Executive Summary The House Transportation and Infrastructure Committee is drafting a major bill to extend billions of dollars in highway,

transit and safety programs and overhaul regulations governing transportation.1 Multiple industries have critical interests at stake in the bill, and theyre vying to shape it. This report examines how railroad companies, an industry worth more than $61 billion, have been using their multimillion dollar Washington influence machine to push a rollback of safety regulations.2 Members of the committee have been signaling support, and in April 2011, the Railroads, Pipelines and Hazardous Materials Subcommittee held two hearings on reducing regulation. 3 Research by Citizens for Responsibility and Ethics in Washington (CREW) found that since 2007, railroads, affiliated companies, and industry trade groups have spent more than $152 million on federal lobbying meant to move their agenda down the track. The railroads current roster of well-connected lobbyists includes at least four former members of Congress, two of whom have sons currently serving on the railroad subcommittee. The railroads campaign contributions to current committee members, meanwhile, jumped more than 25% between the 2008 and 2010 election cycles. Legislative Landscape The previous law authorizing money for transportation programs and laying out policies to govern them expired in 2009.4 Since then, Congress has passed a series of short-term extensions, and President Barack Obama has urged Congress to pass a comprehensive six-year $556 billion transportation bill this year.5 The House Transportation and Infrastructure Committee, chaired by Rep. John Mica (R-FL), is working on a bill, and Rep. Mica said he expects to mark up the legislation in July.6 Rep. Mica, in a recent opinion piece, called for reducing federal mandates and providing more decision-making and approval authority to states.7 Among other things, he

Press Release, House Transportation and Infrastructure Committee, 112th Congress, Federal Government Must Not Get in the Way of Safe, Effective Transportation, April 7, 2011; http://www.eenews.net/public/Greenwire/2011/02/14/5. 2 http://www.census.gov/compendia/statab/2011/tables/11s1121.pdf. 3 http://republicans.transportation.house.gov/hearings/hearingdetail.aspx?NewsID=1206; http://republicans.transportation.house.gov/hearings/hearingdetail.aspx?NewsID=1221. 4 http://republicans.transportation.house.gov/singlepages.aspx/911. 5 Id.; http://www.eenews.net/public/Greenwire/2011/02/14/5. 6 Press Release, House Transportation and Infrastructure Committee, 112th Congress, Shuster: Hazmat Regulations Must Recognize Importance of Safety and Economic Growth, April 12, 2011; http://republicans.transportation.house.gov/news/PRArticle.aspx?NewsID=1310 (see video). 7 Rep. John Mica, How to Fix American Transportation, Politico, May 23, 2011.
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has suggested sweeping changes to passenger rail service as part of the legislation, including deregulating and privatizing passenger rail.8 The subcommittee on Railroads, Pipelines and Hazardous Materials chaired by Rep. Bill Shuster (R-PA) held two hearings in April in connection with the pending legislation.9 The titles of the hearings alone, Railroad and Hazardous Materials Transportation Programs: Reforms and Improvements to Reduce Regulatory Burdens, and Reducing Regulatory Burdens and Ensuring Safe Transportation of Hazardous Materials, make it clear the subcommittee is taking aim at regulatory mandates. The push to lighten regulation of the rail industry comes at a time of heightened worry over a possible terrorist threat to the countrys rail system. Materials found in Osama bin Ladens Pakistan compound after his death included plans to strike at trains, prompting the Transportation Safety Administration to send a bulletin to rail companies.10 Rail security has been a growing concern since the September 11, 2001 terrorist attacks.11 In April 2010, the Senate Committee on Commerce, Science and Transportation held a hearing on securing rail and surface transportation networks, and Sen. John Rockefeller (D-WV) pointed out that the Transportation Security Administration has come under criticism for failing to complete required risk assessment reports, among other things.12 Imagine what it might mean if a terrorist managed to carry out an attack on any one of these systems, Rockefeller said at the hearing. Weve got 140,000 miles of freight of freight rail track ushering coal, chemicals and other materials.13 At the recent subcommittee hearings, representatives of the rail industry said they want to reduce the frequency of locomotive inspections.14 Edward R. Hamberger, president and chief executive officer of the Association of American Railroads, said railroads want a cap on their liability when carrying particularly dangerous substances known as Toxic Inhalation Hazard (TIH) materials, a category of chemicals that includes chlorine. 15 Mr. Hamberger also described as onerous and unjustified, requirements that railroads install and maintain technology designed to slow or stop a train before an accident, a system known as Positive Train Control (PTC), and

Press Release, House Transportation and Infrastructure Committee, 112th Congress, Mica, Shuster Roll Out High Speed & Intercity Passenger Rail Plan, June 15, 2011. 9 http://republicans.transportation.house.gov/hearings/hearingdetail.aspx?NewsID=1206; http://republicans.transportation.house.gov/hearings/hearingdetail.aspx?NewsID=1221. 10 Mark Mazzetti and Scott Shane, Data Show Bin Laden Plots; C.I.A. Hid Near Raided House, New York Times, May 5, 2011. 11 Transcript, Political Transcript Wire, Sen. John D. Rockefeller IV Holds a Hearing on Securing Rail and Surface Transportation Networks, April 21, 2010. 12 Id. 13 Id. 14 Railroad and Hazardous Materials Transportation Programs: Reforms and Improvements to Reduce Regulatory Burdens, Hearing Before the Railroads, Pipeline and Hazardous Materials Subcommittee of the House Transportation and Infrastructure Committee, 112th Cong., April 7, 2011 (Testimony by Edward R. Hamberger, president and chief executive officer of the Association of American Railroads, available at http://republicans.transportation.house.gov/Media/file/TestimonyRailroads/2011-04-07%20Hamberger.pdf). 15 Id.; Lewis M. Branscomb, Mark Fagan, Philip Auerswald, Ryan N. Ellis, and Raphael Barclan, Rail Transportation of Toxic Inhalation Hazards: Policy Responses to the Safety and Security Externality, Belfer Center for Science and International Affairs, John F. Kennedy School of Government, Harvard University, February 2010.
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said PTC carries costs out of proportion with the potential safety benefits.16 Current law calls for large freight railroads to install PTC technology by the end of 2015 on tracks carrying passengers or TIH materials.17 Unions have been pushing back, arguing that almost all of the regulations are necessary. The regulations that exist were promulgated for a reason - often in the wake of tragic incidents or due to an acknowledged need to enhance safety or protect the public, Stephen J. Bruno, vice president of the Brotherhood of Locomotive Engineers and Trainmen, told the subcommittee.18 Bruno also said the PTC technology will significantly reduce human error and preventable losses of life.19 Christopher Hart, vice chairman of the National Transportation Safety Board (NTSB), said the NTSB has investigated 20 railroad accidents over the past five years and determined more than half could have been prevented or mitigated by using PTC.20 During the hearing, Rep. Shuster, one of the committees most outspoken proponents of reducing regulation, criticized requirements put in place by the U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration governing the transportation of hazardous materials and stressed the need to limit regulatory overreach that cripples our economy, stifles job creation and ties our nation in red tape.21 After the second hearing, he issued a statement praising the remarkable safety record of hazardous material carriers.22 Rep. Shuster, Rep. Mica, committee ranking member Rep. Nick Rahall (D-WV), and railroad subcommittee ranking member Rep. Corrine Brown (D-FL) have gone to bat for the railroads on regulatory issues before. In January 2011, the four sent a joint letter to the Surface Transportation Board warning against any effort to change rules governing competition in the industry.23 Those rules are critical to railroad profits.24 The four members wrote, Any policy change made by the STB which restricts the railroads abilities to invest, grow their networks and meet the nations freight transportation demands will be opposed by the Committee.25

Id. http://www.aar.org/Safety/Positive-Train-Control.aspx. 18 Railroad and Hazardous Materials Transportation Programs: Reforms and Improvements to Reduce Regulatory Burdens, Hearing Before the Railroads, Pipeline and Hazardous Materials Subcommittee of the House Transportation and Infrastructure Committee, 112th Cong., April 7, 2011 (Testimony by Stephen J. Bruno, vice president of the Brotherhood of Locomotive Engineers and Trainmen, available at http://republicans.transportation.house.gov/Media/file/TestimonyRailroads/2011-07-04%20Bruno.pdf). 19 Id. 20 Railroad and Hazardous Materials Transportation Programs: Reforms and Improvements to Reduce Regulatory Burdens, Hearing Before the Railroads, Pipeline and Hazardous Materials Subcommittee of the House Transportation and Infrastructure Committee, 112th Cong., April 7, 2011 (Testimony by Christopher Hart, vice chairman of the National Transportation Safety Board, available at http://transportation.edgeboss.net/wmedia/transportation/20110407rr.wvx). 21 Transcript, Federal News Service, Hearing of the Railroads, Pipeline and Hazardous Materials Subcommittee of the House Transportation and Infrastructure Committee; Subject: Reducing Regulatory Burdens and Ensuring Safe Transportation of Hazardous Materials, April 12, 2011. 22 Press Release, House Transportation and Infrastructure Committee, April 12, 2011. 23 Letter from Reps. John L. Mica, Nick J. Rahall II, Bill Shuster, and Corrine Brown to Surface Transportation Board Chairman Daniel R. Elliot III, January 24, 2011 (hereinafter Letter to Surface Transportation Board). 24 John D. Boyd, Waiting on Rail Regulators, Journal of Commerce Online, June 27, 2011. 25 Letter to Surface Transportation Board.
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Methodology CREW used campaign finance data compiled by the Federal Election Commission and by The Center for Responsive Politics at www.opensecrets.org. CREW also reviewed public records maintained by the Senate Office of Public Records in its online Lobbying Disclosure Act Database, as well as media reports, official testimony to the House Committee on Transportation and Infrastructure, and searches on thomas.gov and govtrack.us to research bills and congressional hearings. CREW compiled every campaign contribution to the campaign committees and leadership political action committees of current House Transportation and Infrastructure Committee members from businesses, trade associations, PACs, and other organizations affiliated with the rail industry during the 2008, 2010, and 2012 election cycles. CREW then researched whether entities donating at least $5,000 to committee members during that period had taken a position on rolling back the railroad safety regulations in the pending transportation bill. CREW determined organizations positions on the issue by reviewing public legislative agendas, testimony submitted to the committee, and memberships in trade associations that spoke out publicly on the regulations. CREW analyzed lobbying reports, campaign finance information, and policy positions for the following railroads, trade associations and companies: American Short Line & Regional Railroad Association, Association of American Railroads, BNSF Railway Co. (also known as Burlington Northern Santa Fe), Canadian National Railway/Grand Trunk Western/Illinois Central Railroad, CSX Corp., Genesee & Wyoming Inc., HDR Inc., HNTB Corp., Kansas City Southern, New Jersey Rail Carriers LLC, Norfolk Southern Corp., RailAmerica Inc., Trinity Industries / TrinityRail, Inc., TTX Co., and Union Pacific. Lobbying Lobbying spending by the railroad industry jumped by almost 5% between the 110th Congress and the 111th Congress. The railroads have used 83 outside lobbying firms since 2007. Lobbying Railroads 110th Congress (2007-2008) $69,941,719 111th Congress (2009-2010) $73,363,565 112th Congress (First Quarter 2011) $8,750,435

The outside lobbying firm that received the most in lobbying fees for working on behalf of the railroad industry, Chambers, Conlon & Hartwell, reported earning $3.24 million since 2007: $1.2 million from the American Short Line & Regional Railroad Association, $405,000 from RailAmerica, Inc., $1.44 million from the Canadian National Railway, and $190,000 from Norfolk Southern Railway Corp. CC&H President Keith Hartwell is the lead lobbyist for the American Short Line & Regional Railroad Association.26 The American Short Line & Regional Railroad Association has scheduled a Railroad Day on Capitol Hill grassroots lobbying event

26

http://www.cch-llc.com/interior.asp?id=35&sectionid=2&sub=yes&pagelevel=4&3parentid=31.

for July 14, around the time the Transportation Committee is expected to be marking up the draft transportation bill.27 Participants with an interest in furthering the political goals of the railroad industry will be brought in from different congressional districts to meet with members of Congress.28 Former Sens. John Breaux (D-LA) and Trent Lott (R-MS) and their lobby shop, the Breaux Lott Leadership Group, reported the second-highest amount: $1.68 million in lobbying fees from the Association of American Railroads since 2008. Dutko Worldwide, the third-highest earning firm, brought in $1.65 million lobbying for HNTB and Union Pacific. The roster of outside lobbyists working for the railroads also includes two former members of House Transportation, both with sons currently serving on the committee. Former Rep. Bud Shuster (R-PA), who once chaired the committee, lobbies for the Association of American Railroads and is the father of the current Rep. Shuster.29 His firm, Strategic Advisors, has reaped $390,000 in lobbying fees from the account since 2007, and he is the only lobbyist the firm has registered on the associations behalf.30 Former Rep. William Lipinski (D-IL), the father of Rep. Dan Lipinski (D-IL) has made $866,000 lobbying for the Association of American Railroads and Burlington Northern since 2007.31 The current Rep. Lipinski, a member of the railroad subcommittee, has said his father does not lobby him.32 Campaign Contributions Total federal campaign donations by railroad employees, political action committees (PACs), and trade associations jumped more than 25% between the 2008 and 2010 election cycles. The biggest factor in the increase was a 78% rise in contributions from the employees and PAC of freight rail company CSX Corp., which gave $181,500 to members of the committee during the 2008 presidential election cycle and $323,250 during the 2010 midterm election cycle. Rail companies Norfolk Southern and Union Pacific gave more, too. Norfolk Southern gave $177,550 to committee members during the 2008 election cycle and $228,500 during the 2010 cycle, a difference of more than 28%. Union Pacifics contributions went from $245,000 to $280,200, a more than 14% bump. Campaign Contributions Railroads
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110th Congress (2007-2008) $1,017,750

111th Congress (2009-2010) $1,283,773

112th Congress (First Quarter 2011) $103,397

http://www.aslrra.org/meetings___seminars/Railroad_Day_on_Capitol_Hill/. Id. 29 http://web.archive.org/web/20001225210228/http://www.house.gov/shuster/bio.htm; Eric Pianin and Charles R. Babcock, Easy Street: The Bud Shuster Interchange, Washington Post, April 5, 1998; Sharyl Attkisson, Family Ties Bind Federal Lawmakers to Lobbyists, CBS News, June 25, 2010; Strategic Advisors, First Quarter 2011 Lobbying Disclosure Report on behalf of Association of American Railroads, Secretary of the Senate, Office of Public Records. 30 Strategic Advisors, First Quarter 2011 Lobbying Disclosure Report on behalf of Association of American Railroads, Secretary of the Senate, Office of Public Records. 31 Attkisson, CBS News, June 25, 2010. 32 Id.; http://transportation.house.gov/Subcommittees/rail-members.shtml.

Top Recipients of Campaign Contributions from Railroads on the House Transportation & Infrastructure Committee, 2008-2012 Cycles By far the largest recipient of campaign contributions from the railroad industry was Rep. Brown. Rep. Brown, the ranking member of the Subcommittee on Railroads, Pipelines, and Hazardous Materials, received $232,484 from railroad companies and trade associations in the 2008, 2010, and 2012 cycles. CSX Corp. is headquartered in her district, and she received $86,500 from CSX employees and the companys PAC.33 The Center for Responsive Politics found CSX Corp. was Rep. Browns largest campaign contributor during both the 2008 and 2010 cycles, and railroads were her largest industry contributor for the 2010 cycle.34 The next largest recipient is Rep. Mica, the chair of the committee. He received $182,298 from railroads. Rep. Shuster, the chair of the railroad subcommittee, was the third highest recipient, accepting $165,800 in railroad cash. Railroads were his top industry contributor for both the 2008 and 2010 cycles, according to The Center for Responsive Politics.35 Also on the subcommittee, Rep. Jerry Costello (D-IL) and Rep. Peter DeFazio (D-OR) were the fourth and fifth largest recipients, receiving $139,647 and $121,500 respectively.36 Rep. Lipinski (D-IL), also a member of the railroad subcommittee, is the sixth largest recipient, with $120,641. 37 Rep. Nick Rahall (D-WV), the ranking member of the Transportation Committee, ranked seventh, taking in $113,500.38 Rep. Tom Petri (R-WI), Rep. Russ Carnahan (D-MO), and Rep. Sam Graves (R-MO), all of whom are from Midwestern states with a strong railroad presence, round out the top ten. Rep. Petri received $100,500, Rep. Carnahan took in $94,500, and Rep. Graves netted $86,000. Rep. Graves is also a member of the railroad subcommittee.39 Public Relations As part of its effort to advance its agenda, the railroad industry appears to have set up multiple websites to advance its agenda. Major players in the railroad industry, including BNSF, Kansas

33

Stephanie Kirchgaessner and James Mackntosh, TCI Agrees to CSX Hearing, Financial Times, February 26, 2008.
34

http://www.opensecrets.org/politicians/contrib.php?cycle=2010&type=I&cid=N00002713&newMem=N&recs=20; http://www.opensecrets.org/politicians/contrib.php?cycle=2008&type=I&cid=N00002713&newMem=N&recs=20; http://www.opensecrets.org/politicians/industries.php?cycle=2010&cid=N00002713&type=I&newmem=N. The Center for Responsive Politics totals donations from the organization's PAC, its individual members or employees or owners, and those individuals immediate families. 35 http://www.opensecrets.org/politicians/industries.php?cycle=2010&type=I&cid=N00013770&newMem=N&recs= 20; http://www.opensecrets.org/politicians/industries.php?cycle=2008&type=I&cid=N00013770&newMem=N&recs=2 0. 36 http://transportation.house.gov/Subcommittees/rail-members.shtml. 37 http://transportation.house.gov/Subcommittees/rail-members.shtml. 38 http://transportation.house.gov/singlepages.aspx/763. 39 http://transportation.house.gov/Subcommittees/rail-members.shtml.

City Southern, Norfolk Southern, and Union Pacific, are listed as supporters of the Go Rail website at www.gorail.org.40 The sites mission says that GoRail was founded on the principle that all politics is local and that direct input from constituents is the best way communicate with members of Congress, and the sites Issues section includes vague language against regulation.41 Meanwhile, the sites Action Center is connected to the website of DDC Advocacy, a Washington-area firm specializing in grasstops and grassroots work finding constituents who can contact lawmakers and give the appearance of popular support for an industrys political agenda.42 DDCs other clients have included the Business Roundtable.43 Additionally, GoRails staff overlaps with the staff of Go21, another rail advocacy organization backed by the railroads.44 Go21 has recruited local community leaders and lobbied for initiatives promoting freight rail.45 GoRails president, William C. Gibbs also listed as the president of Go21 and GoRails vice president, Russell McGurk, also previously lobbied for the Coalition Against Bigger Trucks.46 Previous research by the American Trucking Associations found that both Go21 and the Coalition Against Big Trucks were funded by the freight railroad industry.47

40 41

http://gorail.org/about/supporters/railroads/. http://gorail.org/about/mission/; http://gorail.org/issues/reasonable-regulation/. 42 http://www.capitolconnect.com/Gorail2/; http://www.capitolconnect.com/; Jeffrey H. Birnbaum, For Activist Constituents, Click Here, Washington Post, September 19, 2005. 43 Birnbaum, Washington Post, Sept. 19, 2005. 44 http://gorail.org/about/staff/; http://www.linkedin.com/pub/bill-gibb/7/a82/618. 45 Matt Manning, Commissioners Are Asked to Promote Railway Traffic, The (Fremont, Ohio) News-Messenger, May 26, 2010; Bill Mongelluzzo, Rail Industry Gears Up Lobbying, Journal of Commerce, July 29, 2008. 46 Coalition Against Bigger Trucks, LLC, Second Quarter 2009 Lobbying Disclosure Report, Office of Public Records, Secretary of the Senate. 47 http://www.cleanersafertrucking.com/wp-content/uploads/2011/06/What-is-CABT.pdf.