House Set to Act to Avert Rail Strike

By Todd Neeley, DTN Staff Reporter, and Mary Kennedy, DTN Basis Analyst

LINCOLN, Neb. (DTN) -- With an impending national rail strike looming on Dec. 9, Congress appears poised to approve a September agreement reached between workers unions and the rail companies.

The House of Representatives prepared Tuesday to bring a bill to potential floor vote as early as Wednesday. The House Rules Committee debated a resolution Tuesday afternoon that would allow the House to debate the bill.

Following a meeting Tuesday morning, President Joe Biden said he was confident Congress would act.

Senate Majority leader Chuck Schumer, D-N.Y., and House Speaker Nancy Pelosi, D-Calif., left the White House stressing the need to get a bill done quickly. Pelosi said she hated going against the unions but was left with no other choice.

"Weighing the equities, we must avoid a strike. Jobs would be lost -- union jobs would be lost," Pelosi said.

Schumer said he and Senate Minority Leader Mitch McConnell, R-Ky., were in agreement on the need for a bill. Schumer said a bill needed to be passed before Dec. 8 because it would impact businesses and communities making critical decisions for their supply chains.

"Leader McConnell and I agreed we are going to try to get it done ASAP," Schumer said.

In a statement Monday, Biden highlighted the risks to several areas of the economy, including agriculture.

"Let me be clear: A rail shutdown would devastate our economy. Without freight rail, many U.S. industries would shut down," Biden stated. He added, "Communities could lose access to chemicals necessary to ensure clean drinking water. Farms and ranches across the country could be unable to feed their livestock."

His call for congressional action came after the U.S. Chamber of Commerce on Monday spearheaded a letter of 449 business groups -- including dozens in agriculture -- essentially also asking for Congress to step in.

One of the groups signing the Chamber letter was the Michigan Agri-Business Association (MABA).

Chuck Lippstreu, president of the MABA, said during a press call on Tuesday that a national rail strike would add to the myriad pressures agriculture has been facing during the past two years.

"We have a very clear message today for Congress, which is that our national rail shutdown would be absolutely catastrophic for Michigan agriculture and for our state's small towns and rural communities, and it cannot be allowed to occur," Lippstreu told reporters.

"To give you a little bit of context about Michigan's agriculture sector and the importance of rail -- our food and ag sector here in Michigan is by many counts the second-largest economic driver in our state. It pumps more than $100 billion of economic activity back into the state every year, and that's very important, certainly for agricultural communities. We absolutely cannot see agriculture disrupted because the broader impact on Michigan's economy will be severe."

Lippstreu said Congress needs to act immediately because any length of strike would add further pressure to ag markets. Certain commodities shipped by rail could start to be embargoed as soon as this weekend.

"Even a brief strike will add to the severe volatility and logistical challenges that we've already faced over the last 18 to 24 months and create additional roadblocks to growth for our agricultural industry," he said.

More specifically, Lippstreu said grain movement, product movement and fertilizer movement are "heavily rail-dependent."

For Michigan in particular, he said the state exports about $3 billion worth of ag products every year.

"Many of those products absolutely depend on the rail system to move either to direct export markets, for example, dry beans to Mexico, or to export terminals for onward shipment around the world," Lippstreu said.

Geoff Cooper, president and CEO of the Renewable Fuels Association, said in a statement that a national strike would hurt an ethanol industry that relies heavily on rail transport.

"Our country's ethanol producers rely greatly on the railroads to move their products to market, and if the nation's trains stop running, the nation's ethanol biorefineries stop running too," he said.

"We need a resolution quickly so the 400,000-plus jobs supported by our nation's ethanol industry, and the rural economy itself, will not suffer the dire consequences of an interruption in rail service."

Railroad union leaders said they have no desire to go on strike, especially in the holiday season, but they continue to press for paid sick days. Peter Kennedy with the Brotherhood of Maintenance of Way Employes Division (BMWED), told Fox News on Monday that there was misinformation floating around about the rail contract and the standoff over paid sick days. Kennedy said that he wanted to make it clear that railroad track maintenance workers are the second-lowest paid craft in the industry out of the 12 unions.

"In order for them to get close to the proposed salary increase, with benefits, they would have to work over 3,000 hours a year to even make $130,000, with benefits, in a year. Our workers have seen a slashed workforce of 45,000 workers over the past seven years but are expected to maintain the same work structure, doing more work with less people," Kennedy told Fox News.

Kennedy added that with less workers, there is no protection for sick days. "Railroad workers have asked for 15 paid days in contract negotiations for over 52 years and have never gotten any. We are now asking for seven sick days similar to the federal government structure under executive order 13706 for federal contractors of 56 hours minimum per year. Railroads are federal government contractors, but somehow, railroad workers have been exempted from that order."

DTN Ag Policy Editor Chris Clayton contributed to this report.

Whitehouse statement: https://www.whitehouse.gov/…

Fox News interview with BMWED Peter Kennedy: https://www.youtube.com/…

Read more on DTN:

"Ag Groups Push to Prevent Rail Strike," https://www.dtnpf.com/…

"Rail Strike Looms as Congress Returns," https://www.dtnpf.com/…

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @DTNeeley

Mary Kennedy can be reached at Mary.Kennedy@dtn.com

Follow her on Twitter @MaryCKenn

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