Making the Short Line Connection
When Congress passed the Staggers Act in 1980, in addition to largely deregulating the American railroad industry, it also effectively paved the way for major railroads (e.g. Class I carriers*) to begin divesting certain rail lines deemed unproductive or unprofitable. As a result, many small and rural American towns were expected to lose critical transportation links to major domestic, and even international, markets for their locally produced or consumed goods.
Instead, over the past 30 years, the country has witnessed an increase from just 70 short line and regional railroads to more than 550 across 49 states. Entrepreneurs, families, private land owners, local and state governments, and increasingly mid-to-large size holding companies, have turned often obsolete or fledgling railroads into robust and thriving local economic engines (pun intended!). Hauling over 14 million carloads over 50,000 miles of track, these carriers employ nearly 20,000 people, supporting the pick up or delivery of one out of every four rail cars moving on the nation’s rail network.
Clearly, short lines have provided small and large businesses and local producers much needed access to larger markets, but what can often be overlooked is the crucial role they play in economic development. CSX works very closely with its short line and regional partners in developing industrial leads and collecting local market intelligence. Whether it is locating suitable rail served property, or in some cases, securing state and federal funding for rail projects, short lines can provide essential service advantages for the “first and last mile” where it may sometimes be operationally challenging for a Class I provider.
As highways become more congested and industries are increasingly recognizing the economic benefits of moving their products by rail, we encourage you to consider CSX and its more than 240 shortline partners for your, or your prospect’s, rail needs. Keep in mind, many opportunities exist outside of simply adding or improving rail infrastructure; at times, short lines provide tracks, ramps, and docks for trans-loading opportunities in addition to storing excess rail equipment where that capacity may be unavailable elsewhere.
*The Surface Transportation Board classifies railroads into three groups for reporting and accounting purposes:
• Class I: Carriers with annual carrier operating revenues of $467.0 million* or more
• Class II: Carriers with annual carrier operating revenues of less than $467.0 million* but in excess of $37.4 million*
• Class III: Carriers with annual carrier operating revenues of $37.4 million* or less, and all switching and terminal companies regardless of operating revenues.
Generally, Class III carriers are referred to as short lines, and Class II carriers are referred to as regional railroads.