Class III Railroads, also known as short line railroads, are smaller rail companies that typically operate on regional or local routes. They often connect with larger Class I Railroads to facilitate the movement of goods. These railroads play a crucial role in serving industries and communities that may not have direct access to major rail networks. These railroads usually have lower annual revenues compared to larger rail companies, specifically earning less than $40 million. Class III Railroads are vital for transporting bulk materials, agricultural products, and other freight, helping to support local economies and industries.