Railroad merger approved, could bring increased train traffic to Dubuque

DUBUQUE, Iowa (KCRG) - The Surface Transportation Board has approved the acquisition of Kansas City Southern Railway Company by Canadian Pacific Railway.

Board Chairman Martin Oberman announced the decision during a press conference Wednesday morning, in which he addressed concerns over the merger and explained the factors that led to the decision.

The two railroads involved are the smallest of the class 1 railroads, and they’re up against giant railroads in Union Pacific and Burlington Northern.

Oberman said an underlying factor in approving the merger was that combining these smaller railroads will provide a stronger competitive landscape in the rail industry. Separately, the two railroads don’t have the power to provide the competitive service that they would together.

He also addressed concerns over too much consolidation in the industry. He said the board found that the creation of a stronger competitive service and accomplishes the continuation of a sound transportation system.

One key aspect that led to the approval of the merger, according to Oberman, is that the board found it would benefit the economy by enhancing trade because it would be a single-line service between Canada, the United States and Mexico.

However, concerns remain locally that the merger will mean increased train traffic through Dubuque. And chief among concerns related to increased train traffic, is the concern of train wrecks and the spilling of hazardous materials. Those concerns were expressed by the Iowa Department of Natural Resources last month, after the recent train derailment in East Palestine, Ohio.

The Board addressed those concerns during the press conference, saying only one percent of spills of hazardous materials happen because of train derailments. The majority, 94 percent, he said, come from hazardous materials being transported by trucks. He pointed to a benefit in safety by moving the transportation of hazardous materials to trains rather than trucks.

When Scott Gritters with the Department of Natural Resources spoke with TV9 last month, he said train derailments are rare, but the odds go up with increased traffic. He also said it could only take one derailment to have an irrevocable impact on the environment.

Oberman also pointed to an increase in employment as a reason for the merger’s approval. Though Oberman estimated more than 100 jobs may be lost at the headquarters in Kansas City, he said there are expected to be 800 new union jobs created in the U.S. and another 200 in Canada as a result of the merger.

He also said the average length of trains is expected to decrease after the merger.

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