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Home / News & Reviews / News Wire / Regulators receive last-minute pleas regarding CSX acquisition of Pan Am

Regulators receive last-minute pleas regarding CSX acquisition of Pan Am

By Bill Stephens | October 19, 2021

DOT and FRA join Vermont and railroads in responding to comments on deal

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Front of a train
Front of a train
A former CSX B40-8 leads a Pan Am Railways train at Plainville, Conn., on Feb. 6, 2021. (Scott A. Hartley)

WASHINGTON — Federal regulators on Monday received a flurry of last-minute comments regarding CSX Transportation’s proposed acquisition of New England regional Pan Am Railways.

The filings – from federal and state transportation officials, Norfolk Southern, and Genesee & Wyoming – were submitted on the deadline to respond to comments already made to the Surface Transportation Board as part of the merger review process.

The U.S. Department of Transportation and Federal Railroad Administration, while not taking a position on the merger itself, asked the board to impose conditions that would support current and future passenger rail operations in New England.

They also asked the STB to “carefully consider and address” Amtrak’s request for conditions to protect passenger service and proposed expansions.

Vermont transportation officials said the board should reject the merger on the grounds that it would reduce rail competition in the Green Mountain state, particularly for short line Vermont Rail System’s operations over state-owned trackage.

“The proposed transactions as currently structured will result in an effective 2-to-1 reduction in service over key gateways and corridors connecting Vermont to the interstate rail network,” Vermont’s Agency of Transportation argues. “This reduction in competition will leave Vermont’s shippers and competing carriers at the mercy of one company, Genesee & Wyoming, Inc., through two operating subsidiaries over which GWI asserts operating and marketing control. This result substantially and directly harms the Vermont rail network and is completely inconsistent with the public interest.”

G&W’s new Berkshire & Eastern subsidiary has been named the neutral operator of the 425-mile Pan Am Southern. CSX will step into Pan Am Railways’ shoes in the Pan Am Southern joint venture with Norfolk Southern. The Pan Am Southern consists of Pan Am’s trackage west of Ayer, Mass., including the former Boston & Maine main line and the north-south corridor along the Connecticut River in Vermont, Massachusetts, and Connecticut.

But NS said the CSX-Pan Am merger should be approved without conditions aside from standard labor protections. The deal NS and CSX reached regarding Pan Am Southern will enhance competition between the Class I railroads in New England, NS argues. And the rerouting of NS intermodal trains from Pan Am’s Hoosac Tunnel route to new trackage rights via CSX’s former Boston & Albany line will allow NS to double-stack traffic to and from New England for the first time, which will boost intermodal competition in the region.

G&W said that since Pan Am Southern will continue to exist, there would be no reduction in the number of railroads serving Pan Am Southern customers or connecting with Vermont Rail System. “As the contract operator of the PAS Lines, B&E will have contractual obligations to operate in the best interests of PAS, and its own financial incentives to ensure that PAS is a success,” G&W argued.

Last month CSX CEO Jim Foote told a shipper conference that the railroad would respond to concerns that have been raised about the merger. The deal has broad support from shippers as well as the Northern New England Passenger Authority that sponsors Amtrak’s Downeaster service between Maine and Boston.

5 thoughts on “Regulators receive last-minute pleas regarding CSX acquisition of Pan Am

  1. If approved, as submitted, this will be the death of the former B&M thru Hoosac tunnel.
    There is virtually no online business (thanks to the high tax anti-business states of NY and Mass) and the thru traffic will all shift to the CSX Boston line.
    Vermont Railway’s connection at Hoosick Jct. NY will then be ended, leaving VRS with ONE non G&W connection – CP at Whitehall, NY.
    One solution would be to give/sell Hoosick Jct. to Rotterdam to VRS thus connecting to NS and CSX.

    1. And to give/sell the track east of Hoosick Junction to the Mass. DOT to extend passenger service on the Fitchburg line.

  2. Mr. Vincent: I don’t understand how you reach the conclusion that “this will be the death of the former B&M through the Hoosac Tunnel” and by extension the entire line Mechanicville-Deerfield. NS will only get trackage rights for one train pair, intermodals 22K and 23K, over the Selkirk and Berkshire Subdivisions Vorheesville-Worcester. Furthermore, the B&E becomes the designated operator to serve the two customers, Specialty Minerals and Holland Company, on the MassDOT-owned Adams Industrial Track. I’m not saying with certitude you are wrong. I would only like to hear why you make that prediction. And to Mr. Kurland, I don’t think MassDOT, which is hugely modally biased in favor of highways and aviation has any appetite for acquiring the route Fitchburg-North Adams and implementing passenger service Williamstown/North Adams-Boston.

  3. Why would CSX keep the expensive Hoosac Tunnel for one and half trains a day as it is currently (thanks to par combination) for any longer than it has to. Remember the real goal is St. Johns NB to keep CP/CN on thee toes for midwest container business.

  4. I don,t know why Norfolk & Southern doesn,t try and put a bid in to take over Pan Am since Southern is in its name already like CSX is trying to do , it would give Norfolk & Southern a bigger bite to Mass. Vermont ,Conn. New Hampshire instead of just trackage rights and bring more competition in those areas , plus N/S could exchange car loads with CP Rail in Mechanicville yard since both railroads have to go thru Mechanicville to get to their destinations , that to me is a PLUS !

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