Review of the General Purpose Costing System

DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

49 CFR Part 1241

[Ex Parte No. 431 (Sub-No. 2)]

Review of the General Purpose Costing System

AGENCY: Surface Transportation Board.

ACTION: Policy Statement; Final Rules; Request for Comments.

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SUMMARY: The Surface Transportation Board (Board) is modifying the

procedures used to determine the variable costs associated with certain

types of rail movements; discontinuing the collection of data on

switching and terminal companies; and requesting comments on a

modification of the procedure for determining the variable cost of

using privately-owned rail cars.

DATES: The amendments to 49 CFR part 1241, and the policy statement

revising the procedures for costing intermodal traffic and the train

switching conversion factor, are effective October 1, 1997. The policy

statement modifying the costing of privately-owned cars is effective

December 1, 1997; if this effective date is delayed, timely notice will

be published in the Federal Register.

Comments are due October 31, 1997.

ADDRESSES: Send an original and 10 copies of comments referring to Ex

Parte No. 431 (Sub-No. 2) to: Surface Transportation Board, Office of

the Secretary, Case Control Unit, 1925 K Street, N.W., Washington, D.C.

20423-001.

FOR FURTHER INFORMATION CONTACT: Thomas J. Stilling, (202) 565-1567.

[TDD for the hearing impaired: (202) 565-1695.]

SUPPLEMENTARY INFORMATION: To provide consistent and comparable

information on railroad costs, the Board maintains a general purpose

costing system known as the Uniform Railroad Costing System (URCS).

This rulemaking was instituted to review the procedures used by the

URCS to develop the variable cost of providing

[[Page 51380]]

rail service. As a result of the comments received, the Board is

discontinuing the collection of cost data on switching and terminal

companies found in 49 CFR 1241.14. The Board is also adopting certain

modifications to the procedures used to develop the costs associated

with movements of intermodal traffic and revising the train switching

conversion factor used in its costing procedures. All other proposals

previously made in this proceeding are withdrawn. (The Board's decision

may be reviewed at the agency's offices in Washington, DC during normal

business hours and is available for a charge by calling DC NEWS & DATA

INC. at (202) 289-4357.) Finally, as discussed below, the Board

modifies the procedures for determining the variable cost of using

privately-owned rail cars (an issue which has not been previously

noticed for comment), subject to receiving no objections within 30

days.

Privately-Owned Car Costing

In the past, with the exception of unit-coal trains, the Board

developed the variable cost associated with using privately-owned rail

cars by applying an average car rental cost for privately-owned cars if

no mileage rate for that particular car was shown in the Car Hire Rate

Master (CHARMS) file. 1 In its comments in Ex Parte No. 347

(Sub-No. 2), Rate Guidelines--Non-Coal Proceedings, 2 the

AAR pointed out that more than 43% of all U.S.-based rail cars are now

owned by entities other than railroads, and that increasingly shippers

that provide their own cars obtain lower rates in return for the

railroad not incurring any cost for the use of the privately-owned

cars.

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\1\ The CHARMS file is maintained by the Association of American

Railroads (AAR) and contains all car-hire rates.

\2\ See Verified statement of Rockey and Railroad Costing

Officers at 17, filed Feb. 20, 1996.

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In view of this current practice, we believe that more accurate

costs will be obtained by applying a zero car rental cost to privately-

owned cars that do not have mileage rates shown in CHARMS. Thus, we

will tentatively modify our costing procedures to assume that all

privately-owned car types that show no mileage allowance in the CHARMS

file incur no car cost, except for railroad-owned pool cars (for which

an allowance is always paid). 3 For such pool cars, we will

continue to use an average car rental cost, because it is the best

estimate available to us. Absent the receipt of comments voicing

opposition to this modification within 30 days of this decision, it

will become a permanent change effective December 1, 1997. If the

effective date of this modification is delayed, timely notice will be

published in the Federal Register.

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\3\ Railroad-owned pool cars are cars that are owned by

companies that are themselves owned and controlled by the railroads.

Railroad-owned pool cars are generally committed to pools for the

benefit of certain shippers. A rental rate is paid for the use of

these cars.

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The Board certifies that the new procedures will not have a

significant economic effect on a substantial number of small entities.

The impact on small entities, if any, will be to provide them with

better cost estimates.

This action will not significantly affect either the quality of the

human environment or the conservation of energy resources.

List of Subjects in 49 CFR Part 1241

Administrative practice and procedure, Railroads.

Decided: September 19, 1997.

By the Board, Chairman Morgan and Vice Chairman Owen.

Vernon A. Williams,

Secretary.

For the reasons set forth in the preamble, 49 CFR Chapter X is

amended as set forth below:

PART 1241--ANNUAL, SPECIAL, OR PERIODIC REPORTS--CARRIERS SUBJECT

TO PART I OF THE INTERSTATE COMMERCE ACT

1. The authority citation for part 1241 is revised to read as

follows:

Authority: 49 U.S.C. 11145.

Sec. 1241.14 [Removed]

2. Section 1241.14 is removed.

[FR Doc. 97-26029 Filed 9-30-97; 8:45 am]

BILLING CODE 4915-00-P