Posts Tagged ‘U.S. Rep. Peter DeFazio’

T&I Chair DeFazio challenges proposed CN and KCS merger trust

Rep. DeFazio

WASHINGTON – Chair of the House Committee on Transportation and Infrastructure Peter DeFazio (D-Ore.) sent a letter to the Surface Transportation Board (STB) opposing the approval of a trust for the proposed merger of the Canadian National (CN) and Kansas City Southern (KCS) railroads. In his letter, DeFazio stated that approving the trust is not in the public interest and would reduce competition.

“A single holding company responsible for this traffic would likely change rail traffic patterns in the significant areas of parallel service overlap and that would reduce the rail service options these 300 customers currently enjoy,” Chair DeFazio wrote in his letter. “I am also troubled that this combination of Class I railroads serving all three nations in North America will exacerbate U.S. job losses from cross-border trade agreements that prioritize profits over people and inflict harm on worker’s rights, consumer safety, and the environment.”

In April 2021, Chair DeFazio issued a statement after Canadian Pacific (CP) and CN each made separate multi-billion dollar offers to buy KCS, warning that the bidding war that ensued for the railroad threatened to usher in a new round of consolidations in the rail sector, ultimately threatening jobs and affecting shipping in the U.S.

DeFazio’s full letter to STB can be found below and here.

 


 

July 26, 2021

Ms. Cynthia Brown
Chief, Section of Administration
Office of Proceedings
Surface Transportation Board
395 E Street, S.W.
Washington, DC 20423

Re: Finance Docket No. 36514, Canadian National Railway Company, et al. – Control – Kansas City  Southern Railway Company, et al.

Dear Ms. Brown:

I am writing to express opposition to the voting trust proposed by Canadian National Railway Company (CN) in its proposed merger with Kansas City Southern Railway Company (KCS). I am concerned that this proposed trust is not in the public interest. The trust would reduce competition and prejudice the outcome of the Surface Transportation Board’s merger proceeding.

In its May 14, 2021, submission to this docket, the Antitrust Division of the U.S. Department of Justice explained how voting trusts reduce competition both in general for railroad mergers and in particular to the consideration of a voting trust for CN and KCS. In general, putting two formerly competitive businesses under a single holding company immediately reduces the parties’ incentives to engage in competition. While the Surface Transportation Board regularly allowed railroad trusts throughout the many railroad consolidations of the 1980s and 1990s, the board has made the requirements to approve a voting trust more stringent since 2001 as part of an overall reform of merger rules. Now, according to 49 CFR 1180.4(b)(4)(iv), applicants must demonstrate that trusts would be in the public interest. Approving a CN-KCS trust would signal to the rest of the rail industry that the STB is engaging in business as usual, despite the requirement to consider the public interest, and could launch a new round of mergers.

Specifically with regard to the potential for a CN-KCS trust, I am concerned that approximately 300 current customers overlap on the CN and KCS networks. A single holding company responsible for this traffic would likely change rail traffic patterns in the significant areas of parallel service overlap and that would reduce the rail service options these 300 customers currently enjoy. I am also troubled that this combination of Class I railroads serving all three nations in North America will exacerbate U.S. job losses from cross-border trade agreements that prioritize profits over people and inflict harm on worker’s rights, consumer safety, and the environment.

I trust that the Surface Transportation Board will look at the specific facts of this action and conclude that approving a trust is too much, too soon. Too much authority in one company to somehow keep two companies competing against each other that have significant service overlap and too soon because allowing the trust creates a new floor purchase price for any other potential competitive bidders for KCS railroad. 

Sincerely,
Peter A. DeFazio

DeFazio on PSR: ‘Wall Street’s goal is to get wealthier — no matter the impact’

U.S. Rep. Peter DeFazio of Oregon, chairman of the House Transportation and Infrastructure Committee, responded to a recent Fortune Magazine column by a pair of economists who defended the rail industry’s Precision Scheduled Railroading (PSR) scheme and accused unions of hampering productivity.

DeFazio

DeFazio, along with New Jersey Rep. Donald Payne Jr., who is chairman of the Subcommittee on Railroads, Pipelines and Hazardous Materials, were two of the main architects of the INVEST in America Act (H.R. 3684), a surface transportation reauthorization bill that encompasses substantial investment in the nation’s infrastructure as well as in the safety of the people who keep the country moving that passed the U.S. House on July 1.

“PSR is not some fancy optimization strategy to increase freight volume or improve operations and reduce emissions; rather, it is a business strategy promoted by Wall Street to boost short-term profits,” DeFazio wrote.

He noted in his column that shippers, communities and the rail workforce all have been negatively affected by PSR.

“Let’s not forget that prior to COVID-19, from 2015 to 2019, the freight railroad industry slashed the average size of its workforce by over 17%,” DeFazio wrote. “It’s little wonder that STB Chairman Martin Oberman has sought information about how such a reduction may be related to or contributed to recent shipper complaints.”

Read DeFazio’s full column.

The INVEST in America Act looks to protect bus and transit workers from assault, improve school bus safety and maintain safe freight rail operations. It contains increased funding for Amtrak passenger rail service and protects the environment, the public and rail workers alike by putting into law the Rule of 2 — that, like a pilot and co-pilot in the air — a certified engineer and a certified conductor remain present in the cab of freight trains when operated through the nation’s communities.

The bill is under consideration by the U.S. Senate, and SMART-TD members are encouraged to send messages to their senators to pass H.R. 3684 for the sake of public and worker safety.

SMART-TD Leaders Pledge Support to 2021 INVEST in America Act

CLEVELAND, Ohio (June 4, 2021) – Leaders of the SMART Transportation Division today announced their full support of the 2021 version of the Investing in a New Vision for the Environment and Surface Transportation in America (INVEST in America) Act.

DeFazio

The transformational $547 billion surface transportation reauthorization bill introduced today by House Transportation and Infrastructure Committee Chair Peter DeFazio of Oregon contains critical safety reforms for the bus, transit and freight rail industries. Similar to a 2020 version of the bill, provisions of the legislation mandate two-person freight rail crews and take steps to address the problems of bus operator and transit worker assault as well as other issues faced by SMART-TD’s bus, rail and transit members.

“Chairman DeFazio, Rep. Eleanor Holmes Norton and Rep. Donald Payne once again proved that they are receptive to the safety of and the needs of all SMART Transportation Division members,” SMART Transportation Division President Jeremy R. Ferguson said. “Every one of our members has a stake in this bill and in the protections and actions this legislation puts forth. We are thankful for the representatives’ work, and we support this effort to move the transportation industry ahead.”

“This bill is all-encompassing — seeking redesigns of bus operator compartments so that drivers are more protected, protecting transit workers from assault and looking into school bus safety. The representatives also heard our voices regarding almost every one of the concerns we have about the current state of the railroad industry — crew size, train length, the utility of Positive Train Control and safety investigations — to name a few,” National Legislative Director Greg Hynes said. “Elections have consequences, and with this legislation, we now have an avenue where many matters that are important to us can be resolved.”

A markup of the bill is scheduled to take place June 9.

The SMART Transportation Division is comprised of approximately 125,000 active and retired members of the former United Transportation Union, who work in a variety of crafts in the transportation industry.

H.R. 2 passes U.S. House and moves to Senate

H.R. 2, the Moving Forward Act, a massive $1.5 trillion infrastructure bill that contains provisions important to members of all crafts in the SMART Transportation Division and to sheet metal workers, passed through the U.S. House of Representatives by a 233-188 vote on July 1.

A major component of this bill is the INVEST in America Act that passed the U.S. House Transportation and Infrastructure Committee in late June.

H.R. 2 contains:

  • a two-person freight crew requirement
  • bus and transit operator safety measures
  • blocked-rail-crossing enforcement
  • a cross-border solution
  • yardmaster hours of service
  • additional funding for Amtrak
  • requirements for carriers to meet CDC guidelines and to provide personal protective equipment (PPE) to transportation workers

“This is an unprecedented step ahead for many of our union’s major issues through the legislative process,” SMART Transportation Division President Jeremy R. Ferguson said. “Our concerns were heard and addressed by the writers of this bill — safety for workers and communities alike in the bus and transit operator safety measures and in the crew-size provision, funding for Amtrak, and a number of other provisions intended to rebuild and transform the nation’s roads and rails.

“Federal agencies and big-pocketed lobbyists have tried to obstruct the essential protections that this bill provides to our members and to the people who work on, live near and use our nation’s transportation network. These representatives all had the foresight and initiative to move them forward.”

Ian Jefferies, CEO of the Association of American Railroads (AAR), earlier in the week had an op-ed published that was highly critical of the legislation, targeting the two-person crew portion and one that dealt with study of potential rail transport of Liquid Natural Gas (LNG) specifically, saying the bill “woefully missed the mark.”

In the column, Jefferies also argued that legislators were “putting their collective thumbs on the scale” regarding railroad safety in regulating the crew-size safety issue.

The INVEST in America component of the Moving Forward Act was shepherded by House T&I Chairperson Peter DeFazio, an Oregon Democrat, through the committee June 18. He commented on July 1 after the bill’s passage:

“Passage of this bold, forward-thinking infrastructure bill is proof that finally, there is a majority of us in Congress who won’t accept the status quo and instead are willing to fight for a new vision that invests in our communities, addresses the climate crisis, and creates better opportunities for all. And we get there by putting millions of people to work in jobs that cannot be exported, while harnessing American-made materials, ingenuity, and innovation,” he said. “With the Moving Forward Act, we make it clear that our infrastructure does not have to be a product of the past, with crumbling roads and bridges, unreliable transit and rail networks, inequitable outcomes, and little regard to our changing climate and our changing economy. I challenge my Senate colleagues to join the House in thinking big and being bold on long-overdue investments not only in our infrastructure, but also in the communities and the people we all represent.”

Leaders in the SMART-TD National Legislative Department thanked DeFazio and the bipartisan group of Democrats and a trio of Republicans who supported H.R. 2.

“As if we need any additional evidence that elections matter, this result shows that the 2018 change of party control in the House made a difference,” National Legislative Director Greg Hynes said. “We appreciate those legislators who supported this legislation in its journey through the House. There is more work to be done and a path to be cleared for this legislation, and our membership is more than willing to put in the time to make legislators understand why the bill provisions are necessary.”

The Moving Forward Act now moves to the United States Senate, where, according to Politico.com, Republican U.S. Sen. Mitch McConnell of Kentucky, the majority leader, called the bill “nonsense,” “absurd,” “pure fantasy” and vowed that it will die before getting to the White House, where the president has threatened to veto the bill.

A message from President Ferguson on the INVEST in America Act

March 20, 2020

All Members — SMART Transportation Division

Dear Brothers and Sisters:

Today, House Democrats released the text of a $500 billion five-year funding authorization bill that defines their vision for the future of transportation in America, as well as outlines their plans to refresh and renew the infrastructure of the nation’s surface transportation network.

The Investing in a New Vision for the Environment and Surface Transportation in America (INVEST in America) Act is the result of countless hours of work by this Union on the Hill and in the halls of Congress. The INVEST in America Act reauthorizes funding set to expire Sept. 30, but more so, sets standards for safety, training, and transportation reform that have long been sought by the members of SMART Transportation Division including:

  • Two-Person Crews;
  • Operator Assault;
  • Yardmaster Hours of Service
  • a “Cross Border” fix.

Additionally, Amtrak would see its funding triple to $29 billion over the five-year period of the bill, allowing for expansion of national, state and regional routes and facility modernization. Funding for the Consolidated Rail Infrastructure and Safety Improvements (CRISI) grant program also would be increased to $7 billion to fund passenger and freight rail projects. Provisions for/or against the transportation of liquid natural gas (LNG) via rail tank cars, blocked railroad crossings, and excessive freight train length, among others, also have been included.

Our National Legislative Office has been hard at work in Washington, D.C., to convey our issues to both sides of the aisle in the U.S. House and Senate, and the provisions within this bill are the fruits of that labor.

Undoubtedly, House Democrats have heard our cries and have answered the call. By including our issues within the context of this bill, they have let America know that the only safe operation of a Class I freight train is with a two-person crew; that our bus drivers and operators have the right to a safe work environment; and that the public should be shielded from the risks that rail carriers will take in the name of greed.

But make no mistake, this bill still has a long road to travel and a lot of heavy-handed opposition standing before it in the Republican-controlled Senate. We will need all hands on deck to protect the provisions we have all fought so hard for to survive that journey.

I am asking you to please watch this bill as it moves through the legislative process and see who and what hurdles it faces. I’m asking you to please pay attention to the party affiliations of the individuals as the yeas and nays are registered when the bill is voted upon. And I am asking you to listen to the rhetoric and testimony that will affect its final appearance. Once the dust has settled, I will call on you to please support those who support you and your family’s well-being, and I firmly believe that picture will be crystal clear.

There are only two parties at the table. The Democrats wrote it into the bill, only the Republicans will take it out.

Fraternally yours,

 

 

 

 

Jeremy Ferguson
President — Transportation Division

ABOUT THE INVEST IN AMERICA ACT