Industry groups are not sold on the merits of the Railroad Safety Act of 2023

A letter penned to the United States Senate last week by a foursome made up of modal and industry associations made the case for the Senate to be careful and diligent, when it comes to voting on the Railway Safety Act of 2023.

As previously reported, the Railway Safety Act of 2023 advanced to the Senate floor after being approved by the U.S. Senate Committee on Commerce, Science and Transportation in early May by a 16-11 margin. The bill was introduced on March 1 by its lead co-sponsors from Ohio, Sherrod Brown (D) and J.D. Vance (R). A major impetus for it was due to the February 3 derailment of a Norfolk Southern freight train, transporting hazardous materials, on the Ohio-Pennsylvania border.

The legislation is comprised of the following provisions, which were included in a Senate Committee on Commerce, Science and Transportation fact sheet:

• mandating the use of defect detection technology which could have prevented the East Palestine derailment, making them more frequent near dense urban areas;
• expanding the types of hazardous materials, like the vinyl chloride carried by the East Palestine train, that trigger increased safety regulations, including speed restrictions, better braking, and route risk analysis;
• improving emergency response by providing states information about the hazardous materials being transported by rail through their communities and strengthening railroad emergency response plans;
• preventing 30-second railcar inspections and mandates a new requirement that ensures railcars are properly maintained;
• increasing penalties for violations of rail safety law to ensure safety laws are taken seriously; and
• requiring two crewmembers to operate a train to prevent a situation where only one person is on the train in an emergency, among others

The letter to the Senate, which was written by the American Apparel & Footwear Association, Consumer Brands Association, Intermodal Association of North America, and the Transportation Intermediaries Association, explained that while rail transportation is “broadly” safe and intermodal rail transportation is “particularly” safe, railroads need to work to further improve its safety record, adding that based on 2022 Federal Railroad Administration train incident accident data showed that the mainline train accident rate and the hazardous material accident rate are both near all-time national lows.

“As Congress debates rail safety legislation, the undersigned organizations urge you to evaluate carefully whether any data demonstrates that a given policy would actually improve safety and reduce accidents,” the letter stated. “For example, several provisions currently under consideration regarding train consist and length, crew size, and operating practices not only remain entirely untested but fail to recognize the day-to-day realities of intermodal operations as well as potential unintended consequences—particularly on supply chain fluidity. Such provisions are not supported by data and would likely disrupt industry modernization, competition, and efficiency. Moreover, many of these provisions are unrelated to the recent derailments and redundant with regulatory actions already underway. In short, while rail shippers and intermodal providers vigorously promote rail safety, legislation should not substantially change the current laws without attendant safety benefits.”

Bloomberg’s take: The Bloomberg Editorial Board also addressed the legislation, saying it “could fundamentally reshape the railroad industry—and not for the better.”

And the main reason for that, it explained, is that the Railroad Safety Act of 2023, has “almost nothing to do” with the Norfolk Southern crash in Ohio earlier this year.

Addressing the legislation’s push for increased crew size, Bloomberg observed that railroads have been steadily been reducing crews while improving safety, adding that, in the coming years, large railroad carriers are keen on running trains with a single engineer that are assisted by technology that detects signals and avoids collisions, while saving $2.5 billion on an annual basis. Bolstering its point, it noted that 95% of European rail traffic is transported by one-man crews, coupled with various studies finding no evidence that larger crews are any safer.

Bloomberg also noted that the legislation’s proposed inspection requirements are insufficient, as it requires a unionized mechanical inspector to conduct an added examination at a specified inspection site.

“If the nearest site is further away than the train’s destination, the crew will need to push past its intended stop, wait at the site for the train to be inspected for the trip it has already taken, then reverse itself to get back to where it planned to go,” it said. “Only in Congress does this kind of thing seem reasonable.”

The Bloomberg editorial noted that, despite the East Palestine derailment, U.S. railroads are safe and getting safer, with hazmat incidents down 78% going back to 2000, with mainline accidents down 44%, mainly driven by technology upgrades.

“In this sense, the Railway Safety Act could well be counterproductive,” it said. “By mandating pointless labor costs, it will impede investment in tool—such as autonomous track inspection — that could be far more effective at preventing accidents. There’s certainly precedent: The economic deregulation prompted by the Staggers Rail Act of 1980 is thought to have been responsible for https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2869148”>89% of the sharp decline in accidents that followed. Freed from costly mandates, the railroads invested in upgrades and innovation. Avoiding a repeat of the East Palestine calamity should be a priority. Unfortunately, this bill is a collection of pre-existing policy preferences repackaged as a response to tragedy. Congress should scrap this effort, await the NTSB’s report and try again.

AAR's view: The Association of American Railroads (AAR) recently said that more work needs to be done to ensure that the rulemaking proceedings in the legislation “are driven by data, focused on safety and avoid unintended negative circumstances for the supply chain.”

In a recent interview with LM, AAR President & CEO Ian Jefferies said that the focus on railroad safety has been prevalent, especially going back to the East Palestine derailment in February. And he noted that the Federal Railroad Administration’s 2022 railroad safety statistics are very encouraging.

As an example, he observed that the mainline accident rate in 2022 was at its lowest level it has ever been in the entire history of railroading and down 49% over the last 20 years, with derailment rates, while largely down, were slightly up annually, driven by incidents in rail yards, with track-caused derailments at an all-time low, as was the employee casualty rate, which he said is a major focus, as the industry wants all of its workers to be safe, and the hazmat accident rate was also at an all-time low.

“But that is not enough, and we recognize that,” said Jefferies. “As long as we are having incidents, we have to keep taking steps to get that number down. Not every category of accidents was down, and we need to focus on that. I think that is what you are seeing. Policymakers certainly recognize the need for continuous improvement but also recognize that rail is by far the safest way to move goods across land. We are proud of our safety record, but we are not satisfied and have more work to do. That’s a never-ending process.”

What’s more he said that the AAR and the railroad industry have a long history of supporting smart safety measures with demonstrable safety benefits and also have a long history of not waiting for the regulator or waiting for Congress to take safety steps when needed.  In 2011 and 2012, he said AAR was petitioning for stronger tank car standards at the DOT two years before they were formally issued by the DOT.

“Instead of waiting, we were able to get agreement with several of our shipper groups to adopt new voluntary standards, and the tank car standards that are in place today are largely a result of our petition and the work we did on the front end. Our track record is strong. There's been a lot of talk about wayside detection, recently, and hotbox detectors, and acoustic wheel bearing detectors. Well, those are all deployed, and those are all out on the network, because of the voluntary decisions we made because of the safety benefits they have. There is not a regulatory regime around those. We are absolutely pushing ahead without waiting when safety improvements can be made. At the same time, we certainly support appropriate regulatory responses and legislative responses. There are going to be things we agree on and things we disagree on. We are driven by data and science and when the data shows that a particular step is going to result in a higher level of safety, we are 100% behind that.”

Addressing the Railway Safety Act of 2023, Jefferies said he understands the need for the Ohio Senators Vance and Brown to want to introduce it.

“They want to be responsive and take responsible steps to reduce the likelihood of a similar incident occurring again,” he said. “And I certainly don’t fault them for that. I have said publicly that we see a feasible path forward on almost every one of the provisions on the bill. My definition of feasible might be different from others. But I generally think there's an agreeable path forward on most things. There's going to be some areas where we just, you know, have to draw a line in the sand, and that may be the way it has to be. If there are smart things to do on safety, we're going to be right there, supporting and trying to be part of the solution. Nothing happens in a vacuum, and nothing happens overnight. But we'll be engaged throughout the process.”