Shippers ask regulators to order Class I railroads to report on local service performance (updated)

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A Norfolk Southern local works its way east through Otis, Ind., in June 2020. A coalition of shippers' groups is asking the Surface Transportation Board to require Class I railroads to provide information on service to local customers.
TRAINS: David Lassen

WASHINGTON – A coalition of shipper groups has asked federal regulators to require Class I railroads to begin reporting local service metrics.

Every week the big railroads provide the Surface Transportation Board with a host of performance measures (available here) that cover terminal dwell, average train speed, and number of trains held, along with data related to grain and coal shipments as well as Chicago interchange movements.

But the shipper groups say the network performance data do not provide a clear picture of rail service where it matters most: Local service to and from a customer’s spur or facility.

“Many of our members have become increasingly aware of and concerned by the gap between the service data that the railroads report to [the] Board and the level of service that shippers actually receive in the real world,” the shippers wrote in an Aug. 31 letter to the STB.

“Our organizations and our members believe that the omission of first-mile/last-mile data from the service data being reported to the Board is a significant and growing concern,” the shipper groups wrote. “Absent such data, the Board, shippers, and receivers lack relevant information as to how the rail networks are actually performing and whether carriers are providing, and shippers are receiving, service that comports with the railroads’ common carrier obligation and that can support restoration of the general economy.”

The shipper groups — the National Industrial Transportation League, Freight Rail Customer Alliance, National Coal Transportation Association, and the Private Railcar Food and Beverage Association — say their members have experienced rail service problems as the economy reawakened from pandemic-related shutdowns.

Railroads have not moved quickly enough to restore local service to pre-pandemic levels, which has impeded the economic recovery, the shipper groups claim. Crew shortages also have contributed to missed local switches and excessively late or annulled trains.

The industry’s shift to Precision Scheduled Railroading, which has involved moving some traffic out of unit trains and into the railroads’ merchandise networks, has further limited data on rail service performance, the shipper groups say.

The more strict demurrage charges the U.S. PSR systems have imposed make it more important to track local service, the shipper groups argue.

Shippers also were critical of railroads’ focus on operating long trains, which has intensified as a way to cut costs during the pandemic.

The shippers’ request comes less than a week after the STB and Federal Railroad Administration, in an unusual joint letter, asked the Class I railroads to ensure that they provide safe and dependable service as rail volumes increase. [See “In rare joint letter, FRA, STB warn railroads to be ready for rebound in traffic,” Trains News Wire, Aug. 24, 2020.]

BNSF Railway is currently the only Class I railroad to publicly report local service performance. The information — which measures adherence to customers’ first and last mile service plans — is included in BNSF’s network update that is posted on the railroad’s website every other week.

Ann Warner, a spokeswoman for the shipper coalition, tells Trains News Wire that BNSF’s reports are a step in the right direction.

“As we understand it, BNSF’s metric is for industrial products, which seems to include some unit train freight, and there is probably manifest traffic in other categories that is not captured by the metric. So, there are probably inclusion and weighting issues,” Warner says. “Also, the metric appears geared towards meeting customer plans and expectations. That is one way to measure it, and a useful one.  However, it may bake-in some deficiencies, such as where a customer would prefer more frequent service. In short, BNSF’s metric is probably a good start, but it may not be everything that is needed, and it might even have some things that are not needed.”

In its most recent update, BNSF’s local service measure stood at 93.4%, a 1.7-point improvement over the prior week and a 4-point improvement over the average of the prior month.

CSX Transportation and Union Pacific report trip-plan compliance figures for their intermodal and merchandise networks every quarter.

The Association of American Railroads questioned the intent of the shipper coalition and said local service data, if it even exists, would create new regulatory burdens.

“The AAR is aware of the letter recently sent to the Surface Transportation Board by interest groups that lobby for regulation of railroads, requesting that the STB consider requiring the reporting of additional ‘first mile/last mile’ service data,” AAR said in a statement. “Railroads already report extensive service data to the STB on a weekly basis. We are still evaluating the letter, but it is unclear what additional metrics are being suggested, whether data relevant to such metrics exists and would provide reliable and meaningful information, what burdens additional data reporting and analysis would place on both the railroads and the regulator, and how any additional service reporting requirements would relate to the limited regulatory authority that Congress has given to the STB.”

— Updated 1 p.m. CDT with comments from shippers' coalition and the AAR; updated at 7:20 p.m. CDT with clarification of shippers' coalition comment.

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