The President has asked Transportation Secretary Brock Adams to send to Congress legislation that would enable the States to help maintain important local rail freight service.
The Railroad Amendments Act of 1978 would streamline the process by which States receive Federal money to rehabilitate unprofitable branchlines that provide service vital to local economies.
Under existing law, railroads must obtain permission from the Interstate Commerce Commission to abandon a branchline before that line is eligible for Federal assistance. The administration's proposal would eliminate that requirement, allowing States to make grants or loans for rehabilitation before rail lines have been abandoned.
It would also eliminate the provision in the current law that allocates at least 1 percent of available funds to each State, even if the State has no lines eligible for assistance.
The benefits of the legislation will be felt especially in the Midwest, where some railroads are facing a severe financial crisis.
The proposal, which is being transmitted to Congress today, does not increase the cost of the branchline program, currently authorized at $360 million.
Jimmy Carter, Railroad Rehabilitation Announcement of Proposed Legislation. Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/244919