The closing decades of the twentieth century have seen the rise of a new kind of transportation enterprise: The small railroad.
Short line and regional railroads are not new. Indeed, they have always been important segments of the national railroad system. Today, however, they occupy a more vital “niche” than ever and their number has increased steadily.
Today, there are more than 500 railroad companies which could be called “small” railroads — although some are small only when compared with the megasystems produced by the mergers of the 1980s and 90s. Some are virtually — and in a few cases, literally, –‘”Mom and Pop” operations with a few miles of line and only a few full time employees .
However, taken together, today’s small railroads, operating in all 50 states, account for about one-third of all rail route miles, employ 11 percent of all rail workers and generate about 9 percent of all rail revenue.
Congress Opens the Way
The Staggers Rail Act of 1980, which provided partial economic deregulation for the railroad industry, also created mechanisms by which railroads could sell — and entrepreneurs could buy — portions of rail line.
While line-haul railroads were streamlining their systems and operations, new short lines were being formed to serve the small communities and shippers that depend on rail service.
The result was that rarest of outcomes: “Win-win” — in fact, “win-win-win.”
The operators of the new, small railroads won, for the most part, because they were able to profitably provide specialized, community-oriented service not practical for the larger railroads.
The communities served by the railroads won, not only by keeping rail service, but by seeing that service performed by a small, local company which has a stake in the small community and appreciates the business of small shippers.
The major railroad systems won by gaining the right to streamline their operations and focus on the long-haul service for which they are best suited.