The passage of any rail safety legislation in Congress next year is likely to be influenced by two things, industry observers told FreightWaves: the 2024 presidential election and the release of a report by the National Transportation Safety Board on the February 2023 derailment of a Norfolk Southern train in East Palestine, Ohio.
That February derailment — although it resulted in no injuries or deaths — has prompted calls to bolster rail safety because it led to the venting of tank cars carrying vinyl chloride, a hazardous material. That venting, conducted because of concerns that chemical reactions inside the derailed tank cars would eventually cause an explosion, resulted in a huge plume of smoke over the derailment site, rattling locals and raising concerns about the environmental health of communities in the area.
NTSB is expected to release its final investigative report in 2024. The report will include recommendations about what the industry and stakeholders can do to enhance rail safety. NTSB’s reports typically come out 12-16 months after an incident, so the report on the East Palestine derailment could come as soon as the first quarter of 2024 but is more likely to come out midyear, sources said.
That report and its recommendations could influence what kind of rail safety legislation is produced in the U.S. House of Representatives. Indeed, Republican House leaders indicated in 2023 that they would not move on rail safety legislation until NTSB’s report on East Palestine came out, multiple sources told FreightWaves.
In the Senate, a rail safety bill co-sponsored by the senators of Ohio and neighboring Pennsylvania and others passed the Senate Commerce Committee in May but never got to the Senate floor for a vote in 2023.
Ohio’s senators, Democrat Sherrod Brown and Republican J.D. Vance, “continue to be strongly motivated to move legislation through the Senate,” Ian Jefferies, president and CEO of the Association of American Railroads, told FreightWaves. “And we certainly see an opportunity for consensus legislation that all stakeholders can support, that’s targeted and data driven. We do think some changes might be necessary before anything does move through the Senate, and we want to be part of the solution and a productive part of the process.”
Republican Congressman Sam Graves of Missouri, who is also chairman of the House Transportation and Infrastructure Committee, “has been very clear that he wants to see the results of the NTSB investigation surrounding East Palestine, and then we’ll make a decision on how to most appropriately move forward,” Jefferies continued. “We want to continue to be engaged in the process and make sure that any legislation is something that really gets at any identified challenges that need to be addressed via legislation.”
Jefferies also said the Federal Railroad Administration is working on several issues with stakeholders, including regulations and advisories related to track inspection, hot box detectors and related wayside detection, and crew consists or train crew sizes. Meanwhile, the regulatory agenda that the U.S. Department of Transportation issued this fall also indicated that DOT is working on a rulemaking addressing high-hazard freight trains.
Scott Jensen, director of communications for the American Chemistry Council, echoed Jefferies’ remarks.
“I think the House has made it pretty clear that they’re really not interested in taking up the issue until they have seen the NTSB report. So I think that’s where things stand, and our position on the Senate legislation hasn’t changed. We’re supportive of elements of the bill and tried to work with the bill authors and sponsors on elements of that bill,” Jensen said.
As chemicals shippers are waiting to see what rail safety legislation comes out, shippers are continuing to upgrade fleets of DOT-111 tank cars for flammable liquids with DOT-117 tank cars, Jensen said. The final deadline for upgrading those cars is 2029, although there are staggered deadlines for different types of chemical commodities between now and then.
Meanwhile, fuels and petrochemical shippers “feel like a lot of the previous rules that have come out on rail safety have been heavily focused on the tank car itself and not as focused on keeping the railcars in track in the first place,” said Rob Benedict, vice president of petrochemicals and midstream for American Fuel & Petrochemical Manufacturers (AFPM).
“Addressing the root cause of derailments is something we’d be looking for in any future legislation or regulation as this would have the greatest impact on rail safety. AFPM would note that the rail safety bill that ultimately came out of Senate Commerce Committee was a vast improvement on the initial bill. We are interested to see how that bill lines up with whatever NTSB says when they eventually issue their final report on the East Palestine derailment and then how that guides the conversation moving forward,” Benedict said.
Although the Class I railroads and their network are the target of rail safety legislation, short-line railroads will also be watching what rail safety bill shapes up in 2024.
“Even if a bill did entirely exempt short lines, if it’s bad for the network and bad for our Class I partners and doesn’t advance safety, we still wouldn’t be supportive of such an idea because they’re our network partners and we share and we serve customers together,” said Chuck Baker, president of the American Short Line and Regional Railroad Association. “So if there’s a rule that hampers their ability to operate efficiently without a commensurate safety benefit, then we think that’s problematic.”
Could an election year slow momentum for rail safety legislation?
The other major factor that could influence whether rail safety legislation gets passed and signed into law in 2024 is election-year politics, sources said.
“Things tend to slow down in election years. Election years do often feature legislation … but a lot of what moves in an election year is tying up in the first few months of the election year the loose-ends deals that were almost cut at the end of the odd-numbered year,” said Loren A. Smith Jr., president of Skyline Policy Risk Group, a research and consulting firm focused on the supply chain. Smith previously served as deputy assistant secretary for policy at DOT.
What makes any rail safety bill potentially challenging to move in 2024 is not only the railroad industry’s and rail shippers’ reservations about the potential depth of changes in such a bill, but also how those changes might impact the efficiency of the freight rail system.
Those are the concerns that will “need to be hashed out. And in the partisan fire of an election year, it gets really hard to do that,” Smith said.
Greg Regan, president of the Transportation Trades Department (TTD), which is affiliated with the AFL-CIO, also said legislative priorities can tend to shift in election years.
“The election year complicates everything. It shortens the legislative calendar dramatically. That’s a concern in every regard,” Regan said.
He continued, “If we’re going to be able to move something, I think it’s going to be one of those things where if it gets out of the Senate and it builds enough pressure on the House, they have to do something. I would be concerned about the House, taking aspects of the bill to appease their funders in the railroad industry. But we will try to hold everyone accountable now: What exactly are they doing? What are they voting for or against? And we have a lot of allies in that regard right now.”
Another possible factor on whether rail safety legislation passes is current circumstances, such as the perceived health of the overall supply chain, according to Smith.
The COVID-19 pandemic saw a supply chain crunch in 2021 and 2022, but that abated in 2023 and the supply chain actually saw a slowdown in part because of excess inventory, Smith said. In other words, it’s difficult to forecast what the rail industry and the overall supply chain might look like in 2024 because recent years were far from normal, and what happens — or doesn’t happen — in 2024 might affect the momentum to push things forward, Smith said.
“There’s a lot of things that are changing right now. Even if no big reform bill is being passed by the House and the Senate in some sort of compromise form, the Federal Railroad Administration is considering new regulations,” Smith said. “At the same time the freight rail industry itself has been doing a lot to look at the operational changes they can make in terms of communicating more with not just state and local governments but also local communities. That was a big part of why people weren’t happy.”
Couple these factors with continued advancements in safety technology, and “all of that may give us a very different environment over the next few months,” Smith continued. “If we think not much is going to move in the election year, we might look at the situation differently [in 2025], and that could be good or bad. But I think people should be looking at what the industry is doing to improve their own risk modeling.”
Indeed, a potential shift in priorities in 2024 is why rail labor expects to continue its lobbying efforts next year.
“On FRA, we hope that we’ll see a final rule on crew size soon,” said TTD’s Regan. “There are [also] rulemakings on certification for signalmen and dispatchers. There is more that the administration could do, but similarly, we’re running out of time there too. So, you know, there’s no chance to take a break here. We have to keep pushing forward.”
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