WSP USA Develops Key U.S. Freight Rail Report

The 2018 edition of the AASHTO Freight Rail Bottom Line Report was recently developed and produced by WSP USA, updating the original report released in 2002.

“The original study was highly influential and helped to articulate a role for the public sector in freight rail infrastructure development,” said Alex King, of the WSP USA freight and logistic team and the report’s primary author. “With the study now 16 years old, AASHTO’s Council on Rail Transportation (CORT) believed there was a need to revisit and refresh the original report.”

The goal of the updated study was to determine if the findings of the 2002 study were still valid, given the changes in the economy and rail industry that have occurred since it was first released, and to provide further guidance on the role of freight rail in public-private partnerships (P3s). The study can be used by state departments of transportation to inform key funding decision makers – such as state legislatures – as well as to better understand the rail industry itself.

Overall the new report revealed that, while much has changed in the rail industry over the past decade-and-a-half, the findings of the first report are still quite valid.

“The 2002 report concluded that minor investments in rail infrastructure yield major benefits for the public, which the WSP report found to still be true today,” King said. “The WSP report also determined that there continues to be a role for P3 partnerships on nationally significant rail network projects.”

While U.S freight railroads are privately owned and operated, in recent years they have come to rely on public funding for many infrastructure improvements. The report provides guidance to states, answering three principle questions about public sector investment in freight rail infrastructure:

• Why should the public sector continue to invest in private sector freight railroad infrastructure?
• What types of infrastructure projects would benefit which industries that ship by railroad?
• Under what circumstances should the public sector invest in freight rail transportation infrastructure; conversely, when should infrastructure be funded by the railroads alone?

The 104-page report highlights that annual freight volume is expected to grow 60 percent by 2045, while at the same time, U.S. highways are becoming increasingly congested with limited space to add lanes. Rail transportation will play an important role in handling the increased freight, as the average freight train is capable of carrying 170 truckloads of freight in one trip.

The report documents several public benefits of rail transportation: railroad transportation is safer, produces fewer emissions, results in less highway damage as well as lower congestion, and costs less than its closest competitor, trucking.

“The benefits make a compelling case for continued investment in the rail system,” King said. “Shifting freight from truck to rail can provide transportation savings and benefit society. Even just a one-percent shift from truck to rail would eliminate 65 billion truck miles off U.S. roads and reduce greenhouse gas emissions by 64.3 million metric tons of carbon dioxide between now and 2045.”

The study found that different freight shippers rely on railroads in different ways. Each benefits from different types of freight rail infrastructure investment.

According to the report, just gaining access to the rail network may be the biggest challenge for some companies. For other shippers, the availability of competitive rail rates or more reliable service are leading concerns.

“The study provides guidance to state agencies on how to better understand and demonstrate the connection between rail investments and benefits to industries located in their states,” King said.

The report provides a framework that state departments of transportation (DOTs) can use when determining whether to invest in freight rail infrastructure owned by private railroads.

“Understandably, since railroads are private companies, the appropriateness of using public funds to subsidize profitable private enterprise can be questioned,” King said. “The framework considers a project’s public benefits, expected financial returns to the railroad and the importance of the infrastructure to a railroad’s ongoing operations.”

WSP was selected by AASHTO to conduct this two-year study due to the freight rail planning expertise of the firm’s Freight & Logistics group.

“Our depth of rail industry knowledge and our experience working with state DOTs made WSP a logical choice to undertake the project for AASHTO,” said Joe Gurskis, WSP freight and logistics principal and project manager of the study.

In addition to King and Gurskis, the WSP project team included Joe Bryan, vice president and manager of freight and logistics group; Alan Meyers, freight and logistics principal; and Sebastian Guerrero, freight and logistics consultant.

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