Friday, May 03, 2013

For whom does the STB bell toll?

Written by  Frank N. Wilner, Contributing Editor
With the Obama nomination of Anthony Foxx to become the next transportation secretary, chatter now focuses on the successor to Frank Mulvey at the three-member Surface Transportation Board (STB). 
Democrat Mulvey’s second term expired Dec. 31, and by statute STB members are term-limited and may remain in office—awaiting a successor—for only 12 months following expiration of their second term. Thus, Mulvey could remain at the STB—with Democratic Chairman Dan Elliott and Republican member Ann Begeman—through Dec. 31 if a successor is not confirmed. The agency has previously operated with just two members.

Currently, there is no clear front-runner for the nomination to succeed Mulvey. Most talked about are former STB member William Clyburn, cousin of James Clyburn (D-S.C.), the assistant House Democratic leader; and former senior Senate Commerce Committee aide Stephen Gardner, now an Amtrak vice president. Both carry significant baggage.

Clyburn’s recent lobbying activity on behalf of Norfolk Southern places him in the crosshairs of shippers lobbying for more railroad economic regulation, and his confirmation hearing would be before Commerce Committee Chairman Jay Rockefeller (D-W.Va.), the most aggressive member of Congress on behalf of self-described captive shippers. Clyburn also draws the ire of the congressional ethics-reform group, Public Citizen, over lobbying contracts he has with the City of Charleston, which is in the district of his congressman cousin.

Gardner also has captive-shipper opposition, with one shipper attorney, requesting anonymity, saying Gardner “too often took the point of view of railroads” in his work on Rockefeller’s Commerce Committee. Gardner abruptly departed the committee in 2009 for Amtrak.

Association of American Railroads President Ed Hamberger was heard to say railroads “want someone who understands economics,” adding that while Mulvey is a Ph.D. economist, his interpretations of complaints were not always to the liking of railroads. Perhaps Hamberger harks for the Jimmy Carter years, when two Ph.D. economists—Darius Gaskins and Marcus Alexis—served together, along with undergraduate economics major Thomas Trantum, on a then-11-member ICC. One must retreat to 1917 for the previous Ph.D. economist: Clyde Aitchison, first nominated by President Woodrow Wilson and holding an ICC seat for 28 years.

Clyburn has no training in economics. Gardner was closely involved with railroad regulatory issues at the Commerce Committee and previously was employed in operating positions with Guilford Rail Systems and a short line railroad.

A long-shot nominee could be Norfolk Southern attorney John Scheib, who previously worked at the Federal Railroad Administration and as a rail adviser to House Republicans. Few are equally qualified.

Scheib is a Republican, and while the Mulvey seat is reserved for a Democrat, political independents have been confirmed—although the most recent was Alfred MacFarland in 1972, a Democrat who shifted his status to “independent” after being nominated by President Nixon. Whether Scheib could wear a political-independent cap is less problematic than his railroad ties. His most troublesome baggage—as with Clyburn—is that he would have to recuse himself from numerous matters before the STB because of prior involvement on behalf of the railroads.

Then there are three sleepers: Carl Martland, Bill Lipinski Sr., and Clyde Hart.

Martland, with degrees from MIT in mathematics and civil engineering, possesses academic and research tools that make him highly qualified for an STB post. Semi-retired, he continues consulting work on railroad costing, equipment utilization, rail maintenance, terminal operations, and intermodal projects through MIT.

Lipinski, a former Democratic congressman from Illinois, sat on the Transportation & Infrastructure Committee and was deeply involved in the CREATE project, a first-of-its-kind joint federal, state, and railroad project to improve infrastructure efficiency in the Chicago area. Lipinski’s son succeeded him in Congress and sits on the T&I Committee.

Hart, a former Interstate Commerce Commission trial attorney (and African-American, as is Clyburn) came mighty close to gaining an STB appointment in 1998, only to be edged out by Clyburn—at age 32 the second-youngest ICC/STB member, who was strongly advanced for the post by Clyburn’s House member cousin.

At that time, Hart was a senior senate aide to the Commerce Committee under its then-chairman Fritz Hollings (D-S.C.), and had worked in drafting the Interstate Commerce Commission Termination Act. Hollings, however, had a close association with fellow South Carolinian Rep. Clyburn, and thus pushed the Clinton nomination of William. Instead, Hart was confirmed as Maritime Administrator and subsequently became Administrator of the Federal Motor Carrier Safety Administration. Since 2001, Hart has been Vice President of Government Affairs at the American Bus Association.

Political winds sometimes deliver surprise nominees, as again could happen:

• Willard Deason (1965-1975), with no transportation background, was a college roommate of, and dog-trainer for, President Johnson.

• William Brewer (1970-1974), a letter carrier, banker, and automobile tire executive, was a standout Nixon fundraiser.

• Heather Gradison (1982-1990), wife of Rep. Willis Gradison (R-Ohio), was nominated by President Reagan and became, at age 29, the youngest ICC/STB member and chairman of the ICC. She was working as a rate clerk for Norfolk Southern when her husband was an important swing vote for Reagan in authorizing construction of the B-1 bomber. When her nomination was announced, then NS President Harold Hall, attending an AAR board meeting, turned to his chief lobbyist, Ned Breathitt, and asked loudly, “She works for us?”

• Jake Simmons (1982-1983; 1984-1996), worked in the oil industry—the son of a Texas oil-patch family with close ties to George H.W. Bush, who, early in his career, founded Zapata Oil. Simmons so far is the only ICC/STB member to depart the agency (for the Interior Department) and return through a new nomination and confirmation.

• Former ICC/STB member Gus Owen (1995-1998), with no background in transportation and nominated by President Clinton, was the husband of a politically involved Republican credited with being instrumental in Clinton fundraising that figured in California’s electoral vote going to Clinton—which clinched his election—after she became disenchanted with George H.W. Bush over his tax reform policies. Owen, a noted Republican fundraiser, had separate support from Sen. Bob Dole (R-Kans.).

• Current STB Chairman Elliott (2009- ), who went to the STB from the United Transportation Union, where he was an attorney involved in labor issues before the agency, is first cousin to Sen. Sherrod Brown (D-Ohio), who was a swing vote for President Obama’s financial bailouts, having departed his mother’s funeral to jet back to Washington to cast the deciding vote.

Although all served the ICC/STB with distinction, politics does matter, and often has in determining members of the ICC/STB. Indeed, it is logical that Sen. Rockefeller will be consulted by the White House before a nomination is made, and that could be problematic for railroads. It is noteworthy that the ICC/STB has not had a member with a shipper background since Pete Murphy was confirmed in 1954.

So who will be the nominee to succeed Mulvey? Probably a surprise name, as was Charlotte Mayor Anthony Foxx, nominated as the next DOT secretary. National Transportation Safety Board member Debbie Hersman, a former Senate Commerce Committee transportation aide, was considered by many the front runner, with the Foxx nomination catching many in Washington by surprise. On paper, Hersman was the paramount choice given her strong background in transportation legislative, safety, and regulatory matters. Foxx apparently is without any background in national transportation issues. So goes Washington politics.

As for the STB, the Washington rumor mill currently is congested with chatter and studied anticipation, as STB regulatory decisions matter significantly to railroads and their shippers, with billions of dollars riding on its rulemakings.

(Frank N. Wilner is the author of a 1993-published history of the ICC, is a past president of the ICC Bar Association, and was a White House appointed chief-of-staff to former STB Commissioner Owen.)