USDA Grain Transportation Report (12/22): STB Issues Final Rules For Small Rate Disputes

According to today's USDA Grain Transportation Report, on December 19, the Surface Transportation Board (STB) adopted final rules implementing two streamlined approaches for shippers and railroads to resolve rate disputes, worth up to $4 million in relief over 2 years: a voluntary arbitration program and a procedure known as Final Offer Rate Review (FORR).

The voluntary arbitration program will begin only if all seven Class I carriers commit—within 50 days of the final rule’s Federal Register publication date—to participating for 5 years. (If all Class I carriers commit, they will be exempt from the FORR procedure.)

The final rule establishing the arbitration program takes effect 30 days from its Federal Register publication date, and the final rule establishing the FORR procedure takes effect 60 days from its Federal Register publication date.

According to the STB Chair, “The two rules attempt to strike a balance between the competing interests of various stakeholders”—particularly, between shippers’ preference for FORR and the railroads’ preference for a voluntary arbitration program. He further observed that both rules “offer relief under similar timeframes, allow for flexibility to use different methodologies, and have the same monetary limits.”