NPRA ’07: Good prospects seen for US rail reform

26 March 2007 02:18  [Source: ICIS news]

SAN ANTONIO, Texas (ICIS news)--The US chemicals industry may have the best chance in a quarter-century to reform federal railroad law and secure relief for producers who are served by a single rail carrier, a top industry official said on Sunday.


Charles Drevna, executive vice president at the National Petrochemical & Refiners Association (NPRA), told a press conference that there is growing recognition in the US Congress that rate relief for high-volume rail shippers such as chemicals producers, other manufacturers, and the coal and grain sectors is long overdue.


Drevna said there is strong support among Democrats and Republicans in Congress for a bi-partisan bill introduced earlier this month that would provide relief for “captive shippers”, chemical producers and other rail freight customers who are served by only one major US rail carrier and consequently pay disproportionately higher rates.


“We have been trying to get captive-shipper protection since the Staggers Act was passed in 1980,” Drevna said.  That law largely deregulated the US rail industry, ending a structure of federal control that had existed since the late 1880s.


“This year I think there is recognition on both sides of the aisle in Congress that the time has come to provide captive-shipper relief,” he said.  “I hope that Congress will push this bill.”


Legislation introduced earlier this month would make it easier for customers to challenge rail freight rates and lower the now high cost of bringing a rate challenge before the Surface Transportation Board, the principal federal rail regulatory agency.


Drevna said passage of the legislation could mean rate reductions of as much as 50% or more for some captive rail customers.


The chemicals industry has been joined by high-volume rail shippers in manufacturing, agricultural, forestry and the utility sectors in pressing for the reform.


Drevna spoke on the opening day of the 32nd annual NPRA petrochemicals conference.

By: Joe Kamalick
+1 713 525 2653

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