Staggers Act

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DEFINITION of 'Staggers Act '

A federal law that greatly deregulated the American railroad industry. The Staggers Rail Act was passed in 1980 and was intended to replace the highly-regulated structure of the American rail shipping sytem which had existed since the passing of the Interstate Commerce Act of 1887. The Act was named after its sponsor, congressman Harley Staggers who was the chair of the House Interstate and Foreign Commerce Committee.

INVESTOPEDIA EXPLAINS 'Staggers Act '

The primary changes to the regulatory rail system under the Act included:

1. Rail carriers could charge any given rate for services unless the ICC determined no competition for such services existed.

2. Industry-wide rate adjustments were removed.

3. Access must be given by one railroad to another's rails in the case where a single railroad had "bottleneck" control of the rail traffic.

Following the Act, the studies found that the industry had both lowered costs and prices for services, favoring the future prospects of both the rail industry and its customers.

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