STB releases rule on reformed railroad rate cases
The Surface Transportation Board on Monday said it has concluded a major rulemaking proceeding to improve the STB’s procedures for deciding large railroad rate cases.
Changes adopted in the rulemaking seek to establish standards both for deciding whether a rate is too high and for setting the floor for rate relief — the lowest level to which rates can be ordered reduced.
“Today’s announcement marks a significant milestone in the STB’s ongoing effort to reduce litigation costs, create incentives for private settlement of disputes, and shorten the time required to develop and present large rail rate cases to the STB,” said Charles Nottingham, STB chairman. “The procedures established in this rulemaking will save shippers and railroads millions of dollars per case in consultant and legal fees — funds that will now be available for more productive job creation, investment and transportation purposes.”
The new rulemaking updates guidelines that were adopted by the agency 20 years ago to govern large rate disputes. In recent years and in numerous STB cases, it became apparent that the STB’s rate dispute resolution process had evolved into an overly expensive and time consuming process, with cases typically requiring three years or longer to resolve at an estimated cost of more than $3 million for each side, the STB said in a statement.
The new rules reform STB processes to make its rate docket more manageable — both for the agency and the parties — by placing reasonable restraints on the evidence and arguments it would allow parties to submit in a particular case. The STB said the decision should diminish the expense and delay in resolving rate disputes, and the results of the rate reasonableness inquiry should become more accurate.
The STB also said it will now turn its attention to the task of reforming its procedures and standards for smaller rate disputes. That effort is already under way, with final comments on proposed new guidelines due in late December.
The STB’s final decision is available at
http://www.stb.dot.gov/decisions/readingroom.nsf/WebDecisionID/37406?OpenDocument.