United States Government Accountability Office

GAO Report to Congressional Requesters

RAILROAD BRIDGES 

AND TUNNELS 

Federal Role in 

Providing Safety 

Oversight and Freight 

Infrastructure 

Investment Could Be 

Better Targeted 

August 2007 

 

GAO-07-770 
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

August 2007

RAILROAD BRIDGES AND TUNNELS

Federal Role in Providing Safety 

Oversight and Freight Infrastructure 

Investment Could Be Better Targeted 

Highlights of GAO-07-770, a report to 

congressional requesters 

Freight railroads account for over

40 percent (by weight) of the

nation’s freight on a privately 

owned network that was largely 

built almost 100 years ago and 

includes over 76,000 railroad 

bridges and over 800 tunnels. As 

requested, GAO provides 

information on this infrastructure, 

addressing (1) the information that

is available on the condition of

railroad bridges and tunnels and on

their contribution to railroad 

congestion, (2) the federal role in

overseeing railroad bridge and 

tunnel safety, (3) the current uses 

of public funds for railroad

infrastructure investments, and (4) 

criteria and a framework for 

guiding any future federal role in 

freight infrastructure investments. 

GAO reviewed federal bridge safety

guidelines and reports, conducted 

site visits, and interviewed federal, 

state, railroad, and other officials. 

What GAO Recommends

GAO recommends that DOT (1) 

develop a systematic, risk-based 

methodology for selecting railroads 

for bridge safety surveys and (2)

ensure that its Framework for a 

National Freight Policy identifies

national goals, stakeholder roles, 

and funding mechanisms and

revenue sources to maximize the 

national public benefits of federal 

freight infrastructure investments. 

DOT agreed with the first 

recommendation and said that it 

would consider the second

recommendation. 

Little information is publicly available on the condition of railroad bridges 

and tunnels and on their contribution to congestion because the railroads 

consider this information proprietary and share it with the federal 

government selectively. Major (Class I) railroads maintain detailed repair 

and inspection information, while other (Class II and III) railroads vary, from 

keeping detailed records, to lacking basic condition information. Despite 

their age, bridges and tunnels are not the main cause of congestion, although 

some do constrain capacity. Because bridge and tunnel work is costly, 

railroads typically make other investments to improve mobility first. 

The federal role in overseeing the safety of railroad bridges and tunnels is 

limited because FRA has determined that most railroads are sufficiently 

ensuring safe conditions. FRA has issued bridge management guidelines, 

makes structural observations, and may take enforcement actions to address 

structural problems. However, FRA bridge specialists use their own, not a 

systematic, consistent, risk-based, methodology to select smaller railroads 

for safety surveys and therefore may not target the greatest safety threats. 

Federal funds are used to meet many different goals, but are not invested 

under any comprehensive national freight strategy, nor are the public 

benefits they generate aligned with any such strategy. Some state

investments are structured to produce state and local economic and safety 

benefits, and public-private partnerships have facilitated investments 

designed to produce public and private benefits. 

GAO has identified critical questions that can serve as criteria for 

reexamining the federal role in freight investments—including railroad 

bridge and tunnel investments—and a framework for implementing that role 

that includes identifying national goals, clarifying stakeholder roles, and 

ensuring that revenue sources and funding mechanisms achieve maximum 

national public benefits. The Department of Transportation’s draft 

Framework for a National Freight Policy takes a step forward, but more is 

needed to guide the implementation of a federal role in freight transportation 

investments.

FRA Bridge Safety Survey and Double-Stack Train in Modified Tunnel 

Sources: left to right: GAO and BNSF Railway (used with permission).

www.gao.gov/cgi-bin/getrpt?GAO-07-770.

To view the full product, including the scope 

and methodology, click on the link above. 

For more information, contact JayEtta Z. 

Hecker at (202) 512-2834 or 

heckerj@gao.gov. 
Contents 

Letter 1

Results in Brief 3 

Background 6

Little Information Is Publicly Available on Bridge and Tunnel 

Conditions and Congestion, Although Major Railroads Collect, 

Maintain, and Use This Information to Prioritize Investments 11 

The Federal Role in Overseeing Railroad Bridge and Tunnel Safety 

Is Limited 21 

Federal Investments in Freight Railroad Infrastructure Are 

Typically Not Targeted to Maximize National Benefits, Whereas 

Some State and Private Investments Are Strategically Targeted 29 

Federal Funding for Freight Railroad Infrastructure Is Not Guided 

by a National Freight Strategy and Is Generally Not Targeted to 

Maximize National Benefits 29 

Examining Critical Questions and Implementing a Framework That 

Identifies Goals, Stakeholder Roles, Revenue Sources, and 

Funding Mechanisms Could Guide a Federal Role in FreightRelated Infrastructure Investments 41 

Conclusions 49

Recommendations for Executive Action 51 

Agency Comments 51 

Appendix I Scope and Methodology 53 

Appendix II Examples of Bridge and Tunnel Maintenance,

Component and Structural Replacement Costs on 

Selected Railroads 58 

Appendix III Considerations of Funding Sources and Mechanisms 

Available for Federal Funding of Freight-Related 

Infrastructure 59 

Appendix IV GAO Contact and Staff Acknowledgments 63 

Page i GAO-07-770 Railroad Bridges and Tunnels
Related GAO Products 64 

Tables 

Table 1: Examples of Federal Funding Mechanisms That Support 

Freight Railroad Infrastructure 30 

Table 2: GAO’s Critical Factors and Questions for Determining the 

Appropriateness of a Federal Role in Freight-Related 

Transportation 42

Table 3: Three Components of GAO’s Framework Applied to 

Federal Involvement in Freight-Related Infrastructure 

Investments 43

Table 4: Names and Headquarters Locations of Entities Contacted 55 

Figures 

Figure 1: Annual Train-Miles per Track-Mile for Class I Railroads, 

1978 to 2004 7 

Figure 2: Class I Railroad Annual Ton-Miles per Route-Mile Owned 8 

Figure 3: Howard Street Tunnel (Baltimore, Maryland) West 

entrance (left) and East entrance 18 

Figure 4: Range of Railroad Infrastructure Improvement Costs 

(Dollars in thousands per linear foot) 20 

Figure 5: Structural Failure of a Bridge in Mississippi 25 

Figure 6: Barge Navigating through the Narrow Channel of a 

Moveable Railroad Bridge Eligible for Truman-Hobbs 

Funding on the Mississippi River in Iowa 31 

Figure 7: Kansas City Flyovers 37 

Page ii GAO-07-770 Railroad Bridges and Tunnels
Abbreviations 

AAR Association of American Railroads 

AASHTO American Association of State Highway and Transportation 

 Officials

ASLRRA American Short Line and Regional Railroad Association 

CBO Congressional Budget Office 

CREATE Chicago Region Environmental and Transportation 

 Efficiency program 

DHS Department of Homeland Security 

DOD Department of Defense 

DOT Department of Transportation 

FAA Federal Aviation Administration 

FHWA Federal Highway Administration 

FRA Federal Railroad Administration 

RRIF Railroad Rehabilitation and Improvement Financing 

STRACNET Strategic Rail Corridor Network 

TSA Transportation Security Administration 

This is a work of the U.S. government and is not subject to copyright protection in the 

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Page iii GAO-07-770 Railroad Bridges and Tunnels
United States Government Accountability Office

Washington, DC 20548 

August 6, 2007 

The Honorable James L. Oberstar 

Chairman 

The Honorable John L. Mica 

Ranking Republican Member 

Committee on Transportation and Infrastructure 

House of Representatives 

The Honorable Bennie G. Thompson

Chairman 

Committee on Homeland Security 

House of Representatives 

The Honorable Elijah E. Cummings 

House of Representatives 

Freight railroads have been an important part of the U.S. transportation 

network for over 150 years and account for over 40 percent of the tonmiles1

 of the intercity freight transported in the United States. Much of the

current U.S. freight railroad network was originally built by private 

corporations in the late 1800s and early 1900s and is still privately owned,

including most of the nation’s over 76,000 railroad bridges and over 800 

railroad tunnels. While many parts of the railroad infrastructure, such as 

signals and track, have been replaced and upgraded, bridges and tunnels, 

which are the single most expensive railroad infrastructure components, 

have not been replaced and are still being used, some long after their 

originally predicted useful life. In the future, however, with projected 

increases in railroad traffic and further aging, these expensive components 

may need replacement, presenting funding challenges to private railroads. 

This report responds to your request for information on issues related to 

bridges and tunnels on the national freight railroad network. Specifically, 

this report addresses the following questions: 

 1

A ton-mile is a standard industry measure that represents 1 ton of freight transported 1 

mile.

Page 1 GAO-07-770 Railroad Bridges and Tunnels
(1) What information is available on the condition of railroad

bridges and tunnels and on the contribution of this infrastructure 

to railroad network congestion? 

(2) What is the federal role in overseeing railroad bridge and tunnel 

safety? 

(3) How are public funds currently used for freight railroad 

infrastructure capital investments, including those for bridges and 

tunnels? 

(4) What criteria and framework could be used to guide the future 

federal role, if any, in freight-related capital investments, including 

those for railroad bridges and tunnels? 

Our overall approach to addressing these topics was to (1) review federal

legislation, regulations, and guidance; transportation planning literature; 

and forecasts of future freight railroad demand and capacity from private 

railroads, public agencies, and industry organizations; (2) interview a wide 

variety of representatives; and (3) review pertinent documentation from 

railroads of various sizes; federal, regional, state, and local governments; 

and industry groups. In particular, we interviewed representatives from six 

Class I railroads, two Class II railroads, and nine Class III railroads.2

 At the 

federal and state levels, we interviewed officials from six federal agencies 

that have some relationship dealing with railroad bridges and tunnels on

the freight railroad network—including officials in the Department of 

Transportation’s (DOT) Federal Railroad Administration (FRA), which has 

primary responsibility for overseeing the safety of the nation’s freight 

railroad network—as well as officials in nine state DOTs. We selected the 

railroads and the state and local government agencies for interviews to 

include a cross section of characteristics, including geographic diversity, 

the presence of noteworthy public-private partnerships between the 

railroads and government agencies, and state DOTs that actively 

participated in planning or funding railroad infrastructure projects. We 

conducted our review from June 2006 through July 2007 in accordance 

 2

For 2006, the Surface Transportation Board, a bipartisan, independent adjudicatory agency

administratively housed within DOT responsible for resolving railroad rate issues, has

defined Class I railroads as railroads earning adjusted annual operating revenues of $319.3

million or more. Class II railroads are those earning between $25.5 million and $319.3

million, and Class III railroads are those earning less than $25.5 million. The scope of this 

report covers freight railroads of all classes.

Page 2 GAO-07-770 Railroad Bridges and Tunnels
with generally accepted government auditing standards. See appendix I for 

further details about our scope and methodology.

Little information is publicly available on the condition of railroad bridges 

and tunnels, and on their contribution to congestion, but private freight 

railroads collect and maintain this information to varying degrees and use 

it to set investment priorities. This information will be increasingly 

important to the railroads as the demand for freight transportation grows, 

aggravating existing freight railroad congestion problems and further 

straining the railroads’ infrastructure, which includes aging and expensive 

bridges and tunnels. Class I freight railroads collect and maintain detailed 

information on the condition of their bridges and tunnels—including 

inspection reports, condition information, structural ratings, design 

drawings, and maintenance and repair histories—and on the extent to 

which these structures contribute to network congestion. Class II and III 

railroads vary in the amount of information they collect and maintain on 

their bridges and tunnels, with some maintaining the same level of detailed 

information as the Class I railroads and others lacking the information 

needed to produce a complete list of their bridges, having no maintenance 

records, and keeping inaccurate or incomplete records of inspection, 

according to our review of FRA records. Freight railroads of all classes 

view condition and congestion information as proprietary and share it 

with the federal government selectively; and the government plays a 

limited role in collecting such information because there are no FRA 

regulations governing railroad bridges and tunnels. Furthermore, 

according to FRA’s Chief Structural Engineer, the expense of collecting 

and maintaining the information may not be justified by the potential 

safety benefits. While most bridges and tunnels are not the main cause of 

freight railroad congestion, some structures are chokepoints and do 

constrain capacity. For example, opening a movable bridge operated by a

Class I railroad over the Mississippi River for more than an hour during 

peak periods can delay that railroad’s traffic all the way to the West Coast. 

Freight railroads use bridge and tunnel condition and network congestion

information, along with other information, to set investment priorities to 

generate the greatest private return on their investment. According to 

several Class I railroad representatives, railroad bridge replacement 

typically has a lower rate of return on investment, making it more likely 

that railroads would invest in other enhancements before rehabilitation or 

replacement of railroad bridges. 

Results in Brief 

The federal role in overseeing railroad bridge and tunnel safety is limited 

because FRA has determined that railroads responsible for bridges and 

Page 3 GAO-07-770 Railroad Bridges and Tunnels
tunnels are sufficiently ensuring these structures’ stability. Historically, 

FRA track personnel have provided bridge and tunnel safety oversight. 

Under the authority originally granted by the Federal Railroad Safety Act

of 1970, FRA has the authority to enforce railroad safety; and in the 1970s

and early 1980s, FRA had considered issuing bridge safety regulations. 

However, FRA determined that railroads were already inspecting bridges 

using industry standards. As a result, in 1995 FRA decided to issue 

guidelines instead of regulations to guide railroad bridge management 

programs, and hired bridge specialists to make observations about bridge 

and tunnel conditions under these guidelines. If FRA identifies a structural 

concern, it attempts to work cooperatively with the railroad and takes 

enforcement action only if there is an immediate concern for safety. Other 

federal agencies, including the Department of Homeland Security’s (DHS) 

Transportation Security Administration (TSA) and the U.S. Coast Guard, 

also have limited roles in railroad bridge and tunnel safety related to their 

particular missions. FRA bridge specialists have conducted safety surveys 

of all seven Class I railroads’ bridge management programs and assessed 

those programs using FRA guidelines. These specialists also conduct 25 to

35 safety surveys per year of Class II and III railroads, covering a small 

portion of the nation’s 549 Class II and III railroads. The specialists use 

their own criteria to select these railroads. FRA has not established a 

systematic, consistent risk-based methodology for selecting the Class II 

and III railroads for bridge safety surveys; and as a result, FRA may not be 

targeting those whose bridges or tunnels are most likely to present safety 

risks. We are therefore recommending that FRA implement such a 

methodology for selecting Class II and III railroads for bridge safety 

surveys. In commenting on a draft of this report, DOT and FRA officials 

agreed with the need for a consistent, risk-based selection methodology; 

and FRA officials noted that it had already begun to implement our 

recommendation. 

Public funds may currently be used for a variety of capital investments in 

freight railroad infrastructure, including bridges and tunnels, but federal 

investments are typically not targeted to maximize national public 

benefits, whereas some state and public-private partnership investments 

are strategically targeted to achieve specific state, local, and private 

benefits. Overall, the current federal investment in freight railroad 

infrastructure is small compared with the railroads’ own investment. For 

example, in calendar year 2006, Class I, II, and III railroads invested an 

estimated $9 billion in freight railroad infrastructure while the federal 

government provided an estimated $263 million during fiscal year 2006. A 

number of federal agencies make federal funding available for freightrelated infrastructure projects through different funding mechanisms to 

Page 4 GAO-07-770 Railroad Bridges and Tunnels
achieve certain transportation goals. However, the extent to which these 

mechanisms have been used for freight railroad infrastructure is generally

limited, and much of the funding has gone for projects that primarily 

benefit localities or regions, such as railroad-highway grade crossing 

improvements or infrastructure improvements for Class II and III 

railroads, rather than projects that would maximize national public 

benefits, such as capacity-enhancing improvements to bridges and tunnels

on major freight routes. DOT has taken an important step toward targeting 

federal freight-related transportation investments by issuing a draft 

Framework for a National Freight Policy;

3

 however, the objectives of this 

framework are not always clear, and the document does not explicitly 

identify criteria for federal investment, opportunities to incentivize more 

private investment, or opportunities to leverage private and other public 

funds to add freight transportation capacity. At the state level, some states 

target investments in freight railroad infrastructure to produce various 

state and local benefits. For example, the Kansas DOT administers a loan 

program for short line4

 railroads in the state that haul locally produced 

agricultural products. Public-private partnerships have also facilitated 

investments designed to produce both public and private benefits. 

Although the current federal investment in freight railroad infrastructure is 

relatively small, growing congestion—resulting from the aging of the 

nation’s freight transportation infrastructure and projected increases in 

demand for freight transportation—is expected to spur calls for a greater

federal role in freight transportation, especially greater federal funding for 

freight-related infrastructure such as expensive railroad bridges and 

tunnels that constrain capacity on key freight routes. Federal funding is, 

however, constrained by the nation’s long-term fiscal imbalance; and, as 

we have reported, federal funding mechanisms favor truck and marine 

transport over railroad transport and distort competition in freight 

transportation. 

In our past work reexamining the federal role in transportation and other 

policy areas, we identified a number of critical factors and questions—

involving the relevance and purpose of the federal role, performance 

measurement, targeting of benefits, affordability, and cost effectiveness—

 3

DOT, Framework for a National Freight Policy (Draft), (Washington, D.C.: Apr. 10,

2006). 

4

According to the American Short Line and Regional Railroad Association (ASLRRA), short 

line railroads are generally Class III railroads that are less than 350 miles long or provide

switching and/or terminal services. 

Page 5 GAO-07-770 Railroad Bridges and Tunnels
that could be used as criteria to examine the future federal role in freightrelated transportation investments, including investments in railroad 

bridges and tunnels.5

 These factors underscore the need for a federal role 

that promotes equitable, mode-neutral investments of scarce federal funds

in projects designed to achieve national goals and produce national 

benefits. While DOT’s draft Framework represents an important step 

toward determining the federal role in freight transportation, it lacks 

several components that we have identified as key to such an approach, 

including setting national goals for federal investment in freight-related 

infrastructure across all modes; clearly defining federal and other 

stakeholder roles; and identifying cost-effective revenue sources and 

funding mechanisms that can be applied to maximize the national benefits 

of federal investments.6

 Accordingly, we are recommending that DOT 

ensure that its draft Framework includes clear national goals, establishes 

roles, and identifies funding mechanisms for federal freight-related 

infrastructure investments, including freight railroad investments. In 

commenting on a draft of this report, DOT officials said they are 

considering this recommendation. 

Currently, seven Class I railroads own and maintain over 61,000 bridges 

and over 800 tunnels, and 40 Class II and 509 Class III railroads own and 

maintain over 15,000 bridges.7

 According to FRA documents, in 2002, the 

U.S. railroad network contained approximately one bridge for every 1.4 

miles of track. Class I railroads operate on approximately 70 percent of the 

total route miles in the United States and generate 90 percent of total 

railroad revenues. Class II and III railroads also play a critical role in the 

national freight railroad network, serving as feeders to Class I main lines. 

According to the American Short Line and Regional Railroad Association 

Background 

 5

GAO, 21st Century Challenges: Reexamining the Base of the Federal Government, 

GAO-05-325SP (Washington, D.C.: Feb. 1, 2005) and GAO, Intercity Passenger Rail: 

National Policy and Strategies Needed to Maximize Public Benefits from Federal 

Expenditures, GAO-07-15 (Washington, D.C.: Nov. 13, 2006).

6

GAO-07-15. GAO, Intermodal Transportation: Potential Strategies Would Redefine 

Federal Role in Developing Airport Intermodal Capabilities, GAO-05-727 (Washington,

D.C.: July 26, 2005), pp. 26-27; and GAO, Marine Transportation: Federal Financing and a

Framework for Infrastructure Investments, GAO-02-1033 (Washington, D.C.: Sept. 9,

2002), p. 17. 

7

ASLRRA does not maintain a precise count of the number of tunnels on Class II and III

railroads. The association’s General Superintendent of Safety and Operating Practices

estimates that there are at least 30 tunnels of or over 100 feet in length on these railroads. 

Page 6 GAO-07-770 Railroad Bridges and Tunnels
(ASLRRA), Class II and III railroads handle one out of every four carloads 

moved on the U.S. freight railroad system. 

Between 1978 and 2004, railroad traffic on Class I railroads increased 

dramatically while the number of railroad track miles decreased, as 

evidenced by an increase in the ratio of train-miles to track-miles (see fig. 

1).8

 In addition, freight volumes increased, as evidenced by a 105 percent 

increase in ton-miles per route-mile9

 since 1990, from 8.63 million in 1990 

to 17.70 million in 2005 (see fig. 2). These changes have focused more and

heavier traffic over fewer core lines, thereby increasing both the strain on

and the importance of key bridges and tunnels, such as those over the 

Mississippi River and underneath Baltimore. 

Figure 1: Annual Train-Miles per Track-Mile for Class I Railroads, 1978 to 2004 

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Source: Congressional Budget Office.

1978 1980 19 1982 84 1986 1988 1990 1992 1996 1994 1998 2000 2002 2004

Year

Train miles per track mile

 8

A track-mile is equivalent to 1 mile of track, which includes main track, yard tracks, and

sidings. A train-mile refers to a train traveling a distance of 1 mile. 

9

A route-mile is the measure of 1 mile of aggregate roadway, which excludes yard tracks

and sidings, and does not consider that a mile of roadway may include parallel tracks.

Page 7 GAO-07-770 Railroad Bridges and Tunnels
Figure 2: Class I Railroad Annual Ton-Miles per Route-Mile Owned 

Class I ton-miles per route-mile owned (in millions)

Year

Source: Association of American Railroads (AAR).

0

2

4

6

8

10

12

14

16

18

199

1999

2000

2001

2002

2003

2004

2005

8

1990

1991

1992

1993

1994

1995

1996

1997

Bridges and tunnels on the freight railroad network are aging and are 

susceptible to a variety of conditions that may cause wear or deterioration. 

Railroad bridges are constructed from timber, steel, masonry or concrete,

or a combination of these materials. According to an FRA bridge survey 

completed in 1993, more than half of the nation’s railroad bridges were 

built before 1920.

10 This survey, which FRA’s Chief Structural Engineer 

told us is largely applicable today, found that 36 percent of railroad 

bridges were made of timber, 32 percent of steel, and 20 percent of 

masonry; the remaining 12 percent of bridges were not identified by bridge

type. Increased weight and traffic can cause fatigue in timber and steel 

bridges. Timber bridges are also susceptible to decay from weather and

insects, and steel bridges near salt water may be susceptible to high rates 

of corrosion. Masonry bridges are more vulnerable to the effects of time 

and nature than to the weight of traffic, but reinforced concrete bridges 

are susceptible to the effects of traffic loads. According to FRA, from 1998

 10FRA survey results were reported in DOT, Office of Inspector General, Audit Report: 

FRA’s Interim Statement of Policy on the Safety of Railroad Bridges, TR-1999-077 

(Washington, D.C.: Mar. 31, 1999). 

Page 8 GAO-07-770 Railroad Bridges and Tunnels
through 2006 a total of 22 train accidents, involving one injury and no 

fatalities, were attributed to bridge structural failures. The most recent 

fatality resulting from a bridge structural failure occurred in 1957. 

Likewise, very few major railroad tunnels have been built within the last 

50 years, according to FRA’s Chief Structural Engineer, although some 

have undergone maintenance or capacity expansion in recent years. Some 

tunnels are driven directly through rock; some are lined with brick or 

stone masonry, concrete, or timber; and many tunnels include two or more

types of construction. Tunnels do not take stress from train traffic in the 

same way that bridges do, but they are susceptible to drainage issues, and

timber-lined tunnels are particularly susceptible to fires. According to 

FRA, from 1982 through 2006 there were five reportable train accidents 

whose cause could have been related to the tunnel structure. One of these 

accidents resulted in two injuries, and none of the accidents resulted in a 

fatality. 

Many railroad bridges and tunnels were designed to have long useful lifespans, but were built for use by different types of trains. Until recent years, 

stress from locomotives and cars did not exceed the original design loads

for bridges. For example, steel bridges built between 1895 and 1916 were 

engineered for steam locomotives that inflicted greater stress on bridges 

than today’s locomotives. However, because of their increased weight, 

freight cars are approaching the design load limits of older bridges. Railcar

weight standards have increased from 263,000 pounds to 286,000 pounds, 

and some cars now weigh as much as 315,000 pounds; however, 

approximately 45 percent of Class II and III railroad lines are not equipped 

with track capable of handling 286,000 pound cars, according to ASLRRA. 

In addition, freight cars have increased in height as increased intermodal 

freight traffic has led to double-stacking intermodal containers on railroad 

cars. Some bridges and tunnels do not have the clearance needed to 

accommodate these double-stack intermodal trains. 

The majority of the freight railroad network is privately owned, and 

federal economic regulation of freight railroads has decreased since the 

federal government deregulated the railroad industry in 1980. All seven 

Class I railroads are privately owned, and according to ASLRRA, 

approximately 95 percent of Class II and III railroads are privately owned, 

with the rest owned by government entities. Private railroads have an 

incentive to maintain their infrastructure in order to maintain business 

operations, and most railroads privately finance their infrastructure 

maintenance and improvement projects. 

Page 9 GAO-07-770 Railroad Bridges and Tunnels
Railroads invest large amounts in fixed assets such as track, signals, 

bridges, and tunnels. The Association of American Railroads (AAR) 

estimates that in calendar year 2006 Class I railroads alone invested over 

$8 billion in “capital commitments,” that is, expenditures for capital 

projects and operating leases. Compared with other industries, railroads 

invest a higher percentage of revenue in their infrastructure. For example, 

in 2000, the average U.S. manufacturer spent 3.7 percent of revenue on 

capital spending, while railroads spent 17.8 percent—almost five times as 

much, according to an analysis of U.S. Census data prepared by the 

American Association of State Highway and Transportation Officials 

(AASHTO).11 As railroads take steps to increase their capacity—by 

increasing the size or weight of railroad cars or by adding track—some of 

their bridges and tunnels may require alterations. A bridge’s configuration

and condition dictates weight restrictions, and most bridges and tunnels 

cannot accommodate the additional track, if needed, without replacement 

or significant reconstruction. Similarly, the dimensions of some bridges 

and tunnels restrict railroad car height and width. Because bridges and 

tunnels are the most expensive pieces of railroad infrastructure, with 

replacement and construction costs ranging from 11 to 550 times as much 

per linear foot as regular track, capacity expansion projects involving 

bridge and tunnel work require significant capital investment. 

While the freight railroad industry is projected to grow substantially with 

expected increases in freight traffic, the industry’s ability to fund this 

projected growth, including making needed capital infrastructure 

investments in railroad bridges and tunnels, is largely uncertain. For 

private companies seeking to maximize returns to stakeholders, railroad 

investment poses a substantial risk. A railroad contemplating an 

infrastructure investment must be confident that the market demand for 

that infrastructure will hold up for 30 to 50 years. Furthermore, while 

railroads own and maintain their own infrastructure, some other modes of 

transportation, such as the trucking and maritime barge industries, use 

infrastructure that is owned and maintained by the government, providing 

them with a competitive price advantage over railroads. We have 

previously reported that railroad investment is critical to freight mobility 

and economic growth, and investments in railroad projects can produce 

public benefits, such as (1) reducing highway congestion, (2) 

strengthening intermodal connections and the efficiency of the publicly

 11AASHTO, Transportation—Invest in America: Freight-Rail Bottom Line Report, 

(Washington, D.C.: Jan. 16, 2003). 

Page 10 GAO-07-770 Railroad Bridges and Tunnels
owned transportation system, and (3) enhancing public safety and the 

environment.12 (See the list of related GAO products at the end of this 

report.) However, even when the public benefits of freight projects may be

sufficient to warrant public funding, federal funding mechanisms may not 

be well tailored to freight projects. Whereas freight projects are frequently 

intermodal, most federal funding mechanisms are focused on one mode. In

addition, freight projects generate private benefits, raising questions about 

whether and how to provide public support for them. 

Major railroads13 collect and maintain detailed information on the 

condition of their bridges and tunnels and on the extent to which these 

structures contribute to network congestion, but less is known about how 

much information Class II and III railroads collect. Freight railroads 

generally consider this information proprietary, citing concerns over 

security and liability, and they selectively share bridge and tunnel 

information with the government. Meanwhile, the federal government 

plays a limited role in collecting information on railroad bridges and 

tunnels because they are privately owned and maintained. In addition, 

FRA has no regulations or standards for railroad bridges and tunnels; and,

in FRA’s view, the safety benefits that might accrue from collecting and 

maintaining information on their condition would not justify the expense. 

Various other federal agencies collect some information on railroad 

bridges and tunnels that pertain to their mission. While most bridges and 

tunnels are not the main cause of freight railroad congestion, some 

structures are chokepoints and do constrain capacity. Freight railroads set 

maintenance and investment priorities by considering bridge and tunnel 

information, together with comparable information on other components 

of their network infrastructure, and identify those repairs and 

improvements that will improve safety, provide the highest return on 

investment, and increase capacity. A bridge or tunnel is likely to cost more 

to repair—and much more to replace—than other components of railroad 

infrastructure networks, such as track or signals. As a result, railroads of 

all classes are more likely to invest in other components sooner and to 

consider extensive bridge or tunnel repair or replacement as one of their 

last investment options.

Little Information Is 

Publicly Available on 

Bridge and Tunnel 

Conditions and 

Congestion, Although 

Major Railroads 

Collect, Maintain, and 

Use This Information 

to Prioritize 

Investments 

 12GAO, High-Risk Series: An Update, GAO-07-310 (Washington, D.C.: Jan. 31, 2007), pp. 18-

19. 

13Major railroads refers to Class I railroads. 

Page 11 GAO-07-770 Railroad Bridges and Tunnels
Class I railroads, which own over 75 percent of U.S. railroad bridges and 

over 800 tunnels, maintain detailed information on the condition of their 

bridges and tunnels and generally have the resources to invest in a robust 

maintenance and inspection regime; however, less is known about the 

information Class II and III railroads collect on bridge and tunnel 

conditions, according to FRA’s Chief Structural Engineer. Officials from 

five of six Class I railroads with whom we spoke said they maintain bridge 

and tunnel information electronically in databases—including data on

location, age, and other characteristics of the structures; inspection 

reports; condition information, maintenance histories, design drawings or 

construction documents; and other pertinent information.14 While Class I 

railroad bridge departments vary in size, these departments all have inhouse bridge inspectors, engineers, and maintenance-of-way crews that 

conduct inspections, carry out maintenance and repair activities, and may 

also design and construct bridges. Class I railroads use in-house bridge 

inspectors to conduct inspections at least once a year on all bridges and 

tunnels to monitor safety and assess current conditions.15 For example, 

one Class I railroad we interviewed has over 100 personnel dedicated to 

bridge inspections on their network. 

Railroads Collect and 

Maintain Information on 

the Condition of Their 

Bridges and Tunnels to 

Varying Degrees 

According to the limited data we have, Class II and III railroads collect and 

maintain less information on their bridges and tunnels, and the reliability 

of the data collected may be poor. Based on our discussions with two 

Class II and nine Class III railroads, and on the documentation of 43 bridge 

safety surveys of Class II and III railroads that FRA completed from 

January 2004 through March 2007,16 Class II and III railroads collect less 

information on the condition of their bridges and tunnels, generally 

contract out bridge and tunnel inspection and repair work, and have less 

in-house bridge expertise. For example, 18 of the 43 Class II and III 

railroads reviewed by FRA since January 2004 could not produce some 

critical documentation related to the safety of their bridges, including past 

 14Officials with whom we spoke from the other Class I railroad said the railroad is

converting its paper inspection materials to an online database. 

15Some Class I railroads inspect a subset of bridges and tunnels more frequently—based on 

condition, structure type, bridge type, age, or traffic levels—such as requiring an inspection

every 6 months for timber trestle bridges and pin-connected steel bridges, because of their 

increased potential for deterioration. 

16FRA officials told us that they conduct, on average, about 25 to 35 bridge safety surveys 

per year of Class II and III railroads, but they retained documentation on only 43 completed 

bridge safety surveys of Class II and III railroads that they conducted from January 2004 to

March 2007. 

Page 12 GAO-07-770 Railroad Bridges and Tunnels
bridge inspection reports, design documents, or complete bridge 

inventories. Furthermore, only 16 of 43 Class II and III railroads, surveyed

by the FRA inspect their bridges at least once a year. Also, according to 

FRA officials, many Class II and III railroads lack the in-house bridge 

expertise to conduct their own bridge inspections and rely instead on 

outside consultants. For example, according to the 43 FRA bridge safety 

surveys of Class II and III railroads, 26 of the railroads contracted out 

bridge inspections, 7 did not conduct bridge inspections, 4 did not mention 

who conducted the railroad’s bridge inspections, 4 conducted inspections 

in-house, 1 had an informal inspection arrangement, and 1 was found to 

have no bridges. In addition, 8 bridge safety surveys provided to us by FRA 

either found inconsistencies between bridge inspection reports and actual 

bridge conditions or found insufficient detail in inspection reports. 

One Class III railroad representative with whom we spoke stated that the 

true condition of that railroad’s bridges, all of which were built by 

railroads not in existence today, is unknown because the railroad does not 

have design or construction documents, lacks past maintenance and

inspection records, and has never conducted a complete engineering study 

to determine its bridges’ load-carrying capacity. FRA officials stated that, 

based on the limited data they have, they believe that some Class III 

railroads do not have the training or experience needed to recognize 

critical structural deficiencies or even understand the severity and urgency 

of identified bridge or tunnel defects. However, FRA officials also stated 

that some Class II and III railroads have very good bridge management 

practices because they use qualified outside consultants to perform safety 

and inspection processes. 

The Federal Government 

Does Not Have 

Comprehensive Data on 

the Nation’s Railroad 

Bridges and Tunnels

The federal government’s efforts to collect data on railroad bridges and 

tunnels are limited in scope, and the data are not updated regularly. FRA 

collects railroad traffic information and maintains geographic data on U.S. 

freight railroad lines; however, this information does not show the 

location of bridges or tunnels on these routes. FRA maintains records of 

railroad accident and incident reports, some involving bridges and tunnels, 

dating back to 1982, but the information collected is limited to accident 

descriptions, repair costs, structure locations, and information about the 

train, crew, and track involved in the accidents and does not show bridge 

or tunnel condition, age, structure type, or design documents. In addition, 

as part of the Railroad Rehabilitation and Improvement Financing (RRIF) 

Page 13 GAO-07-770 Railroad Bridges and Tunnels
loan application process,17 FRA’s Office of Railroad Development hires 

independent engineering firms to verify the condition of the infrastructure 

and the feasibility of proposed infrastructure improvements. These 

assessments may provide detailed information on specific railroad 

infrastructure, including bridges and tunnels; however, the data are limited 

to the projects submitted in the RRIF loan application process. 

Furthermore, while FRA collects and updates data on track defects from

its track inspections, it collects less information on bridges and tunnels, 

because the FRA has regulations detailing track standards but only 

guidelines for bridges. 

Although FRA has authority to obtain records related to the safety of 

railroad operations, including those involving bridges and tunnels, FRA 

officials expressed concern about the agency becoming a repository for 

railroad bridge and tunnel data. In addition, FRA’s Chief Structural 

Engineer stated that the expense of collecting and maintaining a 

comprehensive railroad bridge and tunnel inventory could not be justified

from a safety standpoint because railroads already maintain inventories of

their own bridges and tunnels, which FRA officials review. 

No comprehensive inventory exists on the nation’s railroad bridges and 

tunnels; however, through unrelated initiatives over the years, FRA has 

obtained some information on bridges and tunnels, although, in some 

cases, this information has not been updated regularly. For example, in 

1993, FRA compiled a list of railroad bridges over navigable waterways 

based on data from the U.S. Coast Guard. However, the list has not been 

regularly updated. Other federal agencies collect some information on 

railroad infrastructure as it pertains to their mission, but this information 

is not comprehensive or exclusive to railroad structures. This information 

is mainly collected by Department of Defense (DOD), DHS, TSA, the Coast 

Guard, the Army Corps of Engineers, and the Environmental Protection 

Agency and centers on either security or construction permitting 

functions. 

 17The RRIF program was established by the Transportation Equity Act for the 21st Century 

(TEA-21) and amended by the Safe, Accountable, Flexible, Efficient Transportation Equity

Act: A Legacy for Users. Under this program, FRA is authorized to provide direct loans and 

loan guarantees for the acquisition, improvement, or rehabilitation of intermodal or 

railroad equipment or facilities, including track, rail, bridges, yards, and buildings.

Page 14 GAO-07-770 Railroad Bridges and Tunnels
While railroad bridges and tunnels are aging, their condition is not the 

main cause of freight railroad congestion; however, some critical bridges 

and tunnels are chokepoints on the freight railroad network.18 According 

to FRA officials and railroad representatives with whom we spoke, many 

of these structures are reaching or have exceeded their originally 

estimated useful life. For example, an FRA bridge survey completed in 

1993 found that more than half of the nation’s railroad bridges were built 

before 1920 and, according to FRA’s Chief Structural Engineer, very few 

railroad tunnels have been built within the last 50 years. As a bridge ages, 

it undergoes natural deterioration, including corrosion, and weatherrelated stresses. In addition, fatigue may occur in some components of 

older bridges because of stress resulting from repeated heavy freight train 

operations. FRA’s Chief Structural Engineer told us that, as bridges and 

other components of railroad infrastructure age and their condition 

worsens, the railroads may need to increase their investment in inspection, 

maintenance, and replacement to keep existing railroad lines serviceable. 

One Class I railroad representative said his railroad has a growing 

inventory of about 300 to 400 older bridges that are deteriorating and 

therefore need additional inspections and assessments. Quantifying the 

future maintenance and replacement needs of the freight railroad network 

is difficult, since private railroads do not make information on the 

condition of railroad bridges and tunnels publicly available because of 

concerns over sharing proprietary information and losing competitive 

advantage. However, the American Society of Civil Engineers gave railroad 

infrastructure a “C-” grade in its 2005 assessment of the nation’s 

infrastructure, noting that limited capacity on the freight railroad network 

has created significant chokepoints and delays.19

Railroad Bridges and 

Tunnels Are Aging but Are 

Not Generally the Main 

Cause of Freight Railroad 

Congestion, Although 

Some Are Chokepoints 

Although officials at a few railroads with whom we spoke expressed some 

concerns about the effect of aging bridges on congestion, they were more 

concerned about the effect of increased train traffic on congestion. 

Demand for freight railroad capacity has increased over the last decade 

with some Class I railroads reaching record traffic levels, especially in 

ethanol, coal, and intermodal traffic. The demand for such capacity is 

expected to continue increasing. For example, the DOT has projected a 55

percent increase in freight railroad traffic from 2000 to 2020. Increased 

train traffic places additional stress on existing infrastructure, especially

 18A chokepoint is a place where there is recurring congestion or delay. 

19American Society of Civil Engineers, 2005 Report Card for America’s Infrastructure

(Washington, D.C.: 2005). 

Page 15 GAO-07-770 Railroad Bridges and Tunnels
railroad bridges; requires capacity expansion investments in rolling stock, 

infrastructure, and personnel; and increases congestion on the railroad 

network. 

Class I railroads consider congestion a networkwide problem whereas 

officials of the Class II and III railroads with whom we spoke said they 

generally experience congestion around crossings, yards, and interchanges 

with Class I railroads. Although officials from four of the nine Class II and 

III railroads with whom we spoke said they currently experience 

congestion on their entire networks, generally, those railroads were more 

concerned about upgrading existing infrastructure to handle the heavier 

railcars and longer trains being demanded by Class I railroads than they 

were with increasing capacity. The American Short Line and Regional 

Railroad Association estimates that out of the 48,000 miles of track owned 

by Class II and III railroads, 20,000 to 25,000 miles need to be upgraded to 

handle the heavier railcars that are becoming the industry standard. 

ASLRRA estimated these upgrades would cost $7 billion to $11 billion. 

Officials at seven of the nine Class II and III railroads with whom we spoke 

said the railroads had completed or needed to complete track or bridge 

upgrades to accommodate heavier railcars. 

Several factors contribute to congestion on freight railroad networks, 

including grade crossings and passenger trains, both of which can 

decrease freight railroad capacity and cause freight train delays. Bridges 

or tunnels may also cause network congestion. For example, single-track 

bridges and tunnels constrain capacity on double-track lines, as do low 

clearances that do not accommodate double-stack intermodal trains, 

bridges that open for marine traffic,20 and other structural characteristics 

such as sharp curves and steep grades that require slower train speeds. 

Deteriorated bridge and tunnel conditions can also contribute to 

congestion by requiring reduced train speeds, closures, and increased time 

out of service for maintenance. Where repairs or improvements to bridges 

and tunnels may not be financially viable or sufficiently profitable, 

railroads may institute slow orders or shut down lines and reroute traffic. 

In some cases, especially for Class III railroads, a bridge or tunnel closure 

can isolate a shipper and cripple a railroad’s entire network. 

 2033 C.F.R. Ch. 1, Part 117. Railroad bridges over navigable waterways are required by law 

to open for marine traffic. 

Page 16 GAO-07-770 Railroad Bridges and Tunnels
Although FRA officials estimated that 10 percent or less of freight railroad

congestion is attributable to capacity constraints caused by railroad 

bridges and tunnels, railroad officials whom we spoke with identified 

some key bridges and tunnels as chokepoints on their networks. For 

example, one chokepoint is a moveable bridge that is one of only a few 

bridges across the Mississippi River owned by a Class I railroad. 

According to railroad officials, during peak periods, the bridge must open 

up to 15 times per day for river traffic while accommodating between 65

and 70 trains per day. Each opening for river traffic generally takes an 

average of 25 to 30 minutes, although the bridge is sometimes open for 

more than an hour, causing train delays as far as the West Coast. In 

addition, this bridge is closed for routine maintenance for over an hour 

several times a week. Another chokepoint is the 1.7 mile Howard Street 

Tunnel (see fig. 3), constructed in 1895 under downtown Baltimore, 

Maryland, which is the largest and most expensive obstacle to transporting 

double-stack railcars from Baltimore to Chicago. The tunnel regularly 

causes passenger and freight train delays in the Baltimore area and beyond 

because it is a single-track tunnel with insufficient clearance for doublestack railcars on a double-track main line. Grades in and curves near the 

Howard Street tunnel also contribute to congestion, constraining freight 

traffic to 25 miles per hour through the tunnel. In addition, during a fire in 

the tunnel in 2001, freight traffic was rerouted, resulting in 18- to 36-hour 

delays. 

Page 17 GAO-07-770 Railroad Bridges and Tunnels
Figure 3: Howard Street Tunnel (Baltimore, Maryland) West entrance (left) and East entrance 

Source: GAO.

Railroads Use Condition 

and Congestion 

Information with Other 

Information to Prioritize 

Investment, Including 

Projects Designed to 

Address Deterioration and 

Congestion 

Freight railroad officials with whom we spoke consider information on 

bridge and tunnel conditions and congestion, along with information on 

demand, cost, and other factors, to set infrastructure maintenance and 

investment priorities. According to all of the Class I railroad officials with 

whom we spoke, maintaining or increasing safety is one of their highest 

investment priorities, along with return on investment. Hence, most Class I 

railroad officials with whom we spoke said the railroads consider 

immediate safety concerns first, ongoing maintenance and asset 

replacement next, and capacity expansion last when prioritizing bridge 

and tunnel projects. 

Bridge and tunnel rehabilitation or replacement is expensive, and the costs 

are highly variable, depending on the complexity of the structure’s design,

the length and location of the structure, the construction materials, and 

the type of replacement structure. The cost of replacing a bridge can range 

from $600,000 for a small timber trestle bridge on a lightly trafficked Class 

III railroad line to $100 million to replace a large steel bridge with a 2,500-

foot moveable span located on a Class I railroad’s main line. See appendix 

II for more examples of railroad bridge and tunnel costs. Because 

replacement costs are high, railroads prefer to use asset extension 

programs and replace components rather than replacing entire structures 

to address deterioration and extend the useful life of their bridges and 

Page 18 GAO-07-770 Railroad Bridges and Tunnels
tunnels. Often, an individual component of a bridge may deteriorate faster 

than other components; therefore, replacing the component could 

significantly extend the life of the entire bridge. 

Bridge and tunnel replacement is typically one of the last options railroads 

choose to address infrastructure deterioration and mitigate congestion. 

Railroads typically try to improve their processes before enhancing 

infrastructure to mitigate congestion. Process improvements and other 

strategies generally cost less and are more cost effective than 

infrastructure enhancements. Class I railroads have used a number of 

process improvements to mitigate congestion, including updating their 

operating plans to reflect changes in business volume and traffic mix, 

increasing train lengths and the number of fully loaded cars per train, 

double-stacking trains, decreasing car cycle times, increasing service,

hiring more train crews, and using pricing strategies to shape demand. 

When process improvements can no longer reduce congestion, railroads 

use infrastructure enhancements to expand the capacity of their networks. 

Infrastructure enhancements include adding sidings or track, expanding

yards and terminals, upgrading signal systems, and rehabilitating or 

replacing bridges and tunnels. Per linear foot, bridge and tunnel 

replacement costs more than other infrastructure improvements, as shown 

in figure 4. Moreover, according to several Class I railroad representatives 

with whom we spoke, bridge replacement typically has a lower return on 

investment than other infrastructure improvements. Consequently, 

railroads invest in other enhancements before rehabilitating or replacing 

bridges. 

Page 19 GAO-07-770 Railroad Bridges and Tunnels
Figure 4: Range of Railroad Infrastructure Improvement Costs (Dollars in thousands per linear foot) 

Range of costs per linear foot

Infrastructure

project

0

New tunnel

construction

Steel bridge

replacement

Concrete bridge

replacement

Timber bridge

replacementa

Increasing

clearance in

existing tunnel

Siding extension

Signal system

installation

10 20 30 40 50 60 70 150 160

$47 to $250

$400 to $800

Doube/triple

tracking

$280 to $380

$230 to $870 

$1,000 to $7,000

$2,000 to $15,000 

$3,500 to $35,000 

$50,000 to $155,000 

Source: GAO analysis based on interviews with railroad and industry association officials and estimates from other rail

infrastructure studies.

a

Generally timber bridges are not being replaced with another timber bridge, but rather they are being 

replaced by either culverts or bridges with concrete and steel components. The low-end example 

represents a timber bridge replaced by a culvert and the high-end example represents a timber bridge 

replaced by a steel and concrete structure. 

While bridge and tunnel work is expensive for all freight railroads, 

railroads vary in their ability to make these investments. Class I railroads 

generally have more resources than Class II and III railroads to invest in 

bridge and tunnel inspection, maintenance, rehabilitation, and 

replacement. According to AAR, in 2006, the seven Class I railroads spent 

an average of $1.2 billion each for capital investments, while all the Class

II and III railroads surveyed by ASLRRA spent an average of over $795,000 

each in 2004. Class II and, to a greater extent, Class III railroads face 

challenges in funding bridge and tunnel rehabilitation or replacement 

efforts because they may have limited funds, lack in-house bridge and 

tunnel expertise, and own bridges and tunnels purchased from Class I 

railroads on lines that those railroads had disinvested in. When repairs or 

improvements to bridges or tunnels are not financially feasible for Class II 

or III railroads, the railroads may instead modify their operations—by, for 

Page 20 GAO-07-770 Railroad Bridges and Tunnels
example, reducing train speeds over bridges or in tunnels. According to 

ASLRRA, some railroads may even stop operating on routes when bridge 

or tunnel repairs are both unavoidable and unaffordable. As a result, 

according to FRA officials, fewer serious problems are found on bridges 

and in tunnels owned by Class I railroads than on bridges or in tunnels 

owned by smaller railroads. Nonetheless, in response to several accidents 

caused by bridge failures, near accidents involving bridges, and results 

from its bridge safety surveys, FRA is developing a formal rail safety 

advisory on railroad bridges, to be released in late 2007, that will urge all 

railroads to increase their attention on bridge safety and bridge 

management programs. 

Freight railroads are responsible for the structural safety of their bridges 

and tunnels; moreover, the federal government does not regulate railroad 

bridge and tunnel inspection requirements or conditions. In 1995, after 

determining that railroads were already inspecting bridges according to 

detailed industry standards, FRA decided to issue advisory guidelines for 

railroad bridge management instead of regulations. Because FRA has 

general authority over railroad infrastructure safety, it may make 

observations of and assess bridge and tunnel conditions, but it does not 

routinely inspect these structures to monitor their condition. FRA bridge 

specialists may make observations while investigating complaints, 

following up on track inspectors’ concerns, and conducting bridge safety 

surveys. If an FRA bridge specialist determines that there is a safety 

problem, FRA attempts to work cooperatively with the railroad to correct 

the problem rather than shut down the railroad’s operations. FRA has 

taken enforcement action to protect public safety when there is a 

documented problem of immediate concern over a structure’s stability. 

Other federal agencies also have limited roles in railroad bridge and tunnel 

safety. FRA’s bridge safety oversight has evolved; however, bridge 

specialists individually apply different criteria in their selection of 

railroads for bridge safety surveys. FRA has not established a systematic, 

consistent risk-based approach to selecting Class II and III railroads for 

bridge safety surveys. As a result, FRA may not be selecting the railroads 

whose bridges or tunnels are most likely to present safety issues. 

The Federal Role in 

Overseeing Railroad 

Bridge and Tunnel 

Safety Is Limited 

Page 21 GAO-07-770 Railroad Bridges and Tunnels
Historically, the federal role in railroad bridge and tunnel safety has been 

narrow. The federal government does not routinely inspect railroad 

bridges or tunnels and does not regulate their condition. After a highway 

bridge collapsed in 1967, Congress debated instituting bridge inspection 

standards that would apply to railroad bridges, but railroads were already 

inspecting their bridges according to their established industry standards. 

In 1968, Congress required national inspection standards for highway 

bridges; however, current law does not regulate railroad bridge conditions

or establish inspection standards. Under the authority originally granted to 

it by the Railroad Safety Act of 197021 to issue safety regulations as 

necessary, from 1975 to 1981 FRA considered establishing bridge safety

regulations based on industry standards created by the American Railway

Engineering and Maintenance of Way Association. However, according to 

FRA, these standards are actually recommendations for a thorough bridge 

management program, including very detailed specifications for particular

types of bridges, rather than minimum inspection standards. In light of the 

industry’s detailed safety standards and the low frequency of accidents 

caused by structural conditions on bridges or in tunnels, FRA determined 

that regulating bridge or tunnel structural conditions or requiring 

inspections would not be cost-effective to FRA when considering the cost 

of implementation and enforcement. Additionally, while establishing 

minimum standards might improve some railroads’ structural management 

policies and procedures, it could also influence some railroads to reduce 

the frequency or effectiveness of their inspections. 

Federal Railroad Bridge 

and Tunnel Safety Efforts 

Are Limited Because FRA 

Has Determined That 

Railroads Are Sufficiently 

Ensuring Structural 

Stability 

FRA observes and assesses bridge and tunnel conditions, but does not 

inspect these structures to regulate their condition. Although FRA does 

not regulate bridge and tunnel conditions, it does regulate track 

conditions, and it uses track inspectors, as well as bridge specialists, to 

identify potential bridge and tunnel safety issues. Historically, FRA track 

personnel have overseen bridge and tunnel safety.

22 Under the authority 

originally granted by the Federal Railroad Safety Act of 1970, an FRA track 

inspector may take action to address a structural concern identified on a 

bridge or in a tunnel, such as a visible crack in a steel beam, to ensure the 

 21The Federal Railroad Safety Act of 1970 has been codified at 49 U.S.C. Chapter 201.

Applicable civil and criminal penalties are found at 49 U.S.C. Chapter 213. 

22Prior to 1981, regional track engineers oversaw bridges and tunnels, but by 1982 FRA had 

reclassified these employees as safety specialists. Engineering qualifications are not

required for this revised role, and incoming safety specialists sometimes lacked the bridge

and tunnel knowledge of the previous regional track engineers.

Page 22 GAO-07-770 Railroad Bridges and Tunnels
safety of the public and railroad employees. Additionally, in 1992, FRA’s 

Office of Safety established the position of Bridge Engineer (currently 

filled by FRA’s Chief Structural Engineer) to assist track personnel in 

identifying and resolving issues of bridge structural integrity and to 

oversee standards regulating the safety of railroad bridge workers.23 After 

completing a bridge survey in 1993, FRA concluded that most railroads 

were inspecting bridges to a higher standard than would be required by

any FRA-issued minimum standards, which prompted FRA to issue 

guidelines for bridge management rather than regulations. In 1995, FRA 

began implementing these guidelines as part of its Bridge Safety Assurance

Program. FRA has hired five full-time bridge specialists since 2000 to 

implement this program.24 These specialists provide expertise to track 

personnel and work with them to relieve some of the track personnel’s 

inspection workload related to railroad structures as well as carry out 

other activities to promote bridge safety. Besides the Chief Structural 

Engineer, the program now includes one bridge specialist at FRA 

headquarters25 and four bridge specialists in the field. Each field bridge 

specialist is responsible for all of the passenger and freight railroad 

infrastructure in two FRA regions and one or two Class I railroads (whose

infrastructure usually spans multiple FRA regions). In addition to 

addressing bridge structural concerns, FRA bridge specialists address 

tunnel structural concerns. However, FRA’s involvement in tunnels is not 

as extensive as its involvement in bridges, since bridges are more affected

by stress from trains moving over them than tunnels are from trains 

moving through them.26 In addition, there are many more railroad bridges 

in the United States than there are tunnels. 

 2349 C.F.R. §§214.101-214.117. Bridge worker safety regulations include provisions such as 

requirements for railroads to provide personal protective equipment and for railroad 

workers to use fall protection systems when necessary. 

24FRA also has a position for a second Structural Engineer in the Office of Safety 

Headquarters. The position has been vacant for several months, and FRA is presently 

recruiting a successor. 

25The bridge specialist at FRA headquarters is not assigned to particular railroads or

regions. The specialist works with field specialists on larger investigations that require two

or more persons. The specialist also coordinates complaint investigations and other issues

that come through FRA headquarters, and conducts training for bridge specialists and FRA

track and signal inspectors. 

26The forces caused by the weight and movement of a train through a tunnel are distributed

through the supporting bedrock or stable ground. By contrast, individual bridge 

components experience direct stress from a passing train. Therefore, bridges are more 

subject to degradation from heavier loads than are tunnels. 

Page 23 GAO-07-770 Railroad Bridges and Tunnels
In observing bridge conditions, FRA bridge specialists use FRA advisory 

guidelines for railroad bridge management programs.27 These guidelines 

recommend, among other things, that organizations responsible for the 

safety of a bridge ensure that a qualified engineer determines the weightbearing capability of a bridge; collect bridge design, construction, 

maintenance, and repair records; and have a competent inspector 

periodically inspect structures. The guidelines do not pertain to tunnels or 

other types of structures on railroad property. FRA encourages, but does 

not require, that railroads comply with these guidelines because the 

railroads are responsible for inspecting, maintaining, and ensuring the 

safety of bridges and tunnels that carry their track. However, when a 

bridge or tunnel owner fails to resolve a structural problem, FRA can use 

legal means, including emergency orders, to ensure safety.28

Federal Enforcement of 

Bridge and Tunnel 

Structural Safety Is 

Primarily Limited to 

Addressing Immediate 

Safety Concerns 

FRA is the primary federal agency responsible for overseeing the safety 

and structural integrity of railroad bridges and tunnels. FRA bridge 

specialists perform both enforcement and nonregulatory activities aimed 

at ensuring the safety of railroad structures. Other federal agencies have

more limited roles in railroad bridge and tunnel safety related to their 

particular missions. 

FRA bridge specialists play a number of roles29 intended to promote bridge 

and tunnel safety, most of which involve responding to identified safety 

issues. One of their principal roles is to alert FRA’s Chief Structural 

Engineer when they encounter an immediate bridge or tunnel safety 

concern so that an emergency order may be issued if necessary. These 

safety concerns may be identified in response to a track inspector’s 

findings, in response to an accident or a complaint, or through 

independent observation of a railroad’s bridges or tunnels. Each bridge 

specialist has numerous safety responsibilities as part of the Bridge Safety

Assurance Program. In particular, the FRA bridge specialists are involved

in the following activities:

 27FRA’s bridge inspection guidelines, issued in 2000, can be found in the Statement of

Agency Policy on the Safety of Railroad Bridges 49 C.F.R. §213, app. C. 

2849 C.F.R. §§216.21 – 216.27. 

29FRA bridge specialists also have the authority to enforce FRA track safety standards and 

bridge worker safety regulations. 

Page 24 GAO-07-770 Railroad Bridges and Tunnels
• Enforcement. If a bridge specialist notices a track defect on or near 

a bridge or tunnel, the specialist typically first recommends 

remedial actions, such as a reduction in train speeds over the 

affected track segment. If conditions warrant, the FRA 

Administrator may issue an emergency order. However, FRA 

prefers to seek cooperative solutions with railroads and has issued 

only three emergency orders for bridges and none for tunnels since 

1970. 

• Accident Investigation. When an accident occurs on a bridge or in 

a tunnel, one or more bridge specialists may conduct an on-site 

investigation. In the case of a bridge or tunnel structural failure, the 

bridge specialist may identify the individual component that caused 

the failure, although the entire structure may need to be replaced 

after the accident (see fig. 5). 

Figure 5: Structural Failure of a Bridge in Mississippi

Source: FRA.

• Complaint Investigation. Bridge specialists are responsible for 

addressing and investigating almost all formal complaints 

concerning bridges and tunnels filed by the general public, Members 

of Congress, and railroad employees. According to FRA, most 

formal bridge complaints from the public are related to aesthetic 

issues rather than the stability or safety of a structure. Bridge 

specialists may also conduct structural evaluations in response to 

Page 25 GAO-07-770 Railroad Bridges and Tunnels
concerns identified by FRA track personnel or as part of a 

complaint investigation.

• Monitoring Compliance Agreements. In response to systemic 

safety concerns that FRA identifies on a railroad through the bridge 

specialists’ or track personnel’s activities, FRA may work with the 

railroad to implement a compliance agreement to improve safety 

across the entire railroad. FRA often initiates a compliance 

agreement to avoid issuing an emergency order for the railroad to 

cease operations on a bridge. FRA has found that compliance 

agreements can be an effective tool to address systemic weaknesses 

in a railroad’s bridge management practices, while emergency

orders usually address serious safety problems on specific bridge 

structures. 

• Training. At FRA conferences, the bridge specialists teach FRA 

track inspectors about bridge conditions. This training supports 

communication between FRA track staff and bridge specialists and 

is designed to increase the number of FRA personnel that can 

detect immediate safety concerns on bridges. 

• Conducting Bridge Safety Surveys. During a bridge safety survey, 

a bridge specialist interviews railroad bridge staff and uses FRA 

guidelines as criteria for reviewing a railroad’s bridge management 

policies, procedures, and records. After reviewing the railroad’s 

records and policies, the bridge specialist observes a sample of the 

railroad’s bridges and compares the results of the sample 

observation with the railroad’s bridge inspection reports to 

determine the inspection reports’ reliability. The bridge specialist 

documents the findings and follows up with the railroad to 

document any necessary repairs to structures or improvements to 

bridge management procedures. 

Besides FRA, several federal agencies have responsibilities related to 

railroad bridges and tunnels in areas such as security and clearance for 

maritime traffic. Within DHS, TSA has issued freight railroad security 

action items in cooperation with the railroad industry, but compliance 

with these action items is voluntary. Much as FRA monitors compliance 

with its guidelines, TSA security inspectors assess a railroad’s compliance 

with TSA’s action items and may make recommendations if the railroad 

does not comply with certain items. Additionally, TSA issued a proposed 

rule in December 2006 that would require freight railroads and other 

transportation entities to allow TSA and DHS to enter, inspect, and test 

property, facilities, and records relevant to railroad security. Also within

Page 26 GAO-07-770 Railroad Bridges and Tunnels
DHS, the U.S. Coast Guard is responsible for overseeing all bridges over

navigable waterways and for assessing obstructions to maritime traffic. 

The Coast Guard regulates movable bridge schedules and prescribes 

bridge lighting for navigational safety. Within the DOD, the Transportation 

Engineering Agency designates STRACNET, a network of railroad lines 

that form the minimum railroad network required to meet the 

transportation needs of the military. The Transportation Engineering 

Agency does not directly oversee the condition of bridges or tunnels on 

this network.

FRA Is Not Using a 

Systematic, Consistent, 

Risk-Based Methodology 

to Target Bridge Safety 

Surveys to Class II and III 

Railroads

FRA’s field bridge specialists monitor bridges and tunnels in a large area 

and have not been able to assess the bridge policies or the bridges and 

tunnels of many of the Class II or Class III railroads in the specialists’ 

assigned areas. Furthermore, as previously discussed, the railroads share 

information on the condition of their bridges and tunnels with the federal

government selectively. As a result, the structural conditions of some 

bridges and tunnels and the practices used to inspect and maintain them, 

particularly on Class III railroads, are largely unknown to the federal 

government. According to ASLRRA, there are 549 Class II and III railroads 

in the United States. Although FRA has conducted bridge safety surveys 

on all of the Class I railroads, FRA officials estimate that they have 

conducted, on average, approximately 25 to 35 bridge safety surveys per 

year on Class II and III railroads since the introduction of the field bridge 

specialists in 2004. As we mentioned earlier, our analysis of FRA’s 

completed bridge safety surveys during this period showed that some of 

the surveyed Class II and III railroads had sound bridge management 

practices and records, but most did not. The limited number of bridge 

safety surveys that the FRA bridge specialists have been able to 

accomplish relative to the number of Class II and III railroads could 

indicate potential bridge and tunnel safety concerns on railroads that FRA 

has not surveyed. 

According to FRA, the goal of the Bridge Safety Assurance Program is not 

to monitor all railroads, but rather to identify railroads whose bridge 

management policies and bridge conditions may lead to safety threats. 

However, the FRA bridge specialists do not select Class II and III railroads

for bridge safety surveys using a consistent methodology based on a 

comprehensive, prioritized assessment of safety issues that could focus 

FRA’s inspection and enforcement resources on those railroads that could 

have the greatest safety risks. Each field bridge specialist uses individually 

developed criteria, based on personal experience and other available 

information--such as whether a railroad’s bridges carry passenger traffic--

Page 27 GAO-07-770 Railroad Bridges and Tunnels
to help identify Class II and III railroads as candidates for bridge safety 

surveys. This is in contrast to how FRA implements its National Inspection 

Plan to target inspections of other railroad safety areas. This plan provides 

guidance to each FRA regional office on how its inspectors should divide 

their work, by railroad and by state, on the basis of trend analyses of 

available accident, inspection, and other data. Before implementing this 

plan, FRA had a less structured, less consistent, and less data driven 

approach to planning inspections, under which each region prepared its 

own inspection plan, on the basis of judgments and available data. The use 

of data was not consistent from region to region, and individual inspectors 

had greater discretion to select sites for inspection using their own 

knowledge of their inspection territories. 

In our previous work, we have noted that risk management can help to 

improve safety by systematically identifying and assessing risks associated 

with various safety hazards, prioritizing them so that resources may be 

allocated to address the highest risk first, and ensuring that the most 

appropriate alternatives to prevent or mitigate the effects of hazards are 

designed and implemented.30 FRA’s safety oversight role in other areas, 

such as operating practices and track, includes inspections that focus on 

compliance with minimum standards; however, these inspections do not 

attempt to determine how well railroads are managing safety risks on their 

systems. In contrast, by examining how railroads manage safety risks 

during its bridge safety surveys, FRA is, in part, addressing riskmanagement issues, even though it has not established a systematic, riskbased methodology to select Class II and III railroads that may need 

additional oversight. For example, one bridge specialist is contacting all 

Class III railroads in one region to obtain specific information on their 

bridge management policies, such as whether a railroad has regular 

inspections by a qualified civil engineer and how the railroad records and

uses the bridge inspection data, to better identify railroads for bridge 

safety surveys. Additionally, FRA’s Chief Structural Engineer is 

considering a research project that would use new technology to measure 

the stress trains inflict on timber bridges. If this project were 

implemented, FRA would analyze stress data that might indicate bridge

problems and a need for monitoring problematic bridges. 

 30GAO, Rail Safety: The Federal Railroad Administration Is Taking Steps to Better Target

Its Oversight, but Assessment of Results Is Needed to Determine Impact, GAO-07-149 

(Washington, D.C.: Jan. 26, 2007), p. 35. 

Page 28 GAO-07-770 Railroad Bridges and Tunnels
Federal, state, and local governments make limited investments in freight 

railroad infrastructure, including bridges and tunnels, in an effort to 

enhance the public benefits associated with freight and passenger 

transportation. However, federal investments in all modes of freightrelated infrastructure are not aligned with a national freight policy or with 

a strategic federal freight transportation plan. DOT has developed a draft 

Framework for a National Freight Policy, but it lacks a strategic federal 

component that specifies federal goals, roles, and revenue sources and 

funding mechanisms. In contrast, some states structure their investments 

in freight railroad infrastructure to produce public benefits at the state and 

local levels, and some public-private partnerships have facilitated 

investments designed to produce public and private benefits. Freight 

congestion and demand are expected to increase, and given the highly

constrained fiscal environment, the federal government may be challenged

to increase the efficiency of the national multimodal freight transportation 

system. 

While the private sector is largely responsible for investing in the freight 

railroad infrastructure that it owns and maintains—an estimated $9 billion 

during calendar year 2006—the federal government invests some public 

funds in this infrastructure as well—an estimated $263 million during 

fiscal year 2006. The federal government funds freight railroad 

infrastructure investments through the General Fund and the Highway 

Trust Fund, and funding mechanisms include loans, grants (such as 

formula grants and legislative earmarks), and tax expenditures (such as 

tax credits). However, these funding mechanisms are (1) targeted toward 

individual transportation modes and address different transportation 

safety and economic issues, (2) are administered by different agencies that 

have different missions, and (3) are not coordinated by a strategic federal 

multimodal freight transportation policy to maximize specific national

public freight transportation benefits31 (see table 1). For example, in 

accordance with its mission to protect maritime economic interests, the 

U.S. Coast Guard administers the Truman-Hobbs program to alter railroad 

Federal Investments 

in Freight Railroad 

Infrastructure Are 

Typically Not 

Targeted to Maximize 

National Benefits, 

Whereas Some State 

and Private 

Investments Are 

Strategically Targeted 

Federal Funding for 

Freight Railroad 

Infrastructure Is Not 

Guided by a National 

Freight Strategy and Is 

Generally Not Targeted to 

Maximize National 

Benefits 

 31Potential public benefits of public investment in freight railroad transportation include 

supporting economic development, enhancing transportation system efficiency, improving 

mobility and decreasing congestion, improving the environment and air quality, and 

enhancing safety and security. On a national scale, these benefits could accrue to regions 

of national interest whose freight flows impact multiple states, large urban areas, and 

international gateways. 

Page 29 GAO-07-770 Railroad Bridges and Tunnels
and highway bridges that obstruct maritime traffic (see fig. 6).32 While this 

program can enhance maritime, railroad, and highway freight mobility, it is 

targeted toward maritime traffic and is not coordinated with other DOT 

freight mobility investments. 

Table 1: Examples of Federal Funding Mechanisms That Support Freight Railroad 

Infrastructure

Funding

mechanism 

Revenue

source Example

Federal 

agency 

Loan General

Fund 

RRIF loans can be used by railroads, state 

and local governments, and other entities to 

finance certain activities such as track and 

bridge rehabilitation. 

FRA 

GrantaGeneral

Fund 

The Truman-Hobbs program funds the 

alteration of railroad and highway bridges 

that are deemed hazards to maritime 

navigation. 

U.S. Coast 

Guard 

Highway

Trust Fund 

Legislative earmarks have been used to fund

federally designated Projects of National and

Regional Significance that include railroad 

components, such as the Heartland Corridor 

Project, which will increase tunnel 

clearances to accommodate double-stacked 

trains. 

Federal 

Highway 

Administration

Tax 

expenditure 

General

Fund 

revenue 

forgone 

The Railroad Track Maintenance Credit is 

available to Class II and III railroads for 50 

percent of their qualified track maintenance 

expenses during a taxable year. 

Internal 

Revenue 

Service 

Source: GAO analysis of programmatic and fiscal year 2006 financial data from FHWA, FRA, U.S. Coast Guard, and the Joint 

Committee on Taxation. 

a

Examples of other federal grant programs that also fund, to some extent, freight railroad 

infrastructure investments include High Priority Projects, Congestion Mitigation and Air Quality, 

Transportation Improvements, Public Lands Highways, and Railway-Highway Crossings (Section 

130). 

 3233 C.F.R. §§116.01. Alterations may include structural changes, replacement, or removal 

of a bridge.

Page 30 GAO-07-770 Railroad Bridges and Tunnels
Figure 6: Barge Navigating through the Narrow Channel of a Moveable Railroad Bridge Eligible for Truman-Hobbs Funding on 

the Mississippi River in Iowa 

Source: GAO.

Today’s federal investments in freight railroad infrastructure are not 

guided by a clear federal freight strategy. In 2006, DOT attempted to move 

beyond the traditional modal approach to freight transportation by 

developing a draft Framework for a National Freight Policy, which, 

among other things, incorporates some previously established federal 

freight railroad infrastructure funding mechanisms. Although this draft 

Framework represents an important step toward developing a national 

intermodal freight transportation policy, it does not go far enough, in our 

view, toward delineating a clear federal role and strategy for carrying out 

that policy. DOT describes its draft Framework as a living document and 

emphasizes that the nation’s freight transportation challenges are of such a 

nature and magnitude that governments at all levels and the private sector 

must work together to address them. We agree, and we note that as the 

draft Framework evolves, DOT and other stakeholders will have an 

opportunity to clarify their respective freight strategies. 

As we have reported, the federal approach to a given transportation 

strategy should include clearly and consistently defined goals, roles, 

revenue sources, and funding mechanisms to ensure that federal 

Page 31 GAO-07-770 Railroad Bridges and Tunnels
investments in the nation’s intermodal freight transportation infrastructure 

will maximize national public benefits.33 DOT’s draft Framework sets forth 

some “objectives” for freight transportation, together with strategies and 

tactics for achieving them; acknowledges that a variety of public and 

private stakeholders play important roles in freight transportation; and 

identifies some funding mechanisms and other tools that the federal 

government can use to support freight infrastructure. However, in some 

instances, these objectives are vague, and federal and other stakeholders’ 

roles and funding mechanisms are not clearly and consistently defined.

For example, one DOT draft Framework objective is to “add physical 

capacity to the freight transportation system in places where investment 

makes economic sense,” with supporting strategies and tactics that 

include focusing on facilitating regionally based solutions for freight 

gateways and projects of national or regional significance and utilizing and 

promoting new and expanded financing tools, such as RRIF, to incentivize 

private sector investment. To implement this objective, DOT would need

to define “economic sense” and develop criteria—as the draft Framework 

says—to identify specific freight gateways and projects of national or 

regional significance; and determine whether federal revenues should be 

used to help subsidize any project components and, if so, which federal

funding mechanisms would be most appropriate.

As we have also reported, federal investments should be directed to 

maximize national public benefits. Allocating benefits and their costs 

among beneficiaries is difficult34 and may be subject to interpretation. 

Hence, it will be important for DOT to define national benefits and to 

establish criteria for determining whether federal investments are 

warranted. DOT’s draft Framework suggests, but does not explicitly 

identify as such, certain criteria for federal investment, such as a project’s

national or regional significance, opportunities to incentivize more private 

investment in transportation infrastructure, and opportunities to leverage 

private and other public funds to add freight transportation capacity. 

Without a federal freight strategy, the existing federal freight funding 

mechanisms are not designed to maximize national public benefits. For 

example, although all railroads may apply for RRIF loans, the only freight 

 33GAO-02-1033, p. 17 and GAO-07-15, p. 90. 

34GAO, Highway and Transit Investments: Options for Improving Information on 

Projects’ Benefits and Costs and Increasing Accountability for Results, GAO-05-172 

(Washington, D.C.: Jan. 24, 2005). 

Page 32 GAO-07-770 Railroad Bridges and Tunnels
railroads that have been awarded loans have been Class II and III 

railroads, whose operations tend to be more regional and local. Also, the 

Federal Highway Administration’s (FHWA) Section 130 grant program 

mainly benefits localities by improving or eliminating railroad-highway 

grade crossings and the public safety benefits of the program are more 

local than national. Benefits from the Truman-Hobbs program’s 

investments directly accrue primarily to private maritime shipping and 

secondarily to railroad companies by improving each mode’s 

infrastructure, thereby enhancing the efficiency of freight transportation. 

On the other hand, depending on the project, legislative earmarks can 

generate public and private benefits that could be national, regional, and 

local in scope; however, these projects do not compete for funding against 

other alternatives. For example, through the Projects of National and 

Regional Significance program, Congress earmarked funds to support the 

Chicago Region Environmental and Transportation Efficiency (CREATE) 

project, which is mainly designed to reduce railroad congestion in the 

nation’s largest railroad hub35—the effects of which, among other things, 

could improve the mobility of the national freight railroad network, 

improve local commuter railroad service, and reduce railroad-highway 

grade crossing hazards and congestion. Finally, Class II and III railroads 

can use the Railroad Track Maintenance Credit—a tax credit—to offset 

capital investment expenditures, but as previously stated, individual Class 

II and III railroad operations tend to benefit the private and local sectors 

more than the nation as a whole. 

Some State Investments in 

Freight Railroad 

Infrastructure Are 

Targeted to Achieve State 

and Local Benefits 

In contrast to the federal government, some states that invest in freight 

railroads administer various goal-oriented and criteria-based programs 

that are funded through a mixture of state and federal resources 

specifically to produce anticipated state and local benefits. Some states 

have been helping short line railroads maintain track in their jurisdictions 

for almost 20 years. For example, the Tennessee DOT provides 

approximately $8 million in grants annually to 18 of 20 Class III railroads 

in the state to fund track and bridge work, including bridge inspections 

and rehabilitation projects. As we have previously reported, governments 

at all levels—including states—have increasingly been providing support 

for freight railroad improvement projects that offer potential public 

benefits, and over 30 states have published freight plans that describe their 

 35One-third of all freight railroad traffic in the United States originates, terminates, or 

passes through the Chicago area. 

Page 33 GAO-07-770 Railroad Bridges and Tunnels
goals and approach to freight-related investments.36 The scope of stateadministered freight railroad programs includes railroad infrastructure 

improvements, construction of intermodal facilities, elimination of public 

railroad-highway grade crossings, and inspection of bridges. For example, 

the Pennsylvania DOT administers a matching grant program—funded at 

$10.5 million as of October 2006—to support freight railroad maintenance 

and construction costs; and eligible recipients include freight railroads, 

transportation organizations, municipalities, municipal authorities, and 

other eligible users of freight railroad infrastructure. 

Officials from three of the nine state DOTs whom we interviewed are 

developing and implementing multimodal freight policies. However, such 

initiatives may be limited by state and federal funding criteria that restrict 

most state transportation spending to highway infrastructure. As we have 

reported, efforts to improve freight mobility are hampered by the highly 

compartmentalized structure and funding of federal transportation 

programs—often by transportation mode—that gives state and local 

transportation agencies little incentive to systematically compare the 

trade-offs between investing in different transportation alternatives to 

meet mobility needs because funding is tied to certain programs or types 

of projects.37 Officials from several state agencies and oversight 

organizations whom we interviewed stated that funding available for 

freight projects, regardless of mode, would be more useful than 

“stovepiped” funding that would be available only for investment in certain 

transportation modes. 

Officials at six of the state agencies and oversight organizations whom we 

interviewed administer freight railroad programs that have identified 

programmatic goals, eligibility criteria, and funding sources aimed at 

generating state and local benefits. For example, officials from the Kansas 

DOT told us that the goals of its loan program for local and regional 

railroads are to improve railroad lines, enhance railroads’ customer 

service to shippers, limit the number of trucks on highways, and increase 

 36GAO, Freight Railroads: Industry Health Has Improved, but Concerns about 

Competition and Capacity Should Be Addressed, GAO-07-94 (Washington, D.C.: Oct. 6,

2006), p. 59. 

37For example, while passenger and freight travel occurs on all modes, federal funding and

planning requirements focus largely on highways and transit, making it difficult for freight 

projects to be integrated into the transportation system. See GAO, Freight Transportation:

Short Sea Shipping Option Shows Importance of Systematic Approach to Public

Investment Decisions, GAO-05-768 (Washington, D.C.: July 29, 2005), p. 35.

Page 34 GAO-07-770 Railroad Bridges and Tunnels
state and local economic vitality by transporting local agricultural 

products. While officials from some state agencies that we interviewed 

acknowledged that public benefits are difficult to quantify for any public

investments, six state agencies and oversight organizations we interviewed 

were trying to quantify them. For example, the Kansas DOT sponsored a 

study which found that the short line railroad system saves the state an 

estimated $49 million annually in pavement damage costs. 

The scope of state freight railroad programs may be either broad, 

including infrastructure investments of all kinds for railroads of all sizes, 

or narrow, focusing on eligible projects and award recipients. For 

example, the Pennsylvania DOT has two broad grant programs for freight 

railroads and shippers, both of which may be used to fund maintenance 

and new construction projects. In contrast, the Tennessee DOT makes 

funds available specifically to Class III railroads by allocating funds for 

track and bridge rehabilitation. State freight railroad initiatives have 

supported investments in track rehabilitation and other infrastructure 

improvements, railroad acquisition and line preservation assistance, 

intermodal facility construction and increased industrial access to 

railroads, and road and railroad-highway crossing safety enhancements. 

Some of the state entities we interviewed reported using a number of 

funding mechanisms for their freight railroad programs. Specifically, 6 of 

the 12 said they provide grants and long-term below-market rate loans, and 

one state reported issuing tax-exempt bonds. Some of these states require 

that entities applying for loans or grants secure matching funds. States 

fund freight railroad programs through state general funds, user fees, 

federal Section 130 and other grants, and other sources. Some states have 

taken an innovative approach to funding freight railroad infrastructure. 

For example, Tennessee created a user-fee based Transportation Equity 

Fund to support investments in nonhighway infrastructure, including short 

line freight railroad track and bridge rehabilitation. The fund is financed 

through the revenue from state sales taxes on diesel fuel paid by railroad,

air, and water transportation modes; and the portion available for the 

Tennessee Short Line Railroad Rehabilitation Track and Bridge grant 

program is typically $7 million to $8 million annually. The program’s 

purpose is to preserve freight railroad service and thereby contribute to 

the state’s economic development. Construction grants are funded at a 90 

percent state and 10 percent local (nonstate) matching share. Each grant 

can be matched with in-kind work, cash contributions or both. 

Page 35 GAO-07-770 Railroad Bridges and Tunnels
States, localities, and railroads have used public-private partnerships as a 

strategic approach to develop freight-related transportation solutions that 

benefit both sectors.38 In using this approach to resolve freight issues, 

public and private participants of the partnerships we reviewed identified

common goals, individual roles, and funding sources and mechanisms, 

which have affected partnership outcomes. In some cases, these 

partnerships have supported railroad bridge and tunnel projects. A wellstructured partnership balances the various strengths, limitations, and 

respective contributions of both the public sector—federal, state, local, 

and regional—and private sector participants in order to secure specific 

public and private freight-related benefits. 

Public-Private 

Partnerships Have 

Supported Some Freight 

Railroad Investments 

Designed to Produce Both 

Public and Private Benefits 

Both the public and the private sectors have initiated freight railroad 

public-private partnerships. For example, according to AASHTO 

representatives we interviewed, in 2002 the Delaware DOT approached a

Class I railroad to reopen the Shellpot Bridge, which had been out of 

service since 1994. The state associated the abandonment of this bridge 

with increased congestion on the Northeast Corridor and saw it as a threat

to the competitiveness of the Port of Wilmington in attracting freight 

traffic. The state and the railroad jointly developed the project’s goals, 

roles, and funding mechanisms. The state agreed to finance the 

approximately $13.5 million cost of restoring the bridge by contributing $5 

million in state grant appropriations and funding the remainder by issuing 

tax-exempt bonds. The railroad agreed to compensate the state over a 20-

year period by paying a fee for each train car that uses the bridge. In 

another public-private partnership, members of the Kansas City Terminal 

Railway Company39and their project designer approached the state of 

Missouri and the Unified Government of Kansas City/Wyandotte County,

Kansas, to propose assisting in financing the construction of two flyovers 

and the rehabilitation of a bridge. The purpose of these three 

infrastructure improvement projects was to separate freight trains from 

different railroads at several points where they came together to form 

what amounted to four-way stops for trains in the Kansas City region and

caused a significant chokepoint on the U.S. freight railroad network (see 

 38For purposes of this report, a public-private partnership is a strategy that public and

private entities mutually agree to use to implement a specific freight railroad project or 

group of projects. Some representatives of state DOTs and railroads told us that they

consider any investment that is supported by public and private funds, such as a grade 

crossing or siding project, to be a public-private partnership.

39The Kansas City Terminal Railway Company is made up of four Class I and one Class II 

railroads that meet in Kansas City, Missouri.

Page 36 GAO-07-770 Railroad Bridges and Tunnels
fig. 7). The railroads had already determined the goals of their proposed 

public-private partnership and came to the bargaining table with proposed 

roles and funding mechanisms. The railroads acknowledged that they 

could pursue the project using strictly private market resources; however,

a wholly private project would have taken longer to complete. The state 

and county saw value in relieving their communities of the grade-crossing 

congestion this chokepoint caused, determined the project risk was 

acceptable, and each agreed to issue tax-exempt bonds that totaled over 

$190 million, which will be repaid by the railroads through user fees. In 

both the Delaware and Kansas City cases, the entities that initiated the 

partnership brought well-defined goals, identified stakeholder roles, and 

guaranteed a set amount of funding to the public-private partnership over 

a period of years. 

Figure 7: Kansas City Flyovers 

Sources: BNSF (used with permission) and GAO (digitally altered).

Public-private partnerships can make funds available and define goals and 

roles for all stakeholders for large, expensive freight railroad projects 

when it is difficult for a public or private entity to fund the entire project

on its own, or when a project is not part of a railroad’s strategic plan, but

would be beneficial to a locality’s or a region’s quality of life. For example, 

Page 37 GAO-07-770 Railroad Bridges and Tunnels
public and private players bring various strengths and limitations to the 

partnerships. The private sector often can bring a more global view of 

freight needs to the project planning process, help identify and implement 

projects, contribute significant funds, and promote efficient use of 

infrastructure. The public sector can offer various public financing tools, 

such as low-interest loans and private activity bonds,40 to create incentives 

for private investments in freight railroads that would not otherwise be 

made and to generate anticipated public benefits. 

Public-private partnerships also present certain challenges. As we heard 

from both public and private freight railroad stakeholders, the extent to

which the public sector can engage the private sector, identify anticipated 

public benefits from railroad investments, and provide funding that is 

commensurate with those benefits, affects partnership outcomes. Our past 

work has shown that an integral part of public-private partnerships is 

ensuring that sound analytical approaches are being applied locally and 

meaningful data are available, not only to evaluate and prioritize 

infrastructure investments but also to determine whether public support is 

justified in light of a wide array of social and economic costs and 

benefits.41 Moreover, as private entities that own most of the nation’s 

railroad infrastructure, freight railroads typically have not worked with the 

public sector because of concerns about the requirements and regulations 

associated with federal funding.42 These railroads need to be convinced

that a proposed infrastructure project will yield financial returns for the 

company. Still another challenge is to reconcile the lengthy planning and 

construction time associated with public infrastructure projects with the 

shorter planning and investment horizons of private companies. 

 40Qualified private activity bonds are tax-exempt bonds issued by a state or local 

government, the proceeds of which are used for a defined qualified purpose by an entity 

other than the government issuing the bonds.

41GAO, Freight Transportation: Strategies Needed to Address Planning and Financing 

Limitations, GAO-04-165 (Washington, D.C.: Dec. 19, 2003), p. 5.

42GAO, Surface Transportation: Many Factors Affect Investment Decisions, GAO-04-744 

(Washington, D.C.: June 30, 2004), p. 32. 

Page 38 GAO-07-770 Railroad Bridges and Tunnels
Overcoming congestion and improving mobility is one of the biggest 

transportation challenges facing the nation. Congestion increases delays 

and creates economic losses that cost Americans roughly $200 billion a 

year, according to DOT estimates.43 As we have previously reported, 

increases in freight traffic on all modes over the next 10 to 15 years are 

expected to put greater strain on ports, highways, airports, and railroads.44

In addition, we have found that this increase in freight transportation 

demand seems to be particularly acute on highways, since trucks transport 

over 70 percent of all freight tonnage nationally and freight truck traffic on

urban highways more than doubled from 1993 through 2001. The increased

congestion, coupled with long lead times for completing infrastructure 

projects (5 to 15 years), may put pressure on all stakeholders, including 

the federal government, to find other more effective investments to 

increase freight mobility. 

Growing Freight 

Congestion and Demands 

May Challenge the Federal 

Government to 

Strategically Invest 

Limited Funds to Maximize 

National Public Benefits 

Increasing the capacity of the nation’s freight railroad network could be 

one way to meet future growth in freight transportation demand. However, 

as mentioned previously, aging railroad bridges and tunnels present 

physical constraints to meeting this projected increased demand for 

freight railroad transportation on key routes, thereby constraining 

capacity. For example, as we previously mentioned, 100-year-old bridges 

and tunnels that are currently in use—such as the moveable bridge over 

the Mississippi River and the Howard Street Tunnel in Baltimore—create 

chokepoints on the freight railroad network due to their operating 

conditions or outdated design. Currently, freight railroads are investing 

billions of dollars in freight railroad infrastructure to increase capacity, 

but because they invest in projects that will maintain or increase safety or 

provide the highest return on its investment, other investments may take

priority over their most expensive pieces of infrastructure, bridges and 

tunnels. In addition, we have found that the railroads’ long-term ability to 

meet the projected growth in demand for freight railroad transportation is 

uncertain, which may increase pressure for public investment in private 

railroad infrastructure. 

As we have previously reported, Congress is likely to receive further 

requests for funding and face additional decisions about how to invest in 

 43GAO, Performance and Accountability: Transportation Challenges Facing Congress

and the DOT, GAO-07-545T (Washington, D.C.: Mar. 6, 2007), p. 7. 

44GAO-07-545T, p. 11. 

Page 39 GAO-07-770 Railroad Bridges and Tunnels
the nation’s freight railroad infrastructure.45 However, Congress’s ability to 

respond to these requests may be limited by (1) federal funding 

constraints and increased demand for infrastructure investment in other 

transportation modes, (2) differences in federal funding for different 

transportation modes, and (3) the lack of a strategic federal freight 

transportation plan to guide federal investments in freight transportation 

infrastructure. 

Revenue from current federal transportation sources may not be 

sustainable. Because revenue from traditional transportation funding 

mechanisms such as the Highway Trust Fund may not keep pace with the 

increase in transportation demand, we designated transportation financing 

as a high-risk area in January 2007.46 The recently enacted transportation 

funding authorization, the Safe, Accountable, Flexible, Efficient 

Transportation Equity Act – A Legacy for Users (SAFETEA-LU), is 

expected to outstrip the growth in trust fund receipts. As a result, the 

Department of the Treasury and the Congressional Budget Office (CBO) 

are forecasting that the trust fund balance will steadily decline and be 

negative by the end of fiscal year 2011. In addition, the nation’s long-term 

fiscal challenges will constrain decision makers’ ability to use other 

funding mechanisms, such as grants and tax expenditures, for 

transportation needs. 

Differences in federal funding for different transportation modes have 

created a competitive disadvantage for freight railroads. Because the 

federal government has an interest in an efficient national freight 

transportation system, the federal role in freight transportation needs to 

recognize that the freight transportation system encompasses many modes 

that operate in a competitive marketplace and are owned, funded, and 

operated by both the private and the public sectors. However, current 

federal transportation policy treats each freight transportation mode 

differently, thereby creating competitive advantages for some modes over 

others. For example, trucking companies and barges use infrastructure 

that is owned and maintained by the government, while railroads use 

infrastructure that they pay taxes on, own, and maintain. Trucking and 

barge companies pay fees and taxes for the government-funded 

infrastructure they use, but their payments generally do not cover the 

costs they impose on highways and waterways. The federal subsidy that 

 45GAO-07-94, p. 5.

46GAO-07-310, p. 16. 

Page 40 GAO-07-770 Railroad Bridges and Tunnels
makes up the difference between the government’s costs and users’ 

payments gives trucking and barge companies a competitive advantage 

over the railroads.47 CBO has observed that if all modes do not pay their 

full costs, the result is inefficient use of roads and waterways and greater 

government spending than otherwise would be necessary if capacity

investments are made in anticipation of demand that does not occur. 

As noted earlier in this report, the federal government lacks a strategic 

freight transportation plan to guide its involvement in freight-related 

capital infrastructure investments. DOT’s draft Framework for a National 

Freight Policy represents an initial step toward such a plan, but it assumes 

a federal role without indicating whether federal involvement is 

appropriate or, when appropriate, what the goals of federal investment 

should be, what specific roles the federal government and other 

stakeholders should play, and what federal revenue sources and funding 

mechanisms should be used to support freight-related investments. As we 

have previously reported, critical factors and questions can be used as 

criteria for determining the appropriateness of a federal role and a 

framework with components that we believe would be helpful in guiding

any future federal freight-related investments. Implementing this GAO 

framework would include setting national goals for federal investment in 

freight-related infrastructure, clearly defining federal and other 

stakeholder roles, and identifying sustainable revenue sources and costeffective funding mechanisms that can be applied to maximize the national 

public benefits of federal investments. 

Examining Critical 

Questions and 

Implementing a 

Framework That 

Identifies Goals, 

Stakeholder Roles, 

Revenue Sources, and 

Funding Mechanisms 

Could Guide a Federal 

Role in FreightRelated Infrastructure 

Investments 

GAO’s Critical Questions 

and Framework Could 

Guide Future Federal 

Investment in FreightRelated Infrastructure 

In light of the federal government’s long-term fiscal imbalance, it is 

important for federal policy makers to determine how the federal 

government can support efficient, mode-neutral, transparent, and 

sustainable investments in freight-related infrastructure. In our report on 

21st century challenges facing the federal government, we defined critical

factors and questions that are useful as criteria for determining the 

appropriate federal role in a government program, policy, function, or 

 47GAO-07-94, p. 62. 

Page 41 GAO-07-770 Railroad Bridges and Tunnels
activity.48 These critical factors and questions are designed to address the 

legislative basis for a program, its purpose and continued relevance, its 

effectiveness in achieving goals and outcomes, its efficiency and targeting, 

its affordability and sustainability, and its management. The factors and 

questions can be used as criteria for determining the appropriateness of 

federal involvement in freight-related transportation, including freight 

railroad projects, as shown in table 2. 

Table 2: GAO’s Critical Factors and Questions for Determining the Appropriateness of a Federal Role in Freight-Related

Transportation 

Factors Questions

Relevance and purpose of the federal role Are some freight transportation issues of nationwide interest? If so, is a federal role

warranted based on the likely failure of private markets or state and local governments 

to address underlying freight problems or concerns? Does current federal involvement in 

freight infrastructure encourage or discourage the private and other public sectors from 

investing their own resources to address the problem? 

Measuring success Do current federal funding mechanisms and programs for freight-related infrastructure 

have outcome-based performance measures and are all applicable costs and benefits 

considered? 

Targeting benefits Are current funding mechanisms for freight-related infrastructure targeted to generate 

national benefits in areas with the greatest needs and the least capacity to meet those 

needs? 

Affordability and cost effectiveness Do current revenue sources and funding mechanisms for federal freight-related

infrastructure encourage state and local governments and the private sector to invest 

their own resources? Are these revenue sources sustainable and are the funding 

mechanisms affordable in the long term? Do these funding mechanisms use the most 

cost-effective or net beneficial approaches when compared with other tools and program 

designs? 

Source: GAO.

If federal policy makers determine that there is an appropriate role for the 

federal government in freight infrastructure investments, including those 

related to railroads, the implementation of that role should have several 

components. From our past work on transportation investment—in such 

areas as intercity passenger rail, intermodal transportation, and marine 

transportation—we have defined a systematic framework that can also 

guide the implementation of any future federal role in freight-related 

infrastructure investments.

49 Our framework’s components include setting 

 48GAO, 21st Century Challenges: Reexamining the Base of the Federal Government, 

GAO-05-325SP (Washington, D.C.: Feb. 1, 2005), p. 14. 

49See GAO-07-15, p. 90; GAO-05-727, pp. 26-27; and GAO-02-1033, p. 17. 

Page 42 GAO-07-770 Railroad Bridges and Tunnels
national goals, establishing clear stakeholder roles, and providing 

sustainable funding (see table 3). 

Table 3: Three Components of GAO’s Framework Applied to Federal Involvement in Freight-Related Infrastructure 

Investments 

Component Description

Set national goals. These goals, which would establish what federal participation in the freight 

transportation system is designed to accomplish, should be specific, 

measurable, achievable, and outcome-based. 

Establish and clearly define stakeholder roles, 

especially the federal role relative to the roles of 

state and local governments and private railroads. 

The federal government is one of many stakeholders involved in freight-related 

investments, including those involving freight railroads. Others include state and 

local governments, port authorities, shippers, and the railroads themselves. 

Given the broad range of beneficiaries, it is important to gain consensus on

what the transportation system is to achieve and to help ensure that the federal 

role does not negatively affect the participation or role of other stakeholders. 

Determine which revenue sources and funding 

mechanisms will maximize the impact of any federal 

expenditures and investment. 

This component can help expand the ability to provide funding resources and to 

promote cost-sharing responsibilities. Given the current budgetary environment 

and the long-range fiscal challenges confronting the nation, federal funding for 

future freight-related transportation projects, including those involving freight 

railroads, will require a high level of justification and should be prioritized to

maximize national public benefits. 

Source: GAO.

In conjunction with GAO’s framework, it would also be important to 

evaluate freight investments periodically to determine the extent to which

expected benefits are being realized. Evaluations also create opportunities 

for periodically reexamining established goals, stakeholder roles, and 

funding approaches, and provide a basis for modifying them as 

necessary.50 In addition, evaluations help to ensure accountability and 

provide incentives for achieving results. Encouraging or requiring the 

identification of all project costs and of all parties who will bear the costs 

can help ensure that the costs are apportioned among all stakeholders 

equitably.

51 Leading private and public organizations that we have studied 

 50GAO-07-15, p. 90. 

51One commonly used definition of the term “equitable” is the principle that beneficiaries 

should pay for project costs, commensurate with the benefits they receive from projects. 

However, in some cases, the combined private and public benefits may substantially 

exceed the combined costs. For example, if the cost of a project is $100 million, and private 

benefits are $80 million and public benefits are $80 million, then in this case, an equitable

public sharing of the cost could be 80 percent private and 20 percent public, which would 

not displace private investments that would have occurred in the absence of public 

funding. See GAO-05-768, p. 31. 

Page 43 GAO-07-770 Railroad Bridges and Tunnels
in the past have stressed the importance of developing performance 

measures and then linking investment decisions and their expected 

outcomes to overall strategic goals and objectives.

52

Goals of a Future Federal 

Role in Freight-Related 

Infrastructure Investment 

Should Be Structured to 

Maximize National 

Benefits 

The first component of GAO’s framework for guiding the federal role in 

freight-related infrastructure investment is a set of clearly defined national 

goals.53 Such goals can help chart a clear direction, establish priorities 

among competing demands, and specify the desired results of any federal

investment. Since many stakeholders are involved in the freight 

transportation system, the achievement of national goals for the system 

hinges on the federal government’s ability to forge effective partnerships 

with nonfederal entities. Decision makers need to balance national goals 

with the unique needs and interests of all nonfederal stakeholders in order 

to leverage the resources and capabilities of state and local governments 

and the private sector. National goals should be structured in a way that 

allows for reliably estimating and comparing national public benefits and

national public costs. As we have previously reported,54 quantifying public

benefits can be difficult, yet an effort should be made to determine that the 

anticipated public benefits are sufficient to justify the proposed levels of 

public investment.55 For example, at the state level, the Pennsylvania DOT 

evaluates and justifies freight railroad investments, in part, by estimating 

the wear and tear imposed by trucks on highways. 

The primary goal of federal investments in freight infrastructure should be 

to maximize the national public benefits of the investments. One way to 

focus these goals could be through federally designated Projects of 

National and Regional Significance, a program that has been designed to 

address critical national economic and transportation needs and has 

funded highway and railroad infrastructure projects. For example, one 

goal could be to improve intermodal freight mobility—which encompasses 

air, railroad, water, and highway facilities and infrastructure—at 

designated ports of national significance that serve multistate regions 

and/or large populations.

 52GAO-07-15, p. 90. 

53GAO, Marine Transportation: Federal Financing and a Framework for Infrastructure

Investments, GAO-02-1033 (Washington, D.C.: Sept. 9, 2002), p. 18. 

54GAO-04-744, p. 22. 

55GAO-04-165, p. 40. 

Page 44 GAO-07-770 Railroad Bridges and Tunnels
Federal policy makers and other stakeholders could define their 

respective roles in many different ways once the goals for the federal role 

in freight transportation infrastructure have been established. However, 

the key elements in defining the federal and other stakeholder roles would 

be to create incentives for collaboration, secure benefits, and promote 

equity for all stakeholders, both public and private, that invest in freightrelated infrastructure projects. Defining these elements is especially

important for the federal role in freight railroad infrastructure investments

because, while most of that infrastructure is privately owned, investments 

to improve safety and increase capacity may benefit stakeholders at all 

levels (national, regional, state, local and private sector). 

Public and Private 

Stakeholder Roles for 

Future Involvement in 

Freight-Related 

Infrastructure Investments 

Should Be Clearly Defined 

In our prior work, we have found that, in defining stakeholder roles, it is 

important to match capabilities and resources with appropriate goals.56

This is important for federal participation because other stakeholders may 

want to emphasize other priorities and use federal funds in ways that may 

not achieve national public benefits. This can happen if other stakeholders

seek to (1) transfer a previously local function to the federal arena or (2) 

use federal funds to reduce their traditional levels of commitment. One 

aim of federal participation in infrastructure investments is to promote or 

supplement expenditures that would not occur without federal funding—

to avoid substituting federal funding for funding that would otherwise 

have been provided by private or other public investors.57

Further refinements to DOT’s draft Framework could help to define 

stakeholder roles in two ways, first by acknowledging that the interests of 

federal, state, and local entities may compete, and second by recognizing 

where public and private sector interests meet and diverge. When the 

federal government invests in freight railroad infrastructure, it could 

justify its involvement by establishing criteria for projects that (1) are 

based on national freight goals, (2) are designed to capture national freight 

transportation benefits, and (3) direct funds to state, local, and private 

entities that would spend the funds in accordance with the national goals. 

For example, the federal government might justify its investment in a 

project that had national goals of improving interstate freight mobility, 

reducing pollution and congestion, and enhancing safety on a multistate 

railroad and highway transportation corridor. In contrast, states and 

 56GAO-02-1033, p. 22. 

57Ibid. 

Page 45 GAO-07-770 Railroad Bridges and Tunnels
localities seek public benefits that accrue within their jurisdictions, such 

as improved automobile safety at grade crossings and reduced air 

pollution within a regional attainment area, and are able to channel state,

local, and discretionary federal funds accordingly. When examining public 

versus private interests, public stakeholders must recognize that railroads 

are privately owned and invest resources to maximize shareholder returns 

and enhance the efficiency and capacity of their operations. Some railroad 

infrastructure projects have spillover effects that produce public benefits, 

such as more efficient goods movement. Yet other railroad infrastructure 

projects that could benefit the public do not meet railroads’ internal 

return-on-investment criteria, and therefore the railroads would not invest 

in them, and the public would not realize the benefits. 

One possible way of defining stakeholder roles could be through publicprivate partnerships. As we have stated earlier, public-private partnerships 

create a forum for bringing diverse stakeholders together around an issue 

of mutual interest to determine how best to share resources, identify 

stakeholder responsibilities, and achieve public and private benefits. 

Encouraging public-private partnerships to provide efficient solutions to 

freight transportation needs could increase the likelihood that the most 

worthwhile improvements would be implemented and that projects would 

be operated and maintained efficiently.58 One example of a public-private 

partnership that addresses various private and public stakeholder interests 

in railroad infrastructure is the CREATE project in the Chicago area. The 

drive to make significant investments in the Chicago area’s railroad 

infrastructure came from public and private railroad stakeholders because

of their concern over the heavy railroad congestion in that area.

59 Under 

the CREATE project, stakeholders established individual roles that 

included owning and managing specific projects and assuming joint 

financial obligations. The railroads initially invested $100 million to begin 

addressing their interests, the federal government has added $100 million 

by designating CREATE as a Project of National or Regional Significance, 

and the state of Illinois and the city of Chicago have pledged $100 million 

and $30 million, respectively, to begin addressing passenger railroad 

projects. CREATE stakeholders also plan to leverage other federal, state, 

and private funds over the lifetime of the project. The Alameda Corridor 

Program in the Los Angeles area provides another example of how 

 58GAO-05-768, p. 31. 

59The Chicago area is the largest railroad hub in the nation, with one-third of all railroad 

traffic originating, terminating, or passing through the area. 

Page 46 GAO-07-770 Railroad Bridges and Tunnels
effective partnering allowed the capabilities of the various stakeholders to

be more fully utilized. Called the Alameda Corridor because of the street it

parallels, the program created a 20-mile, $2.4 billion railroad express line

connecting the ports of Los Angeles and Long Beach to the 

transcontinental railroad network east of downtown Los Angeles. The 

express line eliminates approximately 200 street-level railroad crossings, 

relieving congestion and improving freight mobility for cargo. This project 

made substantial use of local stakeholders’ ability to raise funds. While the 

federal government participated in the cost, its share was about 20 percent 

of the total. In addition, about 80 percent of the federal assistance is in the 

form of a loan rather than a grant. 

Future Federal Role in 

Freight-Related 

Infrastructure Investments 

Should Meet Federal Goals 

While Recognizing Federal 

Financial Constraints 

A well-designed and strategic national freight transportation policy—of 

which there is a federal component—can help encourage investment by 

other public and private stakeholders and maximize the application of 

limited federal dollars for freight-related infrastructure.60 While it is 

important to ensure that such a policy promotes federal investments in 

freight infrastructure that generate national public benefits, especially

when those investments are in privately owned and operated freight 

railroad infrastructure, it is also important to note that any federal 

investments will face federal financial constraints. Although federal 

investments could be crucial to securing the national public benefits of 

certain freight-related infrastructure projects that would not otherwise 

proceed, the scarcity of federal funds puts a premium on justifying and

targeting the use of federal funds for these projects to address critical 

needs and maximize benefits. 

As we have previously reported, determining the scope of government 

involvement in transportation investments entails three major steps: (1) 

determining that the project is worthwhile by applying a rigorous costbenefit analysis or similar study; (2) justifying government involvement on

the basis of known criteria; and (3) deciding on the level of public subsidy 

consistent with local, state, regional, or national interests and benefits.61

Currently, most federal freight investments come from the fiscally 

constrained General Fund and Highway Trust Fund; and typically these 

investments are not subject to a thorough benefit-cost analysis or to the 

consistent application of project criteria, nor are they funded with the 

 60GAO-02-1033, p. 22. 

61GAO-04-165, p. 42. 

Page 47 GAO-07-770 Railroad Bridges and Tunnels
assurance that the funding provided by public and private beneficiaries is 

commensurate with the benefits these parties receive. 

Federal investments in freight infrastructure must be justified and meet 

objective criteria to maximize the impact of federal funds. Justifying 

government involvement in freight infrastructure projects involves 

identifying and quantifying project costs and public and private benefits, 

and having clear guidelines specifying the conditions under which public 

involvement is warranted. Given constraints on federal, state, and local 

funding, we have advocated that public entities implement project 

justification tools such as benefit-cost analysis to better assess proposed 

transportation investments and accordingly target limited funds.62 Resultsoriented assessments can be used to determine what is needed to obtain 

specific national outcomes.63 In October 2006, we recommended that DOT, 

as it continues to draft the Framework for a National Freight Policy, 

consider strategies to create a level playing field for all freight modes and 

recognize the highly constrained federal fiscal environment by developing 

mechanisms to assess and maximize public benefits from federally 

financed freight transportation investments.64 Furthermore, as we testified 

in March 2007, the federal government should make ensuring

accountability for results, as well as maximizing benefits, high priorities in 

deciding on federal investments in transportation infrastructure.65

Unfortunately, we have found that formal analyses are not often used in 

deciding among alternative projects, evaluations of outcomes are not 

typically conducted, and the evaluations that are done show that projects 

often do not produce anticipated outcomes. The public sector faces many

challenges in quantifying national, regional, state, and local benefits, while 

railroads are more able to determine the monetary and operational 

benefits of proposed infrastructure projects and can invest accordingly.

For example, railroads can assess how much each hour of train delay 

costs them, but public entities cannot easily quantify the environmental 

benefits of faster freight railroad transport and less truck traffic.66

 62GAO-07-94, pp. 61 and 63. 

63GAO-02-1033, pp. 19-20. 

64GAO-07-94, p. 62. 

65GAO-07-545T, p. 14. 

66In an attempt to address this issue, in March 2005, DOT publicly released the Intermodal 

Transportation and Inventory Cost software model that enables users to identify the effects 

of traffic diverted from trucks to railroads. 

Page 48 GAO-07-770 Railroad Bridges and Tunnels
Representatives of three state DOTs we interviewed acknowledged the 

difficulty of quantifying public benefits, which may make it difficult to 

judiciously allocate scarce transportation funds to those projects that may 

accrue the highest public benefits. 

According to the Transportation Research Board (TRB), public support for 

freight infrastructure projects must be established on a project-by-project 

basis to determine if a project produces certain benefits, such as 

reductions in the external costs of transportation, efficiencies in the 

transportation system beyond those recognized by the private sector, or 

improvements in public safety.67 TRB stated that if government 

involvement cannot be justified on one of these grounds, the private sector 

should undertake the project. One federal program that awards funds 

using project justification criteria is the Federal Transit Administration’s 

discretionary New Starts program. This program is the federal 

government’s primary source of funds for capital investment in locally

planned, implemented, and operated transit. Potential New Starts projects 

must meet certain project justification criteria (e.g., mobility 

improvements and operating efficiencies) and demonstrate adequate local 

financial support (e.g., the ability of the sponsoring agency to fund the 

operation and maintenance of the entire system once the project is built). 

A comparable approach could be designed so that freight railroad 

infrastructure investments—proposed by state or local governments, 

private railroads, or public-private partnerships—meet appropriate project 

justification criteria, demonstrate public and private support, and provide 

the lowest cost to the federal government. Different funding mechanisms 

and revenue sources could also be used to implement any future federal 

role in freight infrastructure investments. See appendix III for a more 

complete discussion of these revenue sources and funding mechanisms. 

Projected increases in freight transportation demand will likely increase 

the importance of the nation’s freight railroad infrastructure. Bridges and 

tunnels are critical and expensive parts of infrastructure. Because most of 

Conclusions 

 67According to TRB, external costs are borne by nonshippers or the general public.

Examples of external costs include health and other damages caused by air pollution; noise 

generated by trucks, towboats, and locomotives; and the traffic delays and congestion that 

an additional truck or barge imposes on other users of roadways and waterways. See

Transportation Research Board, Special Report 252: Policy Options for Intermodal

Freight Transportation (Washington, D.C.: 1998) and Transportation Research Board, 

Special Report 271: Freight Capacity for the 21st Century (Washington, D.C.: 2002). 

Page 49 GAO-07-770 Railroad Bridges and Tunnels
the freight railroad network is privately owned, the railroads have a keen 

financial interest in maintaining and investing in their bridges and tunnels. 

The federal role in overseeing the public safety of these structures, and in

funding improvements to them, has been limited. 

Concerning the safety area, we have found in our prior work that a riskmanagement approach to oversight of companies’ overall management of

safety risks provides an additional assurance of safety in conjunction with 

inspections. FRA has adopted this risk-management approach in applying

its guidelines for bridge management during its bridge safety surveys of 

individual railroads. However, a more consistent and systematic approach

in selecting railroads for bridge safety surveys based on data about 

railroads’ bridge management programs, such as whether or not the 

railroads have regular inspections by a qualified civil engineer and how 

they record and use that bridge inspection data, could enhance the 

effectiveness of the FRA’s limited resources available for bridge and 

tunnel safety. This approach could help target FRA’s limited bridge 

inspection resources toward railroads that present the greatest safety risk, 

especially numerous short lines that may have more deteriorated 

infrastructure and less technical and financial resources to maintain their 

bridges and tunnels. 

With respect to the federal role in freight-related infrastructure, including 

railroad bridges and tunnels, the federal approach to such investments 

needs to be better structured to maximize achieving national public 

benefits such as increased freight mobility, reduced congestion, and 

improved environmental quality. Although the current federal structure of 

loans, credits, and grants administered by different agencies with different 

missions from disparate funding sources may attain some national public 

benefits, that structure is not guided by a national freight strategy and may 

miss opportunities for an even higher return of national public benefits for 

federal expenditures. DOT has taken a first step in the direction of 

articulating such a strategy by developing its Framework for a National 

Freight Policy, but we believe that the agency needs to go further in 

developing a true national freight transportation strategy that can help 

organize and unify the current structure to achieve that higher return. Our 

past work on public investments in transportation has found that such a 

strategy should focus on national freight transportation related goals, 

involve all public and private stakeholders, and distribute costs equitably 

across all public and private beneficiaries. 

Page 50 GAO-07-770 Railroad Bridges and Tunnels
• To enhance the effectiveness of its bridge and tunnel safety 

oversight function, we recommend that the Secretary of 

Transportation direct the Administrator of the Federal Railroad 

Administration to devise a systematic, consistent, risk-based 

methodology for selecting railroads for its bridge safety surveys to 

ensure that it includes railroads that are at higher risk of not 

following the FRA’s bridge safety guidelines and of having bridge 

and tunnel safety issues.

• To help better focus limited federal resources, we recommend that 

the Secretary of Transportation ensure that its draft Framework for 

a National Freight Policy : 

• includes clear national goals for federal involvement in freightrelated infrastructure investments across all modes, including

freight railroad investments; 

• establishes and clearly defines roles for all public and private 

stakeholders; and 

• identifies funding mechanisms for federal freight-related 

infrastructure investments, including freight railroad 

investments, which provide the highest return in national public 

benefits for limited federal expenditures. 

We provided a draft of this report to DOT for review and comment prior to 

finalizing the report. DOT and FRA officials—including FRA’s Associate 

Administrator for Safety— generally agreed with the information in this 

report, and they provided technical clarifications, which we have 

incorporated in this report as appropriate. These officials agreed with the 

recommendation related to the methodology for selecting railroads for 

bridge safety surveys and said that they are already taking steps to 

implement it, and DOT officials said that they would consider the 

recommendation concerning changes to DOT’s draft Framework for a 

National Freight Policy. 

Recommendations for 

Executive Action 

Agency Comments 

As agreed with your offices, unless you publicly announce the contents of

this report earlier, we plan no further distribution until 30 days from the 

report date. We will then send copies of this report to the appropriate 

congressional committees and to the Secretary of Transportation. We will 

Page 51 GAO-07-770 Railroad Bridges and Tunnels
also make copies available to others upon request. In addition, this report 

will be available at no charge on the GAO Web Site at http://www.gao.gov. 

If you or your staff have any questions about this report, please contact me 

at (202) 512-2834 or heckerj@gao.gov. Contact points for our Offices of 

Congressional Relations and Public Affairs may be found on the last page 

of this report. GAO staff that made key contributions to this report are 

listed in appendix IV. 

JayEtta Z. Hecker 

Director, Physical Infrastructure Issues 

Page 52 GAO-07-770 Railroad Bridges and Tunnels
Appendix I: Scope and Methodology Appendix I: Scope and Methodology 

To determine what information is maintained by railroads on the condition

of their bridges and tunnels, and the contribution of this infrastructure to 

congestion, we reviewed documentation from railroads on bridge and

tunnel data management policies, inspection procedures, sample 

inspection reports, and capital improvement plans. We also determined 

the federal role in collecting and reporting information on railroad bridges 

and tunnels by interviewing officials from federal agencies, state agencies, 

freight railroads, and industry associations (see table 4), and by reviewing 

bridge and tunnel data collected and maintained by these federal agencies. 

To determine to what extent bridges and tunnels contribute to freight 

railroad congestion, we reviewed literature on freight railroad congestion, 

railroad corridor plans, and freight demand studies to identify current 

levels of freight railroad congestion, major factors contributing to 

congestion, and proposed solutions. We also interviewed representatives 

from industry associations and railroads to understand how this 

information is used, what challenges railroads face in maintaining and 

replacing railroad bridges and tunnels, and what strategies railroads use to 

enhance capacity and alleviate congestion. We did not independently 

verify the accuracy of public or private bridge and tunnel condition 

information, inspection reports, or congestion information. In addition, we

did not independently assess the conditions of bridges and tunnels. 

To identify the federal role in overseeing railroad bridge and tunnel safety,

we reviewed public laws and interviewed officials from the public 

agencies and railroads listed in table 4. In particular, we discussed the 

Federal Railroad Administration’s (FRA) structural safety oversight role 

with FRA’s Chief Structural Engineer, all five FRA bridge specialists, and 

one FRA regional track specialist, and asked railroads about their 

interactions with FRA. We reviewed examples of FRA’s bridge safety 

survey documentation to determine the content of these surveys and what 

actions FRA takes after assessing a railroad’s bridge conditions. We also 

accompanied an FRA bridge specialist on a bridge safety survey and other

informal bridge and tunnel observations. We reviewed examples of FRA 

emergency orders, compliance agreements, and structural observation 

reports to determine how FRA enforces its oversight role. Because there 

are more bridges than tunnels in the United States and because FRA has 

established a policy on bridge safety, we reviewed more information on 

railroad bridges than on tunnels. Moreover, because we used FRA’s 

records to understand FRA processes and actions, we did not 

independently verify the reliability of the data in this sample of FRA’s 

observation records. 

Page 53 GAO-07-770 Railroad Bridges and Tunnels
Appendix I: Scope and Methodology 

To determine how public funds are currently used for railroad 

infrastructure investments, including those for bridges and tunnels, we 

interviewed the entities included in table 4 and synthesized relevant

information from these entities, as well as from the Federal Highway 

Administration and the Joint Committee on Taxation. We did not 

independently verify the accuracy of the self-reported cost information 

provided by the railroads, public agencies, and professional associations. 

We reviewed Department of Transportation’s (DOT) draft Framework for 

a National Freight Policy. We also analyzed pertinent legislation and 

analyzed and synthesized relevant information from our reports and other 

ongoing work. 

To determine what criteria and framework could be used to guide the 

future federal role in freight-related infrastructure investments, including 

those for railroad bridges and tunnels, we relied extensively on 

perspectives gained from our past work in transportation and 

infrastructure systems and federal investment strategies. We also reviewed 

DOT’s Draft Framework for a National Freight Policy. We used our prior 

work and conventional economic reasoning to identify key considerations 

regarding possible revenue sources and funding mechanisms for federal 

government support for freight-related infrastructure investment and to 

evaluate potential revenue sources and funding mechanisms on the basis

of those considerations. 

In addressing all of our objectives, we conducted five site visits to 

• observe the conditions of selected bridges and tunnels on Class I, 

II, and III railroads; 

• understand maintenance and deterioration issues inherent in

different geographies and structure types; 

• interview railroad and state agency personnel who manage, inspect, 

and maintain these structures; 

• interview railroad operations personnel who monitor traffic 

capacity and congestion and finance personnel who determine 

capital investment priorities and allocations; and

• meet with state and local transportation agency officials. 

For a complete list of all entities interviewed, including those interviewed

as part of our site visits, see table 4. We selected our site visit locations—

Page 54 GAO-07-770 Railroad Bridges and Tunnels
Appendix I: Scope and Methodology 

Baltimore, Maryland and Washington, D.C.; Illinois and Iowa; Kansas and 

Missouri; Ohio and West Virginia; and Oregon—based on geographic 

distribution and the presence of large and small railroads, private-public

partnership stakeholders, and state DOTs involved in freight railroad or 

large freight railroad public-private partnerships. 

In addition to interviews conducted as part of our site visits, we 

interviewed representatives from the six largest Class I freight railroads in 

the United States;1

 Amtrak; industry associations; federal, state, and local 

transportation officials; and federal agencies involved with collecting 

information on, overseeing, or providing funding for railroad bridges and 

tunnels. We also interviewed additional state agencies based on their 

involvement in railroad bridge and tunnel oversight, freight railroad 

funding, or major freight railroad public-private partnerships. Table 4 lists 

the names and locations of all railroads; federal, state, and local agencies; 

industry associations; and transportation, engineering, and academic 

experts we interviewed as part of our review. 

Table 4: Names and Headquarters Locations of Entities Contacted

Name Headquarters location

Class I freight railroads

BNSF Railway Company

a

Fort Worth, TX 

Canadian National RailwayaMontreal, Quebec

CSX TransportationaJacksonville, FL

Kansas City Southern Railway

a

Kansas City, MO

Norfolk SouthernaNorfolk, VA 

Union Pacific Railroad CompanyaOmaha, NE

Class I passenger railroads

National Railroad Passenger Corporation (Amtrak)aWashington, D.C.

Class II freight railroads

Iowa Interstate RailroadaCedar Rapids, IA 

Wheeling and Lake Erie Railway Co.aBrewster, OH

Class III freight railroads 

Albany and Eastern Railroad CompanyaLebanon, OR

Belt Railway Company of ChicagoaBedford Park, IL 

 1

We did not interview Canadian Pacific, whose railroad lines in the United States comprise 

the smallest Class I freight railroad. 

Page 55 GAO-07-770 Railroad Bridges and Tunnels
Appendix I: Scope and Methodology 

Cedar Rapids and Iowa City Railway Co. (CRANDIC)aCedar Rapids, IA 

Iowa Northern Railway CompanyaCedar Rapids, IA 

Kansas City Terminal Railway Co.aKansas City, KS 

Ohio Central Railroad CompanyaCoshocton, OH

Port of Tillamook Bay RailroadaTillamook, OR

SEMO Port RailroadaScott City, MO

Watco Companies, Inc.aPittsburg, KS 

Federal agencies 

U.S. Army Corps of Engineers Washington, D.C. 

U.S. Department of Defense

 Surface Deployment and Distribution Command: Transportation Engineering Agency 

Newport News, VA 

U.S. Department of Energy Washington, D.C. 

U.S. Department of Homeland Security 

 United States Coast Guard

 Transportation Security Administration 

Washington, D.C. 

Washington, D.C. 

Arlington, VA 

U.S. DOT 

Federal Highway Administration 

Federal Railroad Administration 

 Office of Safety and Compliancea

 

 Office of Railroad Development 

 Office of Policy and Program Development 

Washington, D.C. 

U.S. Environmental Protection Agency Washington, D.C. 

State agencies and oversight organizations 

Illinois DOTa Springfield, IL 

Kansas DOTaTopeka, KS 

Louisiana DOT and Development Baton Rouge, LA 

Maryland DOTaHanover, MD 

Missouri DOTaJefferson City, MO 

Ohio DOTaColumbus, OH

Ohio Rail Development CommissionaColumbus, OH

Oregon DOTaSalem, OR

Pennsylvania DOT Harrisburg, PA 

Pennsylvania Public Utilities Commission Harrisburg, PA 

Public Utilities Commission of OhioaColumbus, OH

Tennessee DOT Nashville, TN

Local agencies 

Chicago DOTaChicago, IL 

Columbus Regional Airport AuthorityaColumbus, OH

Unified Government of Wyandotte County and Kansas City, KansasaKansas City, KS 

Page 56 GAO-07-770 Railroad Bridges and Tunnels
Appendix I: Scope and Methodology 

Industry associations 

The American Association of State Highway and Transportation Officials Washington, D.C. 

American Short Line and Regional Railroad Association Washington, D.C. 

The Association of American Railroads Washington, D.C. 

Transportation, engineering, and academic experts 

Dr. Kazuya Kawamura, University of Illinois at Chicago Chicago, IL 

National Academy of Railroad SciencesaOverland Park, KS 

TranSystemsaKansas City, MO

URS CorporationaSan Francisco, CA 

Source: GAO.

a

Indicates representatives were included in a site-visit. 

Page 57 GAO-07-770 Railroad Bridges and Tunnels
Appendix II: Examples of Bridge and Tunnel 

Maintenance, Component and Structural Appendix II: Examples of Bridge and T Replacement Costs on Selected Railroads unnel 

Maintenance, Component and Structural 

Replacement Costs on Selected Railroads 

Bridge type Description of work Cost estimates

Maintenance

Bridge ties Replacing a bridge tie $450 per tie 

Moveable steel bridge Moveable bridge annual maintenance $50,000 to $1 million 

Component replacement or repair 

Timber bridge Replaced several timber components $40,000 to $50,000 

Timber bridge Replacing timber approach span $239,000 

Timber bridge Replacing timber substructure and deck with steel and concrete 

components 

$3 - $3.5 million 

Concrete bridge Concrete bridge pier replacement $225,000 

Concrete bridge Abutment replacement $75,000 

Concrete bridge Replacing stone arches with culverts $50,000 

Steel bridge Upgrade steel to handle 286,000-lbs. railcars $100,000 

Moveable steel bridge Replacement of several steel components $1 million 

Moveable steel bridge Fender system replacement caused by barge strike $200,000 to $600,000 

Tunnel Replacing timber lining in tunnel with concrete lining $800,000 

Tunnel Upgrading ventilation system $3.5 million 

Tunnel Opening or “day-lighting” tunnel $3 million 

Replacement 

Timber bridge Timber bridge replacement $600,000 to $700,000 

Steel bridge Steel bridge replacement $22 - $44 million 

Moveable steel bridge Moveable swing span replacement $25 - $40 million 

Moveable steel bridge Replacement of a moveable swing span bridge with a lift span bridge $100 million 

Source: GAO analysis of interviews with railroad officials. 

Page 58 GAO-07-770 Railroad Bridges and Tunnels
Appendix III: Considerations of Funding 

Sources and Mechanisms Available for 

Federal Funding of Freight-Related 

Infrastructure 

Appendix III: Considerations of Funding 

Sources and Mechanisms Available for Federal 

Funding of Freight-Related Infrastructure 

Different funding mechanisms and revenue sources can be used to 

implement any future federal role in freight infrastructure investments. 

Two main revenue sources are available to the federal government in 

financing freight infrastructure investments: (1) general revenue, which 

comes primarily from broad-based personal and business income taxes 

and (2) beneficiary financing revenue (such as user fees or fuel taxes), 

which comes from taxes or fees assessed to specific groups that would 

benefit from the federal investment. Revenue from both of these sources 

could be used to increase investment in freight railroad infrastructure 

beyond the level that the railroads would provide without federal support. 

We note, however, that all revenue sources do have opportunity costs, that 

is, the costs of any benefits forgone from alternative investments that 

could have been made with that revenue. 

As discussed earlier in this report, the federal government currently uses 

three main funding mechanisms to support freight railroad infrastructure: 

grants, loans, and tax credits.1

 Each funding mechanism has its own 

advantages and limitations, but some implications would apply to each. 

For example, while the three mechanisms may make federal subsidies 

available for freight infrastructure investments, they may not necessarily 

increase the total amount of funding provided for those investments. 

Instead, these subsidies might result in the substitution of federal funds for 

the railroads’ own funds for investments that they would have made 

themselves, even without federal support. Revenue sources and potential 

funding mechanisms need to be evaluated in terms of several key 

considerations—including equity, sustainability, and efficiency for revenue

sources, and efficiency and transparency for funding mechanisms—as 

discussed below. 

• Equity - Equity is often assessed according to two principles: the benefit 

principle and the ability-to-pay principle. Equity occurs according to the 

benefit principle when those who pay for a service are the same as those 

who benefit from the service. Under the ability-to-pay principle, those who 

are more capable of bearing the burden of taxes or fees pay more in taxes 

and fees than those with less ability to pay, and a tax or fee structure is 

generally considered more equitable if that is the case. The use of general 

revenues is most equitable according to the benefit principle when the 

benefits are diffused across all taxpayers. Benefit financing sources (percontainer or per-railroad-car fees or commodity-specific taxes) can be a 

 1

Tax credits are reductions in tax liabilities based on preferential provisions of the tax 

code, resulting in forgone tax revenue for the federal government. 

Page 59 GAO-07-770 Railroad Bridges and Tunnels
Appendix III: Considerations of Funding 

Sources and Mechanisms Available for 

Federal Funding of Freight-Related 

Infrastructure 

more equitable funding source when the benefits are more focused on a 

locality or set of users and it is possible to collect the additional revenues 

from beneficiaries through higher fees or taxes. Either approach could be 

consistent with the ability-to-pay principle depending on how the revenue 

source is structured. A combination of beneficiary financing, federal 

general revenue, and local matching funds could also be used to enhance 

equity in order to link the amount of payment for an infrastructure 

investment to the anticipated amount of private, national, and local 

benefits gained, although these benefits may be hard to quantify. 

• Sustainability - Sustainability can be defined as the ability of a revenue 

source to maintain a given level of federal expenditure for an investment 

over time. Technological change or inflation could affect the sustainability 

of some beneficiary financing revenue sources by influencing revenue

levels or their purchasing power. But these sources can be more 

sustainable if they have the flexibility to respond to reductions in demand 

or consumption and can be indexed to inflation or otherwise periodically 

adjusted. The sustainability of general revenue could be affected by the 

federal government’s long-term structural fiscal imbalance. 

• Efficiency - Efficiency implications exist for both the choice of revenue

source and the choice of funding mechanism. For revenue sources, 

efficiency can be assessed based on the impact of economic behavioral 

changes likely to result from use of each source and by how much 

accountability2

 is provided. Using general revenue rather than beneficiary 

financing revenue sources is likely to cause smaller behavioral changes 

than using beneficiary financing. Beneficiary financing is likely to cause 

larger behavioral changes in raising a given amount of revenue because 

the impacts of a revenue increase would be more concentrated in a 

geographic location (for example, a user fee assessed for using a specific 

bridge or other structure) or on a group of beneficiaries (for example, a 

diesel fuel tax assessed only on railroads). However, these behavioral 

changes can have either negative or positive consequences on economic 

efficiency, such that in different circumstances increasing revenues from 

either funding source could be less efficient or more inefficient. In terms 

of accountability, the efficiency of a revenue source can be enhanced by 

 2

Accountability can be defined as ensuring that the beneficiaries of a service pay the full 

social cost of that service. Although this concept is similar to the benefit principle for

assessing equity, in discussing the effects of accountability on efficiency, we are concerned 

with the accountability it provides rather than the fairness. For example, if the 

beneficiaries do not pay the full social cost of a benefit, they may seek to have more of the 

service provided by the government even when the additional amounts of that service cost

more than their actual value to provide. 

Page 60 GAO-07-770 Railroad Bridges and Tunnels
Appendix III: Considerations of Funding 

Sources and Mechanisms Available for 

Federal Funding of Freight-Related 

Infrastructure 

collecting funds from the groups that are benefiting from federal 

investments in freight infrastructure. For funding mechanisms, efficiency 

can be defined as the amount of benefit gained for the amount of federal 

resources provided. Grants may generally be more efficient than loans in 

that their administrative costs may be lower. For tax credits, efficiency—

or the benefits gained for the forgone tax revenue—is both difficult to 

calculate and difficult to control, because private firms often control the 

use of the credited funds rather than the government. Therefore, the 

government may have less opportunity to direct the funds toward 

generating specified national public benefits than it does for grants or 

loans.3

 To increase the efficiency of grants, maintenance of effort 

provisions4

 could be incorporated to decrease the likelihood that the 

funding provided through them will be substituted for other funds, rather 

than combined with other funds to increase the total investment. Although 

tax credits do not involve outlays of federal funds, they do have analogous 

costs in forgone tax revenue that would have to be considered in 

evaluating their efficiency. 

• Transparency - Transparency can be defined as the extent to which the 

costs of federal infrastructure investments are visible when using a 

funding mechanism. The commitment of federal resources is visible if 

there is a direct appropriation for a federal grant or loan program. With a 

 3

In some cases, the government controls the allocation of funds for certain tax credits. For 

example, officials from the Department of the Treasury (and a group of external reviewers)

review and score New Markets Tax Credit applications and then make specific allocations 

of the Credit itself to qualified applicants. See GAO, Tax Policy: New Markets Tax Credit

Appears to Increase Investment by Investors in Low-Income Communities, but

Opportunities Exist to Better Monitor Compliance, GAO-07-296 (Washington, D.C.: Jan.

31, 2007) p. 7.

4

Maintenance of effort provisions would require the entity receiving the grant to maintain a 

certain level of spending over the duration of the grant in order to receive the grant.

Page 61 GAO-07-770 Railroad Bridges and Tunnels
Appendix III: Considerations of Funding 

Sources and Mechanisms Available for 

Federal Funding of Freight-Related 

Infrastructure 

grant or a loan, the federal government can readily demonstrate how much 

money was invested in what infrastructure. These funding mechanisms 

can also be guided by objective, transparent criteria in conjunction with 

congressional control over annual funding levels. With tax credits for 

railroad infrastructure investment, however, it is less visible how much the 

investment is costing the government through forgone revenue, and it is 

harder for Congress to make trade-offs with other discretionary spending

programs. 

Page 62 GAO-07-770 Railroad Bridges and Tunnels
Appendix IV: 

A

GAO Contact and Staff 

cknowledgments 

Page 63 GAO-07-770

Appendix IV: GAO Contact and Staff 

Acknowledgments 

JayEtta Z. Hecker, (202) 512-2834 or heckerj@gao.gov 

In addition to the contact named above, Rita Grieco (Assistant Director); 

Jay Cherlow; Steve Cohen; Elizabeth Eisenstadt; Alana Finley; Greg 

Hanna; Carol Henn; Bert Japikse; Richard Jorgenson; Denise McCabe; 

Elizabeth McNally; Sara Ann Moessbauer; Josh Ormond; Laura Shumway; 

Ryan Siegel; and James Wozny made key contributions to this report. 

GAO Contact 

Staff 

Acknowledgments 

Railroad Bridges and Tunnels
Related GAO Products Related GAO Products 

Performance and Accountability: Transportation Challenges Facing the

Congress and the DOT. GAO-07-545T. Washington, D.C.: March 6, 2007. 

High Risk Series: An Update. GAO-07-310. Washington, D.C.: January 

2007. 

Rail Safety: The Federal Railroad Administration Is Taking Steps to 

Better Target Its Oversight, but Assessment of Results Is Needed to 

Determine Impact. GAO-07-149. Washington, D.C.: January 26, 2007. 

Intercity Passenger Rail: National Policy and Strategies Needed to 

Maximize Public Benefits from Federal Expenditures. GAO-07-15. 

Washington, D.C.: November 13, 2006. 

Freight Railroads: Industry Health Has Improved, but Concerns about 

Competition and Capacity Should Be Addressed. GAO-07-94. Washington, 

D.C.: October 6, 2006. 

Government Performance and Accountability: Tax Expenditures 

Represent a Substantial Federal Commitment and Need to Be 

Reexamined. GAO-05-690. Washington, D.C.: September 23, 2005. 

Freight Transportation: Short Sea Shipping Option Shows Importance of 

Systematic Approach to Public Investment Decisions. GAO-05-768. 

Washington, D.C.: July 29, 2005. 

21st Century Challenges: Reexamining the Base of the Federal 

Government. GAO-05-325SP. Washington, D.C.: February 2005. 

Highway and Transit Investments: Options for Improving Information 

on Projects’ Benefits and Costs and Increasing Accountability for 

Results. GAO-05-172. Washington, D.C.: January 24, 2005. 

Surface Transportation: Many Factors Affect Investment Decisions. 

GAO-04-744. Washington, D.C.: June 30, 2004. 

Freight Transportation: Strategies Needed to Address Planning and 

Financing Limitations. GAO-04-165. Washington, D.C.: December 19, 

2003. 

Marine Transportation: Federal Financing and a Framework for 

Infrastructure Investments. GAO-02-1033. Washington, D.C.: September 9, 

2002. 

Page 64 GAO-07-770 Railroad Bridges and Tunnels
Related GAO Products 

Surface and Maritime Transportation: Developing Strategies for 

Enhancing Mobility: A National Challenge. GAO-02-775. Washington, 

D.C.: August 30, 2002. 

U.S. Infrastructure: Funding Trends and Federal Agencies’ Investment

Estimates. GAO-01-986T. Washington, D.C.: July 23, 2001. 

Executive Guide: Leading Practices in Capital Decision Making. 

GAO/AIMD-99-32. Washington, D.C.: December 1998. 

Federal Budget: Choosing Public Investment Programs. GAO/AIMD-93-

25. Washington, D.C.: July 23, 1993. 

Railroad Competitiveness: Federal Laws and Policies Affect Railroad 

Competitiveness. GAO/RCED-92-16. Washington, D.C.: November 5, 1991.

(544124) Page 65 GAO-07-770 Railroad Bridges and Tunnels
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