Staggers Rail Act

The Staggers Rail Act of 1980 is a United States federal law that deregulated the American railroad industry to a significant extent, and it replaced the regulatory structure that had existed since the 1887 Interstate Commerce Act.

In the aftermath of the Great Depression and World War II, many railroads were driven out of business by competition from the Interstate highways and airlines. The rise of the automobile led to the end of passenger train service on most railroads. Trucking businesses had become major competitors by the 1930s with the advent of improved paved roads, and after the war, they expanded their operations as the highway network grew and acquired increased market share of cargo business. However, the railroads continued to be regulated by the Interstate Commerce Commission (ICC) and a complex system for setting shipping rates.

The Staggers Act followed the Railroad Revitalization and Regulatory Reform Act of 1976 (often called the "4R Act"), which reduced federal regulation of railroads and authorized implementation details for Conrail, the new northeastern railroad system. The 4R reforms included allowance of a greater range for railroad pricing without close regulatory restraint, greater independence from collective rate making procedures in rail pricing and service offers, contract rates, and, to a lesser extent, greater freedom for entry into and exit from rail markets.

Although the 4R Act established the guidelines, the ICC, at first, did not give much effect to its legislative mandates. However, as regulatory change began to appear from 1976 to 1979, including the phasing in of the loss of collective ratemaking authority, most major railroads shifted away from their effort to maintain the historic regulatory system and came to support greater freedom for rail pricing, for higher and lower rail rates.

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