Hoeven Tells Commerce Committee Hearing: Railroads Must Invest in Infrastructure, Create More Transparency

WASHINGTON – Senator John Hoeven today gave opening remarks at a U.S. Commerce Committee hearing, telling members that both Burlington Northern Santa Fe Railroad (BNSF) and the Canadian Pacific Railway Company (CP) need to add resources to meet the growing demand for shipping in North Dakota and the Upper Midwest. The senator was invited to address the committee owing to his extensive work to resolve long shipping delays for agriculture products in the region.

“Ultimately, what will resolve these delays is greater rail capacity to not only catch up with delayed shipments but also to manage this year’s harvest,” said Hoeven. “Because of our growing economy and dynamic farm sector, railroads must commit to investing in more rail infrastructure, which means more locomotives, more railcars and more crews. BNSF has made substantial commitments to increasing infrastructure and personnel, and now Canadian Pacific needs to make the same kind of commitment. It is also imperative that CP implement transparent and fair way to reserve cars and track orders for our farmers and elevators. The investments and changes we are pushing for will benefit not just North Dakota shippers, but also the railroads themselves as they grow with our state.”

Hoeven was in Fargo last week to participate in a Surface Transportation Board (STB) field hearing. The senator helped North Dakota farmers, elevator operators and others impacted by backlogged rail shipments make their case to the STB and to hear rail industry executives disclose their plans to resolve the shipping delays.

Hoeven has been working since early in the year to address delays in rail shipping, first by urging BNSF to ensure timely delivery of fertilizer and other products needed for spring planting. In February, he brought BNSF Chairman Matt Rose and commodity groups together in his office to work through a plan to reduce rail shipment delays. Rose committed at the time to invest $5 billion in new resources this year, including approximately $600 million in the Northern Corridor.

Further, this spring, when farmers were short of fertilizer, Hoeven called on BNSF to address the problem in a timely manner. The railroad subsequently dedicated unit trains to carry only fertilizer so that it got to farmers more expeditiously for spring planting.

Hoeven also met in July with STB Chairman Daniel R. Elliott in July to stress shippers’ concerns about backlogs on agriculture rail shipments and, in a separate meeting, asked Rose to dedicate additional resources in the short-term to help resolve the delays. Rose committed to spot 450 cars per day and offered more shuttles this fall than in 2013 to relieve past due agriculture shipments. As of the end of last week, BNSF had approximately 1,016 rail cars past due in North Dakota, down from 2,400 at the end of July. CP, however, reported it had more than 7,500 open requests in the state.

To press the railroads further, last month, Hoeven arranged roundtable meetings in North Dakota with Rose and Canadian Pacific CEO and Director E. Hunter Harrison so that rail industry executives could hear firsthand from agricultural producers and commodity groups about the hardship that delayed shipments are having on their operations. During those meetings, Hoeven continued to emphasize the importance of addressing the backlog prior to the fall harvest, which will significantly increase the demands on the already overburdened rail system.