STB seeks feedback on potential changes to fuel surcharge rule provision

The Surface Transportation Board (STB) yesterday instituted an advance notice of proposed rulemaking proceeding to provide interested parties the opportunity to comment on whether the "safe harbor" provision of the board's rail fuel surcharge rules should be modified or removed.

In a January 2007 decision, the STB prohibited rate-based fuel surcharges as an unreasonable practice and established an index railroads could use as a safe harbor to measure fuel cost changes for fuel surcharge programs. Later, Cargill Inc. filed a complaint challenging BNSF Railway Co.'s fuel surcharge program, specifically the manner in which the railroad's incremental fuel costs should be measured. The board used the safe harbor index in the Cargill case, but indicated it would revisit the index in light of the issues raised in the complaint proceeding.

The STB now is seeking public comments to determine if the safe harbor provision should be changed or eliminated. In particular, the board is interested in feedback on whether a growing spread between a railroad's internal fuel costs and the safe harbor index is likely an aberration; what problems are associated with the board's use of the index as a safe harbor in judging the reasonableness of fuel surcharge programs; and if such problems could be addressed through a modification or outweigh the index's benefits.

Comments are due by July 14 and reply comments are due by Aug. 12.