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of Meeting on Movement of Freight in Minnesota
Civic Caucus, 8301
Creekside Circle, Bloomington, MN 55437
Friday, January 30,
speakers: John Hausladen,
Minnesota Trucking Association; David
Christianson, manager, freight planning and development, MnDOT;
Brian Sweeney, legislative
counsel, BNSF Railway; John Apitz,
executive director, Minnesota Regional Railroads Association
Johnson, chair; David Broden, Marianne Curry (by phone), Bill Frenzel (by
phone), Paul Gilje (by phone), Jim Hetland, Marina Lyon (by phone), and
Wayne Popham (by phone)
Context of the meeting--In
anticipation of a possible Civic Caucus position paper on roads, rails and
buses the Civic Caucus today is gathering perspective on the issues
related to movement of freight in the state and their interface with the
movement of people.
Welcome and introductions--Verne
and Paul welcomed and introduced our speakers for the day.
John Hausladen, president of the
Minnesota Trucking Association, representing 700 member-trucking companies
and allied firms, has been with the organization since 1996. He is a 1982
graduate of Bethel College, St. Paul David
Christianson, manager, freight planning and development, MnDOT,
joined MnDOT in 2008. He has been involved in various transportation
positions since 1973, including seven years with the Metropolitan
Council. His wife, Connie Kozlak, is transportation planning manager at
the Metropolitan Council. Brian Sweeney,
legislative counsel for BNSF Railway, has been with the firm for 28
years. Sweeney is responsible for BNSF's state government affairs in
Minnesota, North Dakota and South Dakota. He is a graduate of the
University of St. Thomas. John Apitz,
a lawyer with Messerli and Kramer, is executive director of the
Minnesota Regional Railroad Association. Apitz is a graduate of Gustavus
Adolphus College and William Mitchell College of Law. He has served as a
staff member to former Sen. Hubert H. Humphrey and former St. Paul Mayor
Issues related to freight movement--Today's
meeting differed from many others, because of almost constant
back-and-forth discussion among the members of the Civic Caucus and the
four speakers. This summary will attempt to outline the issues and, where
possible, identify positions on these issues as articulated by the
Interface between passenger and freight movement on railroads--Railroads
in Minnesota, which have dealt almost exclusively with freight over the
last 30-plus years are now sometimes expected to accommodate proposals for
movement of passengers. Everywhere in the Legislature the issue of
getting people on trains seems to be the big objective of some groups
today, Apitz said, whether it's Minneapolis to Chicago or Duluth or Big
Lake or other locations, and whether by light rail, commuter rail, or
high-speed rail. The existing BNSF tracks between Big Lake and
Minneapolis will be used for the North Star commuter line between
Minneapolis and Big Lake. Service is expected to begin next winter. A
member questioned how much these lines are expected to reduce any
congestion along Hwy 10 or other major highways.
2. Rail's role in serving major industries in the far
reaches of the state--Will
the state be able to continue to provide adequate roads and/or rail lines
to serve smaller cities around the state where major businesses are
located? Some businesses, such as Schwan's Foods and Polaris, are
relatively far from other businesses, making it difficult to provide
needed transportation infrastructure. Others noted there was a huge
reduction rail mileage in this state during the past twenty years. This
left many towns without any rail service. Likewise lightly used portions
of the state trunk highway system may suggest economic development can
only be cost effectively done near the major roadways and remaining
railroads of the state.
3. Making sure that different types of vehicles pay their
fair share for road construction and maintenance--Roads
are built to serve the heaviest vehicles that use them. The base and
asphalt or concrete is thicker and the bridge piers and decks are designed
larger to accommodate heavy vehicles. However, some questioned whether
user taxes reflect differences in vehicle weights, along with distance,
time of day, and amount of congestion produced by these heavy vehicles.
Truckers greatly dislike the weight-distance tax. Hausladen noted that
because loads vary in their weight it would be better to use a distance
factor but not a weight factor. He added that this discussion illustrates
another need for consistency from state to state in how user fees are
imposed. One should not automatically think that it is better to insure
trucks will flow better if they have toll roads because--depending on the
toll--it might be less costly to have professional drivers sit in traffic,
Hausladen said. Trucks and truckers are very adaptable to changing
conditions, as they were, he said, after the collapse of the I-35W bridge.
4. High speed interstate rail proposals-- Proposals
for interstate high-speed rail service to Duluth and Chicago are largely
planned to use existing rail beds along the Great Northern line to Duluth
and the Milwaukee line along the Mississippi River to LaCrosse. Rochester
would like the line to go through that city instead of along the river.
Whether this could be done on an existing rail line or require an entirely
new right of way is unknown at this time. None of the routes to Chicago is
equipped to handle such high speed service. The cost of upgrading existing
lines, probable fares and operating deficits are unknown. Some seem to
think these investments will produce a big return, even to the point of
becoming self supporting. Others see a lot of red ink. The effect of such
lines on transportation in this state, congestion reduction or competition
with the airlines is unknown.
5. Differing state-to-state regulations--Minnesota
does not permit operation of long double and triple bottom trucks as do
some of the neighboring states. A member questioned the impact on
companies that move freight if they have to adjust their loads at the
state borders. There was also the question about the extent regulations
either impede or assist economic development around the state.
6. Equitable treatment of trucking and rail in
moving freight around the state--One
member questioned whether lawmakers look at trucking and rail as part of
an overall system of moving freight, with an objective of making sure that
freight is moved in the most efficient way possible. It was noted that
lawmakers constantly hear from competing truck and rail interests. In
recent years both interests have come together on occasion.
7. Balancing construction of additional roads
and rails with ongoing reconstruction and maintenance of existing
questioned to what extent the state is balancing the pressures for
building additional miles of roadways with that of keeping existing
roadways in good shape. It was noted the railroads need to constantly
weigh these two objectives. Maintenance is critical to keeping the rail
line open and enabling trains to operate at a reasonable speed. Since the
railroads own the lines they have to constantly ensure they spend
sufficient capital on maintenance. As they accumulate capital they also
will add capacity to the system. This was most apparent in recent years
as some railroads added capacity to handle enormous shipments of coal and
containers from West Coast ports.
8. Evaluating the status of comprehensive
transportation planning for the state--Are long range plans for
movement of freight fully integrated with plans for movement of people?
Or does planning for people come first, with later efforts to shoe-horn
freight into the plans? Do long range plans pay attention to all parts of
Comments and discussion--During
comments by speakers and in discussion with the Civic Caucus the following
points were raised:
1. Truckers concerned about system efficiency--Truckers
are concerned about predictable speeds, speed limits, fuel costs, safety
regulations affecting how long truckers are required to rest, and costs
such as tolls. They like predictability. Even congestion is a cost that
can be built into the business as can tolls that can be avoided. Quality
of the road system has declined dramatically. Minnesota used to have one
of the best in terms of pavement condition, now it's in the middle of the
states. We need more maintenance. Of all the highways truckers are most
concerned about the condition of the interstate freeway system.
2. Passenger impact on railroad expense--Apitz
recalled that railroads were de-regulated beginning in 1971, which led to
their moving almost exclusively to freight. Eliminating passenger trains
was the only way railroads could survive, he said. Operating losses on
passenger service were driving railroads into bankruptcy. The Staggers Act
eliminated the requirement for passenger movement on railroads and enabled
railroads to spin off little used pieces of the system. Some of these
survive as regional railroads. In 1971 there were 42 "Class 1" (as
determined by annual gross operating revenue) railroads operating in
Minnesota. Today there are four, BNSF, Canadian Pacific, Union Pacific,
and Canadian National, he said. In addition are 20 smaller railroads.
These railroads are private enterprises and aren't receiving subsidies,
None of he railroads is proposing to get back into the passenger business
because they would again lose lots of money. In addition, such
passenger movements would add trains to portions of already heavily used
rail lines such as the one between Minneapolis and St. Cloud. At some
point additional rail will need to be added to provide desired smooth and
higher speed movements for passenger lines. The public will need to pay
for these improvements if they want to use this right of way and track.
Everyone loves the train, but no one loves the railroad company, he said.
A key question is how railroads will be able to move people, he said.
Fares would likely be far lower than actual costs, requiring subsidies.
The question is where subsidies would come from, he said.
3. Experience with North Star commuter line--
The Minneapolis-Big Lake North Star commuter line has been a tough
learning experience. It will be on the BNSF mainline tracks that carry
freight from the West Coast to Chicago. The state and BNSF have been
able to negotiate the use of BNSF tracks for the North Star commuter line,
but Sweeney said it is very difficult for railroads that have served
freight exclusively for more than 35 years to now add passenger service.
A major problem, he said, is that there's usually not enough capacity on
existing rail lines. Cost estimates for adding passenger trains to this
freight line were too low. Any improvements needed for capacity will not
be paid by the railroad. A proposal has been made to build an additional
track for the North Star line from Fridley to Coon Rapids and through the
north yard to ease movement for the North Star line and provide more
freight capacity. The proposal is for the state or national government pay
for it. Railroads will be challenged to pay for an estimated $150 billion
needed to fix up rails nationally. Currently they estimate they can only
come up with $100 billion.
4. Overall rail condition problem--Sweeney
said that exclusive of the issue of moving passengers, the BNSF is
contemplating major investments for improving its existing freight
lines. Expenses will be paid by the railroad itself. The public
might not fully understand the ownership issue of public vs. private.
5. Paying the cost of improving roads for heavy vehicles--A
Civic Caucus member noted that roads must be built to accommodate the
heaviest trucks. The member inquired whether a weight factor should be
built into the user fees paid by different sized vehicles. Hausladen
replied that because loads vary in their weight it would be better to use
a distance factor but not a weight factor. Hausladen added that this
discussion illustrates another need for consistency from state to state in
how user fees are imposed.
6. Changes in transportation expenses and capacity for
1973, just as deregulation was beginning, transportation expenses averaged
18 percent for business. Today that percentage is 10 percent. This is the
result of deregulation, Christianson said. The metro area has congestion
but good facilities for the shipment of goods. Some areas in rural
Minnesota do not. Christianson noted that overall Minnesota's highway
system is rated at between 6-7 on a scale of 10. However, it has four
class 1 railroads which puts its overall rating closer to 8-9. Until the
recent downturn in the economy we were out of trucking capacity in the
7. Difference in cost of shipping by truck and
by rail--Sweeney noted that
expenses for moving freight by rail are about 2.5 cents per mile per ton,
compared to about 7 cents per mile per ton for moving freight by trucks.
The state has about 4,300 miles of rail and about 30,000 miles of roads
suitable for trucks.
8. BNSF legislative objectives--At
the federal level, Sweeney said, BNSF will oppose efforts to re-regulate
the rail industry and strip its anti-trust exemptions. The railroad will
advocate an investment tax credit for railroads and rail customers. At
the state level BNSF will fight efforts to impose regulations on the
railroads that don't apply to other industries.
9. Change in sufficiency of roads for trucks--Forty
years ago the state highway system was sufficient for trucks of that age.
But now trucks are moving much more tonnage, and roads have not been
improved accordingly, Christianson said. Christianson said he agrees
with a Civic Caucus member's observation that the state hasn't had the
political will to keep up with demand. Another member noted that
Minnesota has an extraordinary large highway system for its size. So it's
not just a matter of improving the roads, but deciding which roads ought
to be improved. There's not enough money, the member said, to improve all
state roads to a standard that can accommodate all trucks. Christianson
noted that Minnesota has less state money available for its road system
than does Wisconsin, because Wisconsin indexed its gas tax several years
10. Question of integrated transportation planning--Asked
by a Civic Caucus member about the status of integrated transportation
planning, Christianson said that MnDOT currently has such planning under
way. Questions were raised whether such plans will be simply advisory or
whether there'll be authority for them to be implemented.
inquired whether MnDOT plans will include recommendations for financing.
Christianson noted that MnDOT was charged last year with developing a
freight plan for the state. In this plan the state will integrate the
modes. Others questioned whether existing state plans give sufficient
attention to railroads.
Whether earmarking is more significant than planning--A
Civic Caucus member observed that in many cases it appears that
transportation expenditures are directed more by public officials
earmarking funds for specific projects than by overall plans. Moreover,
the member said, Minnesota doesn't appear to have an overall
transportation plan covering freight and passenger movement, rural and
urban, and roads and rails. On the question of earmarking, Christianson
said that legislators earmark every road project in Wisconsin. He doesn't
think that is what Minnesota wants.
12. Where local initiatives belong in a state
plan--Members and speakers discussed the fact that certain
initiatives at the local level, such as for ethanol plants, produce
significant impact on the need for improving state highways. We don't
have an easy solution in such a situation. Should localities not be
allowed to take the initiative? If they do, and more transportation
infrastructure is required, should such localities have to pay for that or
pass the bill on to the state?
13. Thanks--On behalf of the Civic
Caucus, Verne thanked our speakers for meeting with us today.