Railroads to Receive $1.4 Billion for Fixes and Upgrades

Date: Monday, September 25, 2023
Source: The Wall Street Journal

Dozens of aging U.S. rail bridges and tracks have been chosen to receive $1.4 billion in federal grants for repairs and upgrades, with businesses and rail commuters expected to benefit from these funds as early as next year.

The 70 approved projects, including around 40 that involve bridges, were judged on how they would improve safety, increase capacity of both freight and passenger railroads, and bring economic benefits to the country, officials in the Biden administration said in a briefing.

The Federal Railroad Administration said it received 234 eligible applications with requests totaling $6.1 billion for the grants. There are more than 70,000 railroad bridges in the U.S. The selected projects span 35 states and the District of Columbia.

“I think across the country it’s fair to say that people look at America’s rail system and correctly say that it needs improvement,” said Transportation Secretary Pete Buttigieg, pointing to derailments on freight lines, protracted blocked crossings and lagging intercity passenger rail.

Part of the problem has to do with prior underinvestment in rail infrastructure, he said. The grant program is part of the roughly $1 trillion infrastructure bill signed by President Biden in 2021.

Disagreements over the use of federal funds for rail infrastructure have persisted for years. Some senators have argued against government assistance, saying that the largest freight railroads have made billions in profits and paid billions in stock buybacks and dividends.

The freight railroads are operated by publicly listed and private companies that own the tracks, bridges and locomotives. The largest railroads have said they invest billions in their infrastructure annually and that they are in compliance with federal safety standards. The railroads say federal subsidies are necessary for repair projects since they provide a public service moving hazardous materials and other essential goods.

The freight railroads operate the majority of the railroad networks in the U.S., including tracks for passenger service. They have spent an average of more than $23 billion annually on their networks in recent years, according to the Association of American Railroads.

In recent months, there has been heightened scrutiny over the safety records of railroads after a February train derailment in Ohio released toxic chemicals in a small town, resulting in the evacuation of residents nearby. Senators from Ohio and Pennsylvania introduced a bipartisan rail safety bill this past spring. The Senate has yet to vote on the proposed safety bill.

Over $600 million is allocated to freight-railroad projects, and around $100 million would go toward funding environmentally friendly locomotive projects, said Amit Bose, administrator of the Federal Railroad Administration.

Recipients of the grants will need to show they have some nonfederal funding in these projects, Bose said. Apart from Amtrak and the major freight-railroad operators, short-line railroads and labor unions will also receive funds to improve tracks and train track workers and inspectors.

In the Gulf Coast region, $178 million will be allocated to Amtrak to help restore passenger rail service between Mobile, Ala., across Mississippi to New Orleans, La., said White House Infrastructure Coordinator Mitch Landrieu. Landrieu is the former New Orleans mayor and a veteran of Hurricane Katrina’s recovery tasked to oversee the $1 trillion infrastructure plan.

In New Jersey, FRA is providing a roughly $59 million grant to help pay for the replacement of the Point-No-Point Bridge owned by Conrail. The 124-year-old swing bridge carries around 7,000 freight cars a day on trains operated by CSX and Norfolk Southern, and a replacement is currently under construction.

The bridge transports freight between the Northeast and Chicago, and it currently takes several hours’ notice and some Conrail employees to be on site to safely open the bridge for river traffic.

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