Other Voices

Texas freight rail lines are in good shape. Highways, not so much

While roads and highways in Texas are suffering with a lack of public funding, private investment in freight rail lines throughout the state rank them among the best in the nation.
While roads and highways in Texas are suffering with a lack of public funding, private investment in freight rail lines throughout the state rank them among the best in the nation.

Despite what some people may believe, it is not just a surging oil and gas industry that gave Texas the fastest growing economy in the United States in 2017. Thriving technology, manufacturing, agriculture and service sectors are also fueling economic growth in the Lone Star State.

Emblematic of our diversified economy: Texas is first in the nation in wind energy as well as oil production.

The foundation for all this economic growth across our diversified economy is our interconnected transportation infrastructure including roads and bridges, waterways and port facilities, and some of the best freight rail assets in the nation.

Unfortunately, the news is not all good. Even as we outpaced every other state in the nation in terms of economic growth in 2017, the American Society of Civil Engineers (ASCE) gave Texas an overall grade of C- on its annual infrastructure report card, with our highways and roads getting a D.

We need to get those grades up if we expect to sustain economic growth over the long haul.

There was one bright spot. Topping all transportation infrastructure on the ASCE national report card was the freight rail network. Rail’s B grade put it head and shoulders above every other infrastructure category that ASCE assessed.

The reason that rail has excelled in comparison to other infrastructure is that while highways, roads and bridges have been starved for cash due to funding shortfalls at all levels of government, private sector freight railroads have doubled down on investment in the rail network.

Railroads have churned more than $660 billion of their own money — roughly 40 cents of every dollar they’ve earned — back into the nationwide freight rail network since 1980 when they were largely freed from government over-regulation.

With 52 freight railroads operating over 10,539 miles of track and employing nearly 17,000 Texans, it is easy to see that Texas has been a major beneficiary of freight rail reinvestment in tracks, locomotives, people and technology.

From BNSF’s corporate headquarters and the Alliance Global Logistics Hub in Fort Worth, to Union Pacific’s new $550 million investment in its Brazos Yard in Robertson County, to rail’s overall support for economic growth in the Texas Triangle and throughout that state, examples abound in Texas demonstrating the benefits of private sector freight rail investment.

As Congress struggles to figure out how to fund highway and bridge infrastructure, perhaps it should look to freight rail’s “user pays” example for inspiration.

Freight rail is by far the nation’s most capital-intensive industry. Driving railroads forward is an inherent need to reinvest in infrastructure as well healthy competitive pressures to continually improve safety, service and productivity. This translates into ever more fuel efficient locomotives, applications of data analytics to improve performance, new technologies to detect defects in tracks or equipment, as well as investments in other cutting edge technologies along with more traditional infrastructure.

As a consequence, while there are funding shortfalls for maintenance and repair of crumbling roads and bridges, the world’s finest freight rail system is using private sector investment to support businesses all across our economy.

We need to work our way out of the infrastructure funding stalemate that threatens to undercut economic growth. Private sector freight rail investments provide an example policymakers should heed.

Carlton Schwab is President/CEO of the Texas Economic Development Council.