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Archive for Sunday, May 2, 1999

TOO FEW TRAINS RAILROAD DECLINE HAS CREATED SHIPPING CONCERNS

May 2, 1999

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railroads.jpg"> More than 1,100 miles of Kansas railroad line have been abandoned this decade, and the number would have been much greater if not for the growth of short lines.

In 1990, a decade after federal deregulation of the railroads, there still were 6,605 miles of track in Kansas and seven major railroad companies operating here.

But today, near the end of a decade that brought the biggest mergers and consolidations in American rail history, there are 1,100 fewer miles of Kansas track (about 5,500 miles total) and essentially only two major railroads still operating, the Union Pacific and Burlington Northern-Santa Fe.

The Kansas City Southern, a third major railroad with only 18 miles of mainline track in southeast Kansas, maintains a minimal presence in the state.

Kansas rail miles peaked in 1917 at 9,363 miles. The first wave of track abandonment came during the Great Depression. During the "Dirty Thirties," 787 miles of track were given up. No decade topped that until the "Deregulating Eighties," with which the "Consolidating Nineties" are keeping pace.

"The reason abandonment picked up after 1980 is the Staggers Act, which allowed the railroads to abandon uneconomical lines," said John Rosacker, an assistant bureau chief and rail specialist at Kansas Department of Transportation. "We had a bunch of line that was very uneconomical, lines running through the Flint Hills to pick up cattle and move them to market, which hadn't happened for a long time.

"Then came the mergers of the major railroads to where we basically have two. If you compare Kansas 1980 and Kansas 1998 (railroad maps), yeah, the drop looks dramatic. But I would direct you to states like Iowa, which lost half its track miles" in the same period.

The contraction of the rail industry has been national. Kansas still ranks fourth among states in total track mileage, but the consolidation of companies and abandonment of tracks have sparked complaints from shippers here and elsewhere of poor service and too-high rates. Also criticized is red tape at the federal Surface Transportation Board, which makes it expensive and time-consuming for shippers to contest railroad company rates.

Shippers' concerns

U.S. Sen. Pat Roberts, R-Kansas, recently introduced legislation aimed at addressing shippers' concerns.

"Agriculture producers must have access to an efficient and reasonably priced rail system in order to move their goods," Roberts said. "Our farm economy depends on it. When shippers are held captive by high rates, poor service, little competition and a convoluted rate relief process, it is high time to make the necessary changes."

Roberts' aides in Washington say the senator has heard from a variety of Kansas shippers concerned about rail service.

"Western Resources had a case before (the Surface Transportation Board) over coal rates from Powder River Basin" in Wyoming, said Roberts' aide Betsy Holahan. "Some beef producers need tank cars to load tallow on. If those cars aren't there when they need them, they have to shut their lines down. Utilities have had problems getting coal in on time. Some (grain) shippers on smaller lines feel they're not getting enough (rail cars) versus big elevators getting 54- and 110-unit trains. There's a wide group of shippers across the country wanting to see changes."

Railroads' view

But the railroads are opposing Roberts' bill, which still awaits hearing in the Senate Commerce Committee. They say it would undo the deregulation of the 1980s.

"That's it," said Mark Davis, a spokesman for Union Pacific in Omaha, Neb. "What it basically does is do away with the Staggers Act. If folks could remember the mid- to late 1970s, they'd remember there were a few railroads going bankrupt. Rock Island is one I think of off the top of my head."

Deregulation, consolidation and mergers have made railroads more efficient and profitable than they have been for years, Davis said.

"What it's really done is lower transportation costs and increase efficiencies in the rail industry," he said

-- Mike Shields' phone message number is 832-7144. His e-mail address is mshields@ljworld.com.

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