Dear Congress: Reform regulatory process, spur sustainable infrastructure investments

“There is no substitute for hard work,” American icon Thomas Edison famously said.

With a new Congress and Administration getting settled in Washington, D.C., it seems most policymakers are heeding this advice. Leaders across political parties, chambers of Congress and regulatory agencies are advancing so many substantive polices, that it is easy to get lost.

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Such is the case when what-would-normally-be top-billed hearings on regulatory reform and infrastructure development – central tenants to the Trump Administration and 115th Congress – take center stage in Senate and House hearingsWednesday, respectively.

America’s private freight rail network, buoyed by world-class infrastructure made possible by sizeable investments, as well as the deregulatory structure enacted nearly 40 years ago, intimately understands both issues. In fact, we argue they go hand-in-hand: nimble regulations for any industry fuels growth, and a growing economy generates dollars for infrastructure investments. In the spirit of discourse, the freight rail industry offers recommendations to leaders of Congress in tackling both issues.

First, on regulatory reform, there is a unique opportunity to not only address specific, harmful policies, but to improve the system that creates rules. Too often individuals writing rules, who may or may not understand operations for the industry they are regulating, lose sight of clearly defined end goals that would ultimately benefit the general population. Rather than telling the cab driver its destination, the government increasingly mandates the route, speed and even the music played.

This may fulfill a perceived obligation to regulate, but it does very little to improve outcomes.  We ought to propose more desired ends, and less prescribed means to that end.

At the same time, rules often lack data. Politics, not policy, sometimes drives decision making.

To begin making over the system we propose broad principles for consideration:

  • Regulations should be based on a demonstrated need, as reflected in current and complete data and sound science.
  • All components of an agency’s decision-making should be transparent to the public and subject to meaningful comment before the rule is finalized.
  • Non-prescriptive regulatory tools, like performance-based regulations, should be deployed wherever possible to align the interests of the regulator and the industry, and to foster and facilitate innovation to achieve well-defined policy goals.
  • Regulations should provide benefits outweighing their costs, and the cumulative impact with other regulations should be considered in every rulemaking.
  • Use of “guidance” should be limited to appropriate situations and time periods.
  • Waivers and pilot programs should be a viable path for industry to innovate without being tied down by archaic and outdated rules currently on the books.

On the separate yet related topic of infrastructure, policymakers should first and foremost address the elephant in the room: sustainable funding for the Highway Trust Fund. They should seek solutions that provide steady funding, avoid deferred maintenance and incorporate multiple transportation modes.

To improve the nation’s highways – rated a “D” by the American Society of Civil Engineers, federal officials should institute equitable systems in which users pay for upkeep. The U.S. highway infrastructure currently relies on federal and state gas taxes, as well as significant funding from the general U.S. Treasury. Since 2008, policymakers have transferred $143 billion in general taxpayer funds to the Highway Trust Fund, because gasoline taxes are not enough to fund highway upkeep.

Even more will be needed, because as cars have become more fuel efficient, and policymakers have avoided increasing the gas tax, taxpayers are taking on even more of the infrastructure deficit.

The current system erodes the underlying user pay principle that all users, including major users and industry, pays for its infrastructure. Heavy users get a discount deal in perpetuity, while working Americans pay full price. I hope today’s hearing begins addressing this discrepancy.

The Trump Administration and Congress have an historic opportunity to shape the nation’s economy for generations to come. Today is a step in the right direction. By addressing fundamental issues such as mechanisms of highway funding and improved regulatory oversight, they can help ensure economic prosperity.

Hamberger is President and CEO of the Association of American Railroads


The views expressed by authors are their own and not the views of The Hill.