STB improves rail rate-reasonableness procedures

The Surface Transportation Board (STB) yesterday issued a unanimous decision in a rate regulation reform proceeding that calls for adopting revised rules governing the board's rail rate-reasonableness procedures.

The decision marks another in a series of steps aimed at improving the board's rate regulation process, particularly procedures governing the resolution of smaller rail rate disputes, STB members said in a press release.

The decision removes limitations on relief for medium-sized rate disputes and raises to $4 million the relief available under small rate disputes. The ruling also makes technical changes to rate complaint procedures and sets the U.S. prime rate as the interest rate on reparations that railroads must pay to shippers for charging rates deemed unreasonable. Future proceedings will be held to address cross-over traffic, as well as small agricultural shippers' concerns, STB members said.

"For years, the shipper community has argued that only the largest freight-rail shippers can justify the time and expense to bring rate disputes to our agency. The board has worked diligently to address that concern and offer captive shippers a simplified, expedited and practical way to bring smaller rate disputes to the agency," said STB Chairman Daniel Elliott. "Today, we are taking another much-needed step to provide captive shippers with better access to a neutral forum to judge the reasonableness of their freight rates, as Congress intended."

Since it held a hearing on rail competition in 2011, the board has considered a wide range of concepts to determine the best way to promote a competitive and economically viable rail network, STB members said. In a May 13, 2013, decision, board members overhauled mediation and arbitration rules to encourage greater use of alternative dispute resolution procedures among rail industry stakeholders.

The STB also continues to evaluate other competitive issues, including reviewing rules for interchange commitments, competitive access and commodity exemptions.