WASHINGTON — The Massachusetts Department of Transportation and Massachusetts Bay Transportation Authority have told federal regulators that they oppose CSX Transportation’s proposed acquisition of New England regional Pan Am Railways.
In a filing with the Surface Transportation Board this week, state officials claim the transaction will harm rail competition, potentially hinder commuter rail operations, and threaten a reservoir that provides drinking water for 3 million people in the Boston area.
Massachusetts officials also were critical of the related transaction involving Pan Am Southern, the joint venture that provides Norfolk Southern with access to New England via the former Boston & Maine main line from Mechanicville, N.Y., to Ayer, Mass. CSX will step into Pan Am Railways’ 50% stake in Pan Am Southern. A new Genesee & Wyoming railroad, Berkshire & Eastern, will be the neutral operator of Pan Am Southern.
State officials say that the Pan Am Southern transaction should not be separated from CSX’s acquisition of Pan Am Railways. CSX is seeking to have the Pan Am Southern deal exempt from board review and for the Pan Am Railways acquisition considered as a minor transaction.
Massachusetts officials say the board should consider the related Pan Am Railways and Pan Am Southern deals as part of a single merger application that should face the board’s more stringent and time-consuming review as a “significant” transaction.
“The railroad transactions … involve the operation of 1,200 miles of railroad in New England. They are, separately and collectively, regionally significant transportation matters. Those advancing the transactions seem to not understand the public interest impacts of their proposals, except as they perceive them as a matter of promotion, business advantage and expedience,” the state DOT and MBTA said in their filing. “Nor could they see them any differently, since many closest to the public interest in New England – entities [such] as MassDOT and MBTA – have been overlooked. Instead of rewarding such indifference, the Board would do all stakeholders a service by rejecting the Application and the Petition, and directing the parties to each filing to develop and file a single, comprehensive application encompassing all interdependent elements of the CSX-PAR and B&E-PAS Transactions, which the Board would then allow to be assessed under its significant transaction application procedures.”
A dozen state lawmakers, in a separate filing, also urged the STB to put the merger through a more thorough review.
“Not only would this acquisition lead to a consolidation or railroads controlled by CSX within the Commonwealth, but it could affect the future of passenger rail in the region and will also impact upwards of 500 employees with no guarantee of employment after the acquisition is completed. The future of these employees’ livelihoods would be at the sole discretion of CSX,” the state senators and representatives wrote.
Included in the state’s filing was a letter Massachusetts Transportation Secretary Stephanie Pollack sent to CSX in January, encouraging the railroad to prioritize potential new passenger service linking Boston with western Massachusetts.
In its merger application filed last month, CSX told federal regulators that its acquisition of Pan Am Railways will improve service, capture business from trucks, and boost railroad competition in New England.
CSX on Nov. 30 announced that it had reached a deal to acquire privately held Pan Am Railways, which stretches from the Albany area to Maine and totals 1,700 miles when trackage and haulage rights are included.
“We look forward to integrating Pan Am into CSX, with substantial benefits to the rail-served industries of the Northeast, and to working in partnership with connecting railroads to provide exceptional supply chain solutions to New England and beyond. We are likewise confident that G&W’s subsidiary will bring similar benefits to PAS customers as the successful operator of PAS,” CSX said in a statement last month.
Is it possible that CSX would buy an entire north-south railroad they do not particularly want just to kill the little bit of (Chicago-Boston) competition they are getting from the east-west PAS?
Now what is happening with that Poland Spring Unit Train? DOBO-BODO the Gravel Train? Their future is to be considered–and what are they up to right now? Of course stories abound that Mass Highway has been looking longingly at the Hoosac Tunnel as converted to the Charles Parker Tunnel for Route 2. Lots of Jobs for the Boys and remediation for railroad pollution of Wachusetts Reservior. Some remarks from Bob Eder lately of the P&W might prove interesting.
Massachusetts is NOT a right to work state. It is highly unlikely, though, that 500 employees would be terminated upon merger. CSX will need to keep the conductors, enginemen, signalmen, and MOW personal at the very least. The possibility of more freight traffic between Maine and New York? God forbid that the sales people in Jacksonville, FL, could capture MORE business from the truckers! Something that hasn’t happened in five-decades.
Thank you, MASSDOT.
Of course they want something. They (representing the public) have legitimate interests that have to be taken into account.
Translation: MDOT and MBTA want something of substance/access for their blessing of this transaction. Sigh, this is cost of doing business,