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By Julie Sneider, Senior Editor
Nearly five months after Union Pacific Railroad announced it would acquire Norfolk Southern Railway and the two would combine to form the first U.S. transcontinental freight railroad, the companies today filed their proposal with the Surface Transportation Board.
The nearly 7,000-page document outlines in detail how UP and NS officials believe the combination will enhance competition in the transportation marketplace and serve the best interests of the public. The application includes more than 2,000 letters from stakeholders who support the merger. The STB will decide whether to approve the proposed $85 billion deal.
After the railroads announced their plans in July, the STB invited stakeholders to submit comments about the merger and/or the board’s proposed schedule for considering the railroads’ application. Since then, dozens and dozens of comments have been filed, including from shipper groups, rail labor unions, Class I competitors of UP and NS, short lines, members of Congress, state attorneys general and lawmakers, county boards, neighborhood coalitions and passenger-rail entities.
In some cases, the filings were submitted to notify the STB that the applicants want to be considered interested parties in the merger case and may offer an opinion later in the process. Others have expressed their support of or opposition to the STB’s proposed schedule or the merger itself.
But in recent weeks, dozens of comments have rolled in from individuals, many owners of small businesses, who expressed concern about how a single railroad controlling about 40% of the freight-rail market would impact their economic livelihoods. Many acknowledge that they base their fears on adverse effects that occurred following other freight railroad mergers over the years.
The letter writers explain how a combined UP-NS might impact their small business and implore the STB to carefully examine, from every angle, what a U.S. transcontinental freight railroad might mean for small-town America.
“As you evaluate this merger, please keep the interests of everyday Louisiana residents in mind, especially those in small towns,” Justin Green, a resident of Baton Rouge, Louisiana, wrote to the board in November. “A competitive freight-rail system is critical not just for businesses, but for the families and communities that depend on it.”
A small-business perspective
Following is a sampling of other comments contained in letters that individuals sent to the STB in recent weeks. The comments have been edited for length. STB filing numbers are included so that statements may be searched and read on the board’s website, www.stb.gov.
“I hope the Surface Transportation Board will take a close look at how this merger could hurt small and minority-owned businesses like mine, and make sure any decision protects competition, reliability and fairness.” — Kelly Reese, founder of Inside Medicine Magazine, STB Filing ID No. 310200.
“I’m one of the owners of Sweet Brew, a small business based in Loxley, Alabama. We started back in 2003 as a family-run operation and over the years we’ve grown into one of Alabama’s more innovative food service manufacturers. ... That’s why I’m concerned about the proposed merger. Like many businesses, we rely on rail service to get the supplies we need and to deliver our products to customers across the country. When rail service slows down or becomes unreliable, it has a real impact on our operations and our bottom line.” — Adam Stewart, No. 310215.
“As an African American entrepreneur, I understand what it takes to build something from the ground up — often with fewer resources and steeper hills to climb. When large corporations merge and competition fades, it's the small, independent businesses — many of them minority-owned — that get squeezed the hardest. Delays, higher shipping costs, and unreliable service can hit us in ways big companies barely feel. ... Less competition always leads to higher costs, and those costs eventually make their way down to consumers and working families.” — Marvin Harrell, president and founder of Harrell Custom Clothes, No. 310218.
“I live in rural Missouri and have spent my life helping harvest and haul row crops like corn, soybeans and wheat. I know how much farmers depend on rail to keep things moving. When harvest hits, timing is everything. We’ve got combines running sunup to sundown, and trucks lined up to get grain to the elevator to market. Without dependable rail service, things back up fast. Delays cost money, and when freight rates climb, it eats into already thin margins. Fewer railroads mean fewer options. The [STB] needs to take a hard look at this proposal. Don’t just listen to the big companies, listen to the people in the heartland who will feel the impact.” — Mike Beardslee, Docket No. 310234.
“My family has been farming [and] ranching in Texas for generations. We rely heavily on freight rail to move essential goods to bring our crops or livestock to market and ensure we can compete globally. When rail service falters — whether through higher rates, reduced options, or poorly executed mergers — it creates ripple effects across the entire supply chain. These changes can be the difference between a profitable season or closing the doors on a farm. ... I ask that you keep farmers and ranchers in mind when [UP and NS] formally file. Agriculture needs a competitive rail system to survive, and we cannot afford changes that would weaken that system further.” — Brennan Kucera, K-Bar Riata Ranch LLC, No. 310237.
“We own a small coffee shop here in Greenville, Ohio. We serve our neighbors every morning with fresh coffee, baked goods and a warm place to gather. What might seem simple — making sure we have beans, milk, cups, sugar and all the other supplies — actually depends on a complicated supply chain that stretches across the country. Reliable and affordable rail service is a critical part of keeping that chain moving. ... As you review this proposed merger, we urge you to consider its impact on small-town businesses like ours. Any deal must meet the highest standards for protecting competition, maintaining reliable service and keeping costs manageable for the families we serve.” — Aaron and Betsy Ward, owners, A&B Coffee Shop, No. 310286.
“I’ve operated a family dental practice here in Findlay, Ohio, for many years. Most people don’t immediately think about railroads when they think about dentistry, but like many small town professionals, I depend on a reliable supply chain. The dental materials, equipment and products that keep my office running all rely on efficient transportation networks — many of which move through our country’s rail systems. ... I urge the [STB] to carefully evaluate this merger and ensure that any conditions placed on it truly protect competition, service and safety for small communities across our state.” — Dr. Jon Davis, owner of Jonathan K. Davis DDS General Dentistry, No. 310291