WASHINGTON — CSX Transportation has defended its proposed acquisition of New England regional Pan Am Railways.
Vermont Rail System, along with transportation officials from Vermont and Massachusetts, claim the deal would harm rail competition in the region and should face a more thorough review from the Surface Transportation Board. Massachusetts officials and lawmakers also expressed concerns that the transaction would affect current commuter operations and plans to expand passenger service across the Bay State. And the states and Vermont Rail System joined rail labor in requesting additional time to comment on an acquisition that would reshape the New England railroad map.
But in its filing with federal regulators, dated Thursday, CSX insisted its acquisition of Pan Am Railways would boost rail competition.
CSX also said the naming of a Genesee & Wyoming subsidiary as the neutral operator of Pan Am Southern, the 425-mile joint venture that provides Norfolk Southern with access to the Boston area, would maintain competitive routing options for shippers and interchanges that Vermont Rail System currently enjoys with Pan Am Southern at Hoosick Junction, N.Y., and White River Junction and Bellows Falls, Vt.
G&W’s Berkshire & Eastern, CSX noted, will be obligated to operate in the interest of Pan Am Southern, not in the interest of G&W’s other New England railroads to the detriment of Pan Am Southern.
CSX did ask the STB to extend the comment period by 30 days, as merger opponents had requested.
But CSX said the STB should consider the Pan Am Railways acquisition as a minor transaction, not under the more stringent significant transaction rules sought by merger opponents.
Merger opponents also told the board that CSX should not seek to have the Pan Am Southern transaction treated separately as a deal exempt from board review.
CSX pointed out that prior merger deals, including Conrail split, have involved multiple related transactions that while filed separately were considered in parallel.
“No party has offered a valid basis for requesting that the Board classify the Transaction as ‘significant’ or to require the Application to be re-filed,” CSX wrote in its filing. “The Transaction was carefully structured to eliminate potential competitive harm, enhance competition, and improve the rail network throughout the Northeast. The only thing ‘significant’ about the Transaction is the extent to which it enhances competition and strengthens the rail network in the Northeast.”
CSX’s filing also included a letter the railroad sent to Massachusetts officials, pledging to keep dispatching of Massachusetts Bay Transportation Authority commuter service based at the Pan Am headquarters in North Billerica, Mass., for the “foreseeable future.”
CSX also said it would work to maintain fluid commuter operations and cooperate with state officials to expand passenger service west of Worcester, Mass., on its Boston & Albany main line, and elsewhere.
The railroad also said it shares Massachusetts’ officials concerns about maintaining safe operations around a reservoir that provides drinking water for 3 million people in the Boston area.
If CSX is serious about the Patriot Corridorremaining independent, then it would be advantageous to finally lower the floor of Hoosac Tunnel for double stack container trains. CSX would then have two routes for automobiles and containers to Ayer, and Norfolk Southern would have similar access to Ayer over the PAS.
Mr. Vincent, what evidence do you have that the Greenfield-Mechanicville segment of PAS is going to be torn up? NS acquired the old D&H Binghamton-Schenectady from CP for the very purpose of having control of most of the route between the Southern Tier and PAS. Yes it’s probably true CSX will route most of the traffic to/from PAR via the Berkshire Sub and the Worcester gateway. But why else would they want PAR’s half ownership of PAS if not to have another route to Ayer and the potential to route more traffic that way? I’m not holding my breath for multi-frequency passenger/commuter service Pittsfield-Boston. But CSX has vowed to work with MassDOT should the DOT get serious on it. Seems to me CSX might want PAS to divert traffic away from having to mix it up with the passengers.
Don’t let them tear up the track. We must preserve the possibility of extending passenger service from Fitchburg west to North Adams. Massachusetts passed a law to study that service and we are counting on MASSDOT to intervene to preserve the route. It should not be easier for me to get to New York City by rail than to my own state capitol.
G&W would NOT be a neutral operator.
Maybe invite Conrail Shared Assets as a neutral operator.
There is little (if any) online business west of Greenfield.
This line survives as a bridge route for NS into Ayer.
West of Ayer (maybe) and west of Greenfield (definitely) will be torn up.
Maybe the VRS would take the line west of Hoosick Jct, maybe not.
The CSX bean counters think this is a good deal for CSX; probably is.
Terrible for New England railroading.
It’s a region with few choices for carriers. It should be treated appropriately by the STB.