1. 1Genesee & Wyoming Inc. A Short Line – DC Update AASHTO - SCORT Annual Meeting September 9, 2014 Jerry Vest, Senior Vice President, Government & Industry Affairs Genesee & Wyoming Railroad Services Inc.

2. 2Genesee & Wyoming Inc. First, an advertisement…

3. 3Genesee & Wyoming Inc. A rundown of current federal legislative issues facing short line freight railroads: 1. Short Line Tax Credit 2. Railroad Safety 3. Preserving Reasonable Regulation 4. Truck Size and Weight 5. Energy and Railroading 6. Other

4. 4Genesee & Wyoming Inc. Short Line Tax Credit Senate Change in Finance Committee Leadership Short Line Railroad Rehabilitation and Investment Act of 2013, S.411 50 co-sponsors House Pending Change in Ways & Means Leadership Short Line Railroad Rehabilitation and Investment Act of 2013, HR.721 250 co-sponsors

5. 5Genesee & Wyoming Inc. Railroad Safety 2008 Rail Safety Improvement Act Expired on September 30, 2013 Delayed consideration by House Transportation & Infrastructure Committee House T&I Committee hearing on “Passenger and Freight Rail Safety” on February 26, 2014

6. 6Genesee & Wyoming Inc. Railroad Safety Positive Train Control AAR and FRA Reports to Congress that December 31, 2015 deadline unattainable FCC announced on May 19, 2014 agreement with seven Class I carriers to allow movement forward on installing 20,000 communications antennas Railroad Safety and Positive Train Control Extension Act, S.1462, 15 co-sponsors

7. 7Genesee & Wyoming Inc. Railroad Safety A New Rail Safety Improvement Act of 2014 Senate bill being introduced by Senator Blumenthal Wide ranging impacts on industry Several areas of significant concern: –PTC for Crude by Rail –Tremendous increases in FRA fines

8. 8Genesee & Wyoming Inc. Railroad Safety Emergency Responder Coordination Railroad Emergency Services Preparedness, Operational Needs, and Safety Evaluations Act. 5 House co-sponsors (HR.5345), 6 Senate co-sponsors (S.2547)

9. 9Genesee & Wyoming Inc. Railroad Safety Two Man Crew Legislation HR.3040 introduced on August 2, 2013 Demands two man crews on all trains Introduced by Cong. Mike Michaud, Currently with 80 co-sponsors

10. 10Genesee & Wyoming Inc. Preserving Reasonable Regulation Senate Bill introduced March 21, 2013: “Railroad Antitrust Enforcement Act of 2013”, S.638 Only five co-sponsors Introduces Federal Trade Commission into economic oversight of freight railroads House No action expected

11. 11Genesee & Wyoming Inc. Surface Transportation Board Reauthorization Senate Bill introduced Sept. 8, 2014: “A bill to establish the Surface Transportation Board as an independent establishment, and for other purposes”, S.2777 Introduced by Senators Rockefeller and Thune Expands and changes STB Unclear if time is available this year for action

12. 12Genesee & Wyoming Inc. Truck Size and Weight USDOT TSW Study Mandated in MAP-21 Methodology on important aspects questionable Specific concern for rail freight industry: Modal Diversion

13. 13Genesee & Wyoming Inc. Truck Size and Weight Safe and Efficient Transportation Act of 2013 Ignores MAP-21 Study Requirement Would allow for states to decide on 97,000 lb. weight limit for national highways Introduced by Cong. Mike Michaud on Feb. 12, 2013; now has 18 co-sponsors

14. 14Genesee & Wyoming Inc. Energy and Railroading Disclaimer: The following historic photo is intended for viewing only by mature audiences. Those easily offended by carbon sources of energy should either close their eyes or leave the room.

15. 15Genesee & Wyoming Inc. Energy and Railroading

16. 16Genesee & Wyoming Inc. Energy and Railroading The U.S. Rail Freight industry is still suffering from the gross operating errors associated with the tragedy at Lac Megantic, Quebec on July 6, 2013. This incident and the resulting loss of 47 lives is still widely used by those that seek to: –Limit the use and transport of carbon forms of energy –Inflict more regulation on the railroad industry

17. 17Genesee & Wyoming Inc. Federal government reactions to Lac Megantic A series of emergency orders from the Federal Railroad Administration to address numerous railroad and shipper practices February 25, 2014: Voluntary Crude by Rail Operating Practices announced by USDOT and AAR July 23, 2014: USDOT Rulemaking on Tank Car Design

18. 18Genesee & Wyoming Inc. A Digression into Railroad History PRR Open Top Coal Hopper Circa 1943

19. 19Genesee & Wyoming Inc. Energy and Railroading Has “Coal Goes to War” become a “War on Coal”? –July 25, 2013 President Obama: Initiative to reduce carbon emissions –June 2, 2014 US EPA: CO2 standards for existing coal fired electric generation Extremely relevant financially for the rail freight industry: –Coal is a base load commodity for many freight railroads –Coal based electric generation is a critical part of our overall economy

20. 20Genesee & Wyoming Inc. Other Surface Transportation Reauthorization July 6, 2012 President Obama signed into law MAP-21 September 30, 2014 MAP-21 expires August 8, 2014 President Obama signs into law providing: –A financial patch for the Highway Trust Fund, funding it through May, 2015 –Extension of MAP-21 through May 31, 2015

21. 21Genesee & Wyoming Inc.