Friday, July 27, 2012
STB moves on behalf of captive rail shippers
The Surface Transportation Board announced two initiatives this week that the regulatory body said would "explore ways to further protect captive [rail] shippers from unreasonable rail rates."
The STB said in a statement that the centerpiece of its rate rules proposal would remove the limitation on relief for cases under "Simplified-Stand Alone Cost" alternative.
"Our goal is to encourage shippers to use a simplified alternative to a Full- [Stand Alone Cost] analysis that is economically sound, yet provides a less complicated and less expensive way to challenge freight rates by discarding the requirement that shippers design a hypothetical railroad to judge a railroad's real world rates," the Board wrote in its decision.
The STB said captive shippers "have long stated that they do not bring rate disputes to the Board because of high litigation costs associated with the Board's complex Stand Alone Cost test traditionally used to resolve major rate cases."
The second STB would double the relief available to shippers under the "simplified approach" that would institute technical changes to rate procedures and raise the interest rate railroads must pay for reparations to shippers if they are found guilty of charging unreasonable rates.
The STB said it has also launched a proceeding over a proposal submitted by the U.S. shipper organization, the National Industrial Transportation League that is aimed at increasing rail-to-rail competition where "certain shippers located in terminal areas that lack effective transportation alternatives would be granted access to a competing railroad, if there is a working interchange within 30 miles."
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