This article has been reprinted from the May 2 USDA Grain Transportation Report.
On April 29, the Surface Transportation Board’s (STB) Rate Reform Task Force (Task Force) released a staff report, containing recommendations for possible changes to the current railroad rate review processes and methodologies.
According to the press release, STB established the Task Force “in January 2018 to recommend improvements to the Board’s existing rate review processes and to propose new rate review methodologies that are more attuned to the realities of the current transportation world.”
Among their main recommendations, the Task Force provides proposals to reduce the cost and complexity in small rate disputes (e.g., requiring arbitration, procedural limitations, etc.) and the Stand-Alone Cost method; offers a new rate methodology (the “Incumbent Network Cost Analysis”) for use in large disputes; puts forward a new concept of “long-term” revenue adequacy (and associated remedies for shippers within such an environment); suggests improvements to the Three-Benchmark method; and seeks to simplify determinations of “market dominance.”