Senator John Thune
Since the beginning of this year, businesses and agriculture producers in South Dakota and many other states have been particularly challenged by rail service delays and network congestion, as well as locomotive and railcar shortages.
From farmers and grain elevators, to auto manufacturers, energy providers, and retailers of all kinds, our nation’s economy depends on rail transportation. However, unreliable rail service can increase the cost of getting products to market, which can negatively impact exports and our nation’s global competitiveness.
As the former South Dakota rail director under the late governor George S. Mickelson, I know first-hand the importance of effective rail access for not only agriculture producers but other shippers. In all my years of working on rail matters, I have never seen agriculture producers more concerned than they have been this year regarding their ability to move grain to market in a timely manner. That is why I held a Commerce Committee hearing on September 10th on the rail challenges that South Dakota producers and others shippers are facing. The hearing underscored that service issues will only get worse if the railroads do not make significant changes.
In South Dakota alone, this year’s harvest and what remains of last year’s is expected to exceed the statewide grain storage capacity by roughly eighteen percent. Grain has already been stored on the ground, posing a significant risk of spoilage and loss. In addition, as winter approaches, ethanol plants will also become more vulnerable to rail delays. This is because ethanol plants cannot simply be shut down during winter months without running the risk of pipes freezing or other major structural damage.
While the Surface Transportation Board (STB), which regulates the freight railroads that operate in the U.S., has been working to address the current rail service issues facing South Dakota, and other states, this crisis has highlighted some of the inefficiencies that currently exist with regard to the way the STB can address service issues.
At the beginning of September, Commerce Committee Chairman Jay Rockefeller (D-West Virginia) and I introduced S.2777, the Surface Transportation Board Reauthorization Act, which is a common-sense bill to help address a number of STB inefficiencies so that the board can better assist shippers and railroads when problems arise. On September 17th, the Commerce Committee approved the legislation clearing the way for future consideration by the full U.S. Senate.Despite these challenging times for businesses and industries that rely on efficient rail service, this situation has brought elected officials, shippers, and railroads together to have a serious discussion about what needs to be done to ensure these delays and service challenges don’t happen in the future. While there are no quick fixes, I am proud of the work that has resulted from continuous dialogue with ag producers and shippers across the state, as well as the close coordination with Governor Daugaard and South Dakota Agriculture Secretary Lucas Lentsch. Working together, we can seize this opportunity to make improvements that benefit both shippers and the railroads that serve them.