Four Illinois congressional leaders have asked the Surface Transportation Board to postpone a decision on whether to approve the merger of Canadian Pacific and Kansas City Southern due to concerns about the data used in the board’s environmental impact statement (EIS).
The Illinois delegation, which includes U.S. Senate Majority Whip Dick Durbin, Sen. Tammy Duckworth, and Reps. Raja Krishnamoorthi and Delia Ramirez, all Democrats, is calling for the data used in the EIS to be vetted for accuracy and reliability by an independent party. In a letter sent to STB Chairman Marty Oberman on Friday, they argued that doing so would result in a more accurate assessment of the effects on the Chicago region.
They claim that the EIS is based on information provided by CP to STB about how much freight traffic may increase in the Chicago area as a result of the merger. However, there is data that contradicts CP’s data, such as freight traffic modeling data from commuter railroad Metra projects, which shows more significant impacts. Metra operates on CP track.
Legislators are concerned that the CP-KCS merger will result in increased noise pollution, blocked crossings, weakened safety conditions, and commuter rail delays, which is why they want to ensure the accuracy of freight traffic projections.
“Conduct a supplemental analysis of the merger’s impacts on the Chicago region using modeling provided by Metra or by conducting its own independent modeling,” the board should do. This would allow the STB to more accurately assess the impacts on Illinois communities, determine appropriate mitigation measures, and meet the STB’s obligations under the National Environmental Policy Act, according to the lawmakers.
In their letter, the lawmakers pointed out one difference: CP expects the merger to increase freight traffic in the Chicago area from three freight trains per day to 11, whereas Metra expects an increase of 18 trains per day.
“Eight additional freight trains on [Metra’s Milwaukee District West line between Bensenville and Elgin, Illinois] would already have significant negative impacts on Metra’s operations as well as the safety and livelihood of local communities, and 15 additional trains would dramatically increase those impacts,” the lawmakers wrote in a letter released on Friday. “The EIS fails to reconcile the fact that there is significant uncertainty in the data. The STB cannot accurately assess or quantify the true environmental impacts of the proposed merger or determine the appropriate mitigation measures required to protect the safety of local communities and ensure the reliability of regional commuter railroad operations unless it ensures the reliability of CP’s projections.
“Moving forward with a merger decision without further analysis risks missing serious adverse impacts on these communities, such as congestion and passenger train delays, grade-crossing delays affecting auto traffic and emergency services, and dangerous conditions for the public.”
This is not the first time an Illinois congressional delegation has urged STB to investigate the merger. Durbin, Duckworth, and Krishnamoorthi expressed their concerns in a letter last July about the potential impact of increased merger-related freight rail traffic on Chicago-area communities.
STB issued a final version of the EIS in January, stating that increased railroad noise levels in some communities would be the most significant environmental impact of the CP-KCS merger.
The board has not stated when it will make its decision on whether to approve the merger, but CP has stated that it hopes to receive approval from the board in early 2023.
Shareholders of CP (NYSE: CP) and KCS approved the $31 billion merger in December 2021, and the deal is currently being reviewed by the STB. The merger, according to CP and KCS, would result in a single rail system known as Canadian Pacific Kansas City, or CPKC, with a network extending from Canada into the United States and Mexico.
The Illinois congressional delegation is not alone in its opposition to the merger; the US Department of Justice stated in a January letter to the board that the merger would reduce shippers’ options in an industry that has already consolidated significantly in recent decades. In 2021, the DOJ expressed similar sentiments.
