It’s good, but not that good…

With my new state of never being in one place for more than a couple of days at a time right now, you would think that a week on the road wouldn’t be that big a deal. Actually, it was, and for a number of reasons: First, I got to spend three nights at home in New Jersey in eight days, which wasn’t too bad. Next, I was in Washington D.C., for Railroad Day on Capitol Hill, where we had the combination “thank you for your past support, but we now need your support for this” tour, and that was followed by the CSX Short Line Conference in St. Augustine, where we all got to hear about how the economy is starting to put the brakes on the latest resurgence of rail traffic.While I am sure that you all want to hear about the time spent with my family, I think it is more important to go into more detail about RR Day. With the cycle that the industry has been in over the last decade or so with Congress on the 45G investment tax credit, we go through one year of asking for their support for the renewal, then the next year of thanking them, followed by a year of asking for their support, and so on. This year, we had a two for one deal. Not only did we have to thank everyone for their support for the renewal of the tax credit, we also asked them for their support on a bill that had just been introduced to make the tax credit permanent.You might think that this was a big ask, coming off of another successful renewal of the tax credit, but it really isn’t. Why? Because of the bipartisan support that the tax credit gets every time we go for the renewal. In this last renewal, the short line tax credit was in the top 25 of all bills introduced in this congress. We had 260 co-sponsors in the house, and 54 in the senate. These were from both sides of the aisle in both houses, so even in this splintered political landscape, small railroads got everyone’s attention for the right reasons.Now on to CSX following the fun in D.C. Rail traffic, as a whole, can both lead and lag the economy at the same time due to the broad variety of commodities that we carry. What starts to get people’s attention is when volume drops. Now, it can drop quickly, like it did in 2008, or it can drop quietly, like it is doing now. If you had asked me two years ago if cheap energy prices could cause traffic to drop, I would have started calling the men in white coats. Two years ago the industry couldn’t find enough people to staff its trains, and locomotives could not be built fast enough. Right now, CSX alone has over 2000 people on furlough, and over 200 locomotives parked. When you are looking at efficiency by running fewer larger trains, you have to start wondering what that will do for velocity in the long run. Who would have thought that coal, the life blood of many a railroad, could be disappearing from some railroad’s portfolios?So in the end, were they both successful meetings? Yes, but I wish they would have been reversed in order. I was making my first visits to the Massachusetts delegates this year, and it would have been more compelling to bring them the big picture story when we were trying to ask them to make a very important piece of funding for our part of the industry permanent.--By Steve Friedland
steven-fb.jpgSteve Friedland is a well-known leader in the short line industry who has devoted more than two decades to railroading. At the Morristown & Erie Railway, a 42-mile New Jersey short line, he worked in all areas of the railroad, including track, mechanical, signals, and operations. In 1999, he founded Short Line Data Systems, a provider of railroad EDI and dispatching software, AEI hardware, and management consulting to the short line industry. He currently serves as the ASLRRA representative to the AAR's Wireless Communications Committee and is chairman of the joint AAR-ASLRRA Short Line Information Improvement Committee. He also is a member of the ASLRRA's board of directors.