Railroad Definitions

Railroads may be defined two ways, by U. S. Surface Transportation Board (STB) definition or by Association of American Railroad (AAR) Classifications.

STB Railroad Classifications*

Class I Railroads: Annual Operating Revenue in excess of $457,913,998
Class II Railroads:  Annual Operating Revenue of less than $457,913,998 and more than $36,633,120
Class III Railroads:  Annual Operating Revenue of less than $36,633,120.

*These threshold figures are adjusted annually for inflation using the base year of 1991.

AAR Railroad Classifications

Class I Railroad - The AAR matches the STB's classification threshold for Class I railroads (see above)

Regional Railroad - Regional railroads are line-haul railroads below the Class I revenue threshold that operate at least 350 miles of road and earn at least $20 million in revenue, or earn revenue between $40 million and the Class I revenue threshold regardless of mileage

Local Railroad - Local railroads include freight railroads which are not Class I or Regional. The Local railroad category can be further subdivided into local line haul carriers and switching & terminal carriers. This latter category is composed of railroads which primarily provide switching and/or terminal services for other railroads. S&T carriers usually have a relatively large number of employees per mile of track.