Panel Holds Hearing on Nation’s Rail Infrastructure
Washington, D.C. – The House Transportation and Infrastructure Subcommittee on Railroads, Pipelines, and Hazardous Materials today held a hearing on rehabilitating and improving our Nation’s rail infrastructure.
Below is the opening statement of U.S. Representative Corrine Brown (D-FL), Democratic Ranking Member of the Subcommittee on Railroads, Pipelines, and Hazardous Materials, as prepared for delivery:
Statement of the Honorable Corrine Brown, Ranking Member
Subcommittee on Railroads, Pipelines, and Hazardous Materials
“Sitting on our Assets: Rehabilitating and Improving our Nation’s Rail Infrastructure”
February 17, 2011
Thank you, Chairman [Bill] Shuster. It’s not easy turning over the gavel, but we’ve had a lot of successes in this subcommittee over the past few Congresses, and I look forward to working with you this session to make sure we have the best freight and passenger rail network in the world.
The Department of Transportation estimates that freight rail transportation demand will increase 88 percent by 2035. Recent studies show that an investment of $148 billion for rail infrastructure expansion over the next 28 years is required to meet the DOT’s projected demand. Without this investment, 30 percent of rail miles in primary corridors will be operating above capacity by 2035, causing severe congestion that will affect every region of the country and potentially shift freight to an already heavily congested highway system. For passenger rail, a working group for the National Surface Transportation Policy and Revenue Study Commission reported that the total capital cost estimate of establishing a national intercity passenger rail network between now and 2050 is about $357 billion (or $8.1 billion annually).
However, the ability of the railroads, shippers, and states to meet those rail infrastructure investment needs is becoming increasingly difficult in the current economic climate. And it’s nearly impossible for anyone to get a traditional bank loan today. Congress made a big mistake when we bailed out the banks but didn’t stipulate that they had to lend it out. Now instead of lending money, banks are calling in notes.
The RRIF program can help railroads, shippers, and states meet those rail infrastructure investment needs. But I don’t think we are taking full advantage of the program. I meet with railroads and others all the time. They tell me – time and again – how difficult the application process is to navigate; how time consuming it is; how expensive and cumbersome it is; and, in the end, many of them tell me: “It’s just not worth it!” Well, we need to do better.
The draft Surface Transportation Authorization Act of 2009 made significant changes to the RRIF program, which I proposed. The bill authorized the Secretary to: (1) reduce the interest to be paid on direct loans provided to railroads, State and local governments, and eligible entities for the sole purpose of installing positive train control systems; (2) allow applicants to use private insurance, including bond insurance, in lieu of a credit risk premium; and (3) allow applicants to pay the credit risk premium over the life of the loan. The draft bill also authorized appropriations to assist the Secretary in reducing the interest rates for loans used for installing PTC.
I look forward to hearing from the witnesses on these proposals and other suggestions for improving the RRIF program. Thank you.