Freight rail adds value to Minnesota’s economy

freightWhen considering Minnesota’s economic advantages, analysts and policymakers often mention factors such as a well-trained workforce, rich natural resources, or diverse manufacturing industries. But one important factor may be overlooked: a vibrant freight rail network.

Since 2012, researchers at the State and Local Policy Program (SLPP) at the Humphrey School of Public Affairs have been examining this factor in a study funded by the BNSF Railway Foundation. As part of the study, the research team investigated the role of freight rail in Minnesota’s economy—particularly in rail-related industry clusters such as agriculture, mining, processed food, and manufacturing. (Industry clusters are groups of related businesses located near each other that tend to have a large economic impact on a region.)

The project team included SLPP director Lee Munnich, SLPP associate director Frank Douma, and visiting research scholar Tom Horan, also a professor at Claremont Graduate University.Infographic

According to the researchers, the study’s findings encompass two big ideas. First, freight rail is a significant but not always understood factor in Minnesota’s economy, providing a crucial link between other transportation methods. Second, maintaining the high performance of the freight rail system through public and private investments is essential to continued economic growth in Minnesota and throughout the United States.

As part of the study, the team produced a summary report that reviews these big ideas and specifically outlines the following key findings:

  • An efficient freight rail system is vital to economic competitiveness.
  • Partnership between Class 1 and short-line railroads is important for economic growth in Greater Minnesota.
  • Because rail infrastructure is generally the business of the private sector, the nature of the public-private partnership is unique.
  • Intermodal transportation policy represents an important new arena for ensuring the continued performance of freight transportation.
  • The freight transportation community needs to maintain an ongoing dialogue with the public on freight rail.The website illustrates how products make their way from Minnesota to U.S. ports and then to international markets.The website illustrates how products make their way from Minnesota to U.S. ports and then to international markets.

“The importance of the supply chain to the American economy—including freight rail’s role in it—is sometimes hard to convey,” says BNSF executive chairman Matt Rose in an introduction to the report. “This report provides a vivid description of the synergy between the local economies and the freight infrastructure that connects those economies to national and, increasingly, international markets. 

The SLPP team also developed a website showcasing the value of freight. The website features maps of Minnesota’s industry clusters and illustrates how products flow from Minnesota to domestic and international markets. It also includes stories of Minnesota companies and the ways they use rail and other transportation systems. The summary report and a project video are also available.

“[This] study may focus on Minnesota, but the lessons apply across the U.S,” Rose says. “It’s a valuable presentation of information for understanding the importance of the region’s transportation economy and it tells the story that we see every day, as we move freight to market from local communities.”

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