance for advisory fees associated with RRIF
loan applications;
Extend RRIF loan terms from the present 35 years to 50
years to more accurately match loan terms with the economic life of
railroad assets;
Facilitate earlier identification of credit risk premium
ranges so that an applicant knows if it's worth engaging in the
process;
Implement an express framework for RRIF applications
meeting certain criteria;
Ensure that RRIF loans are considered local matching
funds for other federal programs provided that they are repaid with
local funds, as is the rule under TIFIA; and
Allow short line holding companies to be applicants.
I know that Members of this Committee have been vocal advocates for
a comprehensive infrastructure program that addresses well-documented
and critical needs. We share your frustration with the political
gridlock that has halted progress on this important subject. In the
hope that good sense will eventually prevail, we offer up five general
principals that will help short lines better utilize any grant programs
funded within a surface transportation reauthorization bill or larger
infrastructure package, whether those are the existing programs noted
above or new programs:
1. Short lines should be directly eligible applicants for project
grants, similar to CRISI. Too often in the past, federal programs have
been only open for application to local units of government, which in
turn requires short lines to create unnecessarily complex and
burdensome applicant structures and which sometimes favors politically
popular projects over economically beneficial projects.
2. The application process needs to be as simple and transparent
as possible. Short lines are small businesses and generally the
individuals writing these applications are employees with other duties
on the railroad. We do not have full time grant writers or the
resources to hire expensive consulting firms.
3. The analysis used to judge a project should not be a rigid one-
size-fits-all process. For example, the process to apply, the public
planning and the engineering required, and the appropriate benefit-cost
analysis format for incrementally upgrading a ten-mile segment of
existing track serving five small grain elevators should not be the
same as building a new subway line or adding lanes to an interstate
highway.
4. If there is to be an associated environmental approval process,
it must be completed in a reasonable period of time. Approval processes
that last for years are a deal-killer to those running a business.
5. Imposing limits on a state DOT's number of grant submissions
allowed in a round of a program forces pre-application competition
between smaller short line projects and other larger projects, often
putting the smaller short line project at a disadvantage.
Finally, I will wrap up with three policy issues to keep in mind as
the Committee looks towards a surface transportation reauthorization
bill and considers how to increase the economic, environmental, and
societal benefits of freight movement:
1) Infrastructure legislation that this committee advances will be
a target vehicle for those who want to increase truck size and weight.
Short lines are part of a broad coalition of interests, including
safety advocates, law enforcement officials, rail labor, truck labor,
independent truckers, Class I railroads, and even some truckload
carriers, who oppose bigger and heavier trucks. Bigger trucks mean
diversion from rail to truck and thus more trucks, more expensive
damage to our highways and bridges, more highway congestion, more
environmental damage, and more danger for the motoring public. Of all
the aspects of my job, this is the only thing that all the relatives at
the Thanksgiving dinner table care about and agree on--NOBODY wants
bigger trucks! The biggest hurdle to enacting new infrastructure
funding legislation is finding the funding, so including a provision
that guarantees higher infrastructure repair costs makes the hurdle all
the more difficult to overcome and that just would not make sense.
2) Mandating crew sizes on trains would be counter-productive in
that it would just make trains less competitive with other
transportation modes and would do so for no good reason as there is no
evidence of a safety benefit generated by a second crew member. It is
ironic that as the government is working to facilitate the move to
driverless vehicles on the complex open architecture of the highway
system, Congress is considering making the railroads do just the
opposite on the simpler closed architecture of the railroad system.
Short lines operate safely all over the country with a variety of
business models and crew sizes, and we need the ability to be flexible
and to adapt to an ever-changing competitive marketplace or else we
will simply vanish in the face of competition.
3) As has been said thousands of times by most of you all on this
Committee and most of us in the transportation community, it is
essential that the highway trust fund return to a largely user- funded
system. There are many important reasons for this, but from our short
line perspective the current system amounts to a $10b+ per year
government subsidy to our biggest competitors, which artificially
shifts traffic from the freight rail system to the highway system and
thus loses the economic, environmental, and societal benefits that can
be provided by freight rail.
In summary, short Line railroads have the right stuff, and with
your continued support in the areas I have identified, we will provide
even more of the stuff that matters--jobs, economic opportunity,
environmental sustainability, and business growth, particularly in
small town and rural America.
I appreciate the opportunity to appear before you today and am
pleased to answer any questions you might have.
attachment
Short Line Railroad Customers Talk about Service and the Short Line
Rehabilitation 45G Tax Credit
Dana Shellberg, of Allweather Wood LLC, in Loveland, CO (a customer of
the Great Western Railway of Colorado)
``Without the Great Western Railway of Colorado we would have to
truck all our lumber in from Oregon, Washington, Alabama, and Arkansas.
This would not allow us to stay competitive in the lumber market.''
Robert Glezen, of Mont Eagle Mills, Inc., in Oblong and Palestine, IL
(a customer of the Indiana Rail Road)
``Short line railroads are an increasingly important piece of our
nation's infrastructure. Our business depends upon the Indiana Rail
Road to serve the agricultural base of southeastern Illinois.''
David Doti, of Jadcore, LLC, in Terra Haute, IN (a customer of the
Indiana Rail Road)
``The Indiana Rail Road is our only connection to the main line.
All of the other carriers have either merged or are out of business.
The plastics industry relies on the railroad for its delivery of
finished products all over the country.''
Daniel Semsak, of Pacific Woodtech Corporation, in Saginaw, MI (a
customer of the Lake State Railway)
``We depend on short lines to get into our customers' facilities.
Rail access is essential for our company and our customers to be able
to grow. As the Class 1 railroads have focused more and more on unit
trains for inefficiencies, small business has relied on short lines for
survival. We need the short lines for the ``last mile''.''
Brian Arnhalt, of Minn-Kota Ag Products, in Breckenridge, MN (a
customer of the Red River Valley & Western Railroad)
``Our rail service from the Red River Valley & Western Railroad is
outstanding. The personalized attention to our customer needs is a big
help in the success of our business.''
Curt Warfel, of Akzo Nobel, Inc., in Columbus, MS (a customer of the
Alabama and Gulf Coast Railway)
``Akzo Nobel has long been supportive of the short line railroad
tax credit. We see this as an excellent way in which short line
railroads may ``stretch'' a dollar to upgrade their railroads and
improve service to rail shippers.''
Chuck Hunter, of PSC Metals, Inc., in St. Louis, MO (a customer of the
Terminal Railroad Association of St. Louis)
``The six short lines that serve our facilities have and will play
a vital role in the growth of our company. They have worked with us to
add rail service to several of our facilities, issued rates to incent
rail service-vs-truck. Their local presence and willingness to
partnership in problem solving has been a blessing. These service
providers are an essential part of our continued success in the North
American marketplace.''
Levi Ross, of Dead River Company, in North Walpole, NH (a customer of
the Green Mountain Railroad)
``Our retail petroleum business is dependent on the service of
short lines for a dependable regional supply chain.''
Jason Tininenko, of Freeport McMoRan, in Hurley, NM (a customer of the
Southwestern Railway)
``There are several short line railroads that are integral to our
business. They provide a consistent, cost effective option for us to
move large volumes of freight both to and from our mining locations.''
Mike Sawyer, of Western Producers Cooperative, in Dill City, Rocky, and
Sentinel, OK (a customer of Farmrail)
``Our livelihood depends on railroads shipping our grain. Farmrail
does a great job in taking care of our needs. We need their services!''
Steve Stivala, of MacMillan-Piper, in Tacoma, WA (a customer of Tacoma
Rail)
``Tacoma Rail is an integral part of our business and overall
operation in Tacoma. The short line railroad provides us with
consistent and reliable service on a daily basis. By meeting our needs
and requirements, we are better able to service our customers. This
would not be possible without the assist from Tacoma Rail.''
Maurice Bohrer, of Michels Materials, in Janesville and Waterloo, WI (a
customer of the Wisconsin & Southern Railroad)
``Our short line and regional railroad, the Wisconsin & Southern
Railroad, is the only railroad that provides service to our black
granite quarry and without them we would not be able to sell our
granite to many of our customers and the other railroads that use our
ballast!''
attachment
The Section 45G Tax Credit and the Economic Contribution of the Short
Line Railroad Industry
The report entitled ``The Section 45G Tax Credit and the Economic
Contribution of the Short Line Railroad Industry'' is retained in
committee files and is available online as an attachment to Mr. Baker's
written testimony at the U.S. House of Representatives Document
Repository at https://docs.house.gov/meetings/PW/PW12/20191205/110277/
HHRG-116-PW12-Wstate-BakerC-20191205.pdf.
Mr. Lipinski [presiding]. Thank you, Mr. Baker.
Ms. Goodchild, you are recognized for 5 minutes.
Ms. Goodchild. Good morning, Chairs Norton and Lipinski,
and Ranking Members Davis and Crawford, as well as
distinguished members of the committee. Thank you for the
opportunity to speak with you about this important topic.
My name is Anne Goodchild. I am a professor of civil and
environmental engineering at the University of Washington, and
the director of the Supply Chain Transportation and Logistics
Center. I am the founding director of the Urban Freight Lab,
and an urban freight expert.
It is an uncommon pleasure to be in a room full of
policymakers so interested in freight transportation.
The freight system allows for economic specialization, and
is a requirement for city living. It provides markets to
producers and strengthens competition.
I am here today to highlight that freight infrastructure is
more than interstates, ports, pipelines, and rail facilities.
It is also city streets, curbs, and sidewalks. This is where a
supply chain's last mile is carried out. That is the
infrastructure that gets a good to its final destination.
When we talk about freight infrastructure investment and
building a better freight system, we must include the last
mile, and even the final 50 feet. Investments in this
infrastructure and innovations in the last mile provide a
substantial opportunity to improve supply chain efficiency,
more effectively delivering essential services and the economic
and social benefits that they promise.
The last mile is not, as the name suggests, a small part of
the freight system. It is the current obsession of the supply
chain industry, and an increasing burden for cities and
neighborhoods. The last mile is the most difficult and costly
mile of the entire freight system, estimated to absorb between
25 and 50 percent of total supply chain transportation spent.
Dramatic growth in online shopping and faster and faster
home delivery is increasing the cost of the last mile and the
amount of last-mile traffic. Investments in improving the last
mile and the final 50-feet infrastructure will bring
disproportionate benefits to the freight system, carriers, and
consumers.
We will have to rethink how we build and manage our
infrastructure if it is to accommodate the expected growth in
delivery services. Departments of transportation are facing
many rapid and complex changes and competing demands for space.
For example, growth in home delivery, the use of ride-hailing
services, the construction of dedicated bike lanes, and
autonomous vehicles all want additional curb space. Relying on
intuition can lead to policies such as truck bans that actually
increase congestion and emissions.
In fact, our research demonstrates that organized,
efficient freight carriers reduce traffic and emissions because
a single delivery truck can replace dozens of car trips. On the
street we see high rates of unauthorized parking, long dwell
times, and high failed delivery rates, which means both poorly
utilized vehicles and drivers, high emissions, and poorly
utilized public space.
Developing effective solutions to these urban freight
challenges requires new approaches. We need evidence-based
solutions that will improve efficiency for carriers and improve
transportation system performance. In the face of a fast-
changing industry, limited data, and freight planning capacity,
this requires new approaches. Our response at the University of
Washington was to establish the Urban Freight Lab, an
innovative partnership between private industry, academic
researchers, and the Seattle DOT, as well as other public
agencies, to jointly solve urban freight problems.
Private-sector members, as well as the public sector,
contribute financially to the research, and collectively decide
on a research agenda. While all members contribute and play an
essential role in defining and identifying needs, lab fees do
not and should not cover the cost of all research. The findings
have national impact, and testing solutions at scale cannot be
the responsibility of only this group.
Important financial support for the center also comes from
the Department of Energy, Office of Energy Efficiency and
Renewable Energy, and the University Transportation Center
Program. These and other Federal programs play an essential
role in sponsoring and guiding the direction of national
research.
I encourage you to include approaches to study and improve
urban freight performance in future policies. Thank you very
much for your time.
[Ms. Goodchild's prepared statement follows:]
Prepared Statement of Anne Goodchild, Ph.D., Founding Director, Supply
Chain Transportation and Logistics Center, University of Washington
Good morning, Chairs Norton and Lipinski and Ranking Members Davis
and Crawford as well as distinguished Members of the Committee. Thank
you for the opportunity to speak to you about this important topic. My
name is Anne Goodchild and I am a professor and the Director of the
Supply Chain Transportation and Logistics Center at the University of
Washington. I am an urban freight expert. The freight system,
ultimately, allows for economic specialization; it supports city
living, provides markets to producers, and strengthens competition. On
its own, the transportation and logistics sector represents
approximately 10% of the US gross domestic product--a larger sector
than either retail, or financial services \1\. The freight system is
more than interstates, ports, pipelines and rail facilities. The
freight system is city streets, local highways, sidewalks, bike lanes,
and front steps--the last mile of where these supply chains is carried
out. It is the delivery man walking to your door or mailbox. When we
talk about freight infrastructure investment and building a better
freight system, we must remember to include the last mile and
particularly the Final Fifty Feet to the final delivery destination.
Without completing this final step, supply chains fail to deliver the
economic and social benefits they promise.
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\1\ https://www.bea.gov/system/files/2019-10/gdpind219_2.pdf
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Last mile costs businesses a disproportionate amount of time and money
The last mile is essential, and expensive; the most difficult and
costly mile of all. While estimates vary, the cost of the last mile has
been estimated at between 25% and 50% of total supply chain
transportation costs \2\ \3\.
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\2\ https://www.kuebix.com/the-high-costs-of-final-mile-delivery/
\3\ https://www.supplychaindive.com/news/last-mile-spotlight-
retail-costs-fulfillment/443094/
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The last mile is costly because:
1) It relies more on human labor than the other segments of supply
chain transportation with drivers going door-to-door to drop off
packages. In cities, drivers can spend 80 or 90% of their time outside
the vehicle \4\.
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\4\ https://www.greenbiz.com/article/we-will-still-need-drivers-
driverless-future
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2) Goods are more fragmented the farther you travel down the
supply chain. Upstream, goods are moved in large, consolidated
shipments such as single commodities but the closer goods get to the
consumer the more they are broken down into shipments for individual
customers.
3) 80% of Americans live in congested regions \5\ where travel
speeds are slower and less reliable. This increases the number of
vehicles and drivers required to do the same work.
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\5\ http://css.umich.edu/factsheets/us-cities-factsheet
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4) There can be high rates of failed deliveries requiring repeated
delivery attempts and resulting in ballooning costs. Failed delivery
attempts can mean that two or three additional trips are require to
accomplish the same task.
While the high cost of the last mile is in part due to the
distributed nature of deliveries, the cost is inflated by congestion, a
lack of reasonable parking options, and other constraints put on
commercial vehicle operations such as specific street or time of day
bans.
Online shopping growing and speeding
Online shopping rates are growing and this is increasing demand for
last mile delivery. UPS, the world's largest package delivery company,
experienced 23% revenue growth from 2014 to 2018 (5.5% annually \6\).
With one-click shopping and free home delivery it is now often cheaper
and easier to order something online than it is to go to the store.
Retail e-commerce sales as a percent of total retail sales in United
States rose to 9% in 2017 and this figure is expected to reach 12.4% in
2020 \7\. With store-based shopping, most Americans use their personal
vehicles for shopping trips; driving to the store alone, purchasing a
few items, and returning home in their car. With an online purchase,
the trip--now a delivery--is made with a commercial vehicle, extending
the supply chain from the store or warehouse and bringing increasing
numbers of commercial vehicles into towns and neighborhoods. The volume
of daily deliveries to homes has soared--from fewer than 360,000 a day
in New York City in 2009 to more than 1.5 million today \8\. Households
now receive more deliveries than businesses; and this, with online
retail representing only 10% of all retail. Imagine how many more trips
there will be when online retail hits 20% or 50%.
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\6\ https://www.forbes.com/sites/greatspeculations/2019/10/18/ups-
revenues-strong-last-few-years-but-slower-growth-ahead/#323b065368e4
\7\ https://nrf.com/insights/economy/state-retail
\8\ https://www.nytimes.com/2019/10/27/nyregion/nyc-amazon-
delivery.html
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In addition to growth in the number of deliveries, the pace of
delivery of speeding. Amazon, which currently holds about a 50% share
of the online market in the US has, in the last 3 years, halved their
average click-to-door speed from about 6 days to about 3 days \9\.
Other retailers are attempting to keep pace. Just this week I received
an email from Amazon notifying me that Amazon Fresh would now deliver
at ``ultrafast speeds'' in my area: ``You can schedule same-day
deliveries from 6:00am-10:00pm and get FREE 2-hour scheduled delivery
windows on orders over $35''. Free two-hour delivery. This was not in
response to a request, rather this is being rolled out to all Prime
members. Depending on your location, you can also get 1-hour delivery
for a small additional fee. This is also available in DC and Northern
VA. There has also been a proliferation of on-demand delivery services,
particularly in the food delivery sector, where online platforms now
serve close to 30% of the market.
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\9\ https://www.emarketer.com/chart/221703/average-click-to-door-
speed-us-digital-purchases-
made-on-amazon-vs-other-retailers-dec-2015-march-2018
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The US leads the world in online shopping activity and speed of
delivery \10\. Supply chains have spent decades investing in technology
and building the information systems required to deliver on home
delivery and service promises. More recently, venture capital has also
invested in transportation and logistics, with PitchBook reporting
$14.4 billion invested globally in privately owned freight, logistics,
shipping, trucking, transportation management system (TMS), and supply
chain tracking startups since 2013 \11\. Not only do these changes
affect transportation and logistics companies, but these changes affect
peripheral sectors as companies reorganize their operations to service
these new demands.
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\10\ https://unctad.org/en/pages/
PressRelease.aspx?OriginalVersionID=505
\11\ https://www.joc.com/technology/vcs-taking-long-odds-big-
logistics-wins_20190523.html
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As customers are offered, and accept, shorter and shorter click-to-
delivery times, delivery companies have less opportunity to make
consolidated, efficient deliveries. Instead of waiting for more orders
and sending out full trucks, vehicles are sent out to meet their quick
delivery promise; reducing vehicle utilization. This increases the
number of vehicles on the road, increases the cost per delivery, and
increases vehicle emissions.
There is a Significant Impact on Cities
It is the roads and sidewalks built by American cities and towns
that enable this last mile delivery. In Seattle, 87% of buildings in
greater downtown rely solely on the curb for freight access \12\. These
buildings have no off-street parking or loading bays.
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\12\ http://depts.washington.edu/sctlctr/sites/default/files/
SCTL_Final_50_full_report.pdf
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Our cities were not built to handle the nature and volume of
current freight activity and are struggling to accommodate growth \13\.
At the same time, delivery of goods is just one of the many functions
of our transportation networks. The same roads and sidewalks are also
used by pedestrians, cyclists, emergency vehicles, taxis, ride hailing
services, buses, restaurants, and street vendors, to name a few.
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\13\ https://www.nytimes.com/2019/10/27/nyregion/nyc-amazon-
delivery.html
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Capacity on our transportation networks is increasingly scarce.
Texas Transportation Institute's 2019 Urban Mobility Report, a summary
of congestion in America, is titled ``Traffic is Bad and Getting
Worse'' \14\. Over the past 10 years, the total cost of delay in our
nation's top urban areas has grown by nearly 47%. It is on top of this
already congested network, that we add this growing last mile traffic.
American cities have yet to make any headway with congestion, and
delivery traffic both adds to, and suffers from, this condition.
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\14\ https://mobility.tamu.edu/umr/
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To address congestion, many state Departments of Transportation are
working to provide safe and competitive alternatives to single
occupancy vehicle travel such as transit, bicycling, and walking. Other
federal agencies are also working on addressing this issue, such as the
Department of Energy, which has awarded UW and Seattle an EERE grant.
In building dedicated bicycle facilities, one common solution is to
convert the curb lane to a bike lane, removing commercial vehicle load
and unload space. At the same time, American's are increasingly using
ride-hailing services such as Uber and Lyft \15\. This also increases
the demand for curb space as passengers request pickup and drop-off
instead of parking their own vehicle off-street.
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\15\ https://www.citylab.com/transportation/2019/08/uber-lyft-
traffic-congestion-ride-hailing-cities-drivers-vmt/595393/
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The result is too much demand for too little space, and there is
ample evidence of a poorly functioning system. From a study in Seattle,
52% of vehicles parked in commercial vehicle load zones were passenger
cars, and 26% of all commercial vehicles parked in passenger load
zones. In New York City, UPS and Fedex received 471,000 parking
violations in 2018. Everyone has seen an image of a truck parked in a
bike lane, or been stuck behind a delivery truck occupying an entire
residential street. While we might expect a small percentage of
violations, these levels reflect a failure of planning and design to
deliver reasonable alternatives to commercial vehicles, and a city that
has not caught-up with the changes in supply chain and shopping
patterns.
In addition to these operational challenges, commercial vehicles
have impacts on American's health and safety. Per mile, trucks produce
disproportionately more carbon dioxide and local pollutants (NOx, PM)
than passenger vehicles so a substitution of delivery trucks for
passenger vehicles has the potential to increase emissions \16\.
However, delivery services also present an opportunity to reduce
emissions per package as they can consolidate many packages into one
vehicle; the same way transit or carpooling can be an emissions
advantage over single occupancy vehicle trips. Research shows that in
most cases a well-run delivery service would provide a carbon dioxide
reduction over typical car-based shopping behavior \17\. While there is
the opportunity for delivery services to provide this emissions
benefit, the move towards very fast delivery erodes that benefit as
delivery services are unable to achieve the same level of consolidation
and begin to look more like butler services.
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\16\ https://www.epa.gov/regulations-emissions-vehicles-and-
engines/regulations-greenhouse-gas-emissions-commercial-trucks
\17\ http://depts.washington.edu/sctlctr/research/publications/
evaluating-impacts-density-urban-
goods-movement-externalities
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Diesel powered vehicles, often used for the movement of freight,
produce disproportionately more particular matter and NOx pollution
than gasoline engines, so the use of these vehicles in urban areas,
where human exposure levels are higher, has significant negative
outcomes for human populations in terms of asthma and heart disease
\18\. This is particularly true for the very young, elderly, or
immunosuppressed.
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\18\ https://www.lung.org/our-initiatives/healthy-air/outdoor/air-
pollution/particle-pollution.html
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While it may seem intuitive that replacing a car trip to the store
with a truck delivery would be bad for the city, in fact, delivery
services can reduce carbon emissions and total vehicle miles travelled.
This is because the truck is not just delivering to one home, but to
many. In this sense, the truck delivery behaves like a transit vehicle
or very large carpool. This can reduce congestion by reducing the
number of vehicles on the road. Delivery trucks can be an asset when
performing in this efficient manner because they consolidate many goods
into a single vehicle reducing per package cost, emissions, and
congestion impacts.
Banning trucks and requiring or encouraging the use of smaller
vehicles INCREASES the number of vehicles and the vehicle miles
travelled; exacerbating traffic and parking problems.
Growth in two and one-hour delivery INCREASES the number of
vehicles and vehicle miles travelled; exacerbating traffic and parking
problems.
The Urban Freight Lab as a Public and Private Sector Collaboration
Businesses are challenged by the high cost of the last mile, and
the increasing time pressure for deliveries. Cities are working to
manage congestion, the competing demands of many users, emissions, and
intense pressure for curb space. This presents a complex set of
problems, where:
private carriers are struggling to comply with city
regulations and remain financially competitive while meeting customer
expectations
customers are benefiting from high levels of convenience
but also experiencing high levels of congestion and suffering from the
effects of growing emissions
cities and towns are struggling to meet demands of
multiple stakeholders and enforce existing rules
All of this, in a context where there are very limited data
regarding truck or commercial vehicle activity, numbers of deliveries,
or other measures of efficiency. The Freight Analysis Framework \19\,
which compiles the nation's most significant freight datasets such as
the Commodity Flow Survey, breaks the country into 153 zones, so that
most states can only see what came into or out of the state, not how
vehicles move around within cities and towns. The more recently
developed National Performance Management Research Data Set (NPMRDS)
\20\, presents truck specific data, and allows for highway speeds to be
monitored at a county level, but does not show vehicle volumes, or give
any insights into origin-destination patterns. At the national level,
mode-specific datasets provide more spatial, temporal, and activity
detail. For example, the Carload Waybill sample \21\ provides important
data on rail cargo movements and the Air Operators Utilization Reports
\22\ provide important data on airplane activity. Unfortunately, the
Vehicle Inventory and Use Survey, which provided detailed data on truck
and goods movements, was discontinued in 2002. This leaves cities and
towns have no nationally consistent sources of or guidelines for
collecting truck activity data.
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\19\ https://www.bts.gov/faf
\20\ https://ops.fhwa.dot.gov/perf_measurement/index.htm
\21\ https://www.stb.gov/stb/industry/econ_waybill.html
\22\ https://www.faa.gov/data_research/aviation_data_statistics/
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The most economically efficient solutions to these challenges will
be identified through collaboration between cities and private
partners. One particularly successful and innovative solution can be
found in the Urban Freight Lab at the University of Washington (https:/
/depts.washington.edu/sctlctr/urban-freight-lab-0). As the director of
the Urban Freight Lab, I have built a coalition of private companies
and public agencies who work together to identify and measure problems,
and develop and pilot-test solutions that will provide benefits for a
diverse group of public and the private sector stakeholders. The goal
is to find win-win solutions for businesses and city dwellers, and to
avoid short-sighted solutions like blanket truck bans \23\.
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\23\ https://nyc.streetsblog.org/2018/08/20/city-abandons-clear-
curbs-program-that-reduced-traffic-congestion-and-made-roosevelt-
avenue-safer/
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The Urban Freight Lab is successful because:
1. All participants have skin in the game. Private sector
contributions elevate public sector research funding and ensure that
all participants fully engage. This is fundamentally different from an
advisory board or oversight committee because members must report back
to their leadership and justify participation with measurable returns
on investment. This participation from the private sector improves
relevance and timeliness of public sector support.
2. Collaboration amongst the private and public sector ensures
that products of the lab are as mutually beneficial as possible.
3. Problems, evaluation metrics, and research ideas come from the
group and are connected directly to real-world challenges faced, not
the research directors, the public, or private sector alone.
4. Private- and public-sector participants are senior executives
who have the authority to make decisions in quarterly meetings. They do
not need to return to the organization for approval.
5. Cities need freight planning capacity but currently don't have
any. The work of the Urban Freight Lab fills gaps in problem
definition, data collection, solution generation, orchestration and
evaluation of pilot tests.
6. Robust analysis is conducted by University researchers--they
serve an important role in taking an unbiased view and base their
analysis on data.
7. Quarterly meetings are working meetings with detailed agendas
and exit criteria. The focus is on making progress, making decisions,
and moving forward, not simply information sharing.
8. Private sector partners are operational and technical staff
with knowledge of operations.
9. Public sector partners represent a breadth of functions
including planning, engineering, curb management, mobility, and
innovation.
10. University research focusses on practical outcomes and does
not hide in theoretical concepts.
11. Solutions are tested on the ground through pilots and real
tests. The slow work of collaboration building and overcoming obstacles
to implementation is part of the research.
Current private-sector lab members include Boeing HorizonX,
Building Owners and Managers Association (BOMA)-Seattle King County,
curbFlow, Expeditors International of Washington, Ford Motor Company,
General Motors, Kroger, Michelin, Nordstrom, PepsiCo, Terreno Realty
Corporation, US Pack, UPS, and the United States Postal Service (USPS).
The Seattle Department of Transportation represents the public-sector.
Seattle is a growing City and has now been ranked in the top 4 for
growth among major cities for five consecutive years. It is a
geographically constrained city surrounded by water and mountains, and
boasts some of the highest rates of bike, walk, and transit commuting
in the country \24\; with less than a quarter of City Center commuters
now driving alone to work. It is a technologically oriented City; with
the region serving as the home to many technology companies such as
Amazon, Convoy, Facebook, Google, Microsoft, and Tableau. The City was
one of the first to launch PayByPhone, electronic toll tags, weigh-In-
motion, high-occupancy-toll lanes, passive bicycle counters, real-time
transit monitoring, bike and car share programs, and most recently, an
Open Data Portal \25\. In this sense, the City provides an excellent
example for experimentation where the public and private sector face
intense pressure to look for new solutions and approaches; and levels
of congestion and pressure that other US Cities can anticipate in their
future as populations grow and infrastructure construction does not
keep pace.
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\24\ https://commuteseattle.com/mediakit/2017-mode-split-press-
release/
\25\ https://data.seattle.gov/
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With this private- and public-sector funding the Urban Freight Lab
has:
produced foundational research on the Final Fifty Feet of
the supply chain \26\
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\26\ https://depts.washington.edu/sctlctr/sites/default/files/
SCTL_Final_50_full_report.pdf
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developed and applied approaches to quantify urban
freight infrastructure \27\
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\27\ https://depts.washington.edu/sctlctr/sites/default/files/
SCTL_Alley_Infrastructure_
Occupancy_Study_12-11-18.pdf
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developed and applied approaches to measure
infrastructure \28\
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\28\ https://depts.washington.edu/sctlctr/sites/default/files/
SCTL_Alley_Infrastructure_
Occupancy_Study_12-11-18.pdf
---------------------------------------------------------------------------
generated and tested approaches to reducing dwell time
and failed deliveries in urban areas including common lockers \29\
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\29\ https://depts.washington.edu/sctlctr/sites/default/files/
SCTL_Urban_Freight_Lab_
5.18.18.pdf
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developed and implemented an approach to measuring the
volume of vehicles entering and exiting the City of Seattle.\30\
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\30\ https://depts.washington.edu/sctlctr/research/publications
Ongoing work is supported in large part by a grant from the
Department of Energy U.S. Department of Energy: Energy Efficiency &
Renewable Energy (EERE) titled Technology Integration to Gain
Commercial Efficiency for the Urban Goods Delivery System, Meet Future
Demand for City Passenger and Delivery Load/Unload Spaces, and Reduce
Energy Consumption. This project, funded by DOE, provides $1.5 million
over 3 years with matching funds from the City of Seattle, Sound
Transit, King County Metro, Kroger, the City of Bellevue, and CBRE. The
project will evaluate the benefit of integrated technology applications
on freight efficiency. Within the scope of this grant, Urban Freight
Lab members and the Seattle DOT will be involved in developing and
testing applications of technology in the Belltown area of Seattle that
will increase commercial efficiency and reduce impact of freight
activity on city residents \31\.
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\31\ https://depts.washington.edu/sctlctr/research-projects/current
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Moving Forward
Shopping patterns have evolved, but our infrastructure has not. We
need to rethink how we use our streets, curbs, and sidewalks if we want
to maintain and grow our current shopping and delivery habits.
By consolidating many goods into a single route, delivery services
could be an asset to communities; growing economic activity, reducing
total vehicle miles travelled and associated carbon emissions, and
supporting communities \32\ less dependent on cars. However, the
current trend towards faster and faster deliveries; and businesses
subsidizing delivery costs means we see lower vehicle utilization,
higher numbers of vehicles and congestion, and increased emissions.
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\32\ http://depts.washington.edu/sctlctr/research/publications/
evaluating-impacts-density-urban-
goods-movement-externalities
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While some town and city governments have invested measuring the
state of urban freight in their communities and developed improvements,
most have limited resources and no guidance from the state or federal
level. For example, they do not know how many trucks operate in the
region, what they carry, whether the current curb allocation is
satisfactory, or what benefit might result from improvements.
New modes, technologies, and operational innovations provide
opportunities for win-win solutions. These new conditions may allow new
modes such as electric assist cargo bikes \33\ to outcompete existing
modes. Electric and hybrid vehicles can reduce both global and local
pollutants. New technologies such as robotics, artificial intelligence,
and electronic curbs may fundamentally shift the existing
infrastructure paradigms. Private companies are ready to test these
innovations, and the US and state DOTs can play a role in supporting
these tests and conducting evaluations.
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\33\ http://depts.washington.edu/sctlctr/research-projects/ups-e-
bike-delivery-pilot-test-seattle-analysis-public-benefits-and-costs-
task
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Investments in the freight system must include the last mile, and
in particular the final fifty feet of the delivery route as a
consideration to ensure economic vitality and support quality of life.
This includes supporting towns and cities in investigating and
understanding the current state of goods movement at the municipal
scale, identifying and evaluating new solutions for cities and towns to
adapt to changing supply chains, integrating freight planning and
passenger planning, and ultimately providing healthy environments for
businesses to thrive and great places to live.
Mr. Lipinski. Thank you, Ms. Goodchild.
I now recognize Mr. Jefferies.
Mr. Jefferies. Good morning, Chairs DeFazio, Holmes Norton,
and Lipinski, Ranking Member Davis, Crawford, and members of
the committee. Thank you for the opportunity to be here today
representing the U.S. freight railroads.
As you examine the capability of U.S. freight modes to meet
the challenges of today and tomorrow, know this: due to
sustained private investment, the freight rail network is in
the best shape of its storied history.
Today's railroad is different than the railroad of the
past. But the capital intensive nature is a constant, enabling
railroads to safely serve today's customers and plan for
tomorrow's demands. Case in point: in the past 3 years, Class I
railroads averaged $25 billion in private investments to manage
and upgrade infrastructure and equipment. That is more than $68
million a day of private capital poured back into our network.
This year is no different. Class I capex is up almost $1
billion through the third quarter of this year, year over year.
Railroads play the long game, and the industry is executing
a strong vision for the future. The positive impacts of this
vision can be found every day.
First, railroads operate safely. Railroads maintain a
safety culture second to none, constantly looking for ways to
further the safety performance. The evidence of this commitment
is clear. In 2018 the train accident rate was down 36 percent
from the year 2000, while the employee accident rate was its
second lowest in history, down 48 percent. To continue these
trends, the industry is deploying new inspection and detection
technologies that allow for significantly more advanced
assessments of rail, track, and locomotive health. We will not
be satisfied until we reach a future of zero incidents.
Second, railroads are the most environmentally sound way to
move freight over land. To reiterate what my colleague said, on
average, railroads move 1 ton of freight 473 miles per gallon
of diesel fuel. To put that in perspective, that is equal to
moving 1 ton of freight on 1 gallon of diesel from DC to
Cincinnati or Chicago to Omaha. While moving nearly one-third
of long-distance freight volume, railroads account for just 2
percent of transportation-related greenhouse gas emissions. In
fact, if just 10 percent of freight that is currently moved by
trucks were transported by rail instead, annual greenhouse gas
emissions would fall by more than 17 million tons.
Third, railroads alleviate highway congestion and
deterioration. Because a single train can carry the freight of
several hundred trucks, railroads cut gridlock and lower the
costs of road construction and upkeep.
And finally, freight rail is a critical economic engine.
U.S. freight railroads move roughly 40 percent of intercity
ton-miles of freight, ship one-third of U.S. exports, and
support more than 1 million jobs across the Nation.
So looking forward, a positive future for freight rail and
other transportation modes relies on a sound public policy.
Robust private investment in the rail sector is made possible
by a balanced economic regulatory system overseen by the
Surface Transportation Board that relies on market-based
competition, while providing a backstop for rail customers. The
structure benefits the entire freight ecosystem. Rail rates in
2018 were 44 percent lower than they were in 1981, when
adjusted for inflation. To continue the success story, the STB
must adhere to sound economic principles and all actions, and
reject reregulatory efforts by some stakeholders.
At the same time, Congress has a role to ensure modal
equity across freight transportation by fixing the Highway
Trust Fund. To do this, railroads believe a mileage-based
solution, such as a weight-distance fee, is the most
appropriate and sustainable long-term solution. I give credit
to my friends in the trucking industry for advocating for a
higher gas tax.
The bottom line, though, all stakeholders agree a viable
funding solution is a must, one that enables full cost recovery
for highway wear and tear.
In closing, privately owned railroads have their eyes on
the future. The industry will continue to invest to meet market
demand and maintain our core role in the Nation's integrated
transportation network. We look forward to working with this
committee and others in Congress as you look towards surface
transportation reauthorization and develop and implement
policies that best meet this country's infrastructure needs.
Thank you.
[Mr. Jefferies' prepared statement follows:]
Prepared Statement of Ian J. Jefferies, President and Chief Executive
Officer, Association of American Railroads
On behalf of the members of the Association of American Railroads,
thank you for the opportunity to appear before you today. AAR members
account for the vast majority of freight railroad mileage, employees,
and traffic in Canada, Mexico, and the United States.
Simply put, railroads are indispensable to the U.S. economy. They
connect producers and consumers across the country and the world,
expanding existing markets and opening new ones. Whenever Americans
grow something, mine something, or make something; when they send goods
overseas or import them from abroad; when they eat their meals or take
a drive in the country, there's an excellent chance that railroads
helped make it possible.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The affordability of freight rail saves rail customers (and,
ultimately, American consumers) billions of dollars each year and
enhances the global competitiveness of U.S. products. Average rail
rates (measured by inflation-adjusted revenue per ton-mile) were 44
percent lower in 2018 than in 1981. This means the average rail shipper
can move close to twice as much freight for around the same price it
paid more than 35 years ago.
Several years ago, the American Association of State Highway and
Transportation Officials (AASHTO) estimated that if all freight rail
traffic were shifted to trucks, rail customers would have to pay an
additional $69 billion per year. Adjusted for increased freight volume
and inflation, it's probably close to $100 billion today.
An October 2018 study from Towson University's Regional Economic
Studies Institute found that, in 2017 alone, the operations and capital
investment of America's major freight railroads supported approximately
1.1 million jobs (nearly eight jobs for every railroad job), $219
billion in economic output, and $71 billion in wages. Railroads also
generated nearly $26 billion in tax revenues. In addition, millions of
Americans work in industries that are more competitive in the tough
global economy thanks to the affordability and productivity of
America's freight railroads.
Without railroads, American firms and consumers would be unable to
participate in the global economy anywhere near as fully as they do
today. International trade accounts for around 35 percent of U.S. rail
revenue, 27 percent of U.S. rail tonnage, and 42 percent of the
carloads and intermodal units U.S. railroads carry.
Sustainability
According to the Environmental Protection Agency (EPA),
transportation accounted for 28.4 percent of U.S. greenhouse gas
emissions in 2017. The vast majority of transportation-related
greenhouse gas emissions are directly related to fossil fuel
consumption: higher fuel consumption means more emissions.
Railroads, though, are the most fuel-efficient way to move freight
over land. In 2018, railroads moved one ton of freight an average of
473 miles per gallon of fuel--roughly the distance from Coos Bay,
Oregon to San Francisco, or from Hannibal, Missouri to Columbus, Ohio.
In fact, freight railroads, on average, are three to four times more
fuel efficient than trucks--meaning that moving freight by rail instead
of truck reduces greenhouse gas emissions by up to 75 percent. The rail
fuel efficiency advantage helps explain why freight railroads account
for just 2.0 percent of transportation-related greenhouse gas emissions
and just 0.6 percent of total U.S. greenhouse gas emissions, according
to the EPA, even though railroads account for one-third or more of
long-distance freight volume (measured in ton-miles).
If just 10 percent of the freight that moves by the largest trucks
moved by rail instead, fuel savings would be more than 1.5 billion
gallons per year and annual greenhouse gas emissions would fall by more
than 17 million tons--equivalent to removing some 3.2 million cars from
the highways for a year or planting 400 million trees.
Railroads are constantly looking for ways to improve their fuel
efficiency and further reduce emissions. Steps railroads have taken
individually or collectively in recent years include:
Installing highly advanced computer software systems that
calculate the most fuel-efficient speed for a train on a given route;
determine the most efficient spacing and timing of trains on a
railroad's system; and monitor locomotive performance to ensure peak
efficiency.
Installing idling-reduction technologies, such as stop-
start systems that shut down a locomotive when it is not in use and
restart it when it is needed, and expanding the use of distributed
power (positioning locomotives in the middle of trains) to reduce the
total horsepower required for train movements.
Acquiring thousands of new, more efficient locomotives
and removing from service thousands of older, less fuel-efficient
locomotives.
Providing employee training to help locomotive engineers
develop and implement best practices and improve awareness of fuel-
efficient operations.
Railroads also help reduce the huge economic costs of highway
congestion. According to the Texas Transportation Institute's 2019
Urban Mobility Report, highway congestion cost Americans $166 billion
in wasted time (8.8 billion hours) and wasted fuel (3.3 billion
gallons) in 2017. Lost productivity, cargo delays, and other costs add
tens of billions of dollars to this tab. A single freight train,
though, can replace several hundred trucks, freeing up space on the
highway for other motorists. Shifting freight from trucks to rail also
reduces highway wear and tear and the pressure to build costly new
highways.
In recent years, railroads have begun to investigate moving away
from diesel locomotives in favor of alternatives--for example, to
natural gas, or even potentially to batteries or fuel cells. At this
point, it's not clear if an alternative will have the combination of
affordability, reliability, and capability to be feasible for
widespread use, but it does show that railroads are ``looking outside
the box'' in terms of enhancing sustainability and environmental
preservation.
Investing for the Future
As America's economy and population grow, the need to move more
freight will grow too. The Federal Highway Administration forecasts
that total U.S. freight shipments will rise 35 percent from 2017 to
2040. Railroads are getting ready today to meet this challenge.
America's freight railroads operate overwhelmingly on
infrastructure that they own, build, maintain, and pay for themselves.
By contrast, trucks, airlines, and barges operate on highways, airways,
and waterways that are almost entirely publicly funded.
From 1980 to 2018, America's freight railroads spent more than $685
billion--their own funds, not taxpayer funds--on capital expenditures
and maintenance expenses related to locomotives, freight cars, tracks,
bridges, tunnels and other infrastructure and equipment. That's more
than 40 cents out of each revenue dollar spent to keep our economy
moving.
Railroads are much more capital intensive than most industries.
Over the past decade, the average U.S. manufacturer has spent about 3
percent of revenue on capital expenditures. The comparable figure for
U.S. freight railroads is close to 19 percent, or about six times
higher. Railroads know that if America's future transportation demand
is to be met, they must have the capacity to handle it. Railroads are
preparing for tomorrow today.
Capital Spending as % of Revenue
------------------------------------------------------------------------
------------------------------------------------------------------------
Average all manufacturing 2.9%
Food 2.2%
Petroleum & coal products 2.4%
Machinery 2.6%
Fabricated metal products 3.1%
Primary metal products 3.1%
Wood products 3.1%
Motor vehicles & parts 3.2%
Chemicals 3.4%
Plastics & rubber products 3.6%
Paper 4.0%
Nonmetallic minerals 4.8%
Computer & electr. products 5.1%
Class I Railroads 19.1%
------------------------------------------------------------------------
Avg. 2007-2016
Source: Census Bureau, AAR
Thanks to their massive investments, freight railroad
infrastructure today is in its best overall condition ever--quite a
contrast to, say, America's highway network. The challenge for
railroads, and for policymakers, is to ensure that the current high
quality of rail infrastructure is maintained, and that adequate freight
rail capacity exists to meet our nation's current and future freight
transportation needs. Policymakers can help by avoiding policies that
discourage rail investment.
Always Pushing to Improve Safety
For our nation's railroads, pursuing safe operations is not an
option, it's a business imperative. Most importantly, it's the right
thing to do. Railroads are not just faceless corporations from
somewhere far away. Rather, your neighbors are their neighbors. No
matter where you live, chances are good that current or former rail
industry employees live nearby. Railroads know they have an obligation
to operate safely for their benefit and for the benefit of all members
of the communities they serve.
Railroads recognize they've not yet reached their goal of zero
accidents and injuries, but we should all be encouraged by their
progress. Recent years have been the safest for railroads in history.
From 2000 to 2018, the train accident rate fell 35 percent, the
employee injury rate fell 48 percent, and the grade crossing collision
rate fell 36 percent. Railroads today have lower employee injury rates
than most other major industries, including trucking, airlines,
agriculture, mining, manufacturing, and construction--even food stores.
Rail operations are subject to stringent safety oversight by the
Federal Railroad Administration (FRA). For example, stringent FRA
regulations cover track and equipment inspections, employee
certification, operating speeds, and signals. FRA safety inspectors
(and in some states, state inspectors) evaluate rail facilities and
operations. Railroads are also subject to oversight by the Occupational
Safety and Health Administration, the Pipeline and Hazardous Materials
Safety Administration, and the Department of Homeland Security.
Railroads are constantly incorporating new technologies to improve
safety. Just a few examples: sophisticated detectors along tracks that
identify defects on passing rail cars; ground-penetrating radar that
identifies problems below ground, such as excessive moisture, that
could destabilize track; and specialized rail cars that use
sophisticated instruments to identify defects in tracks.
Many railroad safety-related technological advancements were
developed or refined at the Transportation Technology Center, Inc.
(TTCI), the finest rail research facility in the world, in Pueblo,
Colorado. TTCI is a wholly owned subsidiary of the AAR. Forty-eight
miles of test tracks, highly sophisticated testing equipment,
metallurgy labs, simulators, and other diagnostic tools are used to
test track structure, evaluate freight car and locomotive performance,
assess component reliability, and much more. The facility is leased by
the FRA from the state of Colorado, but has been operated by TTCI since
1984.
Rail industry safety is also being enhanced by the Asset Health
Strategic Initiative (AHSI), a multi-year rail industry program that is
applying advanced information technology processes to improve the
safety and performance of freight cars across North America. Through
this program, advanced defect detection systems use a wide array of
sensors to identify potential problems with freight cars and freight
car components such as wheels, axles, bearings, and brakes. Advanced
analytical programs flag suspect railcars so they can be removed from
service and fixed before issues arise. Freight cars often travel across
the networks of different railroads, but thanks to the sharing of
information at the individual railcar level facilitated by AHSI, no
matter where a particular railcar is at a particular time, preemptive
action can be taken. The sharing of information across the industry
allows problems to be detected that would not be detectable otherwise.
AHSI is based on the recognition that the best approach to railcar
health encompasses monitoring the entire railcar life cycle.
Finally, freight railroads are committed to safely completing the
implementation of positive train control (PTC) as quickly as possible
so that further safety gains can be achieved. The seven Class I freight
railroads all met statutory requirements by having 100 percent of their
required PTC-related hardware installed, 100 percent of their PTC-
related spectrum in place, and 100 percent of their required employee
training completed by the end of 2018. In aggregate, Class I railroads
had 93 percent of required PTC route-miles in operation as of October
2019. Each Class I railroad expects to be operating trains in PTC mode
on all their PTC routes no later than 2020, as required by statute. In
the meantime, railroads, in coordination with Amtrak, other passenger
railroads, and other tenant railroads, are continuing to test and
validate their PTC systems thoroughly to ensure they are interoperable
and work as they should.
Changing Markets Present a Serious Challenge to Railroads
Freight railroads are what economists call a ``derived demand''
industry. This means that demand for rail service is a function of
demand elsewhere in the economy for the products railroads haul. For
example, automakers' demand for rail service rises when consumers are
buying more cars but dries up if consumers stop buying cars. Therefore,
what affects the broad economy affects railroads too.
It's no secret that the economy has not been doing as well,
especially recently, as we all would like, and rail traffic has
suffered accordingly. Total rail carload and intermodal volume in 2019
through October was down 4.4 percent over the same period last year.
Weakness in U.S. rail volumes today is consistent with an economy in
which manufacturing and commodity-related industries especially are
hurting. The ongoing trade war and accompanying uncertainty has had the
most direct impact on manufacturing and commodity-related industries
that are heavily served by railroads. Railroads are hopeful that this
uncertainty will be eliminated and that firms here and abroad can again
devote full attention to helping our economies grow.
Railroads are also impacted by what's happening in specific
industries. Wheat is a good example. In a typical year, exports account
for more than 40 percent of U.S. wheat production and railroads move
approximately 60 percent of U.S. wheat exports. When wheat producers
elsewhere in the world have good crops, or when trade restrictions are
put into place, U.S. wheat exports--and, consequently, U.S. rail
carloads of wheat--are impacted.
All this illustrates that the U.S. and global economies are
constantly evolving. Firms, even entire industries, can and do change
rapidly and unexpectedly, and railroads must be able to deal with that
flux. These broad, often unanticipated economic changes are reflected
in changes not only in the volumes but also in the types and locations
of the commodities railroads are asked to transport, and in the amounts
and uses of railroad assets. When traffic changes occur in different
areas--as is usually the case and has certainly been the pattern in
recent years--the challenges to railroads become magnified.
To successfully adapt to these challenges, railroads must be
flexible and innovative while improving the efficiency and productivity
needed to maintain their long-term financial health. Railroads may also
have to invest in additional capacity to meet changing demand. Public
policies that hamstring railroads by preventing or limiting this
flexibility and innovation are sure to have a negative impact on
railroads and on their ability to meet the transportation needs of our
evolving economy.
The Importance of Appropriate Public Policies
Prior to passage of the Staggers Rail Act of 1980, excessive
regulation put our nation's freight railroads in a huge financial and
operational hole. By enacting Staggers, Congress recognized that
regulation prevented railroads from earning adequate revenues and
competing effectively. Survival of the railroad industry required a new
regulatory scheme that allowed railroads to establish their own routes,
tailor their rates to market conditions, and differentiate rates on the
basis of demand.
One of the fundamental principles of the Staggers Act was something
that had been essentially ignored for decades prior to it: if our
nation is to have a viable, efficient, privately owned freight rail
system, someone has to be willing to pay for it, and the market is far
superior to the government in determining who should pay.
Importantly, the Staggers Act did not completely deregulate
railroads. In addition to retaining authority over a variety of non-
rate areas, the Interstate Commerce Committee, and now its successor,
the Surface Transportation Board (STB), retained the authority to set
maximum rates if a railroad is found to have ``market dominance'' and
to take other actions if a railroad engages in anticompetitive
behavior.
Nevertheless, some rail customers and their supporters in Congress
and elsewhere want the STB to make major changes in the scope and
intensity of railroad rate and service regulation. Most of these
changes would, in one way or another, limit the prices that railroads
can charge and therefore limit the revenue railroads can earn. If
successful, these regulatory changes would make it much more difficult
for railroads to make the investments they need to maintain and upgrade
their networks and to provide the safe, efficient, and reliable service
their customers need to prosper.
It would be a grave mistake to let this happen. A fundamental tenet
of the economics of competition says that where competition exists,
there should be no regulatory intervention. Because the vast majority
of rail freight movements are subject to strong competitive forces--
including competition from other railroads, from trucks and barges,
product competition \1\, and geographic competition \2\--the vast
majority of rail movements should likewise be free of governmental
oversight. Moreover, no amount of rhetoric about ``competition'' can
change the fact that if a railroad cannot cover its costs, it cannot
maintain, replace, or add to its infrastructure and equipment. Nor can
it provide the services upon which its customers depend. Simply put, if
the existing balanced regulatory structure were changed, either
taxpayers would have to make up the difference or the industry's
physical plant would deteriorate, and needed new capacity would not be
added. The rail industry would not collapse overnight, but over time
rail service would become slower, less responsive, and less reliable.
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\1\ Substituting one product for another in a production process--
for example, generating electricity from natural gas (which is not
carried in significant amounts by railroads) instead of coal (which
is).
\2\ The ability to obtain the same product from, or ship the same
product to, a different geographic area. For example, clay is used for
taconite pelletization in Minnesota. This clay is available from
Wyoming mines served by one railroad and from Minnesota mines served by
another. Iron ore producers can play one railroad against the other for
clay deliveries.
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It's true that freight railroad financial performance in recent
years has been better than it once was. However, policymakers should
not view these improvements as a reason to cap rail earnings through
price controls or artificial competitive constraints, since it would
cause capital to flee the industry and severely harm railroads' ability
to reinvest in their networks.
Today, our nation faces a number of serious transportation-related
problems, many of which this Committee, to its credit, is working hard
to address. It makes no sense to add to that list by trying to fix
something that isn't broken. The current rail regulatory system is
working well. At a time when the pressure to reduce government spending
on just about everything--including transportation infrastructure--is
enormous, it makes no sense to enact public policies that would
discourage private investments in rail infrastructure that would boost
our economy and enhance our competitiveness.
With respect to FAST Act reauthorization priorities, the freight
railroad industry supports the following:
(1) Highway-Rail Grade Crossing Safety
Reducing accidents and fatalities at highway-rail grade crossings
is of paramount importance given that most collisions are preventable.
Engineering solutions (such as closing unneeded crossings and upgrading
warning devices), education and enforcement are key. Thanks in part to
the Section 130 federal program, grade crossing collisions are down 37%
from 2000 to 2018, but much work remains.
The federal Section 130 program, which provides funds to
eliminate hazards at highway-rail grade crossings, should continue to
receive dedicated, formula funding out of the Highway Safety
Improvement Program.
Funding for Section 130 should be maintained at least at
current levels ($245 million in fiscal year 2020) or increased.
Increase Section 130 incentive payments for grade
crossing closures from the current cap of $7,500 to $100,000.
Expand flexibility in the use of Section 130 funds by
eliminating the arbitrary 50% cap on spending for hazard elimination
projects and by enabling replacement of certain protective warning
devices.
Enable costs by public and private entities incurred for
preliminary engineering for grade crossing projects to be counted
toward the non-federal share.
Enable or incentivize states to bundle grade crossing
projects into a single grant application under applicable discretionary
grant programs, such as BUILD, INFRA or CRISI.
Require or incentivize accelerated deployment of
navigational warnings for motorists (e.g., smartphone apps) to warn of
grade crossings.
Require future fleets of automated vehicles to provide
grade crossing warnings and/or prevention of incursions into grade
crossings where gates or other devices have been activated.
Require grade crossing safety training in driver
education curricula at NHTSA through recommendations to states.
Authorize at least $3 million per year for Operation
Lifesaver through FHWA, FRA and FTA.
(2) Innovations for Deployment of Safety Technologies
Freight railroads require a modernized approach to federal
regulations that allows them to innovate with new technologies and
processes for an even safer and more efficient rail network. The
current regulatory approach to rail safety is largely prescriptive and
does not easily allow for the incorporation of the best technologies to
improve safety and performance. Safety and efficiency improvements
should be encouraged by the FRA.
(3) Project Permitting Reforms
While much has been done in recent years to cut the red tape
associated with infrastructure project approval and construction, more
can be done to fast-track routine maintenance and replacement
construction projects without sacrificing environmental or historical
preservation concerns. These include:
Codify that a categorical exclusion and a Finding of No
Significant Impact are the only NEPA documentation needed on projects
where replacement of infrastructure on existing operating railroad
right-of-way is the purpose.
Convert select executive orders on streamlining the
permitting process--such as timeclocks, intermediate deadlines and One
Decision for large projects--to statute.
Continue streamlining the Sec. 106 historic preservation
review process, especially for projects needed to enhance or maintain
safety.
(4) Support Funding for Amtrak & Public Partnering with Freight
Railroads
The freight railroad industry supports funding for grant programs
that enable the public sector, including state and local governments
and passenger and commuter railroads, to partner with freight railroads
to advance projects of mutual interest, including projects to help
lessen road and port congestion, enhance safety at highway-rail grade
crossings, improve port connectivity, facilitate intercity passenger
and commuter rail service and improve the quality of life for
communities. The following programs should continue to be authorized at
existing or increased levels:
INFRA Discretionary Grants ($1 billion in FY 2020). Caps
should be upwardly adjusted or removed on multimodal freight
eligibility in proportion to General Fund contributions to the HTF.
BUILD Discretionary Grants (not authorized, but typically
$1 billion appropriated).
CRISI Discretionary Grants ($330 million in FY 2020).
Federal-State Partnership for State of Good Repair ($300
million in FY 2020).
Funding and authorization for Amtrak and state-supported
passenger routes.
(5) Restore the Highway Trust Fund to a True User-Based Fund
The current underpayment by road users, especially commercial
trucking, has required a transfer of some $144 billion in General Funds
to the HTF over the past ten years. Consequently, the rail sector is
perennially placed at an unfair competitive disadvantage.
Support mechanisms such as an increase in the gas tax, a
vehicle miles traveled fee or a weight-distance tax that could help
remedy this fundamental imbalance.
Oppose measures to fund the HTF that would increase taxes
or fees on freight railroads.
Retain a competitive tax environment for the private
sector.
(6) Oppose Policies that Harm Railroads' Ability to Operate Safely and
Efficiently
Congress must reject policies that would disadvantage the freight
railroad industry, the most environmentally friendly way to move
freight over land. These include:
Proposals to allow longer and heavier trucks on roads,
bridges and highways, until, at a minimum, trucks of all legal
dimensions pay the full cost of the damage that they cause to publicly
provided infrastructure.
Mandates requiring specific operating models such as
railroad crew size.
Mandates resulting in property takings on railroad rights
of way for utility or broadband access.
Conclusion
America's freight railroads are working toward a single goal: to
ensure that they remain the safest, most efficient, cost-effective, and
environmentally-sound mode of transportation in the world. They are
always willing to work cooperatively with you, other policymakers,
their employees, their customers and all other interested parties to
advance our shared interests in moving our nation forward with the help
of our best-in-the-world freight railroads.
Mr. Lipinski. I thank you, Mr. Jefferies. I am going to go
back and make sure I say this, because I think I did--I forgot
to do it: Mr. Jefferies is the president and CEO of the
Association of American Railroads.
And I was up here for Ms. Goodchild, so I know I skipped
that, and Ms. Anne Goodchild is a Ph.D. and founding director,
Supply Chain Transportation and Logistics Center, University of
Washington. So I wanted to go back and correct that.
And I will recognize Mr. Jason Mathers, the director of
vehicle and freight strategy with the Environmental Defense
Fund.
Mr. Mathers, you are recognized.
Mr. Mathers. Great, thank you, Chair Lipinski, Chair
Norton, Ranking Members Davis and Crawford, and members of the
subcommittee for having me here today.
Now is the time to implement policies that will reduce air
pollution and set us on a path of net zero carbon emissions by
2050.
Earlier this year, the Senate Environment and Public Works
Committee unanimously approved its version of the highway
reauthorization bill. And for the first time ever, it included
a title on climate change. This committee can build on that
effort in its version, and lock in the certainty needed to
unleash public and private investment to clean up the
transportation sector.
Pollution from freight transportation has pernicious health
impacts on communities near freight facilities and highways.
Heavy trucks are, by far, the most significant source of
freight pollution. Yet reducing pollution from freight movement
is not primarily a technology matter. It is a matter of
political will.
The operational and equipment choices that can drive down
air pollution are well-known. Many of these are being used
today to create business value while improving community
health. With congressional leadership we can make tremendous
strides in reducing the nearly 11,000 premature deaths annually
that occur from exposure to freight pollution in this country,
and put the sector on a path to contribute to 100 percent clean
economy by 2050.
A few years back, I authored the ``Green Freight
Handbook,'' which examined opportunities for freight shippers
to reduce pollution. This work was based on projects EDF
undertook with large companies, including Walmart, FedEx, Ocean
Spray, and Caterpillar, among others. We condensed into three
broad categories the range of tactics companies can use to
reduce freight pollution and transportation costs. These are,
first, get the most out of every move, which is about making
sure that we use our freight capacity to the fullest; second,
choosing the most efficient mode of transportation, which is
about sending goods intermodally, rather than just by truck
alone; and demand cleaner equipment.
My testimony has examples of all these categories. I will
focus now on this last category.
Zero-emission heavy-duty vehicles are increasingly viable
for freight. Services these trucks can do today include
transporting cargo in and out of ports like NFI, one of the
Nation's largest fleets, is doing today in L.A.-Long Beach;
moving freight from a distribution center to a retail outlet
like Penske is doing for a leading quick service restaurant
chain; positioning trailers within a distribution yard, as
Kraft is doing in Ohio; and delivering packages to businesses
and homes, as FedEx is doing.
We should invest in these trucks with policies that reward
innovation and recognize the full cost of operating combustion
engines. Investing in zero-emission trucks is a win-win
opportunity. Fleets want these trucks, as they can drastically
reduce fuel spend. Developing the manufacturing capacity for
these vehicles will support good jobs. And households across
this country will see lower cost goods.
Congress can make this investment through policies that
advance four objectives: first, encourage the production of
zero-emission heavy-duty vehicles; second, increase the demand
for these vehicles; third, ensure public expenditures drive
just and equitable outcomes; and fourth, support the
development of appropriate charging infrastructure.
As this committee considers the highway reauthorization, I
want to provide two specific ideas.
First, create a commission to develop strategies for
transitioning drayage trucks, those trucks moving goods in and
out of ports and rail yards, to zero emission. The work
performed by these trucks is a great match for the zero-
emission technology. And given that they typically operate in
urban environments, these trucks are highly polluting. There
are unique challenges to move this sector to zero emissions.
These can be overcome. A Federal commission should be
established to develop recommendations for fully transitioning
these vehicles to zero emissions by 2030.
Second, create a Federal revolving loan fund for the
purchase and installation of EV charging infrastructure.
Creating charging systems for trucks remains a barrier.
Congress could create a fund to help offset costs associated
with charging equipment, facility upgrades, and the grid
improvements necessary to power large fleets.
Thank you for the opportunity to be here today. I look
forward to your questions.
[Mr. Mathers' prepared statement follows:]
Prepared Statement of Jason Mathers, Director, Vehicle and Freight
Strategy, Environmental Defense Fund
Thank you Chair Norton, Chairman Lipinski, Ranking Members Davis
and Crawford and members of the subcommittees for the opportunity to
testify today. My name is Jason Mathers. I am the Director of Vehicle
and Freight Strategy for Environmental Defense Fund. EDF is a leading
international nonprofit that creates transformational solutions to the
most serious environmental problems. EDF links science, economics, law
and innovative private-sector partnerships. With more than 2.5 million
members and a global staff of 700 scientists, economists, policy
experts, and other professionals, we're one of the world's largest
environmental organizations.
Overview
Now is the time to implement policies that will reduce carbon
pollution and set us on a path of net-zero carbon emissions economy-
wide by 2050.
Earlier this year, the Senate Environment and Public Works
Committee unanimously approved its version of the Highway
Reauthorization Bill and for the first time ever it included a title on
climate change. This was a major step in accepting that the problem is
real and the title provided some ways to start addressing it. This
committee can build on that effort in its version and lock in the
certainty needed to unleash public and private investment in the
transportation sector, which is the leading source of climate pollution
in the nation.
Every mode of freight transportation has a significant pollution
footprint and pernicious health impacts on communities near freight
facilities and highways. Yet, reducing pollution from the freight
movement is not primarily a technology matter. It is a matter of
political will.
The operational and equipment choices that can drive down air
pollutants, including carbon emissions, are well-known. Many are being
used today to create business value while improving community health
and climate effects. Others will be ready to scale over just the next
couple of years. The most significant uncertainty is whether we will
have the policies in place to reward innovation and recognize the full
cost of operating combustion engines.
With Congressional leadership, we can--by the close of this coming
decade--make tremendous strides in reducing the nearly 11,000 premature
deaths annually that occur from exposure to freight pollution in this
country and put the sector on a path to contribute to a 100% clean
economy by 2050.
As an environmentalist, father of young children and veteran who
cares deeply about the future of this country, I urge us to act.
1. The freight movement has significant impacts on human health and the
environment.
In 2015, transportation pollution resulted in 385,000 premature
deaths globally, with on-road diesel vehicles accounting for half of
this impact--by far the largest contributor. Collectively, on-road
diesel accounted for 3.6 million lost years lived and over $450 billion
in economic damage annually.\1\ In the U.S., international shipping and
on-road diesel--two modes primarily used for moving freight--accounted
for nearly 11,000 deaths in 2015. The health impacts of diesel-fueled
heavy-duty vehicles are concentrated in urban areas, often in
disadvantaged communities close to major freight hubs like distribution
centers and port facilities.\2\
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\1\ Anenberg et al, ``A Global Snapshot of the Air Pollution-
related Health Impacts of Transportation Sector Emissions in 2010 and
2015,'' ICCT and Climate & Clean Air Coalition. (2019)
\2\ Houston, D, Disparities in Exposure to Automobile and Truck
Traffic and Vehicle Emissions Near the Los Angeles-Long Beach Port
Complex, Am J Public Health. 2014 January; 104(1): 156-164.
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EDF has been studying how pollution from fossil-fueled trucks dirty
our air at a hyper-local level, leading to more asthma, heart attacks
and premature deaths. New sensor technology is allowing EDF scientists
to collect data in innovative ways using Google Street View cars and
dense stationary pollution detection networks. With the help of our
partners, we are better able to see how changes in air pollution lead
to harmful health effects that are distributed unevenly.
Our recent analysis in Oakland, California showed that residents
living near one particular freeway that is home to much of the city's
diesel-fueled traffic were exposed to concentrations of black carbon
(soot) 80% higher than those living near a similar road that had less
diesel traffic. The more polluted roadway produced 60% more nitrogen
dioxide--a lung irritating and smog forming gas.
Combining our Google Street View project data with Kaiser
Permanente's electronic health records of over 40,000 people in
Oakland, we found that elderly people living in areas with the most
elevated traffic-related air pollution had a 40% higher risk of heart
attack,\3\ compared to elderly people living in places with less
pollution. This is similar to an individual having a history of
smoking.
---------------------------------------------------------------------------
\3\ Alexeeffet al, High-resolution mapping of traffic related air
pollution with Google street view cars and incidence of cardiovascular
events within neighborhoods in Oakland, CA, Environmental Health (2018)
17:38
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EDF also looked at air pollution hotspots near the Port of Oakland
where diesel-powered ships, trucks and trains transport goods
throughout California and across the United States.
At an intersection near the entrance to the port, EDF
found that black carbon levels were more than three times higher than
the West Oakland neighborhood average.
In a West Oakland neighborhood where homes mix with
industrial facilities and heavy-duty trucks often fill nearby parking
lots, black carbon concentrations were about twice as high as the
neighborhood average at certain busy times of the day.
At a nearby park downwind from a trucking company, air
monitors found increased pollution exposure for children and adults
playing soccer, football and baseball.
We are now undertaking a similar analysis in Houston. The people
living along the heavily industrialized Houston Ship Channel face
higher exposure to air pollution than the region at large.
Freight is a significant--and fast growing--source of climate
pollution. Globally, the sector is on pace to add four gigatons of
additional climate pollution per year by 2050. In the U.S., the freight
sector will emit 535 million metric tons of carbon dioxide emissions in
2020. This pollution is on pace to increase by another 25 million
metric tons annually by 2050.\4\
---------------------------------------------------------------------------
\4\ U.S. Energy Information Agency, Annual Energy Outlook, Table
19. Energy-Related Carbon Dioxide Emissions by End-Use, January 24,
2019.
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Within freight, heavy trucks are--by far--the most significant
source of climate pollution. The phase two EPA greenhouse gas emissions
standards--originally adopted in 2016 with stringency increases in
2021, 2024 and 2027--are critical in slowing the growth of emissions
from this sector. Yet, even with these standards, pollution from
freight trucks is projected to increase by 40 million metric tons of
carbon dioxide between 2036 and 2050. We must do more to ensure long-
term pollution reductions from this sector if we have any hope of
reining in climate pollution.\5\
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\5\ U.S. Energy Information Agency, Annual Energy Outlook, Table
19. Energy-Related Carbon Dioxide Emissions by End-Use, January 24,
2019.
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2. Solutions exist today to significantly reduce this impact.
Heavy-duty trucks require specific focus, as the leading source of
both local and global air pollutants from freight. Zero-emission heavy-
duty vehicles are increasingly viable, as evidenced by the surge of
product announcements over the past two years for parcel delivery
trucks, urban delivery trucks, yard trucks, and regional trucking. Over
two dozen truck models are in production or development. All major
original equipment manufacturers and several new entrants have zero-
emission offerings (see table 1). Reflecting the industry's interest in
a cleaner future, Cummins--which has engines in 70% of trucks on the
U.S. roads--just announced a goal of net-zero emissions in its
operations and products by 2050.\6\
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\6\ Gibson, London, Cummins' most ambitious environmental plan yet
targets net-zero emissions by 2050, Indianapolis Star, November 15,
2019
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While we build for a zero-emission future, we must also push for
further improvements from combustion engine trucks. Reducing emissions
of nitrogen oxides (NOx)--a precursor to ozone--is critical to
providing cleaner air for communities and families across the nation.
NOx emissions standards for heavy-duty vehicles were last issued in
2001 and implementation was completed in 2010. In the nearly 20 years
since the last standards were promulgated, technology has continued to
advance.
It is also clear that additional reductions in ozone forming NOx
are needed from the heavy-duty sector. In places like California--where
much of the state is hard hit by ozone pollution--heavy-duty trucks
still account for 33% of statewide NOx emissions.\7\
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\7\ CARB presentation at Board Hearing, ``Update on the Proposed
Federal Phase 2 GHG and Fuel Efficiency Standards for Medium- and
Heavy-Duty Vehicles,'' Sacramento, July 23, 2015
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Developing technologies, together with the improvement of existing
emissions controls, can provide additional cost-effective, meaningful
in-use NOx reductions from the nation's heavy-duty fleet.\8\ California
is researching the technologies needed to reduce NOx significantly.\9\
Other states recognize the need for further NOx controls.\10\ EPA
announced a Cleaner Truck Initiative to ``update standards for nitrogen
oxide (NOx) emissions from highway heavy-duty trucks and engines.''
\11\ EPA should issue standards that leverages the best technology
options to reduce NOx emissions and protect human health. The agency
should fully partner with California's Air Resources Board in this
effort.
---------------------------------------------------------------------------
\8\ CARB, upcoming ``Draft Technology Assessment: Lower NOx Heavy-
Duty Diesel Engines.''
\9\ California Air Resources Board, Staff White Paper: California
Air Resources Board Staff Current Assessment of the Technical
Feasibility of Lower NOx Standards and Associated Test Procedures for
2022 and Subsequent Model Year Medium-Duty and Heavy-Duty Diesel
Engines, April 2019
\10\ Marin, Arthur, Statement On the U.S. Environmental Protection
Agency (EPA) Cleaner Trucks Initiative, Northeast States for
Coordinated Air Use Management (NESCAUM), November 13, 2018
\11\ U.S. EPA Press Office, EPA Acting Administrator Wheeler
Launches Cleaner Trucks Initiative, November 2018.
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Solutions also exist for international shipping. International
shipping can meet its target of at least halving its emissions by 2050,
and can unleash trillions of dollars of investment opportunities in
sustainable industrial infrastructure--particularly in developing
countries--by using clean fuel such as ``green'' ammonia, as long as
the fuel is produced using untapped renewable potential without
increasing fossil fuel use.\12\ The International Maritime Organization
(IMO) must act quickly to bring in legally enforceable measures to its
April 2018 commitment to reduce the sector's greenhouse gas pollution
by at least 50% by 2050 compared to 2008 levels, and to start reducing
total emissions.
---------------------------------------------------------------------------
\12\ Ash, N. and Scarbrough, T., `Sailing on solar: Could green
ammonia decarbonise international shipping?', Environmental Defense
Fund, London, 2019.
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Demand for air freight is expected to grow, especially with the
dramatic increase in package delivery services. At the most local
level, some shippers are starting to use drones. At the international
level, the International Civil Aviation Organization (ICAO), the UN
body that sets standards for international flights, has capped the net
carbon emissions of these flights at 2020 levels, and adopted a four-
pillar strategy, including new technologies, operational efficiencies,
alternative fuels, and a carbon offsetting and reduction system for
international aviation (``CORSIA''). While considerable work remains to
be done to ensure that CORSIA is implemented with integrity, it is
already spurring investment in lower carbon innovation. The aviation
industry has asked ICAO to adopt a long-term goal for the industry, and
we respectfully suggest that goal should be zero climate impact by
2050.
There are also operational approaches that can reduce emissions
today. EDF worked with leading companies to document three broad
opportunities to reduce freight pollution.
Get more out of every move: We are using only 43% of the capacity
of our freight trucks on the road today, between empty miles and
underutilized ones. Capturing just half of this under-utilized capacity
would cut freight truck emissions by 100 million tons per year and
reduce expenditures on diesel fuel by more than $30 billion a year.\13\
---------------------------------------------------------------------------
\13\ Russell D. Meller, Kimberly P. Ellis, Bill Loftis ``From
Horizontal Collaboration to the Physical Internet: Quantifying the
Effects on Sustainability and Profits When Shifting to Interconnected
Logistics Systems'' Final Research Report of the CELDi Physical
Internet Project, Phase I. September 2012.
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A high profile example of further increasing truck productivity
comes from Walmart. The company set a goal of doubling its freight
efficiency between 2005 and 2015. In 2015, the company delivered 1
billion more cases and drove 460 million fewer miles than in 2005 by
improving truck loading.\14\
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\14\ Mathers, Jason, The Fast and the Furious: A Company's Guide to
Reducing Transportation Emissions, a webinar for the Climate
Collaborative. June 2017.
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Colgate and Kimberly-Clark demonstrated how companies can
collaborate to reduce the number of trucks on the road. The two
companies pooled trips to CVS. Instead of each sending partially filled
trucks to CVS, the companies worked to co-load their freight on the
same trucks. The result was less pollution, fewer trucks and increased
levels of service for CVS.\15\
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\15\ Logistics Management, Getting from Me to We: Creating a Shared
Distribution Infrastructure, June 2014.
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Choose the most carbon-efficient mode of transportation: Typically,
the more carbon intensive option for transportation is also the most
expensive. Air freight emits 47 times more carbon per ton-mile than
container ships, while costing 6.5 times more.\16\ Because rail is
about 3.5 times more fuel efficient than trucks, companies can lower
costs at least 15-20% with intermodal rail based primarily on fuel
savings.\17\
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\16\ Simchi-Levi, David, Operations Rules, 2010, Massachusetts
Institute of Technology.
\17\ Kane Is Able, Look Who's Riding the Rails, 2013.
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Ocean Spray was shipping products by truck from a manufacturing
facility in New Jersey to a Florida distribution center. Both Ocean
Spray facilities were a short distance from rail yards used by a
competitor, Tropicana, which shipped orange juice north from Florida in
special refrigerated boxcars, via CSX Rail. These boxcars often
traveled empty back to Florida. Tropicana's third party logistics
provider (3PL) saw an opportunity for collaboration and proposed that
Ocean Spray operate an intermodal lane from New Jersey to Florida that
would put Tropicana's empty cars to use. By going from truck to rail
and taking advantage of ready rail capacity, Ocean Spray cut
transportation costs more than 40% for that lane and reduced greenhouse
gas emissions by 65%.\18\
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\18\ Bradley, Peter, Collaboration bears fruit, DC Velocity, May
2013.
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Demand cleaner equipment: Companies using freight services have a
responsibility to push for the cleanest equipment available.
Anheuser-Busch is deploying 21 Class 8 battery-electric trucks. It
is also testing Class 8 fuel cell trucks.\19\ The company set a goal to
convert its long-haul dedicated fleet to renewable powered trucks by
2025.\20\
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\19\ Transport Topics, Anheuser-Busch, Nikola, BYD Complete First
Zero-Emission Beer Run, November 21, 2019.
\20\ ABInBev, Climate Action: Anheuser-Busch Drives Leadership in
Clean Energy, February 14, 2016
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IKEA is insisting on zero-emission home deliveries from its
carriers. In 2020, it will demonstrate this model in five cities and
expand it globally by 2025.\21\
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\21\ Peters, Adele, Ikea is quickly shifting to a zero-emissions
delivery fleet, Fast Company, September 2018.
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3. The United States of America would benefit by immediately adopting
these solutions
By leading a transition to a freight industry that supports a 100%
clean economy, the U.S. will be well positioned to retain and expand
manufacturing jobs. Automotive manufacturing employs a million U.S.
workers.\22\ These jobs occur across the country \23\ and support both
the domestic and export market. Manufacturing zero-emission heavy-duty
vehicles can provide good paying, union jobs.\24\
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\22\ U.S. Bureau of Labor Statistics, Automotive Industry:
Employment, Earnings, and Hours, September 2019
\23\ BlueGreen Alliance, VISUALIZING THE CLEAN ECONOMY: THE
AUTOMOTIVE SECTOR.
\24\ Dean, S., Unionizing L.A. bus workers and their CEO come
together over fighting climate change, Los Angeles Times, Nov 2019
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Global markets will see much of the growth in truck fleets in the
decade ahead.\25\ If the U.S. invests in developing zero-emission
trucks, our manufacturers will be well positioned to serve these
markets. Conversely, failure to invest in these trucks risks
disadvantaging U.S. manufacturers in the global marketplace where other
markets--notably China and Europe--are already investing in their
domestic manufacturing capacity for zero-emission heavy-duty vehicles.
---------------------------------------------------------------------------
\25\ McKinsey & Company, ``ROUTE 2030--A Regional View of Truck
Industry Profit Pools,'' (2018)
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In addition to reducing healthcare costs associated with diesel
pollution, an investment in zero-emission trucks will help cut costs
for families. The average U.S. household spends $1,100 a year to fuel
heavy-duty trucks,\26\ which are paid through higher prices at the
store. Zero-emission trucks will significantly reduce fuel costs, while
also lowering the total cost of ownership.\27\
---------------------------------------------------------------------------
\26\ Cooper, Mark, PAYING THE FREIGHT: THE CONSUMER BENEFITS OF
INCREASING THE FUEL ECONOMY OF MEDIUM AND HEAVY DUTY TRUCKS, Consumer
Federation of America, August 2015
\27\ California Air Resources Board, Advanced Clean Trucks Total
Cost of Ownership Discussion Document Preliminary Draft for Comment,
February 2019.
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4. The U.S. Congress should pass policies that increase the adoption of
these solutions today and invest in the development of
solutions that can further drive progress over the next decade.
Given the outsized pollution impact of trucking, I will focus my
recommendations on this sector and outline how the U.S. Government can
help accelerate a transition to a net-zero emissions future.
Despite the recent zero-emission truck product announcements, the
pace of progress remains much too slow. At our current pace of
adoption, diesel trucks will still account for more than half of the
trucks on the road in 2050.\28\ Federal policy leadership will be
critical to accelerate the uptake of zero-emission vehicles, which
would drive down carbon emissions; reduce air pollution, especially in
urban communities; and strengthen a cornerstone manufacturing base that
provides well-paying jobs. EDF urges Congress to enact policies that
ensure zero emission vehicles account for at least 30% of new heavy-
duty vehicles sales nationally by 2030.
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\28\ EDF analysis: Extrapolated annual market growth rates
Bloomberg New Energy Finance projected for each sector in its 2019 EV
Outlook report. EDF assumed 12 year turn over cycle and that the 2050
fleet volumes per sector reflect 2019 mix.
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A well-designed policy can advance four objectives that
collectively will determine the impact and pace of adoption for zero
emission trucks. These objectives are:
Encourage the production of zero-emission heavy-duty
vehicles.
Increase the demand for zero-emission heavy-duty
vehicles.
Ensure public expenditures drive just and equitable
outcomes.
Support the development of appropriate charging
infrastructure.
Encourage the production of zero-emission heavy-duty
vehicles.
Policy can create the long-term certainty necessary to stimulate
production investments from truck manufacturers and component
suppliers. The federal government also has an important role in
catalyzing the development and scaling of advanced technology solutions
through robust R&D investments. To advance this objective, the U.S.
Congress could:
Launch a heavy-duty version of the Advanced Technology
Vehicles Manufacturing Direct Loan Program. Through this program, the
U.S. Government provided direct loans for light-duty vehicle
manufacturers to produce fuel efficient cars. This program supported
the production of over 4 million advanced technology vehicles and
invested $8 billion into American auto manufacturing. A similar program
would enable manufacturers to expedite bringing ZEV trucks to market.
Increase and expand R&D funding for heavy-duty vehicle
technologies. Through the DOE Office of Energy Efficiency and Renewable
Energy, the U.S. Government supports critical research into advanced
vehicle technology. The Super Truck program, for example, has played a
critical role in accelerating the introduction of vehicle efficiency
solutions. Increased funding could be targeted at technology
advancements such as enhancing charging systems and advancing battery
design to enable lighter, more energy-dense and lower-cost batteries.
Additionally, the U.S. EPA should strengthen emission standards for
heavy-duty vehicles. The EPA regulates greenhouse gas and criteria
emissions from heavy-duty vehicles. The current GHG program standards
increase in 2021, 2024 and 2027. However, criteria emissions standards
have not changed since 2010. Technology advancements, including the
emergence of zero-emission solutions, necessitate a significant
strengthening of this program.
Increase the demand for zero-emission heavy-duty vehicles.
Another critical policy lever is to bolster market demand for these
vehicles. To advance this objective, the U.S. Congress could:
Expand the Low or No Emission Vehicle Program. Transit
buses are largely purchased with funding contributions from DOT's
Federal Transit Administration (FTA). FTA's Low or No Emission Vehicle
Program provides competitive grants for state and local governments to
purchase zero- and low emission transit buses and infrastructure. Given
that electric buses are a viable option for much of the nation's fleet
and will further expand their appeal as battery costs continue to fall,
this program should be expanded significantly.
Pass the Green Bus Act. EDF supports the Green Bus Act,
introduced by Rep. Brownley, which would increase the funding for this
program from $85 million in 2019 to $900 million in 2029 and require
all new transit buses to be zero-emission by 2029.
Expand the Diesel Emissions Reduction Act (DERA). DERA,
which was first enacted in 2010, funded a highly popular and bipartisan
set of projects that protect human health and improve air quality by
curbing diesel emissions. It is currently funded at $75 million a year.
A significant increase in this program to support the replacement of
old diesel vehicles with ZEVs could help increase fleet turnover and
get more ZEVs on the road as quickly as possible.
Suspend the federal excise tax on zero-emission trucks.
New heavy-duty trucks pay a 12% federal excise tax to provide funding
for the Highway Trust Fund. This tax is based on the purchase price of
the vehicle and therefore exacerbates the upfront cost discrepancy
between diesel and ZEV vehicles, as the more advanced technology in
ZEVs--which leads to significantly lower operating costs--currently
results in higher upfront costs than diesel vehicles. Policymakers
should waive this tax for ZEVs through the mid-2020s, when the upfront
cost of diesel vehicles and ZEVs are expected to start converging.
Enact the Clean School Bus Act. Introduced in both the
House (Rep. Hayes) and the Senate (Sen. Harris), the Clean School Bus
Act would authorize $1 billion over five years at the Department of
Energy to fund a Clean School Bus Grant Program, which would award
funding on a competitive basis to replace existing school buses with
ZEV models. Several manufacturers are already producing quality ZEV
buses, including Thomas and Blue Bird. EDF encourages these policies
because the electrification of these vehicles will help reduce
children's exposure to harmful diesel emissions while reducing GHG
emissions.
Ensure public expenditures drive just and equitable
outcomes.
The pernicious health impacts of diesel trucks disproportionately
impact low-income communities and communities of color. Policies should
prioritize replacing combustion vehicles with ZEVs in these
communities. To advance this objective, the U.S. Congress could:
Prioritize deployments of ZEVs within front-line
communities. Grant programs that support the adoption of ZEVs, such as
the Low/No Emissions Vehicle Emission program for transit buses and the
DERA should give preference to vehicle deployments within highly
impacted communities.
Create a commission to develop strategies for
transitioning drayage trucks to ZEVs. Drayage trucks--which transport
goods over short distances, for example, hauling cargo in and out of
ports and rail yards--are often old and poorly maintained. The low-
speed, high idling operation of these vehicles exacerbates the
shortcomings of diesel emission control equipment. These vehicles also
operate in densely populated areas. The combination of these factors
results in drayage trucks being a significant contributor to poor air
quality in numerous major metro areas. ZEV demonstrations are currently
underway, but while the technology is ready, several systemic barriers
remain to the wide-scale adoption of ZEVs for drayage. These include
the lack of charging infrastructure to serve drayage drivers and few
financing options for drayage operators seeking ZEVs. Given that the
performance requirements of drayage operations pair well with the EV
drivetrain, and the urgent need to drive down pollution around ports
and rail yards, a federal commission should be established to develop
recommendations for transitioning these vehicles to zero emissions by
2030.
Support the development of appropriate charging
infrastructure.
A well-developed charging network is essential to accommodating
large-scale deployments of electric vehicles of all kinds. This
infrastructure should be deployed to effectively alleviate range
anxiety, mitigate expensive, unnecessary grid upgrades, and facilitate
greater integration of renewable energy. To achieve a robust charging
network, Congress should direct the Department of Transportation (DOT)
and the Department of Energy (DOE) to work with states to define a
comprehensive national EV charging infrastructure plan. Such a plan
should, among other things, detail how Congress should:
Create a grant program to help states and municipalities
develop and implement charging programs. Provide technical assistance
to states regarding technology choices, purchasing practices,
infrastructure options and siting.
Create a grant program to incentivize commercial fleet
operators and owners of large, non-government-owned parking facilities,
to install charging stations.
Create tax incentives for private companies to develop
employee and customer charging opportunities. Reward companies that tie
their charging networks to renewables, local storage, and utility
providers' demand response programs.
Create a federal revolving loan fund for the purchase and
installation of EV charging infrastructure. Such a fund could be
targeted at state and local governments and multijurisdictional transit
agencies. Separate portions of the funds should be dedicated to
creating infrastructure designed for use by light-duty and by heavy-
duty vehicles. Large trucks and buses will have significantly different
charging patterns than light-duty vehicles. These vehicles will have
larger batteries, use most of their capacity daily and be mainly
recharged at centralized facilities while also using some opportunity
charging during their daily operations. Providing infrastructure funds
specifically for this class of vehicle would help offset costs
associated with charging equipment, facility upgrades and grid
improvements necessary to power large fleets.
Research, develop and fund best practices for depot
charging. Given their distinct needs and patterns from light-duty
vehicles, heavy-duty vehicles would benefit from dedicated research
into how to manage their charging load. DOE should identify
opportunities for heavy-duty vehicle electrification through a report
similar in scope to the National Plug-In Electric Vehicle
Infrastructure Analysis it conducted in September 2017. DOE should then
make grants available to realize the opportunities identified in that
report.
Enact an investment tax credit for large-scale storage.
Opportunities to enhance the use of renewables-based charging and to
facilitate and encourage grid integration can be multiplied
exponentially if Congress were to increase incentives for the
deployment of large-scale storage. The goal would be to develop and
advance--in Congress and in willing states--policies to achieve
additional emissions reductions through the integration of electric
charging infrastructure with local grids. Such initiatives would focus
on policies that:
Encourage the use of renewable energy and storage
solutions to power charging stations. This work is a critical component
of ensuring that electrification actually delivers the maximum
potential emissions reductions.
Demonstrate the use of smart charging infrastructure,
storage and EV batteries to reduce utility grid impact through advanced
services such as time-of-use rates, as well as balancing and ancillary
services using ``virtual power plants.'' Leveraging the flexibility in
these technologies can provide significant additional emissions
reductions by, for example, alleviating the need for fossil fuel based
short duration generation.
Conclusion
Reducing pollution from the transportation sector presents a
significant challenge for the U.S. and the world. However, EDF's work,
and that of our partners and colleagues in the private sector,
universities and research centers underscore that the solutions--most
notably the electrification of heavy-duty vehicles--are cost-effective
and technologically feasible. While freight is a major source of air
pollution, solutions are at hand, and Congress should act to provide
the needed support to make the transportation sector a part of a 100%
clean economy. Doing so will help bolster our manufacturing base,
create jobs, and position the U.S. to export solutions globally, while
equitably reducing health impacts to communities and showing global
leadership in fighting climate change. The Senate took the first step
by including a climate title in its highway reauthorization bill. Now
the House can build on that foundation to create investment certainty
for businesses, towns, states and the federal government.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Lipinski. Thank you, Mr. Mathers.
I now recognize Mr. Jim Tymon, executive director, American
Association of State Highway and Transportation Officials.
Mr. Tymon, you are recognized.
Mr. Tymon. Thank you. Chair Norton, Chairman Lipinski,
Ranking Member Davis, Ranking Member Crawford, and members of
the subcommittee, thank you for the opportunity to provide the
perspective of the Nation's State departments of transportation
on freight transportation.
My name is Jim Tymon, and I serve as the executive director
of the American Association of State Highway and Transportation
Officials. And it is my honor to testify on behalf of AASHTO's
membership, comprising the State departments of transportation
for all 50 States, Washington, DC, and Puerto Rico.
My remarks today center around the following key points:
importance of freight transportation in the context of surface
transportation reauthorization; AASHTO's core principles for
reauthorization, including freight, Federal freight policy, and
specific freight policy recommendations for the next surface
transportation bill.
State DOTs strive to deliver the most effective and
efficient surface transportation system that strengthens and
grows the economy. It is the interconnected national multimodal
transportation system, with States as a principal owner and
operator of that system, that has enabled the United States to
become the most vibrant and powerful Nation in history. To that
end, we strongly support your efforts to enact a well-funded,
multiyear, surface transportation reauthorization bill prior to
the expiration of the FAST Act on September 30th, 2020.
Nearly 2 years ago, AASHTO began soliciting input from
policy experts in all 50 States on surface transportation
reauthorization. Based on this membership-driven approach, I
would like to share with you our core policy principles.
First, ensure timely reauthorization of a long-term Federal
surface transportation bill. Getting the next bill completed on
time will ensure uninterrupted investment in our freight
transportation infrastructure, which, in turn, will enable us
to build on the current economic expansion.
Second, enact a long-term, sustainable revenue solution for
the Highway Trust Fund. Our current funding challenges demand
bold action to invest in our transportation infrastructure.
This action has the clear support of the American public, and
it is time for the President and Congress to make it happen.
Third, increase and prioritize formula-based Federal
funding provided to the States. In the next reauthorization, we
urge you to focus on maximizing Federal formula-based dollars
provided directly to States through the existing highway core
formula programs. Efficient goods movement nationwide is
dependent on the Interstate Highway System and the National
Highway System. Many of these facilities are over 50 years old,
and nearing the end of their useful life. States rely on these
formula dollars to keep these assets in a state of good repair.
The next bill should continue to provide 90 percent of highway
funding to States by formulas, so that States can continue to
provide an efficient system for the movement of people and
freight.
Fourth, we ask that you increase flexibility, reduce
program burdens, and improve project delivery. We recommend
increased flexibility of and transferability between the
various Federal programs to enable States to target their
scarce resources toward the most beneficial freight programs
and projects. Transportation priorities here in the District of
Columbia are different from the priorities in rural Arkansas,
and we should continue to provide States the program-level
flexibility to use Federal dollars as efficiently as possible.
In addition, assigning more decisionmaking authority to the
States and cutting unnecessary redtape will help these projects
get built faster.
Fifth, support and ensure State DOTs' ability to harness
innovation and technology. Specifically, we need to preserve
the 5.9 gigahertz spectrum for transportation, safety, and
connectivity purposes. For example, a U.S. DOT-funded connected
vehicle pilot program on I-80 in Wyoming has used the spectrum
to improve snow-related incident management in the corridor
that carries 55 percent of all traffic in that State.
In addition to these core principles, we recommend in the
next bill that you expand eligibility to use Federal freight
program dollars on any portion of a State's multimodal freight
network, as defined in the State's freight plan; increase FAST
Act freight funding caps for multimodal projects; reinstate
additional funding for the National Cooperative Freight
Research Program; and help identify ways to improve
coordination between States and railroad partners.
State DOTs remain committed to assisting Congress in the
development of the next surface transportation legislation that
further enables freight transportation to improve our quality
of life and grow the economy.
I want to thank you again for the opportunity to testify
today, and I am happy to answer any questions that you may
have.
[Mr. Tymon's prepared statement follows:]
Prepared Statement of Jim Tymon, Executive Director, American
Association of State Highway and Transportation Officials
Introduction
Chair Norton, Chairman Lipinski, Ranking Member Davis, Ranking
Member Crawford, and Members of the Subcommittees, thank you for the
opportunity to provide the perspective of the nation's state
departments of transportation on economic, environmental, and societal
impacts of freight transportation.
My name is Jim Tymon, and I serve as Executive Director of the
American Association of State Highway and Transportation Officials
(AASHTO). Today it is my honor to testify on behalf of AASHTO, which
represents the transportation departments of all 50 States, Washington,
DC, and Puerto Rico.
In my role, I oversee a staff of 120 dedicated professionals who
support our state departments of transportation (state DOT) members in
the development of transportation solutions that create economic
prosperity, enhance quality of life, and improve transportation safety
in communities, states, and the nation as a whole. Before, I was
AASHTO's Chief Operating Officer and the Director of Policy and
Management from 2013 to 2018, working closely with state DOTs in the
development of AASHTO's transportation policy positions and overseeing
the monitoring of legislative, administrative, and regulatory
activities relating to transportation; as AASHTO's COO, I also oversaw
the management of the Association's internal operations. Prior to
AASHTO, I had the great honor to serve as a staff director of the
Highways and Transit Subcommittee, working on both MAP-21 and SAFETEA-
LU.
We appreciate your Subcommittees' focus on the topic of freight
today because we share your recognition that the benefits of freight
transportation to the economy are enormous. Freight transportation
increases the value of goods by moving them to locations where they
worth more. And it also encourages competition and production by
expanding the spatial boundaries of commodity and labor markets where
economic activities can take place. Freight transportation also
facilitates the growing demand for goods and services and employs
millions of people. Simply put, freight transportation and the
infrastructure needed to support it is a significant component of our
nation's wealth and productive capacity.
My remarks today center around the following key points:
Importance of freight transportation in the context of
surface transportation reauthorization
Core principles for reauthorization including federal
freight policy
Specific freight policy recommendations in the next
surface transportation bill
Importance of Freight Transportation in the Context of Surface
Transportation Reauthorization
From the very beginning of our developing nation, we have valued
investment in our freight transportation infrastructure, starting with
rivers, harbors, and post roads, and later taking major leaps through
canals, the transcontinental railroad, and the Interstate Highway
System.
Built on this national heritage of transportation investment, state
DOTs strive to deliver the most effective and efficient surface
transportation system that strengthens and grows the economy by
increasing productivity, enhancing jobs and labor market accessibility,
opening new markets for businesses, and optimizing supply chain
efficiency for freight movement. It is this interconnected national
transportation system--with states as a principal owner and operator of
a multimodal surface transportation infrastructure system--that has
enabled the United States to become the most vibrant and powerful
nation in history.
As such, AASHTO's vision for policy recommendations are founded
upon transportation serving as the key enabler for a higher purpose: to
provide the safest system possible, highest possible quality of life,
and most robust economic opportunities for everyone. And we strongly
support your efforts to enact a well-funded, multiyear surface
transportation reauthorization on time by September 30, 2020. We
believe given the strong bipartisan support from the American public
for robust infrastructure investment, it is time for the President and
Congress to take bold action on this consensus national priority.
Core Principles for Reauthorization Including Federal Freight Policy
Over the past two years, our state DOT experts engaged in a bottom-
up policy development process that resulted in our comprehensive
package of reauthorization recommendations, which was adopted by our
Board of Directors in October. Based on our members' extensive work, I
would like to share with you the following ``core principles,'' which
we believe sets the appropriate federal framework, including for
national freight transportation policy.
1. Ensure timely reauthorization of a long-term federal surface
transportation bill
Funding stability provided by federal transportation
programs is absolutely crucial to meet states' capital investment
needs, which take multiple years to plan and construct.
A long-term transportation bill is needed so that there
is no authorization gap upon FAST Act expiration in September 2020.
Short-term program extensions cause unnecessary program disruptions and
delays safety and mobility benefits to states and communities.
Our state DOT members do everything in their power to deliver
needed priority projects to improve freight movement as quickly as
possible, but due to the nature of large capital programs, including an
extensive regulatory process, many of the projects take several years
to complete. The lack of stable, predictable funding from the Highway
Trust Fund makes it nearly impossible for state DOTs to plan for large
projects that need a reliable flow of funding over multiple years. And
these projects are what connect people, enhance quality of life, and
stimulate economic growth in each community where they are built.
Getting the next long-term surface reauthorization completed on
time will ensure uninterrupted investment in our freight transportation
infrastructure, which in turn will enable our nation to continue
building on the current economic expansion.
2. Enact a long-term, sustainable revenue solution for the Highway
Trust Fund
Ensuring Highway Trust Fund solvency in supporting a six-
year federal surface transportation bill that simply maintains current
FAST Act funding levels, will require approximately $100 billion in
additional revenues for the Highway Trust Fund.
To achieve a state of good repair, USDOT's 2015
Conditions and Performance Report estimates highway and bridge needs at
$836 billion and transit needs at $90 billion, which would require
significant additional investment.
Federal funding solutions can draw upon the experience of
31 states that have successfully enacted transportation revenue
packages since 2012.
Despite substantial and recurring funding challenges facing our
transportation system, the investment backlog for transportation
infrastructure continues to increase--reaching $836 billion for
highways and bridges and $90 billion for transit according to the
United States Department of Transportation. According to the
Congressional Budget Office, in order to simply maintain the current
Highway Trust Fund (HTF) spending levels adjusted for inflation after
the Fixing America's Surface Transportation (FAST) Act, Congress will
need to identify $100 billion in additional revenues for a six-year
bill through 2026. At the same time, the purchasing power of HTF
revenues has declined substantially mainly due to the flat, per-gallon
motor fuel taxes that have not been adjusted since 1993, losing over
half of its value in the last 26 years.
Fortunately, infrastructure investment has been one of the top
national policy agenda items for both Congress and the American people
over these last few years, even if significant action is yet to be
taken at the federal level. Americans get it--they understand the
benefits, and they want to see investment in our transportation
systems. According to a Politico and Harvard poll earlier this year, 79
percent of respondents said that infrastructure investment is,
``extremely important,'' falling just behind lowering prescription drug
prices and substantially reducing the federal deficit on the list of
issues polled.
Infrastructure investment ranks high for both parties, with 88
percent of Democrats and 81 percent of Republicans surveyed calling it,
``extremely important.'' A crucial step we can take to harness this
momentum is to complete the FAST Act reauthorization before October
2020 without relying on any short-term extensions. We believe this
truly is a unique window of opportunity to ensure the continued quality
of life and economic vitality that make America a nation we are proud
to call home. To do this, the situation demands bold action to invest
in our transportation infrastructure at the appropriate level to
guarantee the success of our nation's future. This action has the clear
support of the American public, and it is time for the President and
Congress to make it happen.
3. Increase and prioritize formula-based federal funding provided to
states
The current federal highway program optimally balances
national goals with state and local decision-making.
Formula-based transportation funding reflects the
successful federal-state partnership by ensuring the flexibility
necessary for each state to best meet its unique investment needs.
Congress should increase the formula-based program's
share of the Federal-aid Highway Program from 92 percent currently in
the FAST Act.
The heart and soul of the Federal-aid Highway Program are the
formula dollars supporting state and local investment decisions. This
nation-building program, starting with the Federal-aid Road Act of
1916, established the foundation of a federally-funded, state-
administered highway program, and has been perfectly suited to a
growing and geographically diverse nation like ours. The stable federal
investment enabled by the Highway Trust Fund has allowed states and
their local partners to fund locally critical projects that at the same
time serve the interests of the nation as a whole.
As the full Committee unveils your reauthorization bill early next
year, we urge you to focus on maximizing federal formula-based dollars
provided directly to states though the existing core formula programs
rather than looking at untested new programs and approaches that can
divert the federal government's focus and role in the surface
transportation program.
Congress recognized in the MAP-21 legislation the need to
consolidate a complex array of federal highway programs into a smaller
number of broader programs, with the eligibilities generally continuing
under such programs. This revised program structure was continued in
the FAST Act and it has provided state DOTs with greater flexibility to
deliver projects--including key freight projects--more efficiently, and
it better supports data-driven investment decisions to meet national
performance targets.
Efficient goods movement nationwide has especially benefited from
the formula-based program framework that built the Interstate Highway
System and the National Highway System, the backbone of our national
network of roads and bridges that drives our national economy. This
remains the optimal approach to underpin the next surface
transportation legislation that will serve all corners of our country--
by improving mobility and quality of life in urban, suburban, and rural
areas.
4. Increase flexibility, reduce program burdens, and improve project
delivery
Increase programmatic and funding flexibility to plan,
design, construct and operate the surface transportation system.
Reduce regulatory and programmatic burdens associated
with federal programs that are not part of the project approval
process.
Modernize Clean Water Act, Clean Air Act, and Endangered
Species Act processes to improve transportation and environmental
outcomes and reduce delays.
To streamline and improve project delivery, states should
be provided with opportunities to assume more federal responsibilities
and the associated accountability.
As mentioned earlier, state DOTs are appreciative of the
flexibility in the federal program that supports the right mix of
projects to meet the unique investment needs of their own states. To
further enhance the effectiveness of federal funding, we recommend
increased flexibility of and transferability between the various
federal programs, which will better enable states to target their
scarce resources into the most beneficial freight programs and
projects.
Each program has rules that are not always flexible regarding how
the funds may be used, and each program is governed by transferability
provisions that are established in statute. Specifically, because some
set-aside programs have strict guidelines for use or narrow purposes,
these programs tend to be underutilized. Yet limitations in the
flexibility of set-aside programs prevent states from prioritizing
projects based on local needs, as well as limiting the ability of state
DOTs to maximize the use of available funding if a partner is not ready
to begin a set-aside project.
In addition, given the difficulties that local transportation
partners face in obligating federal fund, we can further improve the
efficiency of how limited federal transportation dollars are put to
work under the suballocated portion of the Surface Transportation Block
Grant Program (STBGP). The latest available data shows that 80 percent
of total unobligated STBGP funds nationwide belong to the suballocated
STBGP even though it comprises 54 percent of total STBGP funding in
2019, rising to 55 percent next year. Increased program-level
flexibility for STBGP would enable state and local governments to
target funding to better meet their needs, whether for preservation,
capacity, safety, or other unmet needs.
With regard to project delivery, even with significant progress
being made in the past decade, getting the projects done--especially
larger improvements--still takes too long and is unduly costly and
delay-prone. We believe there remain opportunities to not only make
continued improvement in the National Environmental Policy Act (NEPA)
process itself, but also in making the NEPA process work more
efficiently with other federal requirements, all the while carefully
and responsibly stewarding optimal environmental outcomes.
Beyond NEPA, AASHTO has identified a number of touchpoints where
states can make determinations in lieu of seeking Federal Highway
Administration (FHWA) approval. Examples include: federal funds
obligation management, project agreements, right-of-way acquisition,
preventive maintenance, repayment of preliminary engineering and right-
of-way costs, and credits toward non-federal share, among many other
possible areas of current federal oversight.
5. Support and ensure state DOT's ability to harness innovation and
technology
Innovative approaches and technologies should be embraced
to achieve a safer and more resilient, efficient and secure surface
transportation system.
State DOTs, as infrastructure owners and operators, need
the 5.9 GHz spectrum for transportation safety and connected vehicle
deployment purposes.
Preserve state and local government authority to regulate
operational safety of autonomous vehicles.
Preserve state and local government authority to
responsibly manage data collected from transportation technologies.
Today, the dramatic technological change underway within the
transportation arena is no less significant than when the combustion
engine was merged with the wagon in the early 1900s. Today, with the
merger of technology between the car, truck and other vehicles--and
with the roadway itself--we will enable unprecedented improvements to
safety and mobility. This will change the way we move goods, services
and people on our roads and highways. It is more important now than
ever that we respect the roles at local, state and federal levels and
work hard to develop a shared vision of this transportation future in
order not to be a bottleneck to continued innovation.
The top priority for the state DOTs and AASHTO has been--and will
always remain--the safety of all transportation system users. The loss
of 36,750 lives last year on our nation's highways and streets demands
that we act boldly. To this end, connected vehicles (CV) utilizing
Vehicle-to-Everything (V2X) communication in the 5.9 GHz spectrum will
save lives by creating a seamless, cooperative environment that
significantly improves the safety of our transportation system. This
dedicated spectrum is currently at risk due to proposed action by the
Federal Communications Commission next week to take away more than half
of the safety band away from transportation safety and connectivity
purposes.
The FCC's proposed action would put great progress, such as what we
recently saw in Wyoming, at risk. To improve safety along the 402 miles
of Interstate 80, the Wyoming Department of Transportation implemented
a USDOT pilot program using DSRC-enabled technology to connect vehicles
to infrastructure and to other vehicles. This corridor along the
southern section of Wyoming is prone to winter crashes affecting both
commercial and private vehicles. It is subjected to some of the most
extreme winter weather conditions--especially blowing snow and vehicle
blow overs--of any highway on the Interstate Highway System. From
October 2015 to September 2016, more than 1,600 crashes occurred on I-
80 in Wyoming, resulting in 18 fatalities and 271 injuries. During this
period, all or parts of I-80 were closed to all vehicles for a total of
over 1,500 hours--impacting not only travelers but also the trucks that
make up roughly 55 percent of the state's total annual traffic stream
and carry more than 32 million tons of freight across the state each
year.
The Wyoming pilot program tested applications, such as advanced
forward collision warnings, to let travelers know of crashes ahead. It
also provided immediate situational awareness warnings about weather
alerts, speed restrictions, and parking availability; detailed and
current work zone warnings; specialized spot weather impact warnings
for ice, fog, and other hazards; and notifications from disabled
vehicles. Other sites under the federal pilot program looked at hot,
humid weather (Tampa, Florida) and congestion (New Jersey/New York
City) applications.
We recognize that oversight of communications technology may lie
outside of your Committee's jurisdiction--but it is important to
understand how the FCC's decision could impact the transportation
sector and the policy priorities of this Committee. So we very much
appreciate your willingness to stand with the state DOTs to make sure
that our nation's highway infrastructure assets are provided the
necessary technology to greatly improve safety outcomes for all users.
Specific Freight Policy Recommendations in the Next Surface
Transportation Bill
Based on the extensive input from the freight policy experts at our
state DOTs, the following are the specific recommendations we would
like to make in the next bill.
Expand the Extent of both the Primary Highway Freight System and
National Multimodal Freight Network
The current definition and limitations of the Primary Highway
Freight System (PHFS), National Highway Freight Network (NHFN) and the
National Multimodal Freight Network (NMFN) will not allow states to
attain the comprehensive goals set forth in MAP-21 and the FAST Act and
do not take into account the geographic and economic differences in
states, including the challenges of rural, large, land-based states and
other concerns of states.
The PHFS network currently consists of 41,518 centerline miles,
including 37,436 centerline miles of Interstate and 4,082 centerline
miles of non-Interstate roads. The designation of PHFS roads in various
states has resulted in a limited and disconnected network. The ability
of a state to designate some additional mileage to the NHFN as critical
urban and rural corridors still leaves an unduly limited and
disconnected network. For the NMFN, the current draft network is
limited and does not include all of the National Highway System (NHS)
roads nor critical rural and urban transportation links.
Since states are required to complete state freight plans, which
must then be approved by USDOT, a framework exists to identify and
define the appropriate freight network in any given state.
We recommend the following changes:
Expand eligibility of the National Highway Freight
Program to include all of the NHFN. Eliminate the 2 percdent rule so
states can spend funds on any NHFN route (to include Critical Urban
Freight Corridors and Critical Rural Freight Corridors).
Expand the PHFS to include all Interstate System roadways
regardless of how much freight funding a state receives. Given that the
Interstate System is just that--a system--a fragmented designation of
the Interstate System is not appropriate to addressing freight
transportation and goods movement. Freight program eligibility should
include all Interstate miles by default.
Remove restrictions on state authority to add mileage to
the PHFS, NHFN and NMFN, including but not limited to mileage caps on
critical urban and critical rural corridors.
Add eligibility to use funds on any portion of a state's
multimodal freight network as defined in a state's freight plan.
Expand Eligible Activities through National Highway Freight Program
The use of the nation's transportation system for freight is
increasing, and with it the need for integrated solutions to better
move freight throughout the country. Currently, no more than 10 percent
of NHFP formula funding may be used for intermodal, freight rail, or
water transportation. Integrated freight management solutions, freight
safety programs, and research supporting future investments should be
codified as eligible for NHFP and INFRA funds in new surface
transportation reauthorization legislation.
We recommend the following changes:
Reform the National Highway Freight Program, both the
formula program to states and the discretionary program (INFRA), to
more clearly include eligibility for investment in integrated freight
technology, management and operations strategies and solutions, freight
safety programs (including for emergency responders), and research
supporting future investments.
Remove the 10 percent multimodal cap to provide
flexibility for states to use discretion in determining the amount of
NHFP formula funding to go toward multimodal freight projects
identified in the state's freight investment plan and to invest more in
multimodal projects if appropriate for that state. Eligibility should
include multi-state proposals and projects for regions and corridors to
improve freight intermodal connectivity.
Changes to Infrastructure for Rebuilding America (INFRA) Discretionary
Grant Program
The FAST Act established a new discretionary grant program for
Nationally Significant Freight and Highway projects. Grant eligibility
is limited to highway projects on the NHFN, highway or bridge projects
on the NHS, railway-highway grade crossing or grade separation
projects, or intermodal or rail projects, including those within the
boundaries of public or private freight facilities.
Under the FAST Act, not more than $500 million in aggregate of the
$4.5 billion authorized for INFRA grants (previously known as FASTLANE
grants) over fiscal years 2016 to 2020 may be used for grants to
freight rail, water (including ports), or other freight intermodal
projects that make significant improvements to freight movement on the
National Highway Freight Network.
We recommend the following changes:
Reauthorize the program and remove or increase the caps
used for grants to freight rail, water (including ports), or other
freight intermodal projects.
Add eligibility to use funds on any portion of a state's
multimodal freight network as defined in a state's freight plan.
Minimize annual changes to the Infrastructure for
Rebuilding America (INFRA) Discretionary Grant Program for consistency
in grant applications and award criteria.
Reinstate the National Cooperative Freight Research Program
Throughout its history, a core element of the FHWA Research,
Development, and Technology Transfer's (RD&T) mission has been to
promote innovation and improvement in the highway system. Over the last
decades, this critical mission element has developed into a broad array
of research and technology activities covering the spectrum of advanced
research, applied research, technology transfer, and implementation.
The National Cooperative Freight Research Program, however, was
last authorized under SAFETEA-LU. MAP-21 and the FAST Act provided much
more emphasis on freight, while simultaneously reducing funding for
freight research at the national level. States are concerned that
freight research needs are not being met solely through the National
Cooperative Highway Research Program (NCHRP). A dedicated national
freight research program is needed.
We recommend the following change:
Reestablish the NCFRP to provide research products to
assist states in their delivery of freight transportation projects with
funding beyond the amount prescribed for the federally-managed Research
Technology & Education programs and State Planning & Research funded
programs.
Railroad Coordination
We heard from our state DOT members in every region of the country
this past summer that restrictions and delays imposed on transportation
agencies by railroad owners, either intentionally or unintentionally,
are significantly affecting the timely delivery of transportation
projects.
We recommend the following changes:
Congress should establish consistent requirements,
commitments, and timeframes across all public and private railroad
owners to facilitate transportation work within and across railroad
rights of way, and provide USDOT the authority to enforce those
provisions with the railroads.
Congress should require USDOT to establish template or
model agreements for standard activities conducted by the state DOTs in
railroad rights-of-way (and vice versa), and provide guidance on the
establishment of agreements for special or more complex activities.
Conclusion
State DOTs remain committed to assisting Congress in the
development of the next surface transportation legislation that
recognizes the importance of freight transportation, the investment
needed to support freight transportation, and the ways in which demand
for goods movement is growing and changing.
Over the past year, AASHTO's members have been engaged with USDOT
in their effort to develop a national freight strategic plan to
identify bottlenecks on the multimodal freight network, including the
cost to address each bottleneck and strategies to improve intermodal
connectivity. We share your desire to see this national freight
strategic plan come to fruition soon, which will enable all of us to
take a holistic look at the national freight movement picture prior to
reauthorization of the next long-term bill.
I want to thank you again for the opportunity to testify today, and
I am happy to answer any questions that you may have.
Mr. Lipinski. Thank you, Mr. Tymon, and thank all of our
witnesses for your testimony today. We are now going to move on
to Member questions.
Each Member will be recognized for 5 minutes, and I will
start by recognizing myself. The first thing I wanted to
address is the section 130 program for grade separations. I
wanted to ask Mr. Jefferies.
Can you elaborate on your thoughts in your written
testimony where you talk about how we can improve the section
130 grade crossing safety program?
Mr. Jefferies. Absolutely. Thank you. So section 130 is one
of our primary priorities when it comes to FAST Act
reauthorization, and we have laid out a detailed proposal
attached to my written statement.
But a few examples that we would like to see is, one, any
increase in funding, or even fully funding the authorized level
of the program is a step in the right direction. But another
example would be increasing the flexibility of how funds can be
used.
Right now, if you use section 130 funds to implement some
grade crossing safety devices, time goes by, there are more
effective devices that come available, you cannot use section
130 funding to upgrade, and we think that is common sense to
allow for upgrades, especially at those higher risk crossings,
to make sure you have the most up-to-date technology available.
Mr. Lipinski. Thank you. In grade separations--I mean
section 130 covers all grade crossing safety programs. Grade
separations are the best way to improve safety. I want to ask
Ms. Aleman.
Would the establishment of a dedicated Federal grade
crossing separation program to help advance some of the grade
separation still unfunded in CREATE be a good idea?
CREATE has made great strides over the 15 years. But one
thing that has lagged far behind is the grade separations.
There are 25 that were included originally, and less than half
of those have been funded.
Ms. Aleman?
Ms. Aleman. Yes, addressing the grade separations is of
critical importance, not only to the CREATE program, but to the
movement of freight in our region and beyond. Like you said, 25
CREATE grade separations have been identified. Of those, only
seven have been completed. This clearly shows that there is a
need for additional funding to be able to address those
critical cross points.
Mr. Lipinski. Thank you. And I just wanted to ask about
this, and I know a couple of our witnesses raised it, and I
raised it in my opening statement--I just wanted to see, by
show of hands, how many witnesses support eliminating or
greatly raising the multimodal cap in the INFRA, or whatever
kind of megaprojects program we are going to have.
[Show of hands.]
Ms. Goodchild. I am just abstaining. I am not not voting.
[Laughter.]
Mr. Lipinski. OK, thank you. I was going to ask that.
The big question is how do we structure this program?
And I don't want to keep talking about the INFRA program
itself, because what we have done with each of the past
reauthorizations is we create a somewhat different program. So
I don't want to just say that we are going to move ahead with
INFRA, but there has to be something for megaprojects.
But how do we target that? And I want to start with Ms.
Aleman. You know, given the limited amount of Federal dollars,
should our freight strategic plan and our megaproject dollars
focus on freight infrastructure bottlenecks, or improving the
large freight network generally?
How do we do that, in terms of targeting? What would you
recommend?
Ms. Aleman. I would recommend a comprehensive look at our
national freight infrastructure as it exists today. I mean,
really taking a comprehensive look across the United States
will help Congress be able to evaluate the effectiveness of the
programs that we have had to date, and will also allow you to
shape future reauthorizations. So while we may not be able to
increase funds, I think, thinking about this in a performance-
based way, where you are applying those metrics on a national
system as opposed to locally, will help greatly improve the
next transportation bill.
Mr. Lipinski. Thank you. I just very quickly want to ask
Dr. Goodchild. Yesterday, New York DOT announced a pilot
freight program which will encourage the use of cargo electric
bikes instead of trucks to move freight within New York City. I
am just personally intrigued by this, and how this would
actually work.
I am not sure where these cargo bikes are going to go, but
have you looked at this, and would this type of climate-
friendly transportation mode play an important role?
Ms. Goodchild. So I am currently leading a project to
evaluate a pilot of electric-assist cargo bikes in the city of
Seattle. And so our task there is to evaluate the environmental
safety and efficiency benefits of that approach.
There is some complexity in that, because it doesn't
replace a truck. It can only move smaller packages, and it has
a much shorter range. And so it is used in complement with a
truck. And it is important when we evaluate this system to look
at the relationship between those two modes.
Certainly, it is a more nimble vehicle. And depending on
what the rules are, if it is allowed to use a bike lane, or if
it is allowed to park in a sidewalk, or if it is allowed to
park in a commercial vehicle load zone, it can provide some
better maneuverability at a local scale. And if it is electric,
then there is the local zero-emissions benefit of that mode.
Mr. Lipinski. Thank you. We will look forward to seeing the
results there.
So my time is expired. I will now yield 5 minutes to Mr.
Davis.
Mr. Davis. Thank you, Mr. Chairman. And thanks again to the
witnesses. I enjoyed your testimony. And I wish I had longer
than 5 minutes to get to each of you to ask a few different
questions. But I don't, so I will start with Mr. Tymon.
In your testimony you mentioned the freight plans that each
State has developed. And can you describe any trends that were
identified across multiple States, and strategies that were
employed to address these needs?
Mr. Tymon. I am sorry. Across?
Mr. Davis. Yes, can you describe any trends? You mentioned
the freight plans that each State has. Are there any trends
that kind of go beyond State lines that were employed to
address kind of the freight strategies?
Mr. Tymon. Well, I think the important point here is that
each State is required to put together a State freight plan.
And you are seeing that States are working with their partners
across borders to identify projects that cut across States.
As everybody here knows, freight doesn't just stop at the
State line, and it is important that States are able to work
with their neighbors to make sure that freight is moving as
efficiently as possible. So most, I think, of the freight
projects that are identified are done in concert with their
neighbors to make sure that, once you get to a State border,
that that freight doesn't back up there because the State on
the other side of that border hasn't worked to make similar
improvements.
So we are seeing more and more coordination among States as
they put together these plans to make sure that freight moves
as efficiently as possible.
Mr. Davis. Good. Have you seen the States finding strategic
value in the plans that they have put in place? And have those
plans helped to reduce congestion?
Mr. Tymon. I don't think we have enough of a sample size to
be able to say whether or not we are reducing congestion. But I
think it is a step in the right direction. It has really
required States to take a look at their entire inventory that
handles freight transportation to make sure that they are
making the investments that benefit freight as efficiently as
possible.
Mr. Davis. OK. Well, in my home State of Illinois, they
took an innovative approach using their formula freight dollars
to develop a transparent, competitive grant program that is
open to stakeholder applications. It is like kind of a State-
level INFRA grant program.
What other innovative approaches have other States taken to
use their freight formula funds? And have they allowed States
to leverage more dollars for reducing congestion and improving
performance?
Mr. Tymon. Absolutely. We are seeing the Federal dollars,
in a lot of cases, being used as seed money to bring in local
dollars to address freight bottlenecks. The example that you
have given in Illinois is a great example of States having the
flexibility to use those formula dollars to create a program
that works in that State by, essentially, setting up a mini-
INFRA grant program, where it is competitive, and you are
inviting other stakeholders to come to the table with their
innovative ideas.
If the States didn't have that flexibility, we wouldn't be
able to do projects like that in Illinois.
Mr. Davis. Great. Ms. Aleman, it is great to sit here with
my good friend, Chairman Lipinski, who I know is always looking
at improving the CREATE project. We have talked about it my
entire 6\1/2\ years here working with him on this issue.
And I know you mentioned how CREATE, in your testimony,
will improve the rail system in our home State of Illinois. How
does improved efficiency in the Chicago rail network benefit
agriculture and manufacturers in the 13th Congressional
District that I represent in central Illinois?
Ms. Aleman. Sure. I think a great example is that in 2014
there was a severe weather incident that really shut down and
reduced the delivery service and infrastructure network in
Chicago. And what that meant was that--it was prime agriculture
movement season--produce was rotting on train cars, because
they couldn't get through Chicago. And that produce wasn't
headed toward Chicago, it was headed towards other parts of the
country.
So, you know, 25 percent of all freight trains and 50
percent of all intermodal trains from the Nation's goods
movement cross through Chicago. So this really is a national
issue, and something that we really need to think
comprehensively about.
Mr. Davis. Great. It is important, obviously, being a
center of freight movement in the Midwest. Not just the rail
network, but also our locks and dams, waterways, and our
roadways in infrastructure improvements.
One last question. As somebody who believes we need to pass
the USMCA through this institution, could you estimate how much
traffic through the Chicago rail network would go to our
greatest trading partners, Canada and Mexico?
Ms. Aleman. I don't have those numbers at my fingertips,
but I can get them for you for the record.
Mr. Davis. Thank you, that would be great. I yield back the
balance of my time.
Mr. Lipinski. Now I will recognize Ms. Norton for 5
minutes.
Ms. Norton. Thank you very much. You will note the interest
in this committee in multimodal investments, multimodal
approaches. And, of course, our way in which we allocate funds
is anything but that. It is stovepiped funding, which makes
this even more challenging.
We also know that the railroads, for the first time, were
included--or at least freight needs were included in the FAST
Act for the first time. That is really amazing, isn't it,
considering how important freight has always been?
And, of course, Mr. Lipinski spoke about the cap on
funding. I am not sure how funding would operate, but I would
like to ask perhaps Mr. Tymon, Ms. Aleman, why flexibility to
pursue multimodal investments to meet freight needs, why that
is important to States, or to cities, to planning agencies, and
why you view it as an appropriate use of program funds.
Ms. Aleman. So, from our perspective, freight doesn't move
on highways alone, as you see from the stakeholders that are
here today. We have got rail. Also in our State and across the
country there are ports. And we believe that, where public
goods are moving, public dollars should be invested.
Mr. Tymon. And we absolutely agree that, you know, State
DOTs right now are all departments of transportation. Gone are
the days where we had departments of roads or departments of
highways. All 50 States now have transportation as part of
their name, and I think that reflects a movement towards a
multimodal approach to transportation. It is not just about
moving freight by one mode or another; it is an all-of-the-
above approach.
And I think, in order to solve the challenges that we have,
both on the freight and the passenger side, we need to be
looking at all modes of transportation, and we need the Federal
programs to provide that flexibility so that States can choose
the projects and strategies that work best in that State.
Ms. Norton. Thank you.
Ms. Aleman, I was intrigued by a suggestion on--I think it
is page 8 of your testimony--to develop a national strategy
that guides long-term planning. And you even say that there
should be an office of multimodal freight.
We have heard here that everything from the curbs down to
the last inch of infrastructure is simply not ready for the
21st century. Would you talk more about this national strategy?
Ms. Aleman. Thank you, Chairwoman. The national strategy is
critical, because we have the data to know where the freight
bottlenecks are across this country, and we can use that as our
North Star for programming project funds, and making sure that
the projects that are funded are advancing the goals of this
country and of Congress. And so that allows you a measurable
tool to be able to look back and track your progress over time,
and hold these programs and these discretionary funds more
accountable.
Ms. Norton. So I take it--Dr. Goodchild, your testimony
highlighted the importance of supporting cities and local
communities to grapple with this rapidly changing freight
supply chain. What kind of tools would help cities build the
capacity to plan for the future of freight deliveries, which
are changing and perhaps becoming obsolete, even as they
develop those strategies?
That is why I asked Ms. Aleman about long-term planning.
But what kind of tools do you have in mind?
Ms. Goodchild. So one would be data about goods movement
that is relevant at sort of the municipal scale, or even
megaregion scale. When we just look at State-to-State, or
regional data, like the Puget Sound, it doesn't provide any
insight about movements within the region of the Puget Sound.
Another would be to encourage groups like the Urban Freight
Lab, local collaborations that could contribute to defining
local problems, and there could be a Federal role in
supporting, and initiating, and in catalyzing those kinds of
organizations.
Ms. Norton. Thank you very much. I see my time has expired.
Mr. Lipinski. Thank you, Chairwoman Norton. The Chair will
now recognize Mr. Crawford for 5 minutes.
Mr. Crawford. All right. Thank you, Mr. Chairman. I want to
start with Mr. Jefferies.
I am going to direct this question to you. The advancement
of technology over the past few decades is undeniable. It has
led to tremendous gains throughout the economy. Can you provide
some examples of how technology is being used in the rail
industry, and the impacts they are having?
And what do you think Congress can do to ensure an
environment where future technologies are not stymied by
regulatory burdens?
Mr. Jefferies. Absolutely, thank you. So, I mean, you hit
the nail on the head, that technology has played an
evolutionary role in the railroad. If you look at where it was
10, 15, 20 years ago, today's railroad, while still steel-on-
steel, is a completely different animal.
Locomotives are super-computers on wheels, and they are
able to gather data throughout every aspect of the trip, pair
that with detectors and other inspection equipment that is
along the right-of-way throughout the system that is listening,
watching, and analyzing not only the track as you go over it,
but also the locomotive as it comes by, to identify potential
flaws in the system, potential risk areas. It allows you to,
through predictive analytics, to identify possible risks before
they become serious problems.
Even on the environmental side, using emissionless cranes
in the yards, idle-reduction technology in the yards to reduce
emissions in yard movements, which is where a lot of the
emissions occur.
And really, our main issue is, when we look at regulations,
let's talk about where we want to go, and let railroads find
that path to meet the outcome that Congress or the regulator is
staking out. And let's not focus on the prescriptive way to get
there, because I think ingenuity is a powerful tool, and it is
amazing what people will come up with if you tell them the goal
and let them get there via their best methods.
Mr. Crawford. Excellent, thank you. This is just general.
Anybody that wants to chime in, feel free.
The current rate of highway capacity growth sufficient to
address the growing freight demand and the--what do we need--
what is the expanded capacity that is needed the most?
Mr. Tymon. So, Mr. Crawford, I think that that is a great
question, because I think it varies, depending on what part of
the country you are in. Right now I think that the number-one
priority for State DOTs is maintaining the assets that they
currently have. But there are certainly some parts of the
country and on certain facilities where additional highway
capacity will help improve the efficient movement of both
people and freight.
With the projected growth that we are going to see in
freight transportation in the future, I would have to assume
that there are multiple projects in each State across the
country where additional capacity will help make sure that that
freight continues to move as efficiently as possible.
Mr. Crawford. Do you think the demand for freight
transportation is directly correlated to highway capacity, or
is it more closely tied to other factors like economic growth?
Mr. Tymon. I think that it is a combination of things. I
think that, as the economy grows and the country demands more
products and goods, there is just going to be more of a demand
on the system. How we meet that demand, I think it will have to
be a multimodal approach. I think it is going to have to be an
all-of-the-above approach. It will have to be a, in some cases,
additional highway capacity, but it will also have to be
additional freight rail capacity in some way, shape, or form.
So, you know, I think State DOTs out there are looking for
multimodal solutions, not just one solution. But I do think
that highway capacity increases are part of that solution.
Mr. Crawford. In your view, what are the most significant
trends in transportation and distribution that will impact
where, how, how much freight will be moving over the Nation's
highways in the coming years?
Mr. Tymon. I am sorry, could you repeat that, again? It
is----
Mr. Crawford. What are the most significant trends that you
see in transportation and distribution that would impact where,
how, and how much freight would be moving over the Nation's
highways in the years to come?
Mr. Tymon. I think the number-one trend that we are seeing
is changes in how people expect to get their goods and
services, right?
I mean I think Chairman DeFazio mentioned earlier we are
just through Black Friday and Cyber Monday, and the real-time
nature of what people expect and now demand, as consumers, is
going to put a different stress on the system than we were
thinking about 20, 30 years ago. And the system is going to
have to adapt to be able to meet those demands. I think the
consumers are now--you know, we thought 2- or 3-day delivery
was a push 10 years ago. Now we have 4- to 6-hour delivery
windows. If consumers are going to expect that kind of
responsiveness, the system is going to have to adapt, and there
is going to have to be some expansion and innovation within the
system to be able to accommodate that.
Mr. Crawford. Thank you, I yield back.
Ms. Norton [presiding]. Chairman DeFazio for 5 minutes.
Mr. DeFazio. Thanks, Madam Chair.
Mr. Mathers, you point out that we are using 43 percent of
the capacity of our freight trucks. You give some examples. You
had examples of Ocean Spray, Colgate, Kimberly-Clark, and
Walmart. What Federal policies could we adopt to encourage
higher utilization so we don't have part-full trucks running
everywhere?
Mr. Mathers. Thank you, Mr. Chairman. It is a great
question. I think, as we have seen, there is a lot of, you
know, just operational choices that the shippers themselves
have to make. So it is less clear to me exactly on Federal
policy choices.
But, I would think that part of this is kind of
information- and data-sharing between companies. I think we see
a great opportunity between shippers to co-load and collaborate
in their shipping. And that was the example in the testimony of
Colgate and Kimberly-Clark, right, where they are taking trucks
off the road, they are delivering more products to CVS,
inventory costs are going down.
I think the big barrier there is data and transparency and
companies working together. And so I think it could be an
effort to study that issue, to bring shippers together, and
really try to understand how they can get better data
transparency amongst shippers.
Mr. DeFazio. OK. I am still thinking about what the Federal
policies would be, but I agree with the transparency and the
data-sharing. But I have got to figure out ways to incentivize
that or encourage that.
Mr. Jefferies, as you know, a couple of decades ago
Congress gave Amtrak trains preference over freight. And DOJ
can enforce that preference. They have only done it once. And
under PRIIA, Congress directed the FRA and Amtrak to develop
minimum performance standards.
And then, of course, the freight industry sued, and now our
delays and on-time performance are up dramatically.
I just was recently meeting with Richard Anderson.
And, you know, I live 112 miles from Portland. I would
rather not drive on Interstate 5, but their scheduled time is
3\1/2\ hours for 112 miles. And they frequently don't meet
that.
We now have freights that are running 3 miles long, they
don't have 3-mile-long sidings.
How do you recommend that we might better deal with this
issue? Because I am pretty much getting to the point of some
pretty strong legislation. So do you have any suggestions,
short of that?
Mr. Jefferies. So I think we are happy to see FRA moving
forward with a rule. They estimated at a hearing in the Senate
Commerce, Science, and Transportation Committee they expect to
have that out next June, I believe. We think they are taking
the right approach by taking information from all stakeholders
and moving forward.
I think, on the----
Mr. DeFazio. Was that the FRA?
Mr. Jefferies. Yes, sir.
Mr. DeFazio. Well, yes. We had Mr. Batory here. He is one
of the most embarrassing witnesses we ever had, to tell the
truth. So I am not putting a lot of stock in his rule, but we
will see how that works out.
But you have got to do something here, or we are going to
have to do something in the surface bill that you are probably
not going to like, and it is going to be very prescriptive. So
I just want to get that----
Mr. Jefferies. Well, we think it is important that FRA move
forward with a rule to get metrics and standards----
Mr. DeFazio. Yes, message across.
Ms. Goodchild, you point out a whole host of issues, but I
guess you are an academic. It is kind of short on solutions at
this point, particularly the urban congestion, the last-mile
delivery stuff.
Ms. Goodchild. Well, I think that the industry is
experimenting. I think if you look at--the example was raised
of e-bikes in New York City. I am encouraged by the motivation
to try new solutions. And those need to be tried before we can
identify them as well-established solutions. So I think there
is a need for experimentation.
We can start with ideas. There are lots of ideas. But it is
important to move from ideas to evaluation and consensus and
establishing those as things we might want to set forth as
solutions that communities should consider.
So I think, you know, experimentation and test and
supporting that, to the extent possible, allowing that to the
extent possible, is important right now. And part of that also
comes from having data and information, investing in data that
we can use to actually evaluate and compare and contrast.
Also, to the point about sort of trucks not being
particularly well utilized, there is a very strong market
incentive for trucking companies to utilize their equipment.
They are very good at that. And the reason they don't is that
they are responding to customer demands. And so, I think
allowing--you know, considering the motivation and the role of
the private carrier, listening to what would help them run a
more efficient system, is important.
So we have zero visibility about parking availability. If
you run a tour in the city of Seattle and your goal is to do
that quickly and efficiently, you have no idea what parking
will be available, at what time. And it is essential to having
good performance.
So investing in technology that allows us to see what
infrastructure is available, and to measure its performance,
will result in benefits in supply chain efficiency.
Mr. DeFazio. OK. That is interesting, thank you.
I thank you, Madam Chair.
Ms. Norton. Mr. Gibbs?
Mr. Gibbs. Thank you, Madam Chair. Well, I will say the
good news is the economy is really strong, so that gives us
more stuff to move. Consumers are buying a lot of stuff, they
are driving this economy. And plus, just earlier, the consumer
demands--the attitudes are changing. More challenges for all of
us in the transportation sector, right?
I wanted to say, also, we need all modes. I think we all
agree to that. If one mode breaks down or stumbles, it is going
to affect all the other modes. So we always should be
conscious, we--you know, keep that in mind.
And I know we don't have any representation here, I guess,
from the trucking industry, but hopefully we can in the future.
I know we have met with the auto manufacturers. And on the
passenger side they are pretty much saying they are going to be
all electric at some point on passenger vehicles, all electric.
Now, Mr. Mathers, I see in your testimony on the trucks,
you are talking about heavy trucks, all electric. I just got a
few questions on that.
On your charts here, you have got urban delivery, regional
haul. There is not long haul on there. So the first thing that
comes to my mind is horsepower. Is the technology there? Where
are we on the technology for the horsepower and also the cost
for the, you know, industry driving this?
And then take that a bit further, because I think we have
reduced our greenhouse gas emissions in this country in the
last decade about 13 to 15 percent, the reports I have seen,
and that is from natural gas. And I think most people agree to
that. If we have an all-electric passenger fleet, and we move
to an all-electric freight fleet, has anybody studied what does
that do to our demands on our grid, our electric generation,
and the overall emissions, overall?
So I guess my question is--most to Mr. Mathers, I think--do
you know what the costs are to make these heavy-duty trucks
electric in their operating costs, how that compares to a CNG
or an LNG vehicle, and then also how it relates from the start
of generation all the way through.
Mr. Mathers. Great. Well, thank you. Thank you, Mr. Gibbs.
I think that maybe the first thing to talk around is the
horsepower, right? You are asking about, you know, right now,
Daimler has--I believe it is 20 e-Cascadias pulling cargo out
of L.A.-Long Beach. The horsepower is there, and the technology
is working for drayage applications and kind of making inroads
in the regional haul, which are, you know, 150-, 200-mile kind
of duty cycles.
And I think that is what we are looking for when we think
about zero-emission, Class 8 trucks is having that day cab
operation, going from a distribution center to a grocery store.
And then, for the long haul, I think the question is how do
you use that capacity in the long haul to the fullest, how do
you use intermodal? And I actually think there is a great
pairing between using intermodal to move freight for the long
haul and using the zero emission to deliver the freight
regionally.
On the cost question, I think just yesterday Bloomberg New
Energy Finance came out with their annual update of the cost of
EV battery packs. And it was $156 per kilowatt hour. That is
down from $1,100 per kilowatt hour in 2010. We are seeing a
dramatic reduction in----
Mr. Gibbs. How about cost of heavy-duty trucks, electric,
the cost----
Mr. Mathers. The trucks. Yes. So, like, the trucks on the--
there is a paucity of data right now on the trucks themselves,
because the trucks in operation right now are largely
demonstrational projects. Where you have electric, heavy-duty
vehicles is in the transit space.
And right now, the electric transit buses cost more
upfront, but they deliver savings over the life cycle of cost--
--
Mr. Gibbs. I am running out of time. Your organization, the
Environmental Defense Fund, are you pro or con, integrating
more natural gas where it makes sense to move this, or----
Mr. Mathers. It is a great question. So I think I will make
two really quick points on that.
One is that electric power is inherently more efficient. So
if you want to take natural gas and get miles out of it, you
will get twice the miles by making electricity, and putting
that electricity into a battery, and using that to move the
vehicle.
The second point is freight has two sources of emissions:
criteria emissions that harm local air pollution, and global
climate emissions. Natural gas can help with one. It hurts with
global climate emissions because of the serious issue of
methane leaks throughout the supply chain.
Mr. Gibbs. I am out of time, so I have to yield back.
Ms. Norton. The gentleman's time has expired. Mrs.
Napolitano?
Mrs. Napolitano. Thank you, Madam Chair.
Ms. Aleman, you have discussed economic importance of
freight investments. You also represent local communities
throughout which freight moves, much like the Alameda Corridor
in my district. Would you discuss the community impacts of
freight movement on the quality of life impacts and concerns,
and what projects are best at addressing these issues?
And should the freight industry be more invested in
addressing local impacts of rail?
Ms. Aleman. Thank you for the question, Congresswoman. You
know, we estimate the motorist delay in the Chicago region cost
about $58 million in 2018, but we are reexamining that research
to really look at what the local impacts are of congestion on
communities across our region.
We have 284 municipalities in 7 communities that I
represent here, as the MPO. You know, and we are seeing that
perhaps the number, just based on our preliminary research and
the data that we are collecting, that perhaps the number of
congestion is even worse in our communities.
And, you know, to local communities, the impacts of
congestion are real. Air quality impacts are real. The
deterioration of their local roads, the safety impacts, and the
noise impacts, these are things that communities are grappling
with.
So, as a planning organization, we are working with
communities to help them address these projects, these
concerns, proactively. We are doing local plans, we are helping
them build their capacity at the local level, and really trying
to get ahead of freight movement and freight demand increases
by helping them figure out where trucks should be, and what
time of day those trucks should be in different places. So
thank you.
Mrs. Napolitano. Thank you for your answer.
Mr. Mathers, I represent part of southern California, which
is home to the Ports of Los Angeles and Long Beach. Forty-five
percent of the Nation's imports and exports go through it.
Our ports have done a remarkable job in the past 10 years,
and continuously greening their drayage trucking fleets.
One problem with the retrofits is that their costly
upgrades get passed on to the truck drivers themselves. This is
a problem to where many corrupt trucking agencies force their
employees to lease-own trucking models and then severely
underpay drivers and force them into bankruptcy trying to pay
for engines. How do we deal with this problem?
Mr. Mathers. Thank you for the question. I think the
drayage space is a complex and challenging space. As we are
thinking about zero-emission opportunities there, I think the
big challenge is just the connect between the cost of the
technology and the availability of capital for the drivers
themselves.
And so I think one of the things I am noting here is hoping
that this committee moves forward and brings stakeholders
together to create a plan for moving that industry to 100
percent zero-emission drayage trucks by 2030, and a key part of
that is going to be financing mechanisms for the drivers and
understanding the roles that the shippers should be playing,
and that other folks, other stakeholders have, to make sure
that drayage drivers can move into zero-emission vehicles.
Mrs. Napolitano. Thank you very much.
Ms. Aleman and Mr. Tymon, the FAST Act created two freight
funding programs, one at 4.5 competitive grant, and the other
at 6.3 formula for the States. We are all concerned that
competitive freight has been overly politicized, and that
projects are not being awarded.
Should transportation put all the freight funding into the
formula National Highway Freight Program so that each State is
given freight equity?
Ms. Aleman. I want to be sure that I understood your
question, Congresswoman. Was it about the equity of the
distribution of the funds in the program?
Mrs. Napolitano. Should we move----
Ms. Aleman. Yes.
Mrs. Napolitano [continuing]. All the funds into the
National Highway Freight Program, instead of having the other
competitive--by the administration.
Ms. Aleman. So I think both programs are necessary. I mean
one of the things that I saw when I was at the DOT is that, you
know, freight impacts across the State are very different than
the freight programs where folks would come together across
jurisdictional borders to work on those highly complex
projects. And those competitive funds were really an incentive
for communities, for multistates to be able to work together.
And then, at the local level, to the distribution of those
funds to the States, we are helpful in them addressing sort of
the intrastate commerce challenges.
Mrs. Napolitano. Mr. Tymon?
Mr. Tymon. May I weigh in on that, as well? I think that
that is--you bring up a great point. And I do think there is a
role for both discretionary and formula programs.
But the fact that there is such variation from Congress to
Congress, or administration to administration, in how those
discretionary dollars are distributed, I think, really adds
more merit to the formula-based program, because it is a
predictable stream of funding that will allow project sponsors
such as States to be able to pick the projects that they need
to do over a long period of time.
So I just think that what you have highlighted there is a
great supporting statement for formula dollars and the value
for them.
Mrs. Napolitano. I think you are right, and I think we
should move them.
Thank you, Madam Chair.
Ms. Norton. Thank you, Mrs. Napolitano. We move on to Mr.
Stauber.
Mr. Stauber. I thank you, Chair Norton and Ranking Member
Pence.
Before I go into questioning, I think it is important to
illustrate the freight networks in my district of Minnesota,
and how they interact with each other.
In northeastern Minnesota we have freight rail lines that
carry taconite from the Iron Range to the Port of Duluth to be
shipped by lakers across the Great Lakes through the Soo locks,
and to be made into American steel.
We have freight lines that transport coal and ag products
from the upper Midwest to the Port of Duluth to be shipped to
the east coast and across the Atlantic Ocean.
The Port of Duluth, the most inland port in the Nation,
accepts intermodal traffic, from trucks that must navigate
through a treacherous traffic interchange to drop off or pick
up their products. Our entire freight network in northeastern
Minnesota is interconnected and codependent on each other. This
means that if and when parts of the network fail, or are
inefficient, the entire system suffers.
Mr. Baker, can you please speak to the importance of the
45G tax credit--which I support, by the way--to the
interconnectedness of freight networks?
Mr. Baker. Thank you very much for the question. Normally
people ask me to stop talking about 45G, because I do it so
frequently, but I appreciate you asking.
It is the most critical policy that we have identified to
help with short line railroads. We are largely a privately
funded network. But given the nature of short line railroads,
preserving service into small towns in rural America, Congress
has long seen the wisdom in helping out a little bit.
The credit has been expired since the end of 2017. It is
beyond critical and crucial for us at this point. It is an
extraordinarily effective way to get upgrades done in small
railroads and----
Mr. Stauber. Remain competitive?
Mr. Baker. To remain competitive, and those small railroads
can do an awful lot with just a little bit of help.
Mr. Stauber. Thank you very much.
Mr. Tymon, as I mentioned before, the Twin Ports
Interchange project, also known as the ``Can of Worms''--so
this tells you a little bit about the nature of this traffic
issue just coming out of the Port of Duluth and in the city of
Duluth. It is a major inefficiency, and endangers the freight
network in my district around the port.
Can you please speak a little bit about how the highways--
and specifically, the interchanges such as the ``Can of Worms''
in Duluth, Minnesota, can impact freight travel, and how
important it is to ensure there are efficiencies to maximize
our shipping capabilities?
Mr. Tymon. Thank you for that question. You know, I think,
first, you mentioned safety. And safety is the number-one
priority for every State DOT across the country. So, in
addition to making sure that we can move that freight as
efficiently as possible, we need to make sure that the system
operates as safely as possible.
So, you know, I think that the project that you have
described, there is probably a project like that in every State
across the country, whether it is called the ``Spaghetti
Bowl,'' or the ``Zoo,'' or the ``Can of Worms''--I can't say I
have heard that one before.
You know, there are strategies that States can do to work
with localities to make sure that they either look for ways to
operate that facility as efficiently as possible, whether it is
use of technology, or, in some cases, you know, looking at that
facility and seeing if there are changes that need to be made,
from an infrastructure standpoint, to help it operate
efficiently.
I think that the biggest problem there is funding. And if
there aren't the resources that are necessary for a State or a
locality to take on a major project like that, if you are
talking about reconstituting that interchange in a way that
looks significantly different than what it does now, you are
going to need a significant amount of dollars to be able to do
that.
So, having a robust Federal program that will be able to
fund those types of projects would be extremely helpful in
having a State be able to tackle something like that.
Mr. Stauber. So would you say that, in our case, if the
``Can of Worms''--and they are working on it--if that was
fixed, if it was safer and more efficient, what would be the
timetable that you would see an economic increase? Would it be
immediate, or over a period of time, in your experience?
Mr. Tymon. Well, I think you would see both immediate
impacts as well as long-term impacts for a major project like
that. You would see probably an immediate impact, from a
congestion standpoint and from a safety standpoint. But then,
you are making that area more economically competitive if you
are able to increase throughput and increase the reliability
and efficiency of that facility.
Mr. Stauber. Thank you for your questioning. And to all the
witnesses, thanks for your testimony. It is greatly
appreciated.
And Madam Chair, I yield back.
Ms. Norton. Thank you, Mr. Stauber. Next would be Mr.
Malinowski.
Mr. Malinowski. Thank you. Thank you, Madam Chair.
Mr. Jefferies, you and I had an exchange the last time I
was here that I wanted to follow up with you on, and I want to
say at the outset that I very, very clearly understand the
essential role that freight railways play in our economy, and
the profoundly beneficial role that they play in helping us
maintain a transportation system, while keeping the environment
clean, and dealing with climate change. It is undeniable.
I do have concerns about safety, though. And in our last
exchange you placed a great emphasis on data, on basing
decisions on data, which, of course, I agree with. And you came
today with data about falling accident rates in the freight
rail system. And it was interesting to me that you chose a
timeframe going back to the year 2000, which is quite a long
time.
Well, we actually have data that came out, I think, even
today on 2019 that allows us to look, I think, at a more
significant time period, given changes in the freight rail
industry just the last few years. So let me read you some data.
Since 2016, from 2016 to 2019, total fatalities are up from
519 to 617, almost a 16-percent increase. Trespasser deaths, up
by over 25 percent. The rate of train accidents per million
freight train-miles, up by around 9 percent since 2016. Hazmat
cars damaged or derailed, up by over 20 percent since 2016.
Since you are so focused on data, I wonder if you could
offer us an explanation as to why things have gotten so much
worse in just the last 3 years.
Mr. Jefferies. So, first, thank you for that. Let's start
with the deaths. You know, you mentioned trespassers. Grade
crossings, I don't know if you mentioned grade crossings
specifically, but that is an area of challenge, absolutely.
Ninety-six percent of rail fatalities are at grade crossings or
are trespassers. And that is an area where we continue to focus
on driving that number down. And it is certainly a
responsibility, it is a shared responsibility with the
railroads, with the communities, with individuals involved. And
it is something that we need to continue to work on. And
absolutely, we will do that.
That number is dramatically lower than it was,
historically, but it is not low enough, because it is still
above zero. So we have more work to do.
Mr. Malinowski. Well, it is not just that these numbers are
above zero. Of course, we always want to get down----
Mr. Jefferies. Right.
Mr. Malinowski [continuing]. To zero. It is that they have
been going up.
Mr. Jefferies. Well, I think----
Mr. Malinowski. Really, across the board, not just----
Mr. Jefferies. Every year we want to drive them down, but--
--
Mr. Malinowski. Well, since 2016, virtually every safety-
related statistic looks worse and worse----
Mr. Jefferies. Well----
Mr. Malinowski [continuing]. In the freight rail industry.
And, you know, you are touting this miraculous technology.
Locomotives are super-computers on wheels, identifying all
these----
Mr. Jefferies. Absolutely.
Mr. Malinowski [continuing]. Problems before they arise.
And yet things are getting worse. And I----
Mr. Jefferies. Well, I----
Mr. Malinowski. And I would stress this----
Mr. Jefferies. I would challenge they are getting worse. I
am not looking at the same data you are, but----
Mr. Malinowski. I am looking--I am happy to share this.
This is from the FRA.
Mr. Jefferies. Yes. When we look at hazmat transportation--
--
Mr. Malinowski. The category----
Mr. Jefferies [continuing]. We are in the safest era ever,
99.998 of hazmat movements move from point to destination
without any incident, whatsoever.
Mr. Malinowski. Compared to the early 20th century----
Mr. Jefferies. That is not 100 percent----
Mr. Malinowski [continuing]. Perhaps, but in the last few
years something has happened.
Mr. Jefferies. That is actually current data, but----
Mr. Malinowski. And, look, I am stressing this because you
are up here advocating for certain things.
Mr. Jefferies. Right.
Mr. Malinowski. You are advocating that we do nothing on
the length of freight trains, that we do nothing on crew
requirements for freight trains. You are advocating that we
allow increasingly hazardous materials, like LNG, to move on
freight trains.
You said something earlier today. It was really an eloquent
statement in its way. You said, ``Let's not focus on the
prescriptive way to get there.'' What do you mean by that? Are
you suggesting we do nothing?
Mr. Jefferies. No, I am saying let's talk about the goal we
want to get to, and let's set benchmarks for getting to that
goal. But let's not set one way and one way only for how to get
there.
Mr. Malinowski. So, basically, no way. You want us to
basically tell you--have safer railways, but allow the industry
to figure out how we do it.
Mr. Jefferies. I think that----
Mr. Malinowski. And no regulation.
Mr. Jefferies [continuing]. When you prescribe one and only
one way to get to a desired outcome, you miss opportunities.
I think we have a shared interest. I mean this conversation
shows we have a shared interest in maximizing safety. And so we
can agree on that. Like I said, we may disagree on data
interpretation, but I think we can agree on shared goals of
safety. So something I am certainly happy to have more
conversations with to see where we can----
Mr. Malinowski. Sir, you know, a couple weeks ago the CEO
of Boeing was sitting right in that chair. And right over there
we had families of people who lost their lives because the
airline industry lobbied us for 20 years for less and less
regulation. And he had to look them in the eye and apologize. I
really hope that you don't find yourself in that position at
some point in the future.
There has to be a prescriptive way to get there, and we
have to work together to find it. Thank you. I yield back.
Ms. Norton. Mr. LaMalfa?
Mr. LaMalfa. Thank you, Madam Chair, I appreciate it.
Mr. Mathers, EDF is known for its attempt to use market-
based policies--its claims on taxing--or increasing costs,
fines, whatever, on things it doesn't favor, while decreasing
costs on environmentally friendly vehicles or other energy-
consuming means.
So do you support the repeal--for heavy-duty trucks we are
talking about--of Federal excise tax that has been around since
World War I--I am carrying a bill on this--that adds to the
cost of heavy-duty trucks--$10,000, $12,000, $15,000--as a
means of getting cleaner, more environmentally friendly,
cleaner running diesel engines onto our roads?
Mr. Mathers. Thank you for the question, Congressman. I
think it would be great to target that tax break for zero-
emission vehicles, zero-emission trucks, and that the focus
should be on incentivizing a move to the cleanest technology we
have available.
Mr. LaMalfa. The diesel engines produced these days are
much cleaner than the ones that are 10 years old or more.
Mr. Mathers. And yet there is still significant room for
improvement, particularly in the low-speed, high-idle duty
cycles. And that is why the EPA and the California Air
Resources Board are currently both working on regulations to
further reduce NOx emissions. And we are happy to see that, and
it is desperately needed.
Mr. LaMalfa. Well, there is a time period between now and
when this technology becomes available, whether you are talking
all-electric vehicles, or lower NOx, or what have you, that
people still need to buy and purchase trucks.
Mr. Mathers. Sure.
Mr. LaMalfa. And utilize, upgrade the fleet, California
would see CARB coming down on people right now by January 1.
Many trucks are going to be unavailable to folks, so they got
to replace them with something. So shouldn't they replace them
with the best available technology today? Or do you just want
to make them have nothing until then?
Mr. Mathers. I think that there are programs that exist,
such as the Diesel Emissions Reduction Act, through the EPA,
that help get dirty diesel trucks off the road, and we fully
support that. And I think there are lots of opportunities.
I think the question is, where should we target taxpayer
money. And I think that is to move forward with really----
Mr. LaMalfa. You made a good point there.
Mr. Mathers [continuing]. Cutting-edge technology----
Mr. LaMalfa. This is taxpayer money. These truckers are
paying these additional taxes on a vehicle they are trying to
replace older vehicles with that are achieving 99 percent
cleaner emissions than one that is 10 or 15 years old.
So it is, indeed, their money. So why aren't they allowed
to keep more of their money so they can replace a truck sooner?
Mr. Mathers. Well, I mean, again, I think it is great to
incentivize the advanced technology such as zero-emission
trucks.
Mr. LaMalfa. We are not talking zero emission. We are
talking extremely low-emission trucks available right now.
Mr. Mathers. Mm-hmm.
Mr. Tymon. Mr. LaMalfa, do you mind if I weigh in on this?
Mr. LaMalfa. Quickly, please.
Mr. Tymon. I think you are referring to the Federal excise
tax on--are you referring to the Federal excise tax on the
purchase of new trucks and trailers?
Mr. LaMalfa. Yes, sir.
Mr. Tymon. I see, absolutely, the merits of your argument
in saying that if you eliminate that tax, that there is less of
a barrier for trucking companies to purchase new equipment.
I would say that is a great argument there. I think the
concern for a lot of us in the transportation community is the
loss of revenue associated with that tax. So I don't think that
a lot of folks in the transportation community are opposed to
the elimination of it. It is the fact that it would leave a
pretty large gaping hole in Highway Trust Fund revenue for a--
--
Mr. LaMalfa. It is a pretty small percentage of the overall
Highway Trust Fund, but it is a big barrier for somebody,
especially owner-operators, trying to replace a truck.
Mr. Tymon. Absolutely, and----
Mr. LaMalfa. It is only several billion dollars of a giant
fund.
Mr. Tymon. It is----
Mr. LaMalfa. So you would rather keep that in place to keep
a barrier for small operators, especially, to buy these trucks?
Mr. Tymon. No, I am not saying that. I am just saying that
we need to be cognizant of making sure that, whatever hole that
leaves, that it is replaced by some other revenue source.
We are already spending about $15 billion a year more from
the Highway Trust Fund than we are bringing in revenue. So a
change like that, if that increases that delta, which--I am not
saying that folks are opposed to it, I just think that that
revenue needs to be replaced in some way, shape, or form.
Mr. LaMalfa. There is a lot of ways to replace revenue. But
certainly sacking the small--or any of these folks.
If you all want to talk about wanting to have cleaner
running trucks on the road immediately, especially with CARB
coming down on California truckers on January 1, just days away
from now, and you make it a much higher bar by having this
World War I-era tax still in place, then you are not achieving
cleaner air, you don't have the electric vehicles that are
available in any kind of volume these days, or even seen as
viable. You know, maybe in short hauls, short-term use, and
things like that, but over-the-road trucks still need to have
available the current technology that is improved to 99 percent
cleanliness.
And that is what nobody acknowledges around here, is that
they have achieved much, much cleaner tailpipe, whether we are
talking trucks or cars, and still we go down this path where
people are going to have much fewer choices. Instead, you have
the club of Government saying you have to use this kind of
vehicle. And that is not going to work for a lot of folks.
Ms. Norton. The gentleman's time----
Mr. LaMalfa. I yield back.
Ms. Norton [continuing]. Has expired.
Ms. Finkenauer?
Ms. Finkenauer. Thank you, Chairwoman. I appreciate you all
being here today, too, and taking all of your time to come and
testify. It is an important topic. And my first question
happens to be for Mr. Jefferies.
In your testimony I know you mentioned how the ongoing
trade war with China is hurting two industries that are heavily
served by railroads, both agriculture and manufacturing, which
we feel pretty strongly in Iowa 1 right now.
As a result, the demand for rail service has gone down. I
heard this firsthand when I was visiting Iowa Northern Railway
in August--one of our short line railroads in Iowa--and learned
about the problems that the trade war has created very
specifically for their business.
With Brazil now having taken over most of our market share
of soybean imports to China, the railway is moving less grain
and facing more competition from larger railways for shipments
to local processors.
John Deere, one of their customers, a large employer in my
district, has seen their sales drop because of this ongoing
trade war with China. When our farmers are not doing well, they
are not buying new machinery, meaning that Iowa Northern
Railway is moving less of their freight.
Mr. Jefferies, how are railroads responding to the reduced
demand for freight services?
Mr. Jefferies. Thank you, Congresswoman. You know, you hit
the nail on the head, just about trade uncertainty in general,
whether it is China, whether it is north-south trade
uncertainty right now with the USMCA----
Ms. Finkenauer. But very specifically, China right now----
Mr. Jefferies. Absolutely.
Ms. Finkenauer [continuing]. Specifically when it comes to
steel, when it comes to----
Mr. Jefferies. When it comes to grain exports.
Ms. Finkenauer [continuing]. Specifically our agriculture
products.
Mr. Jefferies. Absolutely.
Ms. Finkenauer. It is devastating our State right now.
Mr. Jefferies. Absolutely.
Ms. Finkenauer. Yes.
Mr. Jefferies. And, you know, when your customers and your
farmers aren't moving stuff, the railroads aren't moving stuff.
So it is a chain reaction.
We feel strongly and have advocated that we need to address
the tariff situation with China, and we need a positive
outcome.
No one says there aren't issues that need to be dealt with.
Ms. Finkenauer. Yes.
Mr. Jefferies. But that uncertainty is having a dramatic
effect. We went from exporting colossal amounts of grain out
through the Pacific Northwest to virtually nothing now. And,
like you said, other markets are moving in to substitute U.S.
grain shippers.
Ms. Finkenauer. Yes.
Mr. Jefferies. And it is incumbent upon us to get a deal in
place to allow those shippers to thrive again. And railroads
are there.
I think 42 percent of our overarching traffic is direct
import-export-related. So----
Ms. Finkenauer. Yes.
Mr. Jefferies. It is grain, it is all products. It is
intermodal. So we----
Ms. Finkenauer. Well, and----
Mr. Jefferies. We are with you on that.
Ms. Finkenauer. Thank you.
And, Mr. Baker, I know specifically for our short lines,
one of the things, again, that I heard, you know, they are
struggling right now because the bigger competitors are coming
in to markets that they typically aren't in, because of
lacking, you know, their own markets right now that they would
typically have. And it has been harder and harder and harder
for them to be able to continue to compete.
Are you seeing this in other areas in the country? I know,
again, in Iowa it is--we are getting hit on all sides of it,
whether it is the ongoing trade war with China, or whether it
is the refinery waivers that we saw that have hurt our corn
growers, our ethanol plants that are struggling right now, as
well. It is just, again, getting hit on all sides.
But are you seeing this through the rest of the country, as
well?
Mr. Baker. No question, the huge percentage of the U.S.
economy and then, of course, a huge percentage of rail business
is dependent on trade--China, Canada, Mexico, all over the
globe.
Just to put it as simply as possible, we believe in free
and fair trade. We desperately need Congress and the
administration to get to a resolution on the China tariffs
problem and USMCA.
And if you wouldn't mind me riffing for 10 seconds on my
other favorite topic, the 45G tax credit, I have to bring it up
only because I know that you have been extremely vocal on the
biodiesel tax credit, which would be part of the same tax
extenders package. So I just wanted to thank you for your
leadership on that for Iowa, for the whole country. And you are
doing the Lord's work, so thank you.
Ms. Finkenauer. No, it is important for the future of my
State, which is my home, and I care a lot about it. And I am
really concerned, as this trade war continues, about how this
is going to impact our short line railroads, in particular,
about making those investments that they typically do.
I understand that short lines invest an average of 25 to 33
percent of their revenue into their infrastructure. And this is
something that, again, is hitting my State on all sides. And I
continue to just listen to folks and make sure that I hope the
administration is hearing us, as well.
So thank you for being here, and uplifting the need to get
a resolution sooner than later, and not after the 2020
election, when it comes to China. So thank you.
Ms. Norton. Mr. Babin?
Dr. Babin. Yes, ma'am. Thank you, Madam Chair. And thank
you, witnesses, for being here. We really appreciate all this
valuable information.
My question is for Mr. Tymon. As this committee prepares
for the reauthorization of the FAST Act, the growing use of
technology throughout the entire transportation sector will
play a huge role in our deliberations and our considerations.
What are the most critical issues that this committee should be
focusing on at the Federal level when it comes to the use of
technology? And how can Congress be helpful, rather than
getting in the way of innovation in private industry?
Mr. Tymon. Thank you for that question, Congressman. I
think you have highlighted, really, the crux of my answer,
which would be to get out of the way----
Dr. Babin. Absolutely.
Mr. Tymon [continuing]. As much as possible, and let States
be those incubators for innovation that they always have. You
are seeing more and more States incorporate technology into
their transportation solutions.
Again, I think the issue of the day is the 5.9 gigahertz
spectrum, and making sure that that stays reserved for
transportation safety. I appreciate that several members of
this committee have come out extremely strong in pushing back
against the FCC to make sure that the FCC knows that State DOTs
and transportation stakeholders in general want to see the 5.9
gigahertz spectrum reserved for transportation safety.
Dr. Babin. Right.
Mr. Tymon. I think that is--as I said before, safety is our
number-one priority. Our goal is to get to zero highway
fatalities. The only way we are able to get to zero highway
fatalities is to incorporate more and more technology into our
transportation network. A key part of that is utilization of
the 5.9 gigahertz spectrum.
Dr. Babin. Yes, sir. Excellent, excellent.
Also, I represent nine counties--Texas counties, that is--
from Houston over to the Louisiana line. And that includes the
Port of Houston.
As you know, the entire Nation depends on the efficient
movement of freight and goods out of southeast Texas, which is
a huge center for transportation, and lots of modes of
transportation. Could you share with this committee what
technological innovations State DOTs--you mentioned that a
little bit in a previous answer, but maybe a little more
specifically, and what these State DOTs are utilizing to
address the increasing movement of goods across the country,
across towns, and in our neighborhoods.
And if there is any time left, I would like to ask someone
else, too.
Mr. Tymon. Sure, so I will be quick in saying that, you
know, it really varies from State to State.
But one area that I think you are seeing States utilize
more often is data. They are analyzing the data that they have
to be able to better target the limited amount of dollars that
they have to invest in infrastructure.
I would say that is absolutely true on the freight side, as
well. You are able now to be able to take the data on where
freight is moving, from point A to point B----
Dr. Babin. Right.
Mr. Tymon [continuing]. Be able to look at it on a map, and
be able to tell which facilities need improvement. And I think
that the utilization of data, and how State DOTs are being able
to analyze that and then target investments based on that data,
is really having an impact on how we move freight and people,
and I think that is only going to improve as we move forward in
the future.
Dr. Babin. Absolutely. Thank you so much.
And Mr. Jefferies, could you add to that?
Mr. Jefferies. Yes. Certainly, to echo Mr. Tymon's
comments, on the freight rail side, whether it is in the port,
en route to destination, that data is driving visibility into
the system. It is allowing for optimization and how things are
moved in the port to increase throughput, decrease dwell time,
increase customer visibility as to where their products are en
route--not quite to the level of maybe an Amazon yet, but
working towards that end goal.
Dr. Babin. Absolutely. And Mr. Baker?
Mr. Baker. The use of technology in rail is huge, a huge
focus of the owners and operators of the system.
I would agree that the data and, essentially, the freight
transparency, the customers knowing where is my stuff, when is
it going to get there, when are the empties going to arrive is
crucial.
And there is--since the environmental aspect of this has
also been a big topic, I would also add on the locomotive side,
TR4 locomotives are the--are sort of the hot, new thing in rail
rolling stock, and it is a massive improvement over previous
locomotives. And railroads are implementing them as fast as
they can. And some railroads, particularly smaller railroads,
do get some help from the Federal Government through programs
like DERA, and that is much appreciated in a big way to help
reduce emissions.
Dr. Babin. Absolutely. Thank you all for that great
information. Information is very valuable as we deliberate over
this important issue.
So I will yield back. Thank you very much, Madam Chair.
Ms. Norton. Thank you, Mr. Babin.
Mr. Stanton?
Mr. Stanton. Thank you very much, Madam Chair. Thank you to
the witnesses. Outstanding testimony here today.
The movement of freight and goods plays a critical role in
our daily lives by providing us the things we need or want. But
it is also key to our country's economic future and maintaining
our global competitiveness.
Growth over the last 20 years, improvements in the
manufacturing process, and new technology are placing ever-
greater strain on the capacity to move goods. And this growth
is only expected to continue increasing. In fact, the U.S.
Department of Transportation estimates by 2040 freight volumes
across all modes of transportation will increase by 42 percent.
Expanding freight transportation capabilities and working
towards creative solutions is something we here in Congress
must focus on.
In my State of Arizona the Maricopa Association of
Governments has been working on a regional transportation
strategy that looks closely at how we prioritize freight-driven
investments to ensure goods are transported safely and
efficiently. The effort has brought together a number of
stakeholders to find ways to expand commerce, strengthen our
economy as it relates to freight.
My first questions are for Ms. Aleman. Arizona is a
significant link in the national freight network. Large volumes
of freight move by rail from the Ports of Los Angeles and Long
Beach to Chicago through Arizona. In fact, more than 74 percent
of all freight entering Arizona, measured by value, is moving
through my State, meaning that many markets outside of Arizona
are dependent upon the health of the infrastructure within
Arizona.
In my district, residents feel the pinch of this nationally
significant movement when they are stuck in traffic congestion
or at rail crossings.
Likewise, I recognize that Chicago's role as a national
rail hub means that your residents face many of the same
challenges. Can you talk a bit about the need for the Federal
investment in regions like ours that are critical to our
Nation's economy?
Ms. Aleman. Thank you, Congressman, for the question. You
know, freight is a commodity that we need to look at,
nationally. I think the burden, again, for paying for these
nationally significant projects can't be shouldered by the
States that are dealing with sort of the near-term local
impacts, because they aren't seeing the benefits. This really
is a global marketplace here.
And so this is why, from the perspective that we have been
looking at, the $12 in unique requests for every $1 of INFRA
available, and it would advocate for a $12 billion program of
competitive funds.
Like I said, in the Chicago region our CREATE program is an
example of how that brings stakeholders together who wouldn't
otherwise be focused on these issues.
Mr. Stanton. As we have discussed before, but worth
repeating, you have called for removal of the 10-percent cap on
nonhighway funding under the freight formula program, as well
as a cap under the INFRA program--grant program. Can you
explain why removal of this cap is important, once again, for
the national goods movement goals?
Ms. Aleman. Absolutely. Our freight across this country
doesn't move on our highways alone. And that is really why we
need to employ strategies like removing the cap on the
multimodal dollars given to States. Really, because we need
States to be able to work together to address their most
pressing freight needs.
Mr. Stanton. Thank you so much. In our urban centers, last-
mile deliveries face regular delays, due to traffic congestion.
Dr. Goodchild, in your curb allocation change project, you
suggest that reforming curb space allocation such as adding
drop-off and loading zones, could improve things. Could you
discuss this a little bit more, and what else could lessen the
economic and environmental impact from urban road congestion
caused by freight?
Ms. Goodchild. Yes, thank you. So the status quo of how we
manage curbs is we put yellow paint on it, or white paint, and
sometimes some red paint. And we haven't updated that approach.
So there is a lot that we could do, use it differently at
different times of day, more dynamically allocate that curb,
and price that curb in a more responsive way. We certainly need
to do that, and many cities are interested in doing that at
this time, including Seattle.
In terms of reducing the impact on communities, there is
certainly a need to use some low-emissions solutions. So e-
bikes--some of that is actually very simple. There is walking
deliveries that happen from--you know, we bring five people to
a delivery truck, and they can walk with hand trucks from
there. It is actually a very cost-effective, fast solution in
dense, urban areas. So using less fuel-intensive modes in that
last mile reduces the impact on those communities.
Mr. Stanton. All right. Thank you for your outstanding
answers. I am just about out of time, so I will yield back.
Ms. Norton. I thank the gentleman. Mr. Balderson?
Mr. Balderson. Thank you, Madam Chair. Thank you, panel,
for being here. And I have got a couple questions. My first
question is for Mr. Tymon.
Thank you very much for being here today. In your testimony
you mentioned the need for Congress to increase flexibility,
reduce regulatory burdens, and improve project delivery in our
surface transportation system. AASHTO believes Congress should
modernize the Clean Water Act, Clean Air Act, and the
Endangered Species Act to reduce infrastructure and
construction delays.
I would like to hear your thoughts on specific ways
Congress should change these laws. Can you please provide
examples of how these changes would benefit our infrastructure
system and help our State departments of transportation?
Mr. Tymon. Thank you for that question. What I would like
to request is that I could provide specific recommendations for
the record. But if you allow me the opportunity to provide more
of an overview, I can say that the changes that we are looking
to make to those laws are really updating them. Many of them
have not been touched in 20 or 30 years.
And it is not that we are looking to not continue to
safeguard the environment, far from it. We think that we can
make improvements and changes to those laws, but still make
sure we are doing right by the environment. It is the fact that
many of them have not been changed at all, or changed very
little in the last 20 or 30 years that we think that it is time
for Congress to at least take a look at those laws to see if
there are some improvements or modernizations that can be made.
Mr. Balderson. OK, thank you very much. The next question
is for Mr. Jefferies.
Mr. Jefferies, thank you for being here. In your testimony
you note that the operations and capital investment of
America's freight railroads support over 1 million jobs, $219
billion in economic output, and $71 billion in wages.
Additionally, railroads generated nearly $26 billion in tax
revenues in 2017. I know a couple other of my colleagues have
mentioned and talked about the USMCA, and that is kind of the
path that I want to go down. But international trade accounts
for about 35 percent of the U.S. rail revenue, 27 percent of
the U.S. rail tonnage, and 42 percent of the carloads and
intermodal units U.S. railroads carry.
Can you discuss the needs for Congress to ratify the USMCA,
and what impact the trade agreement would have on the railroad
and freight industry and their workers?
Mr. Jefferies. Thank you, Congressman. That is a fantastic
question.
You know, I cannot reiterate more the need to move forward
on USMCA. North-south trade with the U.S., obviously, our
largest trading partners, and the amount of goods that flow out
of the country via rail to both the north and the south--grain,
for example, into Mexico, is our largest export product--it is
staggering, quite honestly. It is a job creator, it is an
economic uplifter for our customers.
And not only that. When you look at the supply chain that
has been built up over the past several decades, it is an
international supply chain. So on a lot of products--
automotive, for example--you will see parts move back and forth
across the border multiple times. So it is not something that
can just be ripped up and air-dropped in in another fashion.
So, 50,000 rail jobs rely directly on international trade.
A lot of those are north-south movements, again. And so I
cannot state enough our support for getting USMCA done as soon
as possible.
Mr. Balderson. All right. Thank you very much.
Madam Chair, I yield back my remaining time.
Thank you, panel.
Ms. Norton. I thank the gentleman. Mr. Johnson?
Mr. Johnson of Georgia. Thank you, Madam Chair.
Passing the USMCA will increase trade. But what direct
impact will it have on the ability of the Nation to sustain the
need for increased spending to repair and replace our crumbling
infrastructure?
Mr. Jefferies. Well, from the rail perspective----
Mr. Johnson of Georgia. Mr. Jefferies or anybody. Anybody.
Mr. Jefferies. OK, I will start, and someone else can take
it from me.
But from the rail perspective, we are making long-term
investments year in, year out, because these are 50-year
investments. Certainly the same could be said on the highway
system.
So it is the certainty that trade deals put in place. So
you can plan----
Mr. Johnson of Georgia. Well, I understand that.
Mr. Jefferies [continuing]. To make these investments.
Mr. Johnson of Georgia. I understand we want to increase
trade, and we are projected to do that as the years move
forward. But my question is in terms of repairing and creating
new infrastructure upon which freight can move.
We need Federal revenues in place to do that. Does
everybody agree with that?
Mr. Jefferies. Certainly on the highway side.
Mr. Tymon. Yes----
Mr. Johnson of Georgia. And would you----
Mr. Tymon. Thank you, Mr. Jefferies.
Mr. Johnson of Georgia. Would anyone disagree with me that
it has been Federal revenues that have enabled the growth of
our transportation network up to this point?
Mr. Tymon. Mr. Johnson, absolutely, I agree with you on
that. We need a robust Federal program in order to be able to
fund our transportation network. If we are going to make sure
that we are providing for interstate commerce, both from a
freight standpoint, but also from a passenger standpoint, we
need a robust Federal program.
Right now the program is not meeting the existing state-of-
good-repair needs that we have, as--the crumbling
infrastructure reference that you had mentioned. We need
something to be done to fix the Highway Trust Fund, to provide
additional revenue, and to increase the size of these programs.
Mr. Johnson of Georgia. Now, you know, we have been cutting
revenue, Federal revenues, for decades. We have recently cut
taxes again. And while we have been cutting taxes for decades,
the needs for funding have continued to grow.
And at the same time, my friends on the other side of the
aisle have signed on to the Grover Norquist no new tax pledge,
which is one reason why the gas tax has not been raised since
1993. What impact does this have on our ability to grow our
infrastructure to accommodate the increased trade that we all
agree that we want the Nation to experience?
What impact are our policies of cutting taxes and failing
to raise revenues with increasing needs having on this Nation's
ability to sustain our prosperity into the future?
Ms. Aleman. If I may, Congressman, you know, one of the
points that I made was that private-sector industries are
spending approximately $27 billion annually, due to the cost of
congestion. And that is a cost that I don't imagine that they
are just taking on and not passing on to the consumer. And the
consumers, in return, you know, could be getting so much more
value if we were to put revenues forward to address the
congestion problems at the forefront, as opposed to seeing
those fees, those dysfunction taxes, being passed along on the
back end to consumers.
Mr. Johnson of Georgia. Yes. So when the recent $5.8
trillion tax cut passed, 83 percent of which went to the top 1
percent, then that means that, in addition to consumers paying
higher taxes, or paying a greater proportion of the remaining
tax burden that is in place, they are also getting hit with
increased prices for goods that are incurred by the businesses
that have to build the infrastructure to move the goods that
the consumers pay for. So the bottom 99 percent are catching a
double whammy in this kind of a situation, as our multinational
corporate friends are able to escape their fair share of the
tax burden.
And so, as we talk about these subjects, I think we need to
look at our policies, the policies that we put into place here
in Congress, and stop avoiding the fact that we need to deal
with a revenue shortfall from the Federal Government in order
to sustain the kind of economic growth that we are going to
need for our future.
And with that I will yield back.
Ms. Norton. Thank you, Mr. Johnson.
Mr. Perry?
Mr. Perry. Thanks, Madam Chair. I thank the panel members
for their attendance today.
Mr. Mathers, in your testimony you stated zero-emission
heavy-duty vehicles are increasingly viable. But this
statement, in my opinion, is not completely based in reality.
If they were economically viable and provided a lower total
cost of ownership, as you claim, then the industry would be
embracing them due to the market incentives, alone.
However, the high cost of current battery technology,
combined with its limited energy density level makes EV trucks
infeasible for long-haul operations, currently, and an
expensive alternative for shorter operation.
It is also vital to remind everyone that the phrase ``zero-
emission vehicle'' is a deceptive and misleading labeling
practice, as it fails to account for the emissions related to
energy-intensive battery manufacturing processes, and the very
power generation necessary to recharge the battery. This
reality not only limits the net emissions reductions offered by
a transition to these vehicles, but it requires significant
amounts of the rare earth minerals necessary for the production
of the batteries themselves.
As you know, China has a stranglehold over the component
mineral supply chains in the battery manufacturing industry.
Also, China is projected to supply around two-thirds of global
battery demand in 2020. Not coming from America, they are
coming from China.
The extremely energy-intensive manufacturing process will
be powered largely by coal well into the future in China. Today
70 percent of China's power is generated at coal-fired plants,
and they will continue to generate over half of the nation's
power through 2040, which, according to Mark Mills at the
Manhattan Institute, quote, ``means that, over the life span of
the batteries, there would be more carbon-dioxide emissions
associated with manufacturing them than would be offset by
using those batteries to, say, replace internal combustion
engines.''
It is important to note that these projections likely
underestimate the emissions in question, as they were published
prior to China's recently announced plans to massively expand
coal-generating capacity while simultaneously cutting funding
for renewables by 40 percent.
The threat posed by Chinese influence over our critical
infrastructure has been acknowledged by this very House and
this committee, as we prohibited FTA funding of projects using
Chinese railcars and buses.
I was going to ask you about your justification for the EDF
support of the significant threat to our national security,
just by using the vehicles, but also the significantly higher
consumer cost, the net increase in greenhouse gas emissions,
and the economic harm that it does to the workers in the United
States. But maybe I will just ask if the EDF would consider
including the emissions that are commensurate with the
production of the batteries, and everything else that goes into
the production and the use of the batteries into their
assessment of the economic viability. Maybe that is a better
question.
Mr. Mathers. Thank you, Mr. Perry, for the question. And we
do, right?
I am not familiar with the Manhattan Institute study, but I
am very familiar with work that the U.S. Government is
sponsoring through Argonne National Labs that has looked at the
life-cycle impact of electrification in electric vehicles, and
found that the fuel consumption, right, is still, by far, the
most significant source of emissions, and that the creation of
the battery is on par with the creation of the vehicle.
So it is, I think, on the order of about 20 percent of the
life cycle. I don't have the numbers off the top of my head,
but would be more than happy to follow up and put those on the
record.
I think the questions around China and the life-cycle cost
all kind of come together in the fact that the direction of
this industry is clear. You are seeing Daimler putting in $1
billion to build these vehicles. You are seeing Cummins invest
half a billion dollars. These manufacturers are doing this
because they see that is where the future is. And right now,
China has a head start on us.
And so I think we, as a country, have a choice to make. Do
we want to out-compete China and make those vehicles here? And
I think we are better off if we do. And that is better for the
environment, that is better for our economy, and that is better
for our national security.
Mr. Perry. But the point is we are not making them here
yet. So the policy that you are advocating for is kind of--the
cart is before the horse, as opposed to backwards. And I don't
necessarily disagree that it would be great if that weren't the
case, but that is not the case now, and I would----
Mr. Mathers. Let's let----
Mr. Perry [continuing]. Just like your estimates----
Mr. Mathers. Let's just let----
Mr. Perry [continuing]. To include all these other things,
and don't paint such a rosy picture which isn't commensurate
with reality. And that is what I am saying.
Ms. Norton. The gentleman's time has expired.
Mr. Lamb?
Mr. Lamb. Thank you, Madam Chairwoman.
Ms. Aleman, I represent an area outside of Pittsburgh,
Pennsylvania, which shares some things in common, economically
and culturally, with the Chicagoland area. I am just curious.
Your review of the CREATE model since it has been built, it
looked to me like you said about 40 percent of the revenue was
Federal, and then, I guess, the 60 percent comes from the other
partners that you have enlisted.
So do you think that an area like mine has much to learn
from CREATE? How would you describe the breakthroughs that you
have made using that model, or the efficiencies that you have
gained? Because it must not be just more Federal funding. There
must also be some efficiencies that you have established with
that model.
Ms. Aleman. Yes, thank you for the question, Congressman.
You know, the CREATE model, while we have seen some very
significant successes, in terms of getting a Federal match, and
also substantial matches from our private-sector partners, I
think some of the benefits that we have seen are being able to
have a list of projects that we have prioritized and are lining
up to move forward at any point that funding opportunities
arise.
For the projects that have been completed, there are about
70 projects in the entire program, about 35 of which have been
completed. We have seen that those projects have come in on
time, under budget, and I think that that is exemplary of the
public-private partnership that we have with our railroad
partners, and leveraging their expertise on some of these
projects, where, you know, inherently, the State side, and the
Federal side, and then the private sector are coming together.
So that is what I would say would be one of the primary
benefits.
Mr. Lamb. And at the start of it, who was kind of the
driver of CREATE in the beginning? Was it more of a public
project in which you recruited the private partners? Or was it
the railroads coming to you and asking for it? Or vice versa?
Or how did it go?
Ms. Aleman. Yes, I would say that there was leadership
between the city of Chicago and Cook County, which is the
county that the city of Chicago sits in, and through that
strong partnership we were able to get on board the State, the
railroads, and other partners because it is a mutually
beneficial program, overall.
Mr. Lamb. OK, thank you.
Ms. Aleman. Thank you.
[Ms. Aleman submitted the following post-hearing correction
to her preceding remark:]
Post-hearing Correction of Remarks Submitted for the Record by Erin
Aleman, Executive Director, Chicago Metropolitan Agency for Planning,
and Board Member, Coalition for America's Gateways and Trade Corridors
At approximately 2 hours and 20 minutes into the hearing, in
response to a question from Representative Lamb, I misspoke about the
history of the CREATE Program. I stated that the city of Chicago and
Cook County initially spurred the program. In fact, it was leadership
from the city of Chicago, the State of Illinois, and railroad partners
that in 2003 spurred the program. Cook County became an official
partner in 2018.
Mr. Lamb. Ms. Goodchild, I was wondering if you could talk
a little bit more about the University Transportation Centers.
We have one back in Pittsburgh, as well, at Carnegie Mellon
University that is doing some really strong work. How would you
evaluate that program so far? Has it worked well at Washington?
Are there challenges? Are there things we could do better with
it?
Ms. Goodchild. The University Transportation Center has
sponsored a center at the University of Washington for, I
think, since the beginning of the program. And, in terms of our
ability to train transportation professionals, it is essential.
Without that program, we would have--you know, at a public
university, the rest of our sort of resources have really been
stripped away.
And so, to provide students with opportunities to hear
additional lectures, to travel to TRB, to participate in any
kind of professional development is really supported through
that program. So, in terms of developing the next generation of
transportation professionals, it is essential, and we wouldn't
be able to do that without the program.
Research-wise----
Mr. Lamb. So, sorry, just to interrupt for a--so would you
say, then, that the main benefit you are concentrating on is
the teaching benefit to students, as opposed to, like, external
work product that it is----
Ms. Goodchild. Right. No, I was going to speak to the----
Mr. Lamb. OK.
Ms. Goodchild [continuing]. To the research outcomes. I
think also having--you know, really, as a source of
complementary Federal funding--so those grants, you know, if
you have a grant from a UTC that has to be matched by some kind
of non-Federal, local money--so I think that structure of
matching locally driven and locally motivated projects by
Federal grant money is also a really essential way to develop
regional with national benefit work.
And we don't--there is no substitute. We don't have the
NCFRP program, we--so it is essential, as well.
Mr. Lamb. OK. Thank you, Madam Chair, I yield back.
Ms. Norton. Thank you, Mr. Lamb.
Mrs. Miller?
Mrs. Miller. Thank you, Chairwoman Norton, and thank you
all for being here today.
Transportation infrastructure is the lifeline that connects
my home State of West Virginia to the rest of the country. Our
highways and rail lines are essential for moving products from
West Virginia, and connecting the country.
Our inland waterways also ship over 80 million tons of
natural resources every year. And shipping via waterways will
continue to play an important role to meeting the growing
demand for goods well into the future.
I think that shipping should be a central part of these
discussions, moving forward. West Virginia is a transportation
State, and we are proud to work hard to deliver the goods that
America and the world needs.
We are all gathered here today because we realize the
importance of our Nation's infrastructure development, and I
thank you all for appearing before this subcommittee today to
help us make some of these tough decisions.
Ms. Aleman, my district of southern West Virginia was one
of the hardest hit by the recession, and it is still recovering
from the war on coal, which caused so many to lose their jobs.
With the dramatic growth of long-haul freight traffic in the
United States, how does the freight industry plan to recruit
new drivers to meet this increased demand?
Ms. Aleman. I am going to defer to my partner here.
Mrs. Miller. Fine.
Mr. Baker. And I would love also for Ian to weigh in, but I
would say we in the rail industry, we actually are not finding
a problem recruiting conductors and engineers for the trains.
It is a well-paying job with railroad retirement benefits, and
it is typically pretty attractive. We have lots of
infrastructure challenges, but I would say at the moment
finding folks to operate freight trains is not one of our
challenges.
Mr. Jefferies. Just to add onto that, absolutely, the
freight rail industry is blessed with folks who are
multigenerational and 45-year veterans.
And while there is no shortage because they are very, very
well-compensated jobs, one area where we are facing challenges,
quite honestly, is the opioid issue. That continues to
challenge us, along with every other manufacturing industry, as
far as--we have a strict drug testing program, and areas that
are most hit by the opioid epidemic, certainly that impacts the
number of possible candidates out there, and has certainly
diminished the potential job pool in certain situations. So
that is an area where we continue to want to work with Congress
to address.
Mrs. Miller. That is a very good point.
Mr. Jefferies. But as far as the--I don't know, the
trucking side, I don't know if you have any comments there.
Mr. Tymon. You know, I would just say that I think
workforce development issues continue to be a top priority for
State DOTs across the country, and that includes maintenance
workers and operators of vehicles. It is becoming harder and
harder, I think, for State DOTs or, I am sure, trucking
companies to be able to recruit new entrants into the business.
You know, I think that there are a lot of other
opportunities for folks right now, with the economy doing so
well, and employment rates so low. It is hard, I think, to
attract people into some of those jobs that aren't easy jobs,
you know, for truck drivers. You are on the road a lot of days
out of the year. If there are a lot of other choices to make, I
can see why it is hard to be competitive in this job market.
Mrs. Miller. Well, and my point is, in the coal fields, for
those people who have had good-paying jobs who are now
unemployed, are you doing anything to recruit them?
Mr. Tymon. I can tell you that, from a State DOT
standpoint, recruitment and retention is a top priority. I
can't speak specifically to what is going on in West Virginia,
but I will tell you that what I hear more from our members is a
shortage of workers, as opposed to, you know, trying to--or--
yes, a shortage is the bigger issue.
Mrs. Miller. So that could go through some of the community
college or career teaching that needs to happen.
Mr. Baker, what role do short line and regional railroads
play in connecting parts of rural America with the greater
transportation network?
And what role can Congress play in making sure that these
railroads are not left behind?
Mr. Baker. Thank you. Short lines largely exist as the
first-mile/last-mile of the freight rail network, and
particularly in smalltown and rural America. West Virginia is a
huge State for short lines.
My written testimony goes into somewhat excruciating detail
on some of the policy recommendations I have, but just in a few
seconds here there are programs that the Transportation and
Infrastructure Committee has supported and championed that are
key for short lines: the CRISI grant program; the issue that
has been referenced here multiple times, the idea of taking off
the multimodal caps on the INFRA program and the State freight
program would be really effective; our favorite topic, the 45G
tax credit, would be effective.
And there is more, too, but those would be great, great
places to start. And I think you have been champions of all of
those, so thank you.
Mrs. Miller. Thank you. I yield back my time.
Ms. Norton. I thank the gentlewoman. Her time has expired.
Mr. Lowenthal?
Mr. Lowenthal. Thank you, Madam Chair.
Ms. Aleman, you know as well as anyone here that freight
movement depends upon a complex, interconnected system of
transportation infrastructures. Deficiencies in any one link of
the supply chain affect the efficient movement of goods for
everyone. That is why I appreciate in your testimony and that
of other witnesses--and you have mentioned it again today, both
in written and in oral--the need to remove barriers like the
cap on nonhighway projects under the Federal freight program.
I am also very appreciative that, especially in your
written testimony, you mention the coalition support for my
proposal to establish a multimodal freight infrastructure trust
fund that would help make these critical intermodal
improvements.
But your testimony also mentions a potential improvement to
the national freight strategic plan, including the addition of
a comprehensive freight needs analysis. Why is that so
important, to have a comprehensive freight needs analysis?
Ms. Aleman. Thank you for the question, Congressman. A
comprehensive look at our national freight infrastructure is
really going to help us be more coordinated in Congress' effort
to provide oversight and guidance to U.S. DOT. It will also
help Members of Congress shape future programs in future
Federal reauthorization bills, and make sure that, really, the
goals and objectives that you set forth in the policies are
being achieved through a transparent, performance-based
framework.
Mr. Lowenthal. I want to follow up on that. And while I
personally strongly support the INFRA program and agree with
you that a competitive grant program is better positioned to
fund large-scale infrastructure projects that improve freight
movement, I am concerned about the lack of transparency in the
selection of projects for these funds.
Would a freight needs analysis allow Congress and
stakeholders to better evaluate if the Department is directing
these funds to the most important and urgent projects?
Ms. Aleman. Yes. So I will reference the recent GAO report
that stated that merit-based project selection is necessary,
and also there is room for improvement in the way that projects
are selected today.
And I think our region has seen that, and come a long way.
For instance, the competitive freight program that Illinois DOT
put together laid out in a transparent way the goals and
objectives, and how the measures that they were going to use to
evaluate projects were going to achieve those goals. And
essentially, we created a tool that said to potential
applicants, ``You can fill this tool out yourself and evaluate
your project.''
I think one of the fears is that it is going to open the
door to a floodgate of projects coming through and people
gaming the system. What we found, instead, was that the
projects that were submitted were better and more oriented
toward the goals of the program and the program dollars.
And at the regional level, too, the programming of our
funds, we make those data, criteria, the scoring transparent so
that all can see. And while you may not get the project you
wanted, or the funding you requested, you at least respect the
process, and you understand where your project could have had
room for improvement.
Mr. Lowenthal. Thank you. I want to follow that up and--you
may have answered it--do you have any additional suggestions to
increase the transparency in the INFRA evaluation process?
Ms. Aleman. Yes. Specifically, it is tying those metrics
that you are going to use to the goals and objectives that you
are trying to achieve, and then I would say making those
projects and the scoring publicly available.
Again, you know, that, in and of itself, making that
transparent, allowing people to see where their projects fell
short, is a critical tool to making sure that you are achieving
your goals.
Mr. Lowenthal. Thank you. And in my minute left, does
anyone else want to comment on the transparency, how we can
improve the INFRA project?
Mr. Baker?
Mr. Baker. Well, I was largely just going to agree with
you, that the importance of increasing the transparency, I will
say we have quite a few short line railroads that partner with
State agencies to apply for these grants, and they do find it
extraordinarily frustrating, how opaque the process is. And it
is difficult to understand what was selected, or what the
reasons for the selection were. So I think the transparency
would help everybody.
Mr. Lowenthal. Thank you. I concur. As one who represents
the port areas of Long Beach, Los Angeles, that transparency
would be great for the process.
With that I yield back.
Ms. Norton. Thank you, Mr. Lowenthal.
Mr. Pence?
Mr. Pence. Thank you, Madam Chair, and thank you all for
being here today.
I hail from Indiana, which is the crossroads of America. I
have always emphasized the necessity of reliable and safe
freight in transport options in my home State. I am a
businessman by background, and I came to Congress to address
the challenges facing our critical infrastructure.
We need to face both the short term and the long term and
put Hoosiers back in the driving seat, as well as all those
across the United States.
The 29,600 miles of highway and 4,500 miles of rail track
in our State contribute to the prosperity of not only Hoosiers,
but all Americans.
We are a national leader in intrastates, home to the second
largest FedEx hub worldwide, and have the third most freight
railroads, with 41 lines, including 6 short line regional
railroads in my district, the Sixth Congressional District of
Indiana.
We are also very proud that Cummins engine company,
headquartered just 1\1/2\ miles from my house in Columbus,
Indiana, is developing world-class, innovative solutions to
advance cleaner technology. In October of this year, Cummins
unveiled cutting-edge technology that would use hydrogen fuel
cell solutions to create a Class 8 heavy-duty truck with zero
emissions.
With our Nation's truck and rail freight transport system
accounting for 74 percent of all movement of goods, it is in
the best interest of companies like Cummins to embrace fuel-
efficient alternatives to be profitable and, most importantly,
reduce the impact on the environment. The American
Transportation Research Institute cites greater congestion as a
source of excessive idling and resulting in higher emissions.
With companies like Cummins modernizing our vehicles, we
should also consider more solutions for reliable freight
infrastructure such as increased rail investment and truck-only
lanes, or critical commerce corridors.
In 2017, truckers alone lost 1.2 billion hours of
productivity from nationwide congestion. I firmly believe that
economic growth in both the trucking and rail industries will
lead to greater economic, environmental, and societal impact.
Mr. Tymon, in your testimony you mentioned addressing
freight corridors in the next surface transportation bill. I
wish more of the industry would join you to highlight the
benefit of these corridors, or truck lanes, to physically
separate cars and trucks in the congested areas. Even though
truckers already pay more than any other entity in our Nation's
highways, the industry is coming to the table with creative
ways to affect these projects.
At the beginning of November, Indiana broke ground on a
similar project called the Heavy Haul Transportation Corridor,
which will pull semi-trucks off the highway with new rail
connections, providing easier access to State roads and improve
multimodal shipping. Solutions like these are not only tackling
congestion, but also create a safer and more fuel-efficient
freight system for Hoosiers.
Mr. Tymon, I know AASHTO has done studies in the past
detailing how truck-only corridors can alleviate congestion and
promote safety. How would reducing restrictions on State
multimodal freight network funding to allow, for example, more
miles for railroad coordination and CCCs help propel our
economy?
Mr. Tymon. Well, thank you for that question, Congressman.
I think the easiest and the best way to promote those types of
projects is----
Ms. Norton. Is your mic on?
Mr. Tymon. It is. Is that better?
I think the easiest and best way to provide opportunities
for those types of projects is to continue to provide
flexibility to the States and to provide funding to them by the
formula programs. These core formula programs that have been
the foundation of the Federal highway program for over 50 years
provide States the predictability to know year in and year out
how much money they are going to get. And that will enable them
to take on innovative approaches as you are describing in
Indiana.
So I think removing some of the redtape and the barriers,
and providing States the flexibility to be creative and
innovative, as they are in Indiana, is the easiest, and it is
the best thing that we can do to promote those types of
projects.
Mr. Pence. Thank you, Madam Chair. I yield back.
Ms. Norton. Thank you, Mr. Pence.
Ms. Plaskett?
Ms. Plaskett. Thank you very much, Madam Chair.
Mr. Tymon, I agree with you that the formula is very, very
important. And, as a Member of the Territories, we were taken
out of the formulas in the late 1990s. And so it is our hope to
go back in them, because we believe that that is the best way
for us to plan how we are going to use our infrastructure and
support. So I am glad to hear you agree that that is a really
important thing to do.
I have been harassing the chair of our committee. The last
time the Territories was on it was the last time a Member of
the Territories was on this committee. So I am hoping that me
being on this committee will get us back in there.
But I wanted to go back to something that one of my
colleagues, Mr. Lowenthal, was talking with you all about,
about transparency and the INFRA program as an example, and in
others, some of the other application and programs that DOT has
in other agencies.
We talked about how transparency would be more important,
and support in predictability for those that are applying. Do
any of you have any specific examples where--the types of
guidelines or additional support that would be helpful to
jurisdictions and municipalities and others that are applying
for some of these grants?
Mr. Tymon. You know, one thing that I guess--one thing that
I would add is sometimes having consistency across years would
help, I think, the applicants, because I think we are seeing,
year to year, that the notice of funding availability will
change kind of what they are trying to emphasize. And I think
that causes project sponsors to then have to kind of retool,
year to year, if they are not selected in that 1 year.
So having, I think, some consistency across the years--the
great thing about the FAST Act was that, for those
discretionary programs that were created there, they spelled
out, I think, specific criteria that provided at least a little
bit of predictability for the applicant----
Ms. Plaskett. Right.
Mr. Tymon [continuing]. So that they could come back to the
table if they weren't successful in the first year.
I do think that the administration is doing a good job of
following up with project sponsors if their application does
not go through, and then letting them know where the
application fell short. But having that level of transparency,
so that everybody knows which projects have been successful,
and why they have been successful or unsuccessful, I think,
would help all project sponsors.
Ms. Plaskett. I know that the Virgin Islands, along with
some of our private partners, did have that meeting at DOT. And
I am really grateful that the Department was willing to sit
down with them and explain what was needed, where they fell
short.
Of course, having that on the front end is a better way,
because then you have to wait another year or so to put in what
is missing, so that you can have a better application and meet
the needs of what it is you are trying to grow.
Does anyone else have anything else that they thought might
be helpful in there?
Mr. Jefferies. Just at a very high level, in a prior life I
worked at GAO, and I think they have been on record, just
talking about the need for very objective, articulated criteria
that are then evaluated in a fully transparent manner. So,
hopefully, you do get that information on the front end, and
don't have to wait until it is too late to get the feedback
that----
Ms. Plaskett. Right.
Mr. Jefferies [continuing]. That would be helpful.
Ms. Plaskett. So several months ago--I am also the chair of
the New Democrat Coalition Infrastructure Task Force, and I
have had the pleasure of going around the country to some of my
colleagues' districts to see what is working, what is not
working. And Mr. Colin Allred invited me to Dallas. I was
really excited to see the rail that is going on there between
Dallas and Houston, and the types of goods and services that
can be moved in that.
Dr. Goodchild, I wanted to ask you, you know, that is a
public-private partnership. It is really being driven by the
private sector. What is the role that you believe that the P3s
can play in helping to meet freight infrastructure needs
throughout the country?
Ms. Goodchild. Yes, thank you. I think it is essential that
the private sector be consulted and engaged and participate as
we build infrastructure.
If you think about building big infrastructure projects
with no insight as to how it is going to be used, or what
benefit it might bring, or why it might bring that benefit, you
can really make huge mistakes, and invest a lot of money in
projects that don't bring the benefit that you thought they
were going to to the ones who are using it.
So I think, as we move forward and we believe that we are
building infrastructure to serve industries, we must understand
those industries, and they must be engaged in some of that
decisionmaking. So I think it is a really important principle,
particularly in the freight space, to good decisionmaking and
efficient, cost-effective use of public money.
Ms. Plaskett. Thank you. And, the Virgin Islands, although
we don't have freight, we recognize that all of our goods are
imported, and that, unless the end--those individuals who are
manufacturing are doing it at a port city, that all of the
goods that are coming to us are coming through freight. So
bottlenecks in that system affect those of us who don't
necessarily have freight going through our districts. And we
all need to be part of the solution in making sure that this is
done efficiently, and the best it can get to the end users.
So thank you all.
Ms. Norton. Thank you, Ms. Plaskett.
Are there any further questions from members of the
subcommittees?
Seeing none, I would like to thank our colleagues, but
especially each of our witnesses for your testimony today. It
has been very helpful to me.
I have listened very carefully to see how your testimony
might improve our upcoming bill. I found your testimony to be
informative and helpful in that regard.
I now ask unanimous consent that the record of today's
hearing remain open until such time as our witnesses have
provided answers to any questions that may be submitted to them
in writing. And I invite Members who have such questions to do
so.
And I also ask unanimous consent that the record remain
open for 15 days for any additional comments and information
submitted by Members or witnesses to be included in the record
of today's hearing.
Without objection, so ordered.
If no other Members have anything to add, the subcommittees
now stand adjourned.
[Whereupon, at 12:45 p.m., the subcommittees were
adjourned.]
Submissions for the Record
----------
Prepared Statement of Hon. Eddie Bernice Johnson, a Representative in
Congress from the State of Texas
Madam and Mr. Chairman, I appreciate the joint subcommittees
holding this hearing today. The purpose is to explore the importance of
freight transportation, investments needed to support freight
transportation, and the ways in which demand for the timely movement of
goods are growing and changing.
Importance of Freight Transportation
It is without question that freight transportation is critical to
our economy in the US. I understand that the nation's freight system
transports, on average, 51 million tons of freight, valued at
approximately $55 billion, on a daily basis, which amounts to
approximately 17.7 billion tons of freight, valued at approximately
$16.8 trillion, annually. Additionally, this demand is increasing each
year.
Investments Needed
Continuous increases in freight transportation demand across the
United States requires us to make the necessary investments today. Most
investments are done at the state and local levels. We know that our
national highway congestion negatively affects the freight delivery
system because it impedes trucking's ability to deliver goods on time.
Reliable and precise scheduling is essential to the freight rail and
trucking systems.
In Dallas, we have worked to battle, and are continuing to battle,
congestion issues. It is reported that more than two out of every five
miles of America's urban interstates are congested. Congestion costs
the trucking industry $74.5 billion in 2017, $66.1 billion of which
occurred in dense urban areas like Dallas.
Ways in Which Demand for Goods Movement is Growing and Changing
Investments in new technology are important to the growth and
development of our national freight delivery systems. As we look to
grow our markets internationally, we also have to ensure that our
domestic systems do not impede the international growth of products
that we sell abroad. As we continue to expand our markets, the need for
new and improved domestic and international freight delivery systems
will only increase.
We cannot stop the development and use of new technology. We need
it for continued growth and advancement. However, I am concerned with
the use of new technology displacing our workers. We must provide
opportunities for retraining and new jobs for people who may lose their
jobs.
In Texas, I am also concerned with the shortage of drivers for
freight trucks. With rising gas prices and increasing congestion on our
highways, it is clear that we need long term transportation
infrastructure solutions that meet the current demand for the movement
of goods, while also allowing for future growth. To help alleviate the
shortage of truck drivers, I am looking at how we can allow more young
people to drive trucks and enter into the trucking industry.
Environmental Impact of Freight Railroads
We must seek viable environmentally sensitive solutions to expand
our nation's freight rail capacity, as we make the necessary freight
rail investments. Advancements have been made, such as in the freight
railroads' use of technology systems to help monitor and gain maximum
fuel efficiency. However, we still have a long way to go.
Madam and Mr. Chairman, I am excited about the many possibilities
in helping to improve our nation's freight transportation
infrastructure. I look forward to working with the committee to
strengthen our nation's capacity to move goods efficiently and in a
timely manner.
Prepared Statement of Hon. Steve Cohen, a Representative in Congress
from the State of Tennessee
Thank you, Chairwoman Norton and Ranking Member Davis and Chairman
Lipinski and Ranking Member Crawford for holding this important
hearing.
I appreciate the opportunity to examine the challenges and
opportunities of freight transportation, especially since my district
is the transportation hub of the United States.
In Memphis, we've got five Class 1 railroads, seven primary
highways, two interstates, the 4th largest inland port in the nation,
and Fed Ex's super hub.
As for trucking, we have more than 400 companies that operate from
Memphis.
It's no wonder that we have been dubbed America's Distribution
Center.
While it's true that no one moves like Memphis, it doesn't come
without its challenges.
As the demand for freight continues to increase, it's important we
look at how it affects all our road users.
Statement of Erin Aleman, Executive Director, Chicago Metropolitan
Agency for Planning, and Board Member, Coalition for America's Gateways
and Trade Corridors, Submitted for the Record by Hon. Peter A. DeFazio
During the hearing, several Members of Congress asked questions
pertaining to the Nationally Significant Freight and Highway Projects
Program (INFRA). Questions addressed funding levels, award selection
transparency, and the difference between formula and competitive grant
distribution approaches.
While I answered each of these questions during the hearing and
also addressed these questions in my written testimony, I am taking
this opportunity to restate the following:
The INFRA program is underfunded. CAGTC calls for an
annual investment of $12 billion in multimodal freight investment
through a competitive grant program.
To ensure the best and highest use of federal dollars,
the award selection process must be transparent and employ merit-based
criteria that identify and prioritize projects with a demonstrable
contribution to national freight efficiency. Goals should include
increasing national and regional economic competitiveness, improving
connectivity between freight modes, reducing congestion and
bottlenecks, and improving the safety, efficiency, and reliability of
the movement of freight and people. Likewise, a national freight
strategic plan that identifies key freight gateways and trade corridors
should guide investment decisions.
Competitive grant programs, such as INFRA, are critical
to large-scale infrastructure projects, which often span modes and
jurisdictional borders and are difficult, if not impossible, to fund
through traditional distribution methods such as formula programs.
Likewise, formula programs play an important role--but there is no
``one size fits all'' approach to funding freight projects and formula
dollars cannot supplant the role of a competitive grant program that
awards projects through the use of merit-based criteria. A federally
administered competitive grant program is necessary to advance
nationally significant freight projects in a timely and efficient
manner.
Letter of December 4, 2019, from Catherine Chase, President, Advocates
for Highway and Auto Safety et al., Submitted for the Record by Hon.
Eleanor Holmes Norton
December 4, 2019.
Hon. Peter A. DeFazio,
Chairman,
Hon. Sam Graves,
Ranking Member,
Committee on Transportation and Infrastructure, U.S. House of
Representatives, Washington, DC.
Dear Chairman DeFazio and Ranking Member Graves:
As you prepare for tomorrow's hearing, ``Where's My Stuff?
Examining the Economic, Environmental, and Societal Impacts of Freight
Transportation,'' we urge you to prioritize safety in considering
America's freight transportation system. Each day on average, over 100
people are killed and nearly 7,500 more are injured in motor vehicle
crashes. This preventable toll also comes with a serious financial
burden. Annually, crashes impose comprehensive costs of over $800
billion on society, $242 billion of which are economic costs--amounting
to a ``crash tax'' of $784 per person each year. Yet, available
solutions to the problems that perpetuate crashes continue to languish.
Moreover, year after year proposals are considered to weaken or repeal
the minimal safety protections that do exist. We encourage you to take
action preventing deaths and injuries as part of any legislative
package advanced by your Committee and respectfully request your
consideration of our positions during the hearing.
Truck crashes deaths continue to rise; immediate action is needed.
In 2018, 4,951 people were killed in crashes involving a large truck--a
staggering 46 percent increase since a low in 2009. Additionally,
151,000 people were injured in crashes involving a large truck that
same year. Commercial motor vehicle (CMV) crashes amounted to $134
billion in costs in 2016, the latest year for which data is available.
These grim statistics are unacceptable and more must be done to prevent
this needless carnage.
Proven countermeasures that would bring about safer conditions for
both truck drivers and those with whom they share the road must be
implemented. Technologies including speed limiting devices, automatic
emergency braking (AEB), and comprehensive underride guards could be
saving lives now if they were fully deployed. Similarly, a required
minimum number of behind the wheel hours should be established as part
of entry level driver training. We call on Congress to take swift
action on legislation requiring these crucial upgrades.
Oppose efforts to weaken or repeal existing truck safety rules. In
the last few years, special interests have been relentless in their
attempts to increase truck driver hours of service and evade compliance
with the electronic logging device (ELD) rule, despite the known
dangers associated with ``tired truckers.'' It is also alarming that
efforts have been underway to allow for ``teen truckers'' by lowering
the age to obtain an interstate commercial driver's license (CDL) from
21 to 18. This ill-conceived concept is especially egregious because
truck drivers under the age of 21 are anywhere from 4 to 6 times more
likely to be in a fatal crash, according to studies of intrastate truck
drivers. These dangerous proposals pose a direct threat to the safety
of all road users and should be resoundingly rejected.
Bigger, heavier trucks would endanger all motorists and our
infrastructure. Congress should oppose all attempts to further degrade
safety by increasing truck size and weight limits. According to the
2017 Infrastructure Report Card from the American Society of Civil
Engineers, America's roads receive a grade of ``D'' and our bridges
were given a ``C+''. Nearly 40 percent of our 615,000 bridges in the
National Bridge Inventory are 50 years or older and one out of 11 is
structurally deficient. The U.S. Department of Transportation (DOT)
Comprehensive Truck Size and Weight Study found that introducing double
33-foot trailer trucks \1\, would be projected to result in 2,478
bridges requiring strengthening or replacement at an estimated one-time
cost of $1.1 billion. This figure does not even account for the
additional, subsequent maintenance costs which will result from longer,
heavier trucks. In fact, increasing the weight of a heavy truck by only
10 percent increases bridge damage by 33 percent. The Federal Highway
Administration (FHWA) estimates that the investment backlog for
bridges, to address all cost-beneficial bridge needs, is $123.1
billion. The U.S. would need to increase annual funding for bridges by
20 percent over current spending levels to eliminate the bridge backlog
by 2032.
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\1\ ``Double 33'' is a configuration of a tractor pulling two 33-
foot trailers, amounting to an eight-story office building on its side.
Despite being aggressively pushed by certain segments of the shipping
and trucking industry, this proposal has been rejected on a bipartisan
basis.
---------------------------------------------------------------------------
Longer trucks also come with operational difficulties such as
requiring more time to pass, having larger blind spots, crossing into
adjacent lanes, swinging into opposing lanes on curves and turns, and
taking a longer distance to adequately brake. And, not surprisingly,
trucks heavier than 80,000 pounds have a greater number of brake
violations, which are a major reason for out-of-service violations.
According to a North Carolina study by the Insurance Institute for
Highway Safety (IIHS), trucks with out-of-service violations are 362
percent more likely to be involved in a crash. This is also troubling
considering that tractor-trailers moving at 60 mph are required to stop
in 310 feet--the length of a football field--once the brakes are
applied. Actual stopping distances are often much longer due to driver
response time before braking and the common problem that truck brakes
are often not in adequate working condition.
Increasing truck size and weight will exacerbate safety and
infrastructure problems, negate potential benefits from investments in
roads and bridges, and divert rail traffic from privately owned freight
railroads to our already overburdened public highways. Also, despite
claims to the contrary, bigger trucks will not result in fewer trucks.
Following every past increase to federal truck size and weight, the
number of trucks are on our roads has gone up. Since 1982, when
Congress last increased the gross vehicle weight limit, truck
registrations have more than doubled. The U.S. DOT study also addressed
this meritless assertion and found that any potential mileage
efficiencies from the use of heavier trucks would be offset in just one
year.
Progress to reduce motor vehicle crash deaths has stagnated despite
available, proven technology. Tremendous focus has been placed on the
future potential of autonomous vehicles (AVs), also known as driverless
cars, to eliminate crashes. While it is claimed that AVs may someday
make meaningful reductions in deaths and injuries, this promise is
still likely decades away. Further, at least four people have already
been killed in crashes involving vehicles in the relatively small fleet
of cars equipped with self-driving technologies. The real risks posed
by experimental driverless cars must be addressed through strong
federal regulation--including safety standards and oversight--before
AVs are deployed on a large scale.
As AVs are being developed and deployed, advanced vehicle
technologies, which prevent and lessen the severity of crashes, should
be required as standard equipment in all new vehicles. In fact, the
National Transportation Safety Board (NTSB) has included increasing
implementation of collision avoidance technologies in its Most Wanted
Lists of Transportation Safety Improvements since 2016. Proven
technologies such as automatic emergency braking, lane departure
warning and blind spot detection should be made standard equipment on
all new vehicles now. We urge Congress to require the U.S. DOT to
establish minimum performance requirements for these lifesaving
technologies and require that all new vehicles be equipped with them.
Infrastructure upgrades will be critical as driverless cars are
deployed. As AVs are tested and eventually commercialized on our
Nation's roads, it will be vital that infrastructure improvements be
made to ensure their safe operation. For example, research shows that
driverless vehicles can easily be confused by poor infrastructure
conditions leading to dangerous errors. In one experiment a standard
stop sign with only a few alterations was interpreted by a driverless
car as a 45 mph speed limit sign. The potential consequences of these
types of mistakes could be catastrophic. Substantial investments in our
infrastructure that benefit human drivers now and help to prepare our
roads for self-driving cars must occur before driverless vehicles are
ubiquitous on our streets. Additionally, despite claims that driverless
technology will improve our congested roads, transportation experts
have already found that the proliferation of mobility services like
Lyft and Uber (precursors for mass deployment of driverless vehicles)
have instead increased congestion and reduced mass transit use. In
addition, a recent study predicted that AVs could exacerbate clogged
arteries by constantly traveling at low speeds instead of parking while
waiting for their next trip. These, and numerous other, issues must be
comprehensively addressed before driverless vehicles are deployed on a
large scale. In order to realize the full potential of AVs to be a
catalyst for positive change, protections must be put in place to
ensure the safety of all road users.
As you consider important issues surrounding freight movement, we
urge you to prioritize efforts that will reverse the high number of
crash fatalities, injuries and costs from large truck crashes.
Effective solutions are readily available to save lives now.
Sincerely,
Catherine Chase, President, Advocates for Georges C. Benjamin, MD,
Highway and Auto Safety Executive Director,
American Public Health
Association
Harry Adler, Executive Director, Truck Jason Levine, Executive
Safety Coalition Director, Center for Auto
Safety
Joan Claybrook, Chair, Citizens for Jack Gillis, Executive
Reliable and Safe Highways (CRASH) and Director, Consumer
Former Administrator, National Highway Federation of America
Traffic Safety Administration
Steve Owings, Co-Founder and President, Stephen W. Hargarten, M.D.,
Road Safe America MPH, Society for the
Advancement of Violence and
Injury Research
Janette Fennell, Founder and President Daphne Izer, Lisbon, ME,
KidsAndCars.org Founder, Parents Against
Tired Truckers (PATT),
Mother of Jeff Izer, Killed
in a truck crash 10/10/93
Dawn King, Davisburg, MI, President, Truck Linda Wilburn, Weatherford,
Safety Coalition (TSC), Board Member, OK, Board Member, PATT,
Citizens for Reliable and Safe Highways Mother of Orbie Wilburn,
(CRASH), Daughter of Bill Badger, Killed Killed in a truck crash 9/2/
in truck crash 12/23/04 02
Larry Liberatore, Severn, MD, Board Beth Badger, Columbus, GA,
Member, PATT, Father of Nick Liberatore, Volunteer, Truck Safety
Killed in a truck crash 6/9/97 Coalition, Daughter of Bill
Badger, Killed in truck
crash 12/23/04
Tami Friedrich Trakh, Corona, CA, Board Sally Greenberg, Executive
Member, CRASH, Sister of Kris Mercurio, Director, National
Sister-in-Law of Alan Mercurio, Aunt of Consumers League
Brandie Rooker & Anthony Mercurio, Killed
in a truck crash 12/27/89
Rosemary Shahan, President, Consumers for Andrew McGuire, Executive
Auto Reliability and Safety Director, Trauma Foundation
Jane Mathis, St. Augustine, FL, Vice Ed Slattery, Lutherville,
President, TSC, Board Member, PATT, MD, Board Member, PATT,
Mother of David Mathis, Mother-in-Law of Volunteer, Truck Safety
Mary Kathryn Mathis, Killed in a truck Coalition, Husband of Susan
crash 3/25/04 Slattery, Killed in a truck
crash 8/16/10, Sons Matthew
& Peter Slattery critically
injured in a truck crash 8/
16/10
Ron Wood, Washington, D.C., Volunteer, Gary Wilburn, Weatherford,
Truck Safety Coalition, Son of Betsy OK, Volunteer, Truck Safety
Wood, Brother of Lisa Wood Martin, Uncle Coalition, Father of Orbie
of Chance, Brock, and Reid Martin, Killed Wilburn, Killed in a truck
in a truck crash 9/20/04 crash 9/2/02
Christina Mahaney, Jackman, ME, Volunteer, Nancy Meuleners Bloomington,
Truck Safety Coalition Injured in a truck MN, Volunteer, Truck Safety
crash 7/19/11, Mother of Liam Mahaney, Coalition, Injured in a
Killed in a truck crash 7/19/11 truck crash 12/19/89
Debra Cruz, Harlingen, TX, Volunteer, Laurie Higginbotham,
Truck Safety Coalition, Injured in a Memphis, TN, Volunteer,
truck crash 8/8/08 Truck Safety Coalition,
Mother of Michael
Higginbotham, Killed in a
truck crash 11/18/14
Kate Brown, Gurnee, IL, Volunteer, Truck Peter Malarczyk, Hastings-on-
Safety Coalition, Mother of Graham Brown, Hudson, NY, Volunteer,
Injured in a truck crash 5/2/05 Truck Safety Coalition,
Injured in a truck crash 12/
29/15, Son of Ryszard and
Anita Malarczyk, Killed in
a truck crash 12/29/15
Monica Malarczyk, Hastings-on-Hudson, NY, Randall Higginbotham,
Volunteer, Truck Safety Coalition, Memphis, TN, Volunteer,
Injured in a truck crash 12/29/15, Son of Truck Safety Coalition,
Ryszard and Anita Malarczyk, Killed in a Father of Michael
truck crash 12/29/15 Higginbotham, Killed in a
truck crash 11/18/14
Alan Dana, Plattsburgh, NY, Volunteer, Julie Branon Magnan, South
Truck Safety Coalition, Son of Janet Burlington, VT, Volunteer,
Dana, Uncle of Caitlyn & Lauryn Dana, Truck Safety Coalition,
Brother-in-law of Laurie Dana, Killed in Injured in a truck crash 01/
a truck crash 7/19/12 31/02, Wife of David
Magnan, Killed in a truck
crash 01/31/02
Cindy Southern, Cleveland, TN, Volunteer, Jennifer Tierney,
Truck Safety Coalition, Wife of James Kernersville, NC, Board
Whitaker, sister-in-law Anthony Hixon and Member, CRASH, Daughter of
aunt of Amber Hixon, Killed in a truck James Mooney, Killed in a
crash 9/18/09 truck crash 9/20/83
Amy Fletcher, Perrysburg, OH, Volunteer, Steve Izer, Lisbon, ME,
Truck Safety Coalition, Wife of John Board Member, PATT, Father
Fletcher, Killed in a truck crash 1/24/12 of Jeff Izer, Killed in a
truck crash 10/10/93
Sandra Lance, Chesterfield, VA, Volunteer, Tina Silva, Ontario, CA,
Truck Safety Coalition, Mother of Kristen Volunteer, Truck Safety
Belair, Killed in a truck crash 8/26/09 Coalition, Sister of Kris
Mercurio, Sister-in-Law of
Alan Mercurio, Aunt of
Brandie Rooker & Anthony
Mercurio, Killed in a truck
crash 12/27/89
Bruce King, Davisburg, MI, Volunteer, Melissa Gouge, Washington,
Truck Safety Coalition, Son-in-law of D.C., Volunteer, Truck
Bill Badger, Killed in truck crash 12/23/ Safety Coalition, Cousin of
04 Amy Corbin, Killed in a
truck crash 8/18/97
Kim Telep, Harrisburg, PA, Volunteer, Marchelle Wood, Falls
Truck Safety Coalition, Wife of Bradley Church, VA, Volunteer,
Telep, Killed in a truck crash 8/29/12 Truck Safety Coalition,
Mother of Dana Wood, Killed
in a truck crash 10/15/02
Ashley McMillan, Memphis, TN, Volunteer, Bernadette Fox, Davis, CA,
Truck Safety Coalition, Girlfriend of Volunteer, Truck Safety
Michael Higginbotham, Killed in a truck Coalition, Best friend of
crash 11/18/14 Daniel McGuire, Killed in a
truck crash 7/10/14
Warren Huffman, Odessa, MI, Volunteer, Paul Badger, Davidson, NC,
Truck Safety Coalition, Brother of Tim Volunteer, Truck Safety
Huffman, Killed in a truck crash 5/6/13 Coalition, Son of Bill
Badger, Killed in truck
crash 12/23/04
Frank Wood, Falls Church, VA, Volunteer, Morgan Lake, Sunderland, MD,
Truck Safety Coalition, Father of Dana Volunteer, Truck Safety
Wood, Killed in a truck crash 10/15/02 Coalition, Injured in a
truck crash 7/19/13
Santiago Calderon, Arcata, CA, Volunteer,
Truck Safety Coalition, Injured in a
truck crash 4/10/14
cc: Members of the U.S. House Committee on Transportation and
Infrastructure
Statement of Chris Spear, President and Chief Executive Officer,
American Trucking Associations, Submitted for the Record by Hon.
Eleanor Holmes Norton
Chair Norton, Chairman Lipinski, Ranking Members Davis and
Crawford, and members of the subcommittees, thank you for holding this
important hearing and for providing the American Trucking Associations
(ATA) \1\ with the opportunity to submit testimony for the record. ATA
is an 86-year old federation that represents every sector of the
trucking industry, with affiliates in all 50 states. Our federation has
members in every Congressional district and every community. More than
80 percent of U.S. communities rely exclusively on trucks for their
freight transportation needs. Trucking is the glue that connects all
modes in support of the American economy.
---------------------------------------------------------------------------
\1\ American Trucking Associations is the largest national trade
association for the trucking industry. Through a federation of 50
affiliated state trucking associations and industry-related conferences
and councils, ATA is the voice of the industry America depends on most
to move our nation's freight. Follow ATA on Twitter or on Facebook.
Trucking Moves America Forward.
---------------------------------------------------------------------------
The trucking industry has made great strides over the last several
decades to reduce its environmental footprint, and trucking companies
continually work with their suppliers, customers and other partners to
improve fuel efficiency. Not only is this beneficial to public health
and the future of the planet, but it makes good business sense.
Depending on market conditions, fuel is the highest or second highest
line item cost for motor carriers.\2\ Therefore it is incumbent on
trucking companies to do all they can to reduce their fuel consumption.
Congress can assist in this regard by making the investments in highway
infrastructure necessary to reduce congestion, which caused the
trucking industry to consume an additional 6.87 billion gallons of fuel
in 2016. This represented approximately 13 percent of the industry's
fuel consumption, resulting in 67.3 million metric tons of excess
carbon dioxide (CO2) emissions.\3\ Congress can also eliminate a major
disincentive for carriers who want to buy newer, cleaner trucks by
eliminating the 12% excise tax on new trucks.
---------------------------------------------------------------------------
\2\ An Analysis of the Operational Costs of Trucking: 2019 Update.
American Transportation Research Institute, Nov. 2019.
\3\ Fixing the 12% Case Study: Atlanta, GA. American Transportation
Research Institute, Feb. 2019.
---------------------------------------------------------------------------
Trucking was the first freight industry to widely use advanced
diesel engine emissions control systems. In 2002, the industry began
buying new trucks which incorporated exhaust gas recirculation (EGR)
combined with other emission control technologies to reduce tailpipe
emissions of nitrogen oxides (NOx) by half. The additional cost of
purchasing this new engine technology has been estimated to be as much
as $250 million annually.
Beginning in 2007, the new diesel trucks purchased by the industry
began incorporating diesel particulate filters (DPFs) to reduce
tailpipe emissions of particulate matter (PM) by at least 90 percent.
These trucks also achieved the first half of a 90 percent reduction in
NOx emissions which was fully implemented in 2010. In other words,
every 10 new trucks purchased today equal the NOx and PM emissions
produced by a single truck purchased thirteen years ago.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
To enable the use of these new emission reduction technologies, the
trucking industry began transitioning to ultra-low sulfur diesel fuel
(ULSD) in 2006. By late 2010, all of the highway diesel fuel sold in
the United States contained near-zero levels of sulfur (<15 parts/
million). The additional cost of purchasing this new low-emission
engine technology and fuel has been estimated to be as much as $4
billion annually.
Today, 43 percent of large commercial trucks registered in the
United States meet the most stringent NOx and PM emissions standards.
And with each new truck purchase further expanding the use of NOx and
PM controls, emissions from heavy-duty diesel engines are projected to
significantly decrease over the next decade. According to the
Environmental Protection Agency, these stringent emissions standards
cut nationwide NOx and PM emissions from heavy-duty diesel trucks in
half between 2007 and 2015. By 2030, these emissions will be reduced by
roughly 90 percent.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Achieving Reductions: U.S. Heavy-Duty Diesel Engine Emissions Trends
Beginning in 2014, new diesel trucks began to incorporate enhanced
aerodynamics, low rolling resistance tires and other innovative
technologies to improve fuel efficiency and reduce carbon dioxide (CO2)
emissions. By 2018, these first-ever standards will reduce fuel
consumption and CO2 emissions by as much as 23 percent over a baseline
2010 truck. The additional cost of purchasing this new technology has
been estimated to be as much $8 billion which is expected to be offset
through savings in fuel purchases. A second phase of fuel efficiency
and CO2 standards has been adopted that will achieve an additional 34
percent reduction from trucks and the trailers they pull by 2027. The
estimated cost of the innovative technologies which will be used to
achieve these additional reductions is estimated to be $20-$30 billion.
According to the Federal Highway Administration, trucks transport
more than two-thirds of U.S. freight tonnage. By 2020, while trucking's
share of U.S. freight tonnage is projected to increase, less than 40
percent of U.S. freight-related NOx and PM emissions are expected to be
produced by trucks. These achievements in sustainability and cleaner
air are primarily the result of the trucking industry's investment in
new trucks with advanced diesel engine emissions control systems, the
purchase of ultra-low sulfur diesel fuel to power these engines and
advancements in vehicle design.
This year, the trucking industry will move 70 percent of the
nation's freight tonnage, and over the next decade will be tasked with
moving three billion more tons of freight than it does today while
continuing to deliver the vast majority of goods.\4\ Some claim that
large shifts in freight from trucks to an alternative mode--primarily
rail--would reduce emissions and congestion. This is no doubt true.
However, it is also highly unrealistic to assume that the 40-year
trend-line toward the more nimble, reliable and flexible freight
transportation provided by trucks will suddenly reverse course. Indeed,
over the past 20 years rail market share has fallen by 42 percent,
while the trucking industry's market share has increased by nine
percent.\5\ While pipelines are projected to grow their market shares
as capacity continues to expand and energy production increases, rail
carload traffic is expected to continue to stagnate--both in terms of
market share and amount of volume--and rail intermodal shares will
remain flat. In fact, the annual growth in truck volumes over the next
decade is nearly equal to the total amount of freight moved by
intermodal rail each year. While rail may have a price advantage over
trucks, shippers show no sign that they are ready to abandon the higher
quality, more reliable service that only trucks can provide. In fact,
as e-commerce grows, the trend toward trucking is likely to accelerate.
Therefore, it would be unwise to redirect money designated for
highways--particularly funds currently going toward the two freight
programs created by the FAST Act, to non-highway freight projects when
it is clear that for the foreseeable future the vast majority of
freight will continue to move on the highway system.
---------------------------------------------------------------------------
\4\ Freight Transportation Forecast 2018 to 2029. American Trucking
Associations, 2018.
\5\ Commodity Flow Survey 1997 and 2017 Preliminary tables, U.S.
Department of the Census.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The federal government has a critical role to play in the supply
chain. Freight knows no borders, and the constraints of trying to
improve the movement of freight without federal funding and
coordination will create a drag on all freight providers' ability to
serve national and international needs. The critical role that only the
federal government can play is to look at investment decisions in the
context of national impacts and determine which investments can produce
the greatest economic benefits regardless of jurisdictional
considerations. Only the federal government can break down the
artificial constraints of geographic boundaries that hamper sound
investment in our nation's freight networks. Only the federal
government can provide the resources necessary to fund projects whose
benefits extend beyond state lines, but are too expensive for state or
local governments to justify investments at the expense of local
priorities. This is why devolution of funding highway projects to state
and local governments cannot and will not address our most important
national needs.
A well-maintained, reliable and efficient network of highways is
crucial to the delivery of the nation's freight and vital to our
country's economic and social well-being. However, the road system is
rapidly deteriorating, and costs the average motorist nearly $1,600 a
year in higher maintenance and congestion expenses.\6\ Highway
congestion also adds nearly $75 billion to the cost of freight
transportation each year.\7\ In 2016, truck drivers sat in traffic for
nearly 1.2 billion hours, equivalent to more than 425,000 drivers
sitting idle for a year.\8\
---------------------------------------------------------------------------
\6\ Bumpy Road Ahead: America's Roughest Rides and Strategies to
make our Roads Smoother, The Road Information Program, Oct. 2018; 2015
Urban Mobility Scorecard. Texas Transportation Institute, Aug. 2015.
\7\ Cost of Congestion to the Trucking Industry: 2018 Update.
American Transportation Research Institute, Oct. 2018.
\8\ Ibid.
---------------------------------------------------------------------------
Most troubling is the impact of underinvestment on highway safety.
In nearly 53 percent of highway fatalities, the condition of the
roadway is a contributing factor.\9\ In 2011, nearly 17,000 people died
in roadway departure crashes, over 50 percent of the total.\10\ Many of
these fatalities result from collisions with roadside objects, such as
trees or poles located close to the roadway.
---------------------------------------------------------------------------
\9\ Roadway Safety Guide. Roadway Safety Foundation, 2014.
\10\ Ibid.
---------------------------------------------------------------------------
The Highway Trust Fund (HTF), the primary source of federal revenue
for highway projects, safety programs and transit investments, is
projected to run short of the funds necessary to maintain current
spending levels by FY2021.\11\ While an average of approximately $42
billion per year is expected to be collected from highway users over
the next decade, nearly $60 billion will be required annually to
prevent significant reductions in federal aid for critical projects and
programs.\12\ It should be noted that a $60 billion annual average
federal investment still falls well short of the resources necessary to
provide the federal share of the expenditure needed to address the
nation's surface transportation safety, maintenance and capacity
needs.\13\ According to the American Society of Civil Engineers, the
U.S. spends less than half of what is necessary to address these needs.
As the investment gap continues to grow, so too will the number of
deficient bridges, miles of roads in poor condition, number of highway
bottlenecks and, most critically, the number of crashes and fatalities
attributable to inadequate roadways.
---------------------------------------------------------------------------
\11\ The Budget and Economic Outlook 2019-2029, January 2019
Congressional Budget Office.
\12\ Ibid.
\13\ 2015 Status of the Nation's Highways, Bridges, and Transit:
Conditions & Performance. USDOT, Dec. 2016; see also 2017
Infrastructure Report Card. American Society of Civil Engineers, 2017.
---------------------------------------------------------------------------
While the cost and scale of addressing highway improvement needs is
daunting, it is important to note that much of the congestion is
focused at a relatively small number of locations. Just 17% of National
Highway System (NHS) miles represents 87% of total truck congestion
costs nationwide.\14\ Many of these locations are at highway
bottlenecks that are identified annually by the American Transportation
Research Institute. ATRI recently released its annual freight
bottleneck report, which identifies the top 100 truck bottlenecks
around the country.\15\ The Washington, DC area had two major
bottlenecks, while Illinois had four. While most of the bottlenecks
were in large metropolitan areas, the report found trouble spots even
in smaller cities like Baton Rouge, LA, San Bernardino, CA, Birmingham,
AL, Chattanooga, TN, and Greenville, SC. ATA's highway funding
proposal, described below, would adopt a strategy for funding
improvements at these costly choke points.
---------------------------------------------------------------------------
\14\ Ibid.
\15\ https://truckingresearch.org/2019/02/06/atri-2019-truck-
bottlenecks/
---------------------------------------------------------------------------
A recently released report \16\ by the Transportation Research
Board (TRB) requested by Congress focused specifically on the current
state and future needs of the Interstate Highway System. This critical
network binds our nation together and reaps immeasurable economic and
national security benefits for the United States. Most importantly,
because interstates are far safer than surface roads, since 1967 its
construction has prevented nearly a quarter million people from losing
their lives in vehicular crashes.\17\ The Interstate Highway System
accounts for about one-quarter of all miles traveled by light-duty
vehicles and 40 percent of miles traveled by trucks.\18\ The TRB report
estimates that conservatively, the state and federal investment
necessary to address the Interstate system's maintenance and capacity
needs will have to double or triple over today's expenditures in the
next 20 years.\19\
---------------------------------------------------------------------------
\16\ Renewing the National Commitment to the Interstate Highway
System: A Foundation for the Future (2018). Transportation Research
Board, National Academy of Sciences.
\17\ Ibid, p. 2-18
\18\ Ibid, p. 2-10.
\19\ Ibid, p. S-5
---------------------------------------------------------------------------
ATA's proposed solution to the highway funding crisis is the Build
America Fund. The BAF would be supported with a new 20 cent per gallon
fee built into the price of transportation fuels collected at the
terminal rack, to be phased in over four years. The fee will be indexed
to both inflation and improvements in fuel efficiency, with a five
percent annual cap. We estimate that the fee will generate nearly $340
billion over the first 10 years. It will cost the average passenger
vehicle driver just over $100 per year once fully phased in.\20\ While
much of the money under the BAF would fund existing programs, we
recommend that $5 billion annually should be dedicated to addressing
major highway freight bottlenecks.
---------------------------------------------------------------------------
\20\ Federal Highway Administration, Highway Statistics 2016, Table
VM-1. Average light-duty vehicle consumed 522 gallons of fuel.
---------------------------------------------------------------------------
We also support a new fee on hybrid and electric vehicles, which
underpay for their use of the highway system or do not contribute at
all. We look forward to working with the committee to identify the best
approach to achieve that goal.
The fuel tax is the most immediate, cost-efficient and conservative
mechanism currently available for funding surface transportation
projects and programs. Collection costs are less than one percent of
revenue.\21\ Our proposal will not add to the federal debt or force
states to resort to detrimental financing options that could jeopardize
their bond ratings. Unlike other approaches that simply pass the buck
to state and local governments by giving them additional ``tools'' to
debt-finance their infrastructure funding shortfalls for the few
projects that qualify, the BAF will generate real money that can be
utilized for any federal-aid project.
---------------------------------------------------------------------------
\21\ Ibid.
---------------------------------------------------------------------------
Beyond infrastructure needs, Congress can assist in addressing a
major safety and efficiency challenge facing the trucking industry.
Research and feedback from carriers and drivers suggest there is a
significant shortage of available parking for truck drivers in certain
parts of the country. Given the projected growth in demand for trucking
services, this problem will likely worsen. There are significant safety
benefits from investing in truck parking to ensure that trucks are not
parking in unsafe areas due to lack of space. In addition, locating
truck parking in strategic areas can help to alleviate congestion by
allowing trucks to stage their deliveries and get to their destinations
before peak congestion periods begin.
Funding for truck parking is available to states under the current
federal-aid highway program, but truck parking has not been a priority
given a shortage of funds for essential highway projects. Therefore, we
support the creation of a new discretionary grant program with
dedicated funding from the federal-aid highway program for truck
parking capital projects.
Once again, thank you for holding this hearing and giving ATA the
opportunity to submit testimony. The safe, efficient and sustainable
movement of freight is both critical and attainable. While trucking
companies work hard every day to achieve these goals, some things are
beyond their control. The trucking industry cannot determine how much
money is invested in highways, or which projects are selected. We all
rely on our elected representatives to make these decisions. ATA's
members have offered to help pay for improvements to the highway
system, and we hope you make the right decision by accepting that
assistance and by investing the money where it is needed most--in
highway bottlenecks and the expansion of truck parking capacity where
shortages exist.
Statement of the Association of Equipment Manufacturers, Submitted for
the Record by Hon. Eleanor Holmes Norton
Dear Chairwoman Holmes Norton, Chairman Lipinski, Ranking Member
Davis, and Ranking Member Crawford:
The Association of Equipment Manufacturers (AEM) appreciates the
opportunity to submit a statement for the record on the hearing
entitled ``Where's My Stuff? Examining the Economic, Environmental, and
Societal Impacts of Freight Transportation.'' AEM represents more than
1,000 members in the construction, agriculture, forestry, utility and
mining sectors and advocates for an industry that employs more than 1.3
million U.S. men and women and contributes $159 billion a year to our
national economy. AEM's membership is dependent on a well-maintained
and reliable freight network to ensure that raw materials, goods, and
components are transported efficiently and cost effectively. As such,
we continue to urge policymakers to pursue sensible legislative
solutions that target intermodal network bottlenecks.
Many of our members manufacture products in rural areas, acting as
important employers for these communities; however, operation in rural
communities presents unique shipping challenges. For instance, rural
facilities frequently operate along two-lane highways that are ill-
equipped to accommodate significant freight traffic, yet raw materials
need to make their way to the facilities to allow products to be
manufactured and finished goods and components need to get to
customers. Poorly maintained roads and those that are unable to
accommodate freight traffic as well as freight rail congestion
increases shipment transportation time.
Likewise, significant freight delays at our nation's ports have
created additional challenges for our membership. In some cases,
significant delays and freight congestion have even forced our members
to divert shipments to non-domestic ports. Infrastructure capacity and
reliability challenges raise logistics costs which are ultimately
passed onto customers in the form of higher prices. Transportation
funding directed towards freight capacity will help alleviate these
challenges and ensure that equipment manufacturers can retain
competitive pricing models. AEM supports proposals that would help
mitigate the challenges that our members face with regard to our
nation's freight network. We support legislative proposals that would
establish grant programs dedicated to freight focused projects and
those that would create a dedicated revenue stream for freight projects
funded by user fees.
We appreciate the leadership of the Subcommittee on Highways &
Transit and the Subcommittee on Railroads, Pipelines, & Hazardous
Materials on this important topic. We look forward to working with you
as you develop innovative solutions to our nation's freight challenges.
Letter of December 3, 2019, from Allen R. Schaeffer, Executive
Director, Diesel Technology Forum, Submitted for the Record by Hon.
Eleanor Holmes Norton
December 3, 2019.
Rep. Eleanor Holmes Norton,
Chairman,
Subcommittee on Highways & Transit, Committee on Transportation &
Infrastructure, U.S. House of Representatives, Rayburn House
Office Building, Washington, DC.
Rep. Rodney Davis,
Ranking Member,
Subcommittee on Highways & Transit, Committee on Transportation &
Infrastructure, U.S. House of Representatives, Rayburn House
Office Building, Washington, DC.
Dear Chairman Norton and Ranking Member Davis,
On behalf of the Diesel Technology Forum, we would like to submit
the comment concerning the hearing before the subcommittee titled
Where's My Stuff? Examining the Economic, Environmental, and Societal
Impacts of Freight Transportation. Diesel is the prime technology that
moves many freight conveyances including commercial vehicles,
locomotives, marine vessels and the wide variety of off-road cargo
handling equipment. Diesel technology has undergone a significant
transformation over the past decade and half and the latest generation
diesel technologies that power heavy duty trucks and off-road equipment
are now near-zero in emissions. The leaders in diesel technology are
engaged to refine the technology to further drive these emissions
closer to zero in the near term while generating significant fuel
savings and greenhouse gas emission reductions. While emerging zero-
emission heavy-duty technologies are on the drawing board today, and a
few are available currently, introducing the latest diesel technology
will do the most to deliver immediate term benefits to the communities
where these vehicles and equipment operate. Diesel is also a U.S.
economic success story as 13 states are home heavy-duty diesel
manufacturing facilities.
By way of background, the Diesel Technology Forum represents the
leaders in diesel technology including engine, vehicle, equipment and
component manufacturers and biofuel producers. The Diesel Technology
Forum is a not-for-profit organization that conducts research and
educational outreach about the economic importance, energy efficiency
and clean air and climate benefits of diesel technology of all kinds.
Diesel vehicles and equipment play a key role in 15 sectors of the US
economy, from agriculture to goods movement and warehousing and mass
transit.
1. Diesel is the Prime Mover of the U.S. Economy & Supports 12 Percent
of Private Sector Economic Activity
Diesel engines power the overwhelming majority of vehicles and
equipment responsible for moving freight in the U.S. Three out of every
four commercial vehicles is powered by diesel with the remainder
comprised of gasoline and just 2 percent are natural gas. 98 percent of
the larger Class 8 trucks are powered by diesel while nearly the
entirety of locomotives and larger marine workboats are also powered by
diesel. While alternative fuels and all-electric technologies power
some of the wide variety of off-road cargo handling and warehouse
equipment, including forklifts and gantry cranes, diesel is still the
prime technology among off-road equipment.
Much of these heavy-duty diesel engines and the vehicles and
equipment they power are manufactured in the U.S., supporting private
sector economic activity and employment. Over 1 million heavy-duty
diesel engines were manufactured in 13 states in the U.S. These
engines, and the vehicles and equipment they power are critical to the
warehousing and logistics, agricultural and construction industries
that generated $4 trillion in economic activity in the first quarter of
2019, or 12 percent of all private sector activity.
According to the Bureau of labor Statistics, over 265,000 Americans
are employed as diesel technicians across the country and job prospects
show signs of continual improvement \1\. The leaders in diesel
technology sponsor technical programs around the country to help
guarantee a skilled workforce to keep diesel technology working for
America.\2\
---------------------------------------------------------------------------
\1\ Occupational Employment and Wages--Bus, Trucks and Diesel
Engine Specialists. Bureau of Labor Statistics. https://www.bls.gov/
oes/current/oes493031.htm
\2\ ``MANUFACTURING PROGRESS: 1 MILLION HEAVY-DUTY DIESEL ENGINES
ARE GOOD FOR THE ENVIRONMENT AND ECONOMY''. Diesel Technology Forum,
September 2019. https://www.dieselforum.org/policyinsider/
manufacturing-progress-1-million-heavy-duty-diesel-engines-are-good-
for-the-environment-and-economy
---------------------------------------------------------------------------
2. Significant Transformation to Near Zero Emissions in the Diesel
Platform
Over the last decade-and-a-half, diesel technology has undergone a
significant transformation to near-zero emissions. Cleaner fuel along
with modern engine designs and aftertreatment technologies yield near-
zero levels of fine particles and oxide of nitrogen. 43 percent of the
diesel commercial vehicle fleet come with these near-zero emissions
technologies and generate significant emission reduction benefits to
the communities where they operate. A single near-zero emissions Class
8 truck, for example, generates 2.3 tons less oxides of nitrogen than
an older generation truck. U.S. Environmental Protection Agency finds
that a new Class 8 diesel truck and an all-electric truck can reduce
about the same amount of fine particle emissions as most emissions are
generated by brake and tire wear and not from tailpipe emissions.\3\
---------------------------------------------------------------------------
\3\ https://www.epa.gov/ports-initiative/national-port-strategy-
assessment-reducing-air-pollution-and-greenhouse-gases-us
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
---------------------------------------------------------------------------
Source: U.S. EPA Office of Transportation and Air Quality (OTAQ)
3. Clean Commercial Vehicles Reduce Greenhouse Gas Emissions
Transportation sources of greenhouse gas emissions are now the
leading source of emissions in the U.S. While passenger cars contribute
the most to transportation emissions, commercial vehicles rank as the
second leading contributor while rail and marine vessels represent 4
percent collectively.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Within the large population of commercial vehicles, the larger
Class 7 and 8 trucks are responsible for the majority of emissions.
Efforts to encourage the replacement of older Class 7 and 8 vehicles
with new cleaner technologies will do the most to reduce commercial
vehicle greenhouse gas emissions.
4. Continued Improvements in Diesel Technology Provides Greenhouse Gas
Reductions
One of the benefits of the diesel platform is its impressive track
record for continual improvement. While the current generation of
diesel commercial vehicles deliver near-zero emissions, truck and
engine manufacturers are hard at work developing much more fuel
efficient diesel trucks that will deliver significant fuel savings.
Fuel economy rules are now required of the large variety of commercial
vehicles from larger pickups to the largest Class 8 trucks. More
efficient diesel trucks are expected to save 130 billion gallons of
fuel and reduce 1.3 billion tons of greenhouse gas emissions between
2010 and 2030, according to research commissioned by the Diesel
Technology Forum. These are significant benefits that are equivalent to
removing all cars on U.S. roads for a year or eliminating the emissions
generated from electricity used by 22 million homes.\4\
---------------------------------------------------------------------------
\4\ https://www.dieselforum.org/policy/climate-change-and-diesel-
technology
---------------------------------------------------------------------------
5. Reducing Transportation Emissions Requires a Variety of Clean
Technologies Including Diesel
As emerging technologies will be the focus of much attention to
reduce heavy-duty transportation emissions, significant and near-term
benefits can be realized by replacing older trucks with newer diesel
options to help contribute to achieve climate goals.
While zero-emission technologies are available today in some
commercial vehicle and bus types, and others are on the drawing board,
diesel technology is expected to continue to dominate the larger
commercial vehicle fleet through 2030, particularly Class 8 trucks that
are responsible for most of the greenhouse gas emissions from the
entire commercial vehicle sector. As these emerging zero-emissions
technologies will make in-roads into the fleet, so too will more
efficient diesel commercial vehicles and their benefits are substantial
as noted above. IHS Markit estimates that 75% of commercial vehicle
truck sales will include a diesel engine by 2030.\5\ Meanwhile, the
work truck industry and the National American Council for Freight
Efficiency estimate that all-electric technologies may not prove out
for larger commercial vehicles until at least the 2030 time frame.\6\
This outlook is shared by the Truck and Engine Manufacturers. As these
technologies become available in the future, a recent analysis
conducted by the National Academies of Science concludes that the
relatively longer turn-over of older vehicles in favor of new trucks
results in a further timeframe for these technologies to enter the
fleet in any sizeable number to generate benefits.\7\
---------------------------------------------------------------------------
\5\ https://ihsmarkit.com/products/reinventing-the-truck.html
\6\ https://nacfe.org/future-technology/electric-trucks/
\7\ https://www.nap.edu/catalog/25542/reducing-fuel-consumption-
and-greenhouse-gas-emissions-of-medium-and-heavy-duty-vehicles-phase-
two
---------------------------------------------------------------------------
6. More Efficient Off-Road Technologies
Replacing older engines that power marine vessels and locomotives
may provide greenhouse gas emission reductions. Unlike commercial
vehicles, off-road equipment including rail and marine that is
responsible for about 4 percent of transportation greenhouse gas
emissions, are not subject to fuel economy standards. Engines that
power these applications must meet stringent emissions standards for
criteria pollutants including fine particles and oxides of nitrogen.
New technology diesel engines developed to meet the most recent
standard required by the U.S. Environmental Protection Agency reduce
these emission by upwards of 90 percent. While fuel economy is not
required, replacing these much older and longer lived engines with new
more modern designs frequently results in fuel economy benefits that
translate directly to greenhouse gas emission reduction.
For example, one rail operator in the New York City region replaced
an old switch locomotive manufactured before emission controls were
required with the new diesel technology and saved 26,000 gallons of
fuel per year.\8\ Similarly, a tug boat operator in the Puget Sound
region replaced an old uncontrolled propulsion engines with new diesel
models to realize 1,000 tons of greenhouse gas emissions.\9\ These are
benefits generated by a single project and are equivalent to converting
thousands of automobiles to zero-emissions technologies.
---------------------------------------------------------------------------
\8\ https://www.epa.gov/ports-initiative/new-york-city-locomotive-
repowers-collaborative-efforts-improve-air-
quality?fbclid=IwAR2wUx2848cmG_PDQcrY9IlclL_Q2pTcgXvpfDcO-Q_J5V1y0-
FNPYpzU5U#outcomes
\9\ https://www.epa.gov/sites/production/files/2019-05/documents/
diesel-tech-forum-large-engine-research-2019-mcdi-mtg-12pp.pdf
---------------------------------------------------------------------------
7. Significant Benefits From Advanced Biofuels
Significant additional and immediate term greenhouse gas reduction
benefits can be realized through the use of advanced biofuels including
biodiesel and renewable diesel fuel. These two fuels are considered
advanced biofuels capable of reducing greenhouse gas emissions by at
least fifty percent and in the case of renewable diesel fuel,
greenhouse gas emissions can be eliminated by more than 80 percent.
Unlike other alternatives, the use of biodiesel and renewable
diesel fuel can be used in existing diesel engines and does not require
the purchase of a new engine, vehicle or equipment. The use of these
fuels also does not require additional and expensive investments in
refueling or recharging infrastructure.
These fuels have provided the most greenhouse gas reductions in the
transportation sector in California, according to the California Air
Resources Board.\10\ As a result of California's requirement to reduce
the carbon content of transportation fuels sold in the state, biodiesel
and renewable diesel fuel have eliminated the most greenhouse gas
emissions even exceeding the benefits generated by all-electric cars
and trucks by almost 4:1.
---------------------------------------------------------------------------
\10\ https://ww3.arb.ca.gov/fuels/lcfs/dashboard/dashboard.htm
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Interest in these fuels is growing outside of California. The City
of New York, with its fleet of 13,000 heavy-duty vehicles and equipment
announced it efforts to replace 17 million gallons of diesel fuel with
renewable diesel fuel that is expected to be the leading contributor to
the City's greenhouse gas reduction strategy.\11\ The Port Authority of
New York-New Jersey announced its partnership with Neste, the global
leader in the supply of renewable diesel fuel, to use this advanced
biofuel in the Port's fleet of heavy-duty vehicles and equipment.\12\
---------------------------------------------------------------------------
\11\ https://www1.nyc.gov/assets/dcas/downloads/pdf/fleet/Press-
Release-DCAS-to-Expand-Use-of-Renewable-Diesel-in-City-Fleet-
Vehicles.pdf
\12\ https://bioenergyinternational.com/biofuels-oils/neste-and-
the-port-authority-of-new-york-new-jersey-collaborate-to-facilitate-
the-use-of-sustainable-transportation-fuels
---------------------------------------------------------------------------
conclusion
Diesel technology is the prime technology that moves freight in the
U.S. Much of this technology and fuel is produced in the U.S. helping
to provides jobs to communities across the country. Thanks to continued
investment by the leaders in diesel technology, the latest near-zero
emissions innovations are ready and able to move freight while reducing
emissions. The leaders in diesel technologies are hard at work
developing the next generation of solutions to drive emissions closer
to zero.
Please feel free to contact me with any questions or concerns.
Sincerely yours,
Allen R. Schaeffer,
Executive Director.
Letter of December 16, 2019, from David French, Senior Vice President,
Government Relations, National Retail Federation, Submitted for the
Record by Hon. Eleanor Holmes Norton
December 16, 2019.
Hon. Eleanor Holmes Norton,
Chairman,
U.S. House of Representatives, Committee on Transportation and
Infrastructure, Subcommittee on Highways and Transit,
Washington, DC.
Hon. Rodney Davis,
Ranking Member,
U.S. House of Representatives, Committee on Transportation and
Infrastructure, Subcommittee on Highways and Transit,
Washington, DC.
Dear Chairman Holmes Norton and Ranking Member Davis:
I am writing on behalf of the National Retail Federation to provide
our views for the record of your December 5, 2019 hearing entitled
``Where's My Stuff? Examining the Economic, Environmental, and Societal
Impacts of Freight Transportation.''
The members of the National Retail Federation are among the
country's largest shippers, moving hundreds of billions of dollars in
merchandise through their supply chains, using America's transportation
infrastructure--its seaports, airports, rail lines, and highways. The
condition of the U.S. freight transportation system is vital to
American competitiveness, and especially the retail industry, which
must be able to deliver goods to the consumer at brick-and-mortar
stores, or through direct to consumer options. The freight
transportation system is of critical importance to the entire U.S.
economy.
The National Retail Federation, the world's largest retail trade
association, passionately advocates for the people, brands, policies
and ideas that help retail thrive. From its headquarters in Washington,
D.C., NRF empowers the industry that powers the economy. Retail is the
nation's largest private-sector employer, contributing $2.6 trillion to
annual GDP and supporting one in four U.S. jobs--42 million working
Americans. For over a century, NRF has been a voice for every retailer
and every retail job, educating, inspiring and communicating the
powerful impact retail has on local communities and global economies.
The U.S. freight infrastructure--particularly those segments such
as the nation's highways that rely on public-sector funding--has
suffered from decades of underinvestment, leading retailers to fear
that future growth in global commerce will be stalled because of a lack
of infrastructure to support it. Your subcommittee's focus on these
issues is welcomed, and we provide these views on freight issues that
we see as priorities that need to be addressed when Congress takes up
surface transportation reauthorization in the next year.
Sustainable Federal Funding for the Highway Component of Freight
Infrastructure
Much of the nation's freight infrastructure is privately financed.
Marine Terminals and U.S. port authorities self-finance water-side
infrastructure. Similarly, freight rail pays for on-dock and near dock
facilities and invests billions of dollars to maintain and expand its
national network. Significant portions of the air freight system are
also privately financed. However, the nation's highways, which are the
main intermodal connections between seaports, airports, railheads,
farms, factories, distribution centers, stores, and consumers are
publicly financed.
The federal portion of highway funds is supported through fuel
taxes, which are a proxy for user-fees. Unfortunately, there has been
no significant increase in the federal gasoline tax in decades. In
addition, fuel efficient automobiles have decreased revenues over time.
In the upcoming reauthorization of the Fixing America's Surface
Transportation (FAST) Act, we urge Congress to:
Recommit to public funding for the nation's highways and intermodal
connectors
Find a long-term, sustainable source of revenue for the
federal Highway Trust Fund that preserves the concept that the users of
the system--trucks, automobiles, and busses--should pay for it.
Limit Highway Trust Fund spending to those projects that
will improve performance on the nation's key transportation corridors.
The Federal Highway Administration has developed performance metrics,
and we strongly believe they should be used as a basis for directing
federal highway dollars.
Establish a special freight account within the Highway
Trust Fund that should be devoted exclusively to projects identified as
part of the National Strategic Freight Plan. In particular, federal
dollars should be reserved for key freight infrastructure including:
``Last mile projects,'' which are the highways that
connect seaports and railheads to the interstate system.
The highway portion of grade crossings that will
separate motor vehicles from trains. Grade crossings are a good example
of public private partnerships, because freight rail will pay a portion
of the cost.
Projects identified by the Department of Transportation
as being of national or regional significance. Freight projects are
very often multi-state or regional in nature, requiring a federal
presence.
Fully Fund Freight-related programs in the Department of
Transportation.
Fund Research Identified in the National Freight
Strategic Plan: As part of the Moving Ahead for Progress in the 21st
Century (MAP-21) Act, Congress directed the Department of
Transportation to develop a National Freight Strategic Plan (The
Strategic Plan), a draft of which was published for comment in early
2016. The Strategic Plan identifies many areas in need of research,
among them, better information about truck moves and truck safety.
Congress and the administration should fully fund this research.
Fund the research needs recommended as part of the Bureau
of Transportation's Port Performance Freight Statistics Program's first
report to Congress. Congress established the Port Performance Freight
Statistics Program in the Fixing America's Surface Transportation
(FAST) Act. The program was enacted in response to the 2015 West Coast
port disruptions that significantly harmed the nation's exporters. The
first report under the program outlined research needs. Congress has
provided no funding for this program, which is the first to attempt to
measure the productivity and performance of the nation's international
gateways, which are so important to global commerce.
Reauthorize the National Freight Advisory Committee
(NFAC). Created as part of MAP 21, The National Freight Advisory
Committee (NFAC) was created to promote a safe, economically efficient,
and environmentally sustainable freight transportation system. The
committee is a resource within the Department of Transportation for
collecting the views of the freight community. The Committee should be
reauthorized to continue their work on freight policy. In our opinion,
the failure to consult freight users is a continuing problem that needs
to be addressed. Congress should require the federal government to seek
out and include the users of the freight transportation system as part
of its policy-making process.
Create an Office of Multimodal Freight Transportation
Moving freight across the nation requires the use of many modes of
transportation. The products that line the shelves at NRF-member stores
came by truck, but they also may have come by rail, air, and water
modes. Unfortunately, the U.S. Department of Transportation is
organized by transportation mode, making it difficult to coordinate
responses on important multimodal freight projects and issues. For this
reason, we call on the administration and Congress to create an Office
of Multimodal Freight Transportation within the U.S. Department of
Transportation.
Create a Shippers Advisory Committee at the Federal Maritime Commission
In recent years, the Federal Maritime Commission (FMC) has gone out
of its way to foster dialog between shippers and cargo interests and
ocean carriers and marine terminals. While FMC issues are not under the
Subcommittee's jurisdiction, we want to call attention to the work the
FMC has been doing in reaching out to cargo interests to make important
gains in port efficiency and congestion reduction. The Commission has
recently suggested the creation of a permanent shippers advisory
committee composed equally of importers and exporters, to help foster
greater collaborative efforts that can improve business practices and
reduce congestion. We urge Congress to facilitate this proposal and
call your attention to it because it underscores the importance and
efficacy of seeking out the views of cargo interests.
Pursue Common Sense Truck Regulations
The nation's retailers support safe and efficient trucking, but we
also believe that many of the regulations affecting commercial motor
vehicles (CMVs) are not based on sound research with respect to the
correlation between regulations and safety. For this reason, we call on
the administration and Congress to undertake an overhaul of regulations
affecting CMVs. Congress and the administration should:
Establish uniform truck Size limits that allows longer
trailers. At present, there is a patchwork of state and federal
regulations affecting truck sizes that are inconsistent with a
nationwide freight system. In the recent past, Congress has asked the
Federal Highway Administration to undertake research that would
determine the correlation between truck sizes and weights and truck
safety, but such studies have been inconclusive because the government
has no data with respect to truck accidents. As noted above, funding
research on freight is a high priority, but in the absence of hard
data, it's hard to justify truck and weight limits that vary by state.
In addition, moving toward larger trailers or the use of twin-trailers
nationwide will reduce the carbon footprint of the trucking industry.
Establish a commercial driver apprenticeship program. The
retail industry relies on a stable system of distribution for our
supply chains. America's long-haul trucking industry provides the vital
distribution networks that serve retail and so many other sectors of
our economy. Even if a larger portion of freight moves via rail, there
will continue to be a need for trucks and drivers. Right now, the
industry is facing a critical shortage of talent. For this reason, we
believe that proposals, such as the ``Developing Responsible
Individuals for a Vibrant Economy (DRIVE-Safe) Act'' (H.R. 1374),
represent a sensible approach to this issue.
Modernize the national twin trailer standard from 28 feet
to 33 feet. This modest increase in trailer length will improve truck
safety, efficiency and sustainability. Modernizing the trucking
equipment would lead reduced congestion with no cost to the taxpayer,
increased safety, maximized efficiency and increased environmental
gains.
Support performance-based goals for achieving lower-
emission trucks, rail, and dock equipment. NRF members support efforts
to reduce carbon emissions. Many of its members participate in the
SmartWay program and have made operational changes that have reduced
truck emissions. We strongly believe that the best approach toward
achieving lower carbon emissions, is to avoid prescriptive regulations,
and focus on performance standards that would provide maximum
flexibility to innovate and allow for collaborative efforts between
technology providers, surface transportation providers, and cargo
interests. Over the last few decades, NRF members have played a
leadership role in public-private partnerships to reduce truck
emissions in the ports of Los Angeles and Long Beach. We continue to
believe that these efforts are valuable and sensible.
We thank you for the opportunity to provide these post-hearing
comments. We look forward to working with Subcommittee members on these
important issues. If you have any questions, please contact Jonathan
Gold, NRF's Vice President for Supply Chain and Customs Policy.
Sincerely,
David French,
Senior Vice President, Government Relations.
Article entitled ``The Significance of Li-ion Batteries in Electric
Vehicle Life-cycle Energy and Emissions and Recycling's Role in its
Reduction,'' Submitted for the Record by Hon. Eleanor Holmes Norton
Energy Environ. Sci., 2015, 8, 158
J. B. Dunn, L. Gaines, J.C. Kelly, C. James and K.G. Gallagher
The article is retained in committee files and is available online
at https://pubs.rsc.org/en/content/articlehtml/2015/ee/c4ee03029j
Statement of Stephen Gardner, Senior Executive Vice President, Chief
Operating and Commercial Officer, National Railroad Passenger
Corporation (Amtrak), Submitted for the Record by Hon. Daniel Lipinski
Introduction
Chairwoman Holmes Norton, Chairman Lipinski, Ranking Members Davis
and Crawford, and all the members of both Subcommittees, thank you for
this opportunity to submit written testimony on behalf of the millions
of Americans who depend on Amtrak intercity passenger rail service to
move them across this nation.
As you may recall, prior to Amtrak's creation in 1970, railroads
provided both freight and passenger services. Then, because these
railroads were losing money on their passenger trains, Congress bailed
out the private railroads and created Amtrak to relieve them of their
obligation to operate intercity passenger trains. In return, the
freights agreed:
To give Amtrak access to their lines in order to operate
passenger trains; and
To give Amtrak passenger trains preference over freight
trains.
Unfortunately, as a result of some freight companies' practice of
ignoring federal law, coupled with Amtrak's inability to enforce its
statutory right for passenger trains to have priority over freight
trains, your constituents are routinely and unlawfully delayed by
freight trains. In addition, many freight railroads make it exceedingly
difficult for Amtrak to add new service to meet the growing and
shifting demand by many of your constituents for more trains.
This is an existential challenge to Amtrak as we own only 3% of the
21,200 route-miles that our 32.5 million riders traveled over in 2019.
Most of the remaining 97% are owned by freight railroads. Therefore,
Americans are largely beholden to the freights for reliable, trip time
competitive service on the national network.
How does this impact society? Consider that in FY 2019, 6.5 million
Amtrak passengers, many of whom are your constituents, were
significantly late on trains largely delayed by host railroads.
Across the Amtrak long-distance network, customer on-time
performance (OTP) in FY2019--the percentage of passengers who arrived
at their destination on time--was only 42%. On one-third of our 15
long-distance routes, more than seven out of every ten passengers
arrived significantly late. Customer OTP on some of our state-supported
corridor routes was just as bad: 34% on the Chicago-to-Detroit/Pontiac
Wolverine route and just 26% on the Chicago-to-Carbondale Illini/Saluki
route.
The principal reason for this dismal on-time performance is freight
train interference by host freight railroads. Freight train
interference is caused by dispatching decisions to prioritize the
operation of freight trains over passenger trains, either putting
Amtrak trains behind slow-moving freight trains for miles or relegating
the passenger train to wait in sidings for freight train to pass. These
delays amounted to more than one million minutes in FY 2019--equivalent
to two years of passengers waiting for freight.
Yet, the increase in freight train interference delays is occurring
at a time when rail freight traffic is declining: more than 10% since
2006 and 4% in the last year alone. Interestingly, most of the major
freight railroads have recently adopted new operating practices, called
Precision Scheduled Railroading, that they claim have made their
operations more reliable. Freight railroads claim that they provide
preference to Amtrak, but our customers can attest that this is often
far from the case. Just ask the 240,000 passengers aboard the Texas
Eagle, or the 211,000 passengers on the Crescent, who were all an
average of two hours late to their destination.
Moreover, substantial public funds that have been invested in
freight railroad infrastructure to improve passenger rail performance
have not yielded returns for passengers or state funding partners. For
example, after nearly $500 million was invested in the freight railroad
line used by the State of North Carolina-supported Piedmont service,
host railroad delays increased for the year following completion of the
project, until delays were twice the level they were prior to the
investment; host railroad delays have finally fallen, but there is
still much room for improvement. On the route into Chicago used by
three train services supported by the State of Michigan, as well as our
Capitol Limited and Lake Shore Limited long-distance trains, $200
million of public funds were invested into the Englewood Flyover and
Indiana Gateway projects. Today, however, passengers traveling on this
line encounter severe--and eminently avoidable--host railroad delays on
a daily basis. Taxpayers and passengers deserve a better return on
investment.
Some freight railroads follow the law and provide preference . . . And
some ignore it.
There is absolutely no reason why this nation cannot have both a
world class freight rail network and modern intercity passenger rail
service. Amtrak wants both freight and passenger rail to succeed, and
it appears that individual freight railroads agree with us to widely
varying degrees depending on the railroad and sometimes on the
individuals making decisions.
When freight leadership has decided to dispatch Amtrak trains
according to the law, we have seen Amtrak's on time performance improve
literally overnight. During these times, there was no evidence of
negative impacts to the overall fluidity of America's rail network. In
fact, it has been reported by some freight railroad leadership that
efficient Amtrak service can be a proxy indicator that their own
operations are running most efficiently.
The bottom line is that some railroads follow the law and provide
preference to Amtrak trains and other freight railroads simply ignore
the law and choose to delay your constituents. The attached Host
Railroad Report Card illustrates this point well.
Congress can help prevent freight railroads from delaying your
constituents.
Currently, only the U.S. Department of Justice can bring a legal
action to enforce Amtrak's preference rights, and it has done so only
once, nearly four decades ago. Meanwhile, continued deterioration in
on-time performance is driving away passengers and increasing operating
losses and federal subsidies. The biggest threat to the future of this
nation's rail network is our growing inability to offer reliable
service on many routes.
Congress should also provide Amtrak with the right to bring legal
action against a freight railroad when such freight violates federal
law to provide Amtrak passenger trains with preference.
Legislation was recently introduced in the Senate and Amtrak urges
the House of Representatives to do the same.
Some freight railroads are also making it difficult to add passenger
service.
When Amtrak and its state partners approach host railroads to
negotiate the operation of additional trains, some freight railroads
demand unreasonable capital investments to accommodate the Amtrak
trains. Amtrak and its partners are willing to invest in the host
railroad, consistent with the law, if we do, in fact, impair the
freight railroad. However, what we have experienced is that Amtrak and
its partners will identify the capital projects needed for the
additional service and some freights will simply create an excessive
list of capital projects needed, a list that appears to be aimed at
preventing Amtrak's access to the railroad. The two parties then spend
years trying to negotiate to little avail, while it is your
constituents who suffer from a lack of meaningful transportation
options.
Congress should provide a fair and expeditious manner for
determining the cost of adding new and additional trains to host
freight railroads.
Intercity passenger rail can do more for this nation.
As you know, Amtrak's statutory mission given to us by Congress is
to provide ``high quality service that is trip-time competitive with
other intercity travel options.'' (49 USC 24101(b)). The need for such
has never been greater, especially in short-distance corridors between
major cities that are too far to drive and too short to fly. All the
trends suggest that demand for such service will only continue to grow.
This provides a great opportunity and a way for the United States to
accommodate increased intercity travel demand in a sustainable manner
without exacerbating congestion in other modes.
As we have stated for the record in previous hearings, there are
several key factors that we are considering as we plan for how Amtrak
can better serve your constituents, including: the U.S. population is
growing and becoming more densely populated in urban corridors; highway
congestion is spreading and getting worse; air travel in short-distance
markets is declining; and sustainability is a growing concern for
travelers.
On most of the National Network, we have not even begun to realize
the potential--and address the increasingly urgent need--for reliable,
frequent, high-quality service that can attract passengers for whom
rail could be a preferable alternative to driving or flying. Amtrak's
growing ridership, strong financial results, and our proven success in
certain short corridors where we have strong partnerships, demonstrate
the potential of intercity passenger rail. We know what works well and
we want to create more convenience and value for your constituents and
this nation. Doing so will require enhanced tools and increased
partnership regarding our relationship with host freight railroads and
support from Congress.
Conclusion
Freight and passenger rail service can co-exist and provide far
better service to all customers, both people and products. To do so, we
believe there must be a stronger federal role in ensuring that the law
is followed and not abused. This will help improve the overall fluidity
of the rail network, provide much improved and needed passenger trains
to underserved communities, and support this nation's economy from
coast to coast.
On behalf of Amtrak, we thank you for your consideration of our
remarks. We remain optimistic that Congress will find a way to create a
modern and expanded intercity passenger rail system that thrives in
partnership with a booming freight network--Amtrak is ready to do its
part.
Appendix
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Question from Hon. Daniel Lipinski to Erin Aleman, Executive Director,
Chicago Metropolitan Agency for Planning, and Board Member, Coalition
for America's Gateways and Trade Corridors
Question 1. The Fixing America's Surface Transportation Act or
``FAST Act'' established and authorized $6.3 billion in formula freight
funding through the National Highway Freight Program and $4.5 billion
in discretionary grant funding through the Nationally Significant
Freight and Highway Projects or ``INFRA'' grant program.
As a former state transportation official and current head of a
metropolitan planning organization, could you speak to the need for and
benefits of providing national freight funding through both a formula
and separate discretionary funding program?
Answer. Freight infrastructure projects vary a great deal in size
and scope, rendering a ``one-size-fits-all'' approach suboptimal. Some
freight projects--such as paving an intermodal connector--can be funded
with relative ease using money provided by a freight formula. These
projects are relatively smaller in scale and less complex. Freight
formula dollars provide state departments of transportation a
dependable and certain funding stream to address small and medium scale
projects. To improve upon the existing freight formula program, I
encourage Congress to eliminate the 10 percent cap on multimodal
investment and increase the overall amount of funding provided.
Competitive grant programs, such as INFRA, are critical to large-
scale freight infrastructure projects, which often span modes and
jurisdictional borders and are difficult, if not impossible, to fund
through traditional distribution methods such as formula programs.
Competitive grant programs can incentivize these multijurisdictional
projects while encouraging applicants to seek creative funding
arrangements and bring forward the best possible arrangement for the
Federal Government to consider. Further, competitive grants are
available to a wide variety of applicants, including state departments
of transportation, allowing the many types of organizations responsible
for developing nationally significant freight infrastructure to access
federal resources.
While a state department of transportation may, out of necessity,
place emphasis on intrastate commerce, a federally administered
approach places focus on interstate commerce. According to a 2019 study
by the Congressional Research Service, ``discretionary grants may be
more effective in providing large amounts of federal funding for very
costly freight-related projects, particularly those requiring
interstate cooperation.'' \1\ It should be noted that 77 percent of
freight crosses state lines.\2\
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\1\ Congressional Research Service, Freight Issues in Surface
Transportation Reauthorization, January 2019.
\2\ Tomer, Adie and Joseph Kane, Brookings and JP Morgan Chase
Global Cities Initiative, Mapping Freight: The Highly Concentrated
Nature of Goods Trade in the United States, November 2014.
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For competitive grants to be effective, they must be developed and
administered correctly. To improve upon the INFRA competitive grant
awards, I recommend that Congress:
Remove the cap on multimodal investment and increase the
amount of funding to $12 billion annually, which aligns with needs
revealed through previous INFRA funding rounds.
Confine awards to freight projects only.
Mandate that USDOT's award selection process is
transparent and based upon merit-based criteria that identify and
prioritize projects with a demonstrable contribution to national
freight efficiency. As Congress included in the FAST Act INFRA program
(23 USC 117), goals should include increasing national and regional
economic competitiveness, improving connectivity between freight modes,
reducing congestion and bottlenecks, and improving the safety,
efficiency, and reliability of the movement of freight and people.
Questions from Hon. Eddie Bernice Johnson to Chuck Baker, President,
American Short Line and Regional Railroad Association
Question 1. The Association of American Railroads filed comments
with the USDOT last year urging the agency to extend a pro-innovation
regulatory approach to the freight railroads. Much of the comments were
related to the use of automated and autonomous technology in the
freight rail industry. Such technologies could have major implications
for workers who perform various crafts in this industry.
How do the railroads envision using autonomous technologies?
Question 2. How will this impact the jobs of those who work for the
railroads?
Answer (1. & 2.). Short line railroads today operate safely and
efficiently as we connect thousands of small customers in small towns
and rural communities to the national freight rail network. However, we
are always looking for every opportunity to be even safer and more
efficient, so that we can move more freight more safely by rail, which
is good for the economy, helps the environment, reduces congestion,
lowers the need for highway infrastructure investment, and improves
overall safety.
Short lines are not yet major users of autonomous technologies, but
over the years we have made great strides in using other advanced
technologies (e.g., ultrasonic rail inspection, big data for locomotive
maintenance, advanced methods of treating wood ties, etc.) and will
continue to look for ways to improve.
Technology can frequently help us do what we need to do to run a
railroad safer. For instance, using drones when possible for bridge
inspection improves both safety for workers and creates the ability to
inspect bridges more frequently. Better track inspection (higher
quality with less risk of worker injuries) can be done with autonomous
and continuous test vehicles. In general, human factor incidents are a
leading cause of injuries and fatalities in our industry. The future
use of autonomous technologies will assist in the reduction of human
factor incidents, improving safety for both employees and the public.
On the grade-crossing front, autonomous motor vehicles have the
potential to substantially improve grade crossing safety by reducing
human error by motor vehicle drivers.
The goal of technology is to get better and more efficient--if
technology advances impact existing jobs, short lines as always will
work with their employees and customers to adjust. We will employ as
many people as needed to do the job of railroading safely, efficiently,
and reliably so that we can continue to provide critical transportation
services to our customers throughout the country. Overall, our goal is
to grow, not shrink!
Questions from Hon. Peter A. DeFazio to Anne Goodchild, Ph.D., Founding
Director, Supply Chain Transportation and Logistics Center, University
of Washington
Question 1. Dr. Goodchild, your testimony discusses the potential
of delivery services to reduce emissions by consolidating many packages
into one vehicle. Mr. Mathers' testimony points out that we are using
only 43 percent of the capacity of our freight truck fleets.
What policies or regulations will help encourage better capacity
utilization to reduce carbon emissions?
Answer. While estimates of truck utilization vary, and observed
values vary by time, place, and truck type, it is true that observed
truck utilization is lower than desired. There are three main reasons
for this; first, that product flows are one-directional, second, that
truck sizes are limited and fixes, while product flows are uncertain
and varying, and third, that quick, on-time delivery expectations are
increasing.
Most product flows are one-directional:
Most trucks are either dropping off or picking up. This means that
even a truck that starts its day full, is empty at the end of its
route, and has a utilization rate of 50%. This is overwhelmingly the
case for retail delivery.
Trucks are purchased to provide flexibility to fleet owners:
This often means they ``buy-up'' when making purchasing decisions.
A larger truck can handle small loads, and big loads, but this is not
true smaller vehicles. If you have a large load, it is much more cost
effective to send it in a single large-truck, rather than 2 smaller
ones.
Delivery expectations are increasing:
As customers, as we demand shorter times between purchase and
delivery, vehicle loads decreased. Previously, if a delivery company
offers 2 day delivery, and sends out 5 full trucks every 10 days, when
they move to same day, they will need to send one half-full truck each
day. So there are very significant reasons trucks are not fully
utilized; even though trucking companies have a very strong profit
incentive to fill them.
In order to alter these decisions in favor of fuller trucks, we
need to make transportation more expensive, so that it plays a stronger
role in the short and long-term decisions of carriers, as well as
consumers of their services. This could be accomplished through
increasing the cost of emissions, fuel taxes, per-mile charges, tolls,
or congestion pricing, to name a few.
Question 2. Is greater consolidation of deliveries realistic in the
age of hyper fast delivery speeds?
Answer. No, I don't see greater consolidation aligning with faster
delivery speeds. Of course we will still see economics favoring
consolidation farther upstream in the supply chain, but the last mile
becomes less consolidated with hyper fast delivery.
Questions from Hon. Steve Cohen to Anne Goodchild, Ph.D., Founding
Director, Supply Chain Transportation and Logistics Center, University
of Washington
Question 3. Dr. Goodchild, in your testimony, you mention that the
freight system also includes city streets, local highways, sidewalks,
bike lanes and people's front door steps. As the volume of freight
increases, I have concerns about how last mile deliveries will
contribute to increased congestion and traffic fatalities.
In your opinion, what can Congress do to support infrastructure
investments that consider the entire freight system?
Answer. Adopt a gateway or network perspective. Typically
infrastructure investments are made on a project basis; expansion of an
individual port, or highway interchange. In reality, goods move through
a system, passing through a port, onto a highway, for example.
Individual projects can have close to zero benefit, if the next links
in the chain are more constrained. To address this, Congress should
consider developing connected corridors, where investments are not
planned at the project level, but at the corridor level, allowing goods
flows to really benefit.
Question 4. In your testimony, you also mention that cities lack
freight planning capacity.
How can we best support cities to plan for the future of freight
delivery?
Answer. Cities are unprepared for the future of delivery because
there has been little investment in capturing data about goods movement
at urban scales, and they have not historically included freight
planning in the organizational objectives. They therefore need
assistance in both of these areas.
The federal government can play a key role in 1) requiring,
funding, and setting standards for data collection, 2) supporting
cities as they develop this capability. This could be initiated
through:
a federal grant program for cities and researchers
interested in collecting data and building knowledge
federal support for peer exchange programs where leading
cities and researchers can share their knowledge and practices with
each other
Questions from Hon. Peter A. DeFazio to Ian J. Jefferies, President and
Chief Executive Officer, Association of American Railroads
Question 1. Your written testimony stated that President Trump's
ongoing trade war had created uncertainty for many commodity-related
industries and manufacturers, impacting demand for rail service and
highlighting that total U.S. rail carload and intermodal units were
down 4.4 percent compared to last year. Additionally, U.S. originated
carload and intermodal originations were down 8.1 percent compared to
that same time the previous year. Since the hearing, the House passed
the U.S.-Mexico-Canada Agreement (USMCA), and the Senate is expected to
consider the measure shortly.
Assuming the Agreement takes effect, what are the industry's
projections for rail volumes over the next year?
Answer. Railroads commend Congress for passing the USMCA and are
hopeful that this agreement--along with the resolution of other trade
disputes--will lead to reduced economic uncertainty, higher levels of
business investment, a boost in U.S. exports, and a stronger U.S.
economy.
Railroads also hope that the USMCA will lead to higher levels of
rail traffic. At least 42 percent of the carloads and intermodal units
that U.S. railroads carry, and more than 35 percent of rail revenue,
are directly associated with international trade. Many of those
international movements are cross-border shipments as well. While the
USMCA can only serve to help railroads and the wider U.S. economy, U.S.
rail volumes in 2020 will also depend on a wide range of additional
factors. Changes in U.S. energy markets that have been underway for
years will continue to impact rail volumes. Large amounts of rail
traffic are tied to the U.S. manufacturing sector, the near-term future
of which is cloudy right now. The grain market continues to face
challenges in global markets and at home. Intermodal volumes in 2019
were the second highest ever, but growth in that market will depend
largely on what happens to consumer spending and in the greater trade
arena. Railroads are hopeful that the parts of the economy that
generate the most rail freight--e.g., manufacturing, agriculture,
consumption of goods, trade in goods, and resource extraction--will
grow in 2020, and, consequently, demand for rail service in many
commodity sectors will rise as well.
Question 2. An article published in the Washington Post on January
3, 2020 entitled, ``Railroads are slashing workers, cheered on by Wall
Street to stay profitable amid Trump's trade war'' suggested that the
Class I railroads implementing precision scheduled railroading (PSR)
are turning away some business that isn't profitable enough,
eliminating or downsizing some routes.
How has the size of the Class I rail network in the U.S. changed
during the years of 2017-2019?
Answer. Data for 2019 for U.S. Class I rail mileage is not yet
available, but there has been very little change in total Class I rail
mileage over the past decade (see chart). Moreover, miles that Class I
railroads no longer operate are typically operated by non-Class I
railroads, as opposed to simply abandoned.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Source: Association of American Railroads
Of course, the U.S. and global economies are constantly evolving.
Firms, even entire industries, can and do shift rapidly and
unexpectedly, and railroads must be able to adapt with those changes.
These broad, often unanticipated economic shifts are reflected in
changes not only in rail volumes but also in the types and locations of
the commodities railroads are asked to transport, as well as in the
amounts and uses of railroad assets. To successfully adapt to these
challenges, railroads must be flexible and innovative while improving
the efficiency and productivity needed to maintain their long-term
financial health.
Question 3. We know that demand for freight transportation is
rising at a disproportionate rate to freight system capacity on the
highways. Yet, you highlight in your testimony that rail traffic is
down 4.4 percent over the same period last year.
What is the railroad industry doing to capture some of that demand?
Answer. The freight transportation market in the U.S. today is
intensely competitive. When shippers move freight on railroads, they do
so because the value railroads offer, in terms of cost and service, is
superior to the alternatives. Railroads know that they must continue to
work hard to earn this business, which is why they are constantly
searching for ways to further increase productivity, reduce costs for
their customers, and improve their service.
For railroads, these actions take many forms, including:
Retaining a focus on safety. Recent years have been the
safest in rail history, but railroads know the safety challenge never
ends. That's why railroads, in cooperation with policymakers,
employees, suppliers, and customers, are constantly looking for new
technologies, operational enhancements, improved training, and other
ways to better their safety record.
Recognizing that capacity is key. Thanks to massive
investments back into their networks in recent years, freight railroad
infrastructure today is in the best overall condition ever. Railroads
are working to ensure that the current high quality of rail
infrastructure is maintained and that adequate freight rail capacity
exists in order to meet our nation's current and future freight
transportation needs.
Focusing on customer service. Railroads know their
customers face intensely competitive global markets and are
increasingly demanding faster and more reliable, cost-effective
service. In response, railroads are continually launching new customer
service initiatives and alliances with fellow railroads, rail
suppliers, trucking companies, and others to improve their service
offerings.
Advocating for appropriate public policies. For example,
railroads have emphasized that the existing balanced regulatory
structure covering rail rates and service be maintained; that outdated
regulations that unnecessarily hinder rail innovation and progress be
replaced in ways that continue to protect the public but do so without
``locking in'' existing technologies and processes; that modal
inequities related to infrastructure financing be ameliorated; and that
more public-private partnerships, in which public and private entities
each devote resources to projects in proportion to the benefits that
will accrue to them, be encouraged.
Question 4. Since 2016, there have been more than 4,340 collisions
at highway-railroad at-grade crossings, resulting in more than 1,680
injuries and at least 530 deaths.
If more funds were made available for the Section 130 program, what
projects--other than grade separation projects--should states
undertake?
Question 5. What types of infrastructure or technologies should be
pursued that are not eligible under the current program?
Question 6. Are the freight railroads willing to bring more funding
to the table to support grade crossing closures or grade separation
projects?
Answer (4.-6.). Reducing accidents and fatalities at highway-rail
grade crossings is of paramount importance given that most collisions
are preventable. Engineering solutions (such as closing unneeded
crossings and upgrading warning devices), education, and enforcement
are key. Thanks in part to the Section 130 program, grade crossing
collisions are down 37 percent from 2000 to 2018; however, much work
remains. Railroads believe the following steps would enhance safety at
grade crossings:
The Section 130 program, which provides funds to
eliminate hazards at highway-rail grade crossings, should continue to
receive dedicated, formula funding out of the Highway Safety
Improvement Program.
Funding for the Section 130 program should be maintained
at current levels ($245 million in fiscal year 2020) or increased.
The Section 130 program's incentive payments for grade
crossing closures should be increased from the current cap of $7,500 to
$100,000.
Flexibility in the use of Section 130 funding should be
expanded by eliminating the arbitrary 50% cap on spending for hazard
elimination projects and by enabling replacement of certain protective
warning devices.
Costs incurred by public or private entities for
preliminary engineering for grade crossing projects should be counted
toward the non-federal share.
States should be permitted or incentivized to bundle
grade crossing projects into single grant applications under applicable
discretionary grant programs, such as BUILD, INFRA or CRISI.
Accelerated deployment of navigational warnings for grade
crossings for motorists (e.g., smartphone apps) should be required or
incentivized.
Future fleets of automated vehicles should be required to
provide grade crossing warnings and/or prevention of incursions into
grade crossings where gates or other devices have been activated.
The incorporation of grade crossing safety training into
driver education curricula should be incentivized through NHTSA.
Operation Lifesaver should be authorized at a minimum of
$3 million per year through FHWA, FRA, and FTA.
Decisions on what types of traffic warning devices to put at
particular grade crossings are made by state highway authorities, not
by railroads. Trains often require a mile or more to stop and cannot
deviate from their course. That's why safety at grade crossings by its
nature is primarily motorists' responsibility; the warning devices are
present to protect motorists, not trains. Railroads generally approach
grade crossing projects on a case-by-case basis and are always willing
to discuss the individual circumstances of a particular crossing,
including funding needs, with appropriate public officials.
Questions from Hon. Eddie Bernice Johnson to Ian J. Jefferies,
President and Chief Executive Officer, Association of American
Railroads
Question 7. The Association of American Railroads filed comments
with the USDOT last year urging the agency to extend a pro-innovation
regulatory approach to the freight railroads. Much of the comments were
related to the use of automated and autonomous technology in the
freight rail industry. Such technologies could have major implications
for workers who perform various crafts in this industry.
How do the railroads envision using autonomous technologies?
Answer. America's freight railroads are safer today than ever
before. A significant contribution to the industry's strong safety
record are the annual investments to modernize and improve the freight
rail network. Indeed, this improvement in safety has been accomplished
with record levels of private spending on capital improvements and
maintenance over the last five years--more than $25 billion annually on
average. These investments have included meeting the Congressional
mandate that positive train control systems (PTC) be fully operable by
the end of 2020, and, as of January 2020, PTC is now in operation on
98.5% of Class I PTC route-miles network wide. In addition to these
investments, freight railroads have also undertaken a holistic approach
to rail safety that includes numerous other elements, such as
infrastructure and equipment; training and operational improvement;
technology; and community outreach and preparedness.
As a result, 2018 FRA safety data continues to show that recent
years have been the safest on record for the rail sector. Based on FRA
data per million train miles, since 2009, the train accident rate is
down 10%, the equipment-caused accident rate is down 11%, the track-
caused accident rate is down 26%, the derailment rate is down 9%, and
the employee injury rate is down 16%. Additionally, in 2018, more than
99.999% of rail hazardous materials shipments reached their destination
without a release caused by an accident, and, between 2000 and 2018,
the grade crossing collision rate fell 37%.
However, railroads will always strive to be even safer. That's why
they are constantly researching, developing, and implementing new
safety-enhancing technologies and working cooperatively with employees,
suppliers, customers, and policymakers to find new ways to improve
their safety record.
Autonomous technologies are expected to play a critical role in
rail safety improvement efforts. Autonomous motor vehicles have the
potential to substantially improve grade crossing safety by reducing or
eliminating human error by motor vehicle drivers, but automation
promises to significantly enhance other areas of rail safety beyond
grade crossings. Automated technologies can detect a wider range of
defects, respond faster, and provide a larger window for action than a
safety system that is subject to the limitations inherent in human
eyes, minds, and hands. Automated track inspections can reduce track
defects, leading to fewer accidents. Likewise, automated inspection of
locomotives and freight cars has been shown to reduce the occurrence of
broken wheels and other mechanical problems.
Question 8. How will this impact the jobs of those who work for the
railroads?
Answer. Like firms in every industry, railroads must manage their
resources, including their most important resources--their employees--
based on business needs. The number of rail employees tends to ebb and
flow based on current and expected future rail traffic levels,
technological developments, and other factors. Railroads are hopeful
that freight transportation demand will continue to grow, and they will
ensure that their equipment, infrastructure, and employees will be
sufficient to meet those transportation needs.
Over the years, railroads have adopted a long line of new
technologies to improve the safety, efficiency, and reliability of
their operations. Just as the industry transitioned from steam to
diesel locomotives or from cabooses to end of train devices,
technological innovation often brings with it the need to evolve
operating procedures and models. Railroads must have the incentives and
flexibility to invest and develop new technologies that improve safety,
increase efficiencies, and allow the rail industry to remain
competitive and help their customers thrive.
The implementation of positive train control and other technologies
could potentially allow for a reduction in the number of crewmembers in
the locomotive cab without jeopardizing safety. Railroads aren't
seeking the ability to impose one-person crews haphazardly or
unilaterally, however. The subject of crew size has typically been
addressed as part of the collective bargaining process with rail labor.
As a result, railroads will continue to work with rail labor to come to
an agreement and find solutions as they have for decades.
Question from Hon. Peter A. DeFazio to Jason Mathers, Director, Vehicle
and Freight Strategy, Environmental Defense Fund
Question 1. Mr. Mathers, your testimony discussed policies that
Congress should adopt to increase the demand for zero-emission heavy-
duty vehicles and develop the necessary charging infrastructure to
support it.
Without significant Federal investment and strategic planning in
deploying charging infrastructure, do you think there is any chance of
achieving a nationwide network of charging stations to support an
electric heavy vehicle fleet?
Answer. Transforming our transportation sector, which is a climate
change and public health imperative, presents a daunting challenge. It
is also an urgent one.
Although some states are motivated and are taking their own steps
to promote electric vehicles, the sheer scale of the needed
transformation, and the relatively short time we have to make
meaningful cuts in greenhouse gas emissions, mean that the federal
government must play a leadership role in planning and implementing the
build-out of nationwide networks of charging stations.
There is considerable good news. For example, the technology for
transforming the heavy-duty fleet, including the growing availability
of suitable vehicles, is rapidly evolving. And while additional
investment is needed to achieve electric propulsion for the long-
distance fleets, there is a lot of cost-effective, low-hanging fruit,
such as in electric drayage trucks and in regional delivery and
municipal fleets.
So, while innovation in truck electrification will continue, and
costs will continue to decline across all truck classes, true
transformation of the sector--especially if the goal is rapid
progress--absolutely will depend on federal leadership. That means, as
I said in my testimony, favorable tax and regulatory policies. It also
includes incentives for owners of both private and publicly owned
fleets to switch to electric trucks and buses. And it means federal
support for state and interstate charging infrastructure planning and
installation.
The result will be a more efficient, more sustainable
transportation sector with far fewer impacts on public health and
climate.