The U.S. Surface Transportation Board issued an Advance Notice of Proposed Rulemaking proposing a new procedure to resolve small rate disputes between shippers and Class I railroads.
The U.S. Surface Transportation Board has issued an Advance Notice of Proposed Rulemaking (ANPR) proposing a new “streamlined” procedure to resolve small rate disputes between shippers and Class I railroads.
STB said in a statement the proposed rules aim to make the board’s rate case procedures more fair and accessible to grain shippers, but also noted that for small rate disputes, regardless of commodity, the litigation costs of bringing a case under its existing rate reasonableness methodologies can quickly exceed the value of the case.
Under the procedures outlined in its ANPR, STB would create a “comparison group” of similar rail shipments against which to judge the reasonableness of the rate challenge, rather than the having the parties design the comparison group. This will “streamline” the rate dispute process compared with current procedures, which rely on the boards “Three-Benchmark methodology,” according to STB.
In addition,STB would hold a final evidentiary hearing, either in person or over the phone, rather than receiving rebuttal submissions and closing briefs in writing only.
The new process may also include mandatory initial disclosures by the parties, elimination of discovery or limits on discovery, and limits on the length of evidentiary submissions, which would reduce litigation expenses and improve the speed of rate challenges, STB said.
The board said it is also considering a preliminary screening procedure to ensure the challenged traffic meets a certain threshold criteria for review, which “could allow for more streamlined market dominance and rate reasonableness presentations than in other rate case methodologies.” STB may also limit the amount of financial relief available to the parties due to the abbreviated nature of the process.
“The new approach described in today’s decision is intended to create a cost-effective pathway to resolve small rate disputes,” STB Chairman Daniel R. Elliott said of the ANPR. “It has been a key objective of my tenure as Chairman to re-invent the rate case process, and today’s decision is a significant part of that effort.”
STB proposes ‘streamlined’ small rate dispute process
