USDA: STBÆS FINANCIAL REPORTING REQUIREMENT WOULD IMPACT SMALL RAILROADS
The U.S. Department of Agriculture on Friday voiced concern that the Surface Transportation Board's proposal to require consolidated financial reporting by commonly controlled U.S. railroads and railroad-related affiliates could adversely affect smaller railroads serving rural areas.
Despite some benefits, “consolidated reporting of financial data could result in the reclassification of smaller railroads as either Class I or Class II railroads, which would greatly increase their reporting requirement, as well as impose more stringent merger rules on them,” said Michael V. Dunn, Under Secretary for Marketing and Regulatory Programs for the USDA.
“Although they have preserved rail service to agricultural and other regions, smaller railroads are often only marginally profitable since they typically operate lines having lower railcar traffic densities,” Dunn said. 'Increased regulatory burdens could affect their ability to continue serving rural areas.”
The STB is considering changing the reporting rules to ensure conformity and consistency of reports. The board also believes the reporting would allow it to obtain more meaningful and accurate information on major rail systems operating in the United States than can be obtained from separate reports from individually affiliated railroads.