Key Considerations

Prioritize corridors based on viability for both passenger and freight

Acknowledge the true risk of partnership - both economic and regulatory

Determine the impacts and opportunities for communities

Build a working relationship based on mutual trust

Understand gaps in key success metrics

Explore regulatory and performance metrics for continued success

Fund consistently for good planning

Prioritize corridors based on viability for both passenger and freight

"Work to establish priorities ... don't go where regions are better at applying for grant"

- Planner, State Department of Transportation

What does this mean?

Seek mutual benefits

Look for corridors that are viable in carrying higher volumes and generating a reasonable return and prioritizing them in a way that works for all parties
Viable corridors for freight railroad is often one that has limited traffic and spare capacity.
Viable corridors for passenger rail is often one that will generate sufficient ridership and adequate funding

States must play a role

Passenger agencies often work at cities, counties, or regional levels while freight railroads operate on a national or even multinational scale
Freight companies are not staffed or funded to manage numerous small-scale partnership, and many operate on a "first come, first served" basis with passenger requests
State or even national agencies should play a bigger role in the prioritization process and provide a signal to host railroads about where they should spend their resources
- States should work to establish priorities rather than going to where regions are better at applying for grants
- States can negotiate with more influence and higher level than smaller geographic entities

Federal signals must be clearer

Corridor Identification and Development (Corridor ID) program announced in May 2022 is a promising start for prioritization at the federal level as it is asking for this larger-scale prioritization work but does not sufficiently integrate with freight railroad planning. Public entities selected under the first stage of the program will receive funding to develop more detailed service plans and models under the guidance of the FRA; however, this is done without the consideration of the existing traffic on the line and host railroads are not required to have input until the second phase.
New federal regulations can also have significant impacts on what gets prioritized if it requires new spending.

Acknowledge the true risk of partnership - both economic and regulatory

"In model partnerships ... both agencies spend millions of dollars every year to maintain shared infrastructure used by commuter and freight trains ... resulting in improved speeds and schedules for their communters"

- Ian Jefferies, President & CEO, Association of American Railroads

What does this mean?

Transportation planning can be siloed, leading to a lack of understanding about the legal and economic realities that underpin corridor negotiations.
From the passenger agencies perspective, they grow frustrated with freight railroads who impose what they see as unreasonable or excessive capital investments to run new train service, drag out negotiations, or refuse to add additional passenger trains altogether. But they have very few options if a railroad does not respond to request or work with them on what they see as reasonable economic terms.
From the freight perspective, they see a lack of knowledge among passenger agencies about what freight companies do, the kinds of cargo they move and how, and the true cost of increasing passenger service. Their ability to serve current or future customers cannot be affected by passenger service.

A Different Paradigm

Freight operations are generally optimized around keeping costs low and using as few human hours, locomotives, and cars as possible, and have a low tolerance for the kind of disciplined operation on-time passenger service requires. Higher-speed passenger service also consumes line capacity at disproportionately high rates.
Standards of track maintenance also differ. Passenger rail must generally be maintained to a higher standard to accommodate its faster speed and passenger comfort, which comes with higher costs.
The different speeds at which trains travel also have different kinds of wear and tear on the tracks: heavy freight trains tend to wear out the rails faster.

Sharing the Load - and Footing the Bill

"Sharing" in some cases mean separation, whether by time of day or with separate tracks in the same right-of-way
There were different perspectives on the extent of separation required
- - Building new tracks exclusively for passenger use, regularly costing tens of billions of dollars "may pay off in the long run."
  - Sharing tracks could provide huge capacity improvements to both parties, including being able to share ongoing maintenance costs by running the lines closer to capacity.
Liability and insurance is also a common sticking point of negotiations over shared operating agreements and becomes more complex with the addition of passenger traffic.

Determine the impacts and opportunities for communities

"The California Transportation Commission recognizes that throughout California's history improvements to the State's transportation system have disportionately benefitted some population groups and burdened others"

- California Transportation Commission, Released Racial Equity Statement

What does this mean?

Positive Impacts

Freight and passenger rail serves as vital link for communities
New or enhanced passenger rail service can address transportation deficits for disadvantaged populations, fostering inclusivity and accessibility through giving greater access to transportation networks and destinations.
Freight rail establishes critical links between populations and essential goods, fulfilling economic needs.
Rail improvements can also spur nearby development, attracting both people and businesses
Prioritizing freight rail offers environmental benefits from the modal shift from trucks to rail, reducing greenhouse gas emissions from freight trucks and addressing concerns related to traffic congestion and the high road maintenance costs associated with large freight trucks on the roads.

Negative Impacts

Rail can bring negative impacts to communities, including increased risk of transporting hazardous materials, noise and vibration impacts, and the possibility of gentrification and displacement.
Hazardous materials can have serious impacts on the environment and health
There is a risk of gentrification and displacement with new passenger rail station with increased land value around the new rail station and the intentional use of increased property values and tax potential through mechanisms like land value capture

All stakeholders must adopt a holistic approach in order to harness the full potential of rail as a transformative force for inclusive, accessible, and sustainable community development

Build a working relationship based on mutual trust

"You have to spend time building the trust ... Don't walk in saying 'I know what I'm doing'"

- Passenger Operations Leader, Freight Railway Company

What does this mean?

There is a history of mistrust and even antipathy between the passenger and freight sectors which can impede negotiations.
Passenger agencies resent feeling "beholden" to freight railroads while freight feels as if passenger agencies were ignorant of the needs to freight rail.
Time needs to be spent to build relationship. Both sides need to be willing to approach negotiations with an open mind and mutual respect in order to be partners.
Frequent meetings to build up strong working relationships over time and develop shared understanding of both needs and value is core to this practice.
Additional importance of both sides coming to negotiations prepared and having "done their homework" with models, but also being willing to complete further analysis together so all parties could agree on the facts and not let preconceived models or assumptions get in the way of discovering new avenues of collaboration

Neutral third parties can bridge gaps in understanding and act as an impartial arbiter, equipped with in-depth insights into the motives and needs of both sectors.

Neutrality helps to slowly build trusting relationships because each partner believes their interests are being heard.

Understand gaps in key success metrics

"The metrics are just different ... if passenger rail is 2 hours late, members of Congress start calling!"

- Passenger Operations Leader, Freight Railway Company

What does this mean?

Passenger rail and freight rail have different metrics for success. While they may look at similar information, the value and weight they place on it varies between passenger and freight rail
Freight and passenger rail are not compatible and do not operate the same way from an engineering, operations, or business perspective.
Freight is privately operated and often beholden to their shareholders and focus on financial profitability and economic gains
Passenger rail is usually publicly operated and subsidized by regions and states and focus more on reliability, performance of the rail, and the overall public benefit.
Understand gaps and differences in success metrics help set realistic expectations for each party and allow them to identify specific issues and problems they both value and can collectively address.

Explore regulatory and performance metrics for continued success

“Regulation is still somewhat toothless… because there is no competitive alternative to the existing host railways, there is little recourse over the actual service that can be provided”

- Senior Planner, Regional Planning Agency

What does this mean?

Building in performance controls will be more successful with stronger initial agreements; however, clarifying and strengthening regulations related to rail partnerships can speed up negotiation time, allow both passenger and freight organizations to feel that their interests will be protected, and make shared investments more viable in the long term.

Creating a Fair, Neutral Negotiating Framework

The unique nature of these partnership - one potential buyer and one potential seller - can result in passenger agencies at a disadvantage. Passenger operators often felt beholden to railroad companies and often frustrated by a lack of engagement on their part.
Commuter rail operators have called for federal agency to step in as an "honest broker" and provide an unbiased perspective on how much a freight operator stands to lose from running passenger operations, and how much needs to be spent on capacity improvements. Although generally opposed by the freight companies, there is a precedent for this and there was previously a Rail Service Planning Office offering unbiased, professional information for use during negotiations
Because railroads are primarily an interstate means of commerce, both the public control and legal obligation to regulate rests with the federal government. Without overarching national standards, negotiations over state requirements for rail service within their boundaries can be extended by months or years.

Ensure Freight Operations and Staffing Levels Allow Statutory Compliance with OTP Metrics

Over the last six years, many freight railroads have implemented the practice of precision scheduled railroading (PSR), a series of dispatching and efficiency practices that reduce operating redundancies. This has often resulted in much longer trains and workforce reductions of roughly 30% among Class I railroads.
Freight train lengths have expanded to over three miles long in some cases, making it more difficult to operate and are at greater risk of delaying other traffic.
Ensuring freight has the same obligation to passenger service as to shippers will signal that the STB considers OTP as high a priority as freight customer satisfaction

Local Solutions

Though much regulation should occur at the federal level, local interventions are also possible.
Some jurisdictions have considered legal remedies such as allowing public agencies to take a public easement along the right-of-way or track itself in order to provide passenger service, whether outright or for use only at certain times of day.
Another alternative may be for cities or counties to purchase strategic corridors in order to "rationalize" the movement of multiple carriers and conduct safety upgrades, charging railroads for access but relieving them of the need to pay for capital upgrades.

Fund consistently for good planning

“Freight railroads [are] not prepared for public investments in their assets, ... or for the rapid expansion in the interest in passenger rail investment by multiple States”

- Joseph Szabo, Federal Railroad Administrator

What does this mean?

There is often insufficient funding to properly plan for rail projects, especially when there are immediate needs on current operations. This, however, leaves little capacity for the in-depth corridor assessments that are required to advance a project.
Host railroads expect to be compensated for the planning phase; however, they are often not staffed to handle multiple simultaneous requests.
Although there is new funding opportunities, especially through the Infrastructure Investment and Jobs Act (IIJA), freight and passenger agencies are not yet staffed to take full advantage of the funding opportunities and illustrate the challenge of "lumpy", crisis-driven funding package.
Funding and investments should be more dedicated and predictable. Creating a steady stream of funds to ensure the best projects are ready for investments when the time comes is necessary
Federal and state funds often emphasize capital projects at the expense of ongoing operations and maintenance. A new paradigm for funding may be required to incentivize sustained passenger service, with increased funding for operations and maintenance support.

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