Pushing Combatants Together, STB Orders Amtrak Gulf Mediation

By Jim Mathews / President & CEO

The Surface Transportation Board just sent all sides in the long-running Gulf Coast service restoration dispute to a 30-day mediation period while simultaneously refusing to stay the Board’s proceeding, saying that the Board “continues to encourage the Parties” – CSX, Norfolk Southern, the Port of Alabama, and Amtrak – “to negotiate resolution” of the entire controversy.

As outlined in a flurry of motions to the docket (FD 36496) over the past few weeks, the host railroads and the Port wanted the Board to order mediation and stay the proceeding but did not want Amtrak planners to get access to the route-modeling data that’s at the heart of the dispute. Amtrak was initially open to mediation, but formally opposed it in a motion before the Board in May because of the freight railroads’ refusal to share the modeling data. Amtrak argued that mediation without the data put Amtrak at a disadvantage and was just more evidence of bad-faith negotiations by host railroads determined to block any new service.

In the end, it appears in today’s STB decision that the Board decided to split the difference, giving the freight railroads the mediation period they wanted but without a stay and without the route-data restrictions for Amtrak, while also giving Amtrak the data access Amtrak wanted but permitting the mediation to begin over Amtrak's objection.

The Board’s new decision also extends the period for submitting additional evidence another 30 days to July 13.

It’s important to note that this decision is not the final word in the Gulf Coast case but is, instead, a procedural ruling intended to coax – with a little force – all sides to come up with a negotiated settlement in hopes that the Board does not have to order the host railroads outright to permit the new daily Amtrak service.

Ever since this stage of the dispute began more than a year ago with Amtrak’s motion asking STB to order host railroads CSX and Norfolk Southern to let Amtrak start its Gulf Coast service, all sides have been squabbling over the credibility of the route modeling CSX and N-S used to claim the new Amtrak service would “unreasonably impair” freight service. That’s the legal standard the host railroads must use to stop new Amtrak service, which the law is written to permit by default unless the hosts can prove it would be bad.

For what it’s worth, it’s not just Amtrak (and your Association) claiming that the modeling doesn’t pass the smell test. In January, the U.S. Dept. of Transportation dropped an unusually forceful amicus brief into the STB’s Gulf Coast restoration docket, declaring flatly that the STB “should order the restoration of the Gulf Coast service” and undercutting much of the evidence the two railroads submitted. DOT told the Board that the host railroads’ operational analyses submitted as evidence were “insufficient” to prove that adding two trains each day to the area would “impair unreasonably” the freight transportation offered by the hosts.

The posture DOT adopted in its filing mirrors many of the arguments your Association has been making for some time – that the host railroads are acting in bad faith to block Gulf Coast restoration, that Congress has always intended that host railroads must affirmatively prove that new service will harm their operations, and that the host railroads continue to benefit each and every year from the “Grand Bargain” they struck in 1971 with the U.S. taxpayer, who pays some $2 billion every year to relieve the railroads of their common-carrier obligations in exchange for access to tracks and infrastructure.

As a result, when the public trial-like proceeding began in April, attorneys presented hours and hours of testimony, supplemented by videos and diagrams and even drone-video footage, aimed at trying to answer a single question: how accurate, or inaccurate, is the HNTB Rail Traffic Controller (RTC) study, which CSX, N-S, and the Port of Alabama say says proves Amtrak’s two new daily trains would “unreasonably impair” freight operations between New Orleans and Mobile?

In addition to DOT’s earlier criticisms, cross-examination by Amtrak’s attorneys and Board Members of well-known rail operations consultant Charlie Banks seemed to undercut the study’s utility. CSX called in Banks as an expert witness to defend the study, but under questioning he acknowledged that the study’s 95% on-time standard – which Amtrak pointedly testified and notes in its motions and briefs it never sought – was a somewhat arbitrary level set by the study team’s “collective judgment.” Banks also acknowledged that the breathtaking and unrealistic freight growth rates embedded in the study weren’t based on any characteristics specific to the Gulf or the Southeast.

For several years, CSX and Norfolk Southern invoked “competition-sensitive” arguments as a way to sidestep giving stakeholders straight answers about the challenges that this project may pose. As I said in my own STB testimony in February, government agencies, Amtrak, and others are willing to pay their share, so long as it’s defensible and transparent. But host railroads continue to claim that to even discuss the number of train movements would compromise their shippers’ business secrets. CSX tried that gambit again and again during this Spring’s public hearings, forcing a confidential recess while the Board heard arguments about whether particular topics could be discussed in public.

In February I testified that, at least when it comes to train movements, the secrecy argument was curious, considering that this information is readily available to "anyone with a lawn chair and the patience to count." Amtrak took that idea to heart and used modern technology to fabulously snarky effect – pointing a webcam at a section of CSX’s “busy” railway to show pointedly how little traffic there actually is that would be impaired, streaming a live feed from this sleepy territory on the Twitch online gaming community platform.

Rumor has it that CSX was not amused. But your Association’s counter to that is simple: the truth hurts.