Key, Issues, Legislation, and Proceedings
Issue Priorities for the 117th Congress can be read here, “FRCA Legislative and Regulatory Priorities”:
- Congressional Oversight – Implementation of the Surface Transportation Board Reauthorization (STB) Act of 2015 Continued STB implementation and Congressional oversight of the first authorization for the STB since 1998 which is establishing basic reforms and process enhancements for the Board. View FRCA’s position paper, “FRCA Congressional Oversight-Implementation of STB Reauthorization Act of 2015”:
- Annual Appropriation Levels for the Surface Transportation Board
For FY 2020, FRCA supports at a minimum, $37.1 million for the Surface Transportation Board (STB) as recommended by President Trump in the Administration’s FY 2020 Budget. This is the same amount recommended and enacted for the current FY 2019 which is allowing the STB to continue its IT upgrades.
The Consolidated Appropriations Act, 2019 (P.L. 116-6) funds the STB at $37.1 million which is equal to the amount recommended in the FY 2019 Trump Budget. The Administration’s Budget also noted that $2.797 million of the amount was for IT upgrades. The Consolidated Appropriations Act 2018, P.L. 115-141, of which $2.401 million was recommended for IT upgrades. These actions follow the record level funding provided to the STB in the FY 2017 Consolidated Appropriations Act, P.L. 115-31, of $37 million where $2.046 million was directed to IT upgrades in accompanying report language.
- Emergency Fuel Supply Coordination Legislation that would establish efforts to prevent disruptions, uncertainties and delays in commodities – such as fuel, grains, and chemicals – reaching the market.
- Railroad Antitrust Exemption Legislation that would remove the 91-year-old special freight railroad antitrust exemption.
- Positive Train Control Implementation, Surface Transportation Extension Act, P.L. 114-73 The railroad industry’s efforts to implement PTC systems by December 31, 2018, including alternative schedules up to December 31, 2020 as approved by the Federal Railroad Administration.
Proceedings before the Surface Transportation Board
- Revenue Adequacy Considerations Before the STB STB efforts in Docket No. EP 722, Railroad Revenue Adequacy, exploring its methods in determining railroad revenue adequacy. As a part of this review, FRCA strongly opposes the use of replacement cost methodologies.
- Rate-Reasonableness Standards and Expediting Rate Cases Before the STB Actions to review the Board’s three tests when used to determine railroad revenue adequacy in EP Docket No. 733, Expediting Rate Cases.
- Commodity Exemption Review Before the STB The Advanced Notice of Proposed Rulemaking in Docket No. EP 704 (Sub-No. 1) that would allow certain commodities to seek rate and/or service relief before the Board.
- Competitive Switching (Access) The Notice of Proposed Rulemaking to determine the pros and cons of requiring railroads to provide requested switching arrangements in Docket No. EP 711 (Sub No. – 1).
Supporting Published Reports
“Modernizing Freight Rail Regulation,” Transportation Research Board/National Academy of Sciences. June 2015. View FRCA’s Position Paper, “TRB Report”
“Freight Rail Pricing: Contracts Provide Shippers and Railroads Flexibility, but High Rates Concern Some Shippers”, General Accountability Office. December 2016. View FRCA’s Position Paper, “GAO-Freight Rail Pricing and Contracts”
Quadrennial Energy Review, U.S. Department of Energy. April 2015. View FRCA’s Position Paper, “Quadrennial Energy Review”.
The information below discusses the above issues and supporting reports in further detail, including access to FRCA’s Position Papers. Contact FRCA for further details.
Surface Transportation Board (STB) Reauthorization Act of 2015, S. 808 (S. Rpt. 114-52), was signed into law (P.L. 114-110) on December 11, 2015. It was approved by the U.S. House of Representatives under Suspension of the Rules on December 10, 2015 and approved earlier by the U.S. Senate on June by Unanimous Consent on June 18th.
Introduced by Commerce Committee Chair John Thune (R-SD) and Ranking Member Bill Nelson (D-FL), the law:
- Increased the Board members from 3 to 5 and allow non-public meetings
- Created authority for the Board to initiate investigations without shipper complaints and creates new guidelines for the investigations.
- Required a report on rate case methodologies by the STB looking at whether rate cases are too complex and expensive and whether alternative methods could be used to address the complexity and expense.
- Created new quarterly public reports for the Board on pending cases and a compilation of complaints on the public website.
- Created timelines for rate cases.
- Created a new voluntary arbitration process at the Board that can be used for rate cases with judgments up to $25 million.
- Requires a study by GAO of rail contracts proposals containing multiple origin and destination pairs.
- Accompanying report language, Section 16 (Criteria), clarifies standards and procedures for evaluating revenue adequacy and emphasizes the infrastructure needed in order for rail carriers to be able to meet the present and future demand for rail service. This section does not require any change to how the STB determines railroad revenue adequacy. View FRCA’s Position Paper, Congressional Oversight: Implementation of the Surface Transportation Board Reauthorization Act of 2015.
FRCA’s positions during the development of S.808 can be read here: FRCA STB Reauthorization Act of 2015 Side-by-Side and FRCA 2015 Surface Transportation Board Reauthorization Principles. During the legislative process, FRCA expressed concerns to key Senators and staff that Section 16 of S. 808 could allow the STB to utilize “replacement cost methodologies” when evaluating current and future needs for railroad revenue adequacy purposes. Also on July 21st, FRCA submitted written testimony to the STB stating opposition to using “replacement cost methodologies”. [July 22-23, 2015 Hearing: Docket No. EP 722, Railroad Revenue Adequacy and Docket No. EP 664 (Sub-No. 2), Petition of the Western Coal Traffic League to Institute a Rulemaking Proceeding to Abolish the Use of the Multi-Stage Discounted Cash Flow Model in Determining the Railroad Industry’s Cost of Capital.]
The STB Reauthorization Act of 2015 expired on September 30, 2020.