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Yesterday, the Surface Transportation Board (STB) issued a decision on the Class Is’ revenue adequacy for 2010 that found only Union Pacific Railroad was "revenue adequate" in the calendar year. The board determined that all other Class Is were “revenue inadequate.”

The STB considers a railroad to be revenue adequate if it achieves a rate of return on net investment equal to at least the current cost of capital for the rail industry for 2010, which the board determined to be 11.03 percent. Congress directed the STB to conduct revenue adequacy determinations on Class Is annually.

Following are the board-determined rate of return on net investment for each Class I in 2010:
• UP, 11.54 percent;
• Norfolk Southern Railway, 10.96 percent;
• CSX Transportation, 10.85 percent;
• Kansas City Southern, 9.77 percent;
• BNSF Railway Co., 9.22 percent;
• CN (all U.S. affiliates), 9.21 percent; and
• Canadian Pacific (all U.S. affiliates), 8.01 percent.