Reciprocal Switching

First, let it be noted I've been gone from the railroad industry, where I was employed "first job out of college", for now thirty five years.

From first this article appearing in The Journal, and the follow up letter, it would appear that reciprocal switching, or the apparent one-time practice of having a road switch cars from one of their on-line industries for a line haul on another, AND v.v, is gone. - possibly a victim of dereg and the combinations of roads of which there were thirty of consequence "back in my day" to the "magnificent seven" of today:

http://www.wsj.com/articles/freight-rai ... 1465943599" onclick="window.open(this.href);return false;

Fair Use:

In another proposal under consideration at the Surface Transportation Board, some companies that move goods by rail want to force railroads to open up their tracks and facilities to other railroad competitors in order to obtain lower shipping costs. Doing so would upend the logistical efficiencies that today benefit all customers using the U.S. rail system to move their goods

http://www.wsj.com/articles/time-to-let ... 1466794859" onclick="window.open(this.href);return false;

Fair Use:

In “Freight Railroads Are Braking for Regulatory Creep” (op-ed, June 15) about regulation of freight railroads, Edward R. Hamberger presents a misleading critique of a proposal that would actually reduce regulatory burdens and promote free-market competition. The proposal is called competitive switching, and it would simply allow rail customers to request that their freight be moved to another major railroad if it is reasonably accessible. It isn’t really a radical idea since it’s a process that has worked well for more than a century in Canada, which has a similar freight rail network

Now it would appear that one shipper or another suggests the concept be reinvented under the name of "competitive switching". I was never aware that "reciprocal switching" was dead.

Anyone with industry knowledge more contemporaneous than mine care to enlighten me?

Reciprocal switching is still very much alive, Mr Gilbert. As you probably recall from your days in the industry, customer locations were (and are) either "open" or "closed", open meaning that a carrier other than the serving carrier could access the location from a designated junction point for a set fee, usually publish in a tariff or circular - here's an example:

https://www.up.com/cs/groups/public/@up ... _recip.pdf" onclick="window.open(this.href);return false;

The reference is to blanket open access. Canada has zoned open-access, based on mileage from industry location to competing railroad. IIRC, there are five zones (as high as 100 miles) on a tiered-pricing scheme.

Cowford, many thanks for posting that; I also have been away from the industry for a good many years and am completely out of touch with developments in carload traffic. I gather from the circular (no tariffs any more!) that the switching charges are determined by the serving carrier, and the line-haul carrier has the option of including them in its rate to the shipper, who then decides whether to accept that rate or explore other alternatives; a far cry from ICC days, when the charge was what the ICC permitted, had to be absorbed by the line-haul carrier, and had to apply to all industries in the switching district, irrespective of cost to the serving railroad. I wasn't sure what conditions apply today under Staggers.

The topic of reciprocal switching came up in a video Mr. Norman shared in this same forum: post1620422.html#p1620422



Here's something in the Federal Register talking about a proposal by the Biden Administration: https://www.federalregister.gov/documen ... -switching

Reciprocal Switching
A Proposed Rule by the Surface Transportation Board on 01/03/2022

The Surface Transportation Board (Board) will hold a public hearing on March 15 and 16, 2022, concerning the reciprocal switching regulations it proposed in this proceeding. The hearing will be held in the Hearing Room of the Board's headquarters, located at 395 E Street SW, Washington, DC 20423-0001. All interested persons are invited to appear. In addition, the Board will pause the period for ex parte discussions, beginning January 24, 2022, and modify the instructions for ex parte communications in this proceeding to permit ex parte discussions with up to two Board members in the same meeting.
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I also did a Google search on news regarding same: https://www.google.com/search?q=recipro ... =617&dpr=1

I see several problems with reciprocal switching. A good example is with the telephone company. In my area Verizon is the local landline carrier. That doesn't mean that I can't contract with AT&T for my service. If I contract through AT&T, the infrastructure serving my home is still owned by Verizon. My father in law did this. It was all going well until a storm hit. AT&T couldn't restore the damage to his line because Verizon owned it. Verizon had no incentive to repair it timely because he was not their customer, plus their own customers came first.

Likewise, if your company was along CSX, and you contracted to have your switching done by D&H, you might be in the same boat as my farther in law was with the phone company. If any track problems developed, CSX would repair lines to their customers first. Also note that during the time in which the USRA mandated the D&H expansion, as a competitor to Contrail, CR favored and prioritized movements of their own trains first. I feel that this will be the downfall of reciprocal switching.

We still see reciprocal switching at facilities that do not need their own class 1 connection or find it more cost-effective to create line haul agreements for when they do need to be moved to a class 1 switching point. (Think Facility > facility > Class 1)

I see Engineer Spike has a concern about maintenance however let me explain using made-up names.

Joe's Class 1 operates in an area, but the railroad I need to take to access Joe's is Jerry's Short-Line which is connected via a switch to James's storage facility (Origin Point). If Jerry's line is damaged Jerry will want to fix it asap as this costs them revenue. You are right in assuming that Joe has no stake in this, however, that doesn't mean Jerry isn't in his right to fix it. He owns the land and the rail. If he wants Joe to stop and pick up the cars at the switch he needs to keep his track up to reg. However, if Joe's line is the issue then Joe will have an incentive to repair it as every day the line is down is a day without revenue on that line. If it's Class 1 to Class 1 they have the same incentive to keep the tracks maintained.

We have had issues where "Joe" claims there is an issue and rejected cars, but Joe was never there. Always good to have cameras and ground crews to verify... That's a whole different pandora's box though.

News (paywall): WSJ

Relevant STB: https://dcms-external.s3.amazonaws.com/ ... /51803.pdf

Fair Use:

WASHINGTON—Railroads that fail to provide reliable service could be ordered to share tracks with competitors under a proposed rule that backers say will increase competition in the business of moving cows, corn, chemicals and other goods across America.

The rule on so-called reciprocal switching, proposed Thursday by the Surface Transportation Board, is seen as a way to improve efficiency among major freight lines that have struggled to move goods and supplies from farms, factories and ports, especially during the Covid-19 pandemic.

“In my view, it’s likely to lead hopefully to better service, where railroads are going to say, ‘We’d better up our game,’” STB Chairman Martin Oberman, a Democrat, said in an interview.

The board’s goal, he said, is to have the threat of increased competition motivate railroads to boost their on-time performance: “We’d rather you solve it yourself.”
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From Railway Age (no paywall):

According to the STB, the newly proposed regulations would provide “a streamlined path for the prescription of a reciprocal switching agreement when service to a terminal-area shipper fails to meet any of three performance standards.” The proposed standards, it explained, “are intended to reflect a minimal level of rail service below which a shipper would be entitled to relief, and each standard would provide an independent path for a petitioner to obtain prescription of a reciprocal switching agreement.” STB said they are “intended to be unambiguous, uniform standards that employ Board-defined terms and are consistently applied across Class I rail carriers and their affiliated companies.”

STB Decision: https://dcms-external.s3.amazonaws.com/ ... /52104.pdf

SUMMARY: The Board adopts new regulations that provide for the prescription of reciprocal switching agreements as a means to promote adequate rail service through access to an additional line haul carrier. Under the new regulations, eligibility for prescription of a reciprocal switching agreement will be determined in part using objective performance standards that address reliability in time of arrival, consistency in transit time, and reliability in providing first-mile and last-mile service. The Board will also consider, in determining whether to prescribe a reciprocal switching agreement, certain affirmative defenses and the practicability of a reciprocal switching agreement. To help implement the new regulations, the Board will require all Class I railroads to submit certain service data on an ongoing and standardized basis, which will be generalized and publicly accessible. Railroads will also be required to provide individualized, machine-readable service data to a customer upon a written request from that customer.
DATES: The rule will be effective 120 days after publication in the Federal Register.
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