The Surface Transportation Board has raised the bar for what counts as a Class I railroad, and railroads need almost $1.1 billion in annual revenue to make the cut.
To be considered Class I, a railroad now needs at least $1,094,774,354 in yearly revenue. The threshold for Class II has also increased to $49,143,204.
These changes kick in at the start of 2025.
Every year, the board updates these numbers to keep up with inflation. That way, railroads are sorted by real growth, not just bigger numbers on paper. How a railroad is classified also affects what it has to report to the federal government.
The board uses a number called a deflator factor to make these yearly changes. For 2025, that number is 0.8221.
Since 2021, the Class I threshold has climbed from $943.9 million to almost $1.1 billion. The Class II cutoff has also gone up, from about $42.4 million to $49.1 million.
In 1992, the Surface Transportation Board’s predecessor, the Interstate Commerce Commission, set higher classification levels — $250 million for Class I railroads (in 1991 dollars) and $20 million for Class II railroads.
Beginning with the 2020 reporting year, the board increased the Class I threshold to $900 million in 2019 dollars and adjusted the Class II threshold to $40.4 million in 2019 dollars.
Any railroad making less than the Class II amount is usually considered Class III.
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