Shortline railroad
A shortline railroad is a small or mid-sized railroad company that operates over a relatively short distance relative to larger, national railroad networks. The term is used primarily in the United States and Canada. In the U.S., railroads are categorized by operating revenue, and most shortline railroads fall into the Class III or Class II categorization defined by the Surface Transportation Board. Shortlines generally exist for one of three reasons: to link two industries requiring rail freight together (for example, a gypsum mine and a wall board factory, or a coal mine and a power plant); to  interchange revenue traffic with other, usually larger, railroads; or to operate a tourist passenger train service. Often, short lines exist for all three of these reasons. History. At the beginning of the railroad age, nearly all railway lines were shortlines, locally chartered, financed and operated; as the railroad industry matured, local lines were merged or acquired to create longer mainline railroads. Especially since 1980 in the U.S. and 1990 in Canada, many shortlines have been established when larger railroad companies sold off or abandoned low-profit portions of their trackage. Shortline operators typically have lower labor, overhead and regulatory costs  than Class I railroads and therefore are often able to operate profitable lines that lost money for their original owners. Classification. Because of their small size and generally low revenues, the great majority of shortline railroads in the U.S. are classified by the Association of American Railroads as Class III. As defined by the Surface Transportation Board, a Class III is a railroad with an annual operating revenue of less than $28 million. In Canada, Transport Canada classifies short line railroads as Class II. There are three kinds of shortlines in the U.S.: handling, switch, and ISS (Interline Settlement  System). Impact of consolidation. An ever-growing number of shortline operators have been acquired by larger holding companies which own or lease railroad properties in many states, as well as internationally. For example, "Genesee & Wyoming Inc." (AAR Rep. Mark "GEXR") at this writing controls 113 railroads in 42 US States and 4 Canadian provinces. A necessary and direct consequence of this is that "shortline railroads" may no longer be "by state." Statistics. It was reported in 2009 that short-line railroads employ 20,000 people in the U.S., and own 30 percent of the nation's railroad tracks. About a quarter  of all U.S. rail freight travels at least a small part of its journey over a short-line railroad. In other countries. In France, the equivalent of short-lines railroads are the "opérateurs ferroviaires de proximité" (local railways operators).