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Ag Leaders Testify In Support Of Freight Rail Reform Law

Erin Mairose

Some South Dakota Agriculture industry leaders say federal reforms are increasing the efficiency and transparency of the railroad system.  They say the 2015 reforms help streamline rail freight regulations.

U.S. Senator John Thune held a hearing in Sioux Falls August 11th to listen to area businesses leaders and board members.

State leaders in Ag all voiced support of U.S. Senator John Thune’s Surface Transportation Board Reauthorization Act of 2015.

Thune says changes to the Surface Transportation Board, or STB, requires the board to submit reports about complaints and procedures, expands the board to five members, and gives the board more avenues to problem solve with rail users.

Michael Skuodas is with the biofuel company POET.  He says prior to the reform, filing concerns about rail service was difficult and costly.

“Today near 70 percent of all ethanol in this county is shipped by rail. Similarly a significant portion of all ethanol co-products, like distillers, grains, and corn oil rely on rail to reach markets. This makes our industry particularly susceptible to rail rate increases, of which there have been many over the recent years. Because ethanol is used in nearly every gallon of gasoline sold in this country, these rates and any rail issue affecting service have a direct and immediate impact on consumers throughout the country. Likewise, distillers, grains, or DDGS are vital to the feed market for livestock production. As is corn oil for biodiesel. If I could boil our position down to one sentence today, it would be that we support policy aimed at providing fair, efficient, and competitive rail services for our industry,” says Skuodas.

Board members of the STB also testified at the hearing. Member Ann Begeman says the board’s biggest challenge in carrying out the reforms is managing rail user’s expectations for change.

“I believe the three of us and the staff is firmly committed to implementing it and meeting the deadlines. I don’t want to meet a deadline just for the sake of meeting it if we can have a better product if it’s week later,” says Begeman.

The board Reauthorization Act was signed in last December by President Obama.