The Surface Transportation Board should rethink its mission, moving away from support of the railroads, which are now “financially strong,” John D. Rockefeller, IV, chairman of the U.S. Senate Committee on Commerce, Science and Transportation, said Thursday at a nomination hearing.
Rockefeller said that the agency has tasked itself with helping the railroads gain financial traction, a move that necessitated shrinking the industry from 39 carriers to four major railroads.
“The STB has set a high bar for captive shippers who have the resources and the guts to challenge these dominant railroads’ business practices,” he said. “It is not any secret that I think that … the STB needs to change its perspective. The evidence is overwhelming at this point that the four dominant freight railroads are financially strong. It’s time for the STB to re-focus its mission on supporting the businesses and people who use the rail network.”
Rockefeller pointed out that the railroads are setting and breaking financial records and that “while the rest of the economy has been limping along for the past few years, the freight railroads have been hauling in record amounts of cash.” The railroads are hitting all the financial-health checkpoints, he added.
“I think the STB needs to stop worrying so much about the financial health of the railroads, and focus more on the persistent complaints coming from the shipper community – about poor service, bullying tactics, and lack of competition,” he said. “I also think the STB needs to a better job responding to its stakeholders in a timely way.”
CSX finished its third quarter with net earnings of $463 million, showing improvement over the $455 million result seen in the third quarter of 2012. It recorded revenues of $3 billion for the quarter, and officials said full-year, per-share earnings will show an increase over 2012 results. Norfolk Southern turned in a 5-percent increase in operating revenues during the third quarter and a 16-percent increase in income from railway operations. Third quarter net income for Norfolk Southern represented a 20-percent rise over results from the third quarter of 2012.
On Nov. 21, Union Pacific officials renewed its share buyback program early, saying it would buy back up to 60 million of its shares by Dec. 31, 2017. The new program raises the original amount of shares to be re-purchased by 13 percent.