Contact: Colleen Roche (212) 788-2958
Curt Ritter (212) 788-2971
Bernadette O'Leary (212) 312-3523 (EDC)
"For months, the City has worked hard to ensure that the breakup of Conrail by CSX and Norfolk Southern would bring the benefit of competition to New York City - something that has been lacking for over 20 years," said Mayor Giuliani. "As a result of our unified effort with Governor Pataki, Senators D'Amato and Moynihan, Congressman Nadler and the entire New York delegation, businesses will now have access to competitive rail service on the Hudson line. I applaud the STB's decision to provide competitive access to the City from Albany to the Bronx and Queens which is good news for companies and consumers throughout the City."
The STB yesterday approved a $10 billion plan to divide the vast Conrail Inc. System between CSX Transportation Inc. (CSX) and Norfolk Southern Railroad (NS) on the condition that both make significant concessions on competitive access. Regarding New York City, the STB required that CSX grant the Canadian Pacific Railroad access via a line from Selkirk, N.Y. to Queens.
For more than two decades, Conrail has held a monopoly over the region's rail freight market, including control of the Hudson Line, the primary freight line from Albany to New York City. The City had opposed the original Conrail sale proposal because it did not provide for competitive rail freight on the Hudson Line. Accordingly, last November the New York City Economic Development Corporation (EDC) submitted a filing to the Federal Surface Transportation Board (STB) in Washington, DC, recommending disapproval of the proposed sale unless it included provisions for competitive rail freight access east of the Hudson River.
"For far too long, New York City has been dependent on trucks to move goods into the City," said Randy Levine, Deputy Mayor for Economic Development, Planning and Administration. "The STB's decision will now enable wares to be shipped by more than one railroad to New York City, bringing much-needed competition and better pricing to this region."
The STB's will issue its written decision on July 23, 1998. CSX and Norfolk Southern will then have to wait 30 days before the takeover becomes effective.
Mayor Giuliani was joined in his efforts to create competition on the Hudson Line by Governor George E. Pataki, the Coalition of Northeastern Governors and regional representatives in Congress.
The STB is the federal regulatory agency responsible for approving the proposed purchase of Conrail and overseeing other regulatory issues regarding interstate commerce. The STB has the power to block the proposed purchase, approve the proposed purchase, or approve the proposed purchase with conditions.