[Federal Register Volume 77, Number 213 (Friday, November 2, 2012)]
[Proposed Rules]
[Pages 66165-66169]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-26882]
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DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
49 CFR Parts 1121, 1150, and 1180
[Docket No. EP 714]
Information Required in Notices and Petitions Containing
Interchange Commitments
AGENCY: Surface Transportation Board (the Board or STB), DOT.
ACTION: Notice of proposed rulemaking.
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SUMMARY: Through this Notice of Proposed Rulemaking (NPR), the Board is
proposing a rule establishing additional disclosure requirements for
notices and petitions for exemption where the underlying lease or line
sale includes an interchange commitment.
DATES: Comments are due by December 3, 2012. Reply comments are due by
January 2, 2013.
ADDRESSES: Comments and replies may be submitted either via the Board's
e-filing format or in the traditional paper format. Any person using e-
filing should attach a document and otherwise comply with the
instructions at the E-FILING link on the Board's Web site, at http://www.stb.dot.gov. Any person submitting a filing in the traditional
paper format should send an original and 10 copies to: Surface
Transportation Board, Attn: EP 714, 395 E Street SW., Washington, DC
20423-0001. Copies of written comments and replies will be available
for viewing and self-copying at the Board's Public Docket Room, Room
131, and will be posted to the Board's Web site.
FOR FURTHER INFORMATION CONTACT: Amy C. Ziehm at (202) 245-0391.
Assistance for the hearing impaired is available through the Federal
Information Relay Service (FIRS) at (800) 877-8339.
SUPPLEMENTARY INFORMATION: Interchange commitments are ``contractual
provisions included with a sale or lease of a rail line that limit the
incentive or the ability of the purchaser or tenant carrier to
interchange traffic with rail carriers other than the seller or lessor
railroad.'' \1\ Currently, if a proposed acquisition of a rail line
involves an interchange commitment, the party filing the notice or
petition for exemption must inform the Board that such a provision
exists and must file a confidential, complete version of the document
containing that provision with the Board.\2\
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\1\ Review of Rail Access and Competition Issues--Renewed
Petition of the W. Coal Traffic League, EP 575, slip op. at 1 (STB
served Oct. 30, 2007). Interchange commitments are sometimes
referred to as ``paper barriers.''
\2\ See 49 CFR 1121.3(d), 1150.33(h), 1150.43(h), and
1180.4(g)(4).
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Historical Regulation of Interchange Commitments
As a result of both the Railroad Revitalization and Regulatory
Reform Act of 1976 and the Staggers Rail Act of 1980, it has become
easier for rail carriers to abandon, sell, or lease a line or part of a
line by utilizing exemptions from regulatory procedures. This
flexibility has helped to revitalize the railroad industry. In 1998,
the Board held two days of hearings to examine rail access and
competition.\3\ The issue of interchange commitments, or paper
barriers, arose in the context of shortline railroads. Many of the
transactions that created or built up these new shortline railroads
contained interchange commitments.\4\ The existence of these
contractual restrictions encouraged large railroads to sell or lease
lighter-density lines at reduced prices (in some cases at no cost),
because they were guaranteed to retain a portion of the future revenues
from the traffic on those lines. In many instances, they also provided
a means of helping to finance the acquisition by shortline railroads.
Interchange commitments took varying forms, including lease payment
credits for cars interchanged with the seller or lessor carrier (in
some instances the lease
[[Page 66166]]
credit applied if the lessee interchanged with the lessor up to the
same number of cars interchanged with the lessor in the prior year);
monetary penalties for traffic interchanged with another railroad; or a
total ban on interchange with any carrier other than the seller or
lessor carrier.\5\ Many reportedly had no fixed termination date.\6\
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\3\ Review of Rail Access and Competition Issues, EP 575 (STB
served Apr. 17, 1998).
\4\ Id. at 8.
\5\ Review of Rail Access and Competition Issues--Renewed
Petition of the W. Coal Traffic League, EP 575, slip op. at 4 (STB
served Oct. 30, 2007).
\6\ Id.
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In September 1998, the American Short Line and Regional Railroad
Association and the Association of American Railroads entered into a
Railroad Industry Agreement (RIA), which stipulated, among other
things, that ``[l]egitimate paper barriers are those that are designed
as fair payment for the sale or rental value of the line that created
the Short Line.'' \7\ In December 1998, the Western Coal Traffic League
(WCTL) filed a petition for rulemaking asking the Board to adopt rules
of general applicability regarding interchange commitments. The Board
deferred action on WCTL's petition in order to allow for industry
experience under the RIA.\8\
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\7\ Railroad Industry Agreement Sec. III, Paper Barriers (Sept.
10, 1998).
\8\ Review of Rail Access and Competition Issues--Renewed
Petition of the W. Coal Traffic League, EP 575, slip op. at 5-6 (STB
served Oct. 30, 2007).
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In 2005, in response to a renewed petition filed by WCTL, the Board
initiated a rulemaking proceeding to consider regulations restricting
interchange commitment provisions included with a sale or lease of a
rail line.\9\ WCTL argued that interchange commitments were
anticompetitive because they prevented lessee/purchaser railroads from
offering shippers the full array of competitive routing options. WCTL
asked the Board to establish a rebuttable presumption that such
provisions are unreasonable and contrary to the public interest if they
(a) Last longer than five years, (b) include any financial penalty for
interchanging traffic with another carrier, or (c) include a credit for
interchanging traffic with the seller or lessor railroad that would
provide a return in excess of the railroad industry's cost of
capital.\10\ Upon receiving comments and conducting a public hearing,
the Board declined to adopt a single rule of general applicability,
deciding instead to consider the propriety of interchange commitments
on a case-by-case basis.\11\ The Board indicated that it would give
especially close scrutiny to those interchange commitments that totally
ban the lessee/purchasing railroad from interchanging with a third
party carrier, and those commitments that were not time-limited.\12\
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\9\ See generally id.
\10\ The cost of capital is the Board's estimate of the average
rate of return needed to persuade investors to provide capital to
the freight rail industry. See Railroad Cost of Capital--2011, EP
558 (Sub-No. 15) (STB served Sept. 13, 2012).
\11\ Review of Rail Access and Competition Issues--Renewed
Petition of the W. Coal Traffic League, EP 575, slip op. at 13 (STB
served Oct. 30, 2007).
\12\ Id. at 15.
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To facilitate its review of transactions that include interchange
commitments, the Board proposed new disclosure requirements in 2007 to
ensure appropriate advance regulatory scrutiny of sale and lease
agreements containing interchange commitments,\13\ and in May 2008, the
Board formally adopted the proposed rules.\14\ Thus, a purchaser or
lessee railroad filing a notice or petition for exemption must advise
the Board if the sale or lease contract includes an interchange
commitment and must file a confidential, unredacted copy of that
contract and any related documents containing the terms of the
interchange commitment with the Board.\15\
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\13\ See generally id.
\14\ Disclosure of Rail Interchange Commitments, EP 575 (Sub-No.
1) (STB served May 29, 2008).
\15\ Id.
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Since its May 2008 decision adopting disclosure rules, the Board
has reviewed 10 notices or petitions for exemption involving
interchange commitments.\16\ In the majority of these cases, the
interchange commitment was styled as a lease credit for cars
interchanged with the seller or lessor.\17\ At least one, however,
involved a total ban on interchanges with any other railroad.\18\
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\16\ Midwest Rail d/b/a Toledo, Lake Erie and W. Ry --Lease &
Operation Exemption--Norfolk S. Ry., FD 35634 (STB served June 29,
2012) (Mulvey, commenting); Progressive Rail--Lease & Operation
Exemption--Rail Line of Union Pac. R.R., FD 35617 (STB served May 4,
2012) (Mulvey, dissenting); Middletown & N.J. R.R.--Lease &
Operation Exemption--Norfolk S. Ry., FD 35412 (STB served Sept. 23,
2011) (Mulvey, dissenting); E. Penn R.R.--Lease & Operation
Exemption--Norfolk S. Ry., FD 35533 (STB served July 15, 2011)
(Mulvey, dissenting); C&NC R.R.--Lease Renewal Exemption--Norfolk S.
Ry., FD 35529 (STB served July 1, 2011) (Mulvey, dissenting); Adrian
& Blissfield R.R.--Continuance in Control Exemption--Jackson &
Lansing R.R., FD 35410 (STB served Oct. 6, 2010) (Mulvey,
dissenting); Jackson & Lansing R.R.--Lease & Operation Exemption--
Norfolk S. Ry., FD 35411 (STB served Oct. 6, 2010) (Mulvey,
dissenting); Jackson & Lansing R.R.--Trackage Rights Exemption--
Norfolk S. Ry., FD 35418 (STB served Oct. 6, 2010) (Mulvey,
dissenting); N. Plains R.R.--Lease Exemption--Soo Line R.R., FD
35382 (STB served Aug. 6, 2010) (Mulvey, dissenting); Wash. & Idaho
Ry.--Lease & Operation Exemption--BNSF Ry., FD 35370 (STB served
Apr. 23, 2010) (Mulvey, dissenting).
\17\ Midwest Rail d/b/a Toledo, Lake Erie and W. Ry.--Lease &
Operation Exemption--Norfolk S. Ry., FD 35634 (STB served June 29,
2012) (Mulvey, commenting); Progressive Rail--Lease & Operation
Exemption--Rail Line of Union Pac. R.R., FD 35617 (STB served May 4,
2012) (Mulvey, dissenting); Middletown & N.J. R.R.--Lease &
Operation Exemption--Norfolk S. Ry., FD 35412 (STB served Sept. 23,
2011) (Mulvey, dissenting); E. Penn R.R.--Lease & Operation
Exemption--Norfolk S. Ry., FD 35533 (STB served July 15, 2011)
(Mulvey, dissenting); C&NC R.R.--Lease Renewal Exemption--Norfolk S.
Ry., FD 35529 (STB served July 1, 2011) (Mulvey, dissenting); Adrian
& Blissfield R.R.--Continuance in Control Exemption--Jackson &
Lansing R.R., FD 35410 (STB served Oct. 6, 2010) (Mulvey,
dissenting); Jackson & Lansing R.R.--Lease & Operation Exemption--
Norfolk S. Ry., FD 35411 (STB served Oct. 6, 2010) (Mulvey,
dissenting); Jackson & Lansing R.R.--Trackage Rights Exemption--
Norfolk S. Ry., FD 35418 (STB served Oct. 6, 2010) (Mulvey,
dissenting).
\18\ Wash. & Idaho Ry.--Lease & Operation Exemption--BNSF Ry.,
FD 35370 (STB served Apr. 23, 2010) (Mulvey, dissenting).
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The Board and interested parties have availed themselves of the
information required in transactions containing interchange
commitments. For instance, in four of those cases, third parties filed
petitions to revoke the exemptions based on the interchange
commitment.\19\ In another case, the Board, on its own initiative,
rejected the notice of exemption because the rail carrier had not filed
a complete copy of the lease contract as required by our
regulations.\20\
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\19\ Adrian & Blissfield R.R.--Continuance in Control
Exemption--Jackson & Lansing R.R., FD 35410 (STB served Sept. 27,
2011) (Mulvey, dissenting); Jackson & Lansing R.R.--Lease &
Operation Exemption--Norfolk S. Ry., FD 35411 (STB served Sept. 27,
2011) (Mulvey, dissenting); Jackson & Lansing R.R.--Trackage Rights
Exemption--Norfolk S. Ry., FD 35418 (STB served Sept. 27, 2011)
(Mulvey, dissenting); Middletown & N.J. R.R.--Lease & Operation
Exemption--Norfolk S. Ry., FD 35412 (STB served Sept. 23, 2011)
(Mulvey, commenting).
\20\ Wash. & Idaho Ry.--Lease & Operation Exemption--BNSF Ry.,
FD 35370 (STB served Apr. 23, 2010) (Mulvey, dissenting).
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In this rulemaking, the Board proposes to require that additional
information be provided in notices and petitions for exemption to
include, among other things, specific details regarding the impact the
interchange commitment will have on shippers and the purchaser or
lessee railroad. The Board's goal is to ensure that both the agency and
other interested parties have sufficient information to judge whether
the exemption process is appropriate for a transaction. In particular,
because the notice of exemption process involves very short deadlines,
the Board proposes to require disclosure of information about the
transaction at the time of the notice itself, rather than during any
subsequent requests to reject or revoke the exemption.
The Proposed Rule: The Board proposes to revise its rules at 49 CFR
1121.3(d), 1150.33(h), 1150.43(h), and 1180.4(g)(4) to require that the
filing
[[Page 66167]]
party affirmatively disclose whether or not the underlying agreement
contains an interchange commitment. The Board further proposes to
revise those rules to require that the following information be
included in notices and petitions for exemption involving an
interchange agreement:
(1) A list of shippers that currently use or have used the line in
question within the last two years;
(2) The number of carloads those shippers specified in paragraph
(1) originated or terminated (submitted under seal);
(3) A certification that the railroad has provided notice of the
proposed transaction and interchange commitment to the shippers
identified in paragraph (1);
(4) A list of third party railroads that could physically
interchange with the line sought to be acquired or leased;
(5) The percentage of the purchasing/leasing railroad's revenue
projected to be derived from operations on the line with the
interchange commitment (submitted under seal);
(6) An estimate of the difference between the sale or lease price
with and without the interchange commitment (submitted under seal);
(7) An estimate of the discounted annual value of the interchange
commitment to the Class I (or other incumbent carrier) leasing or
selling the line (submitted under seal); and
(8) A change in the case caption so that the existence of an
interchange commitment is apparent from the case title.
The Board's goal is to encourage transactions that are in the
public interest, while ensuring that it has sufficient information
about transactions to determine whether they are appropriate for the
exemption process or, on the other hand, raise competitive issues that
require a more detailed examination. The Board has already indicated
that interchange commitments that last in perpetuity or completely
eliminate the ability of the lessee/purchaser railroad to interchange
with a third-party carrier raise significant concerns. Long-term
interchange commitments, often embodied in lengthy, renewable leases,
also have the potential to control the competitive environment--thus
affecting rates and service--for years to come. To this end, the Board
believes that it will benefit the parties to the transaction, shippers,
and the public for the Board to be provided with the above-outlined
information simultaneously with the filing of a notice or petition for
exemption. This additional information will aid the Board in its review
of petitions for and notices of exemption and allow the Board to
evaluate contracts involving interchange commitments without the delay
involved with seeking additional information. Furthermore, parties
objecting to a petition for exemption or those filing a petition to
revoke an exemption will have access to this relevant information up
front, thus minimizing the length of time spent on the process of
filing and deciding a petition to revoke.
Regulatory Flexibility Act. The Regulatory Flexibility Act of 1980,
5 U.S.C. 601-612, generally requires a description and analysis of new
rules that would have a significant economic impact on a substantial
number of small entities. In drafting a rule, an agency is required to:
(1) Assess the effect that its regulation will have on small entities;
(2) analyze effective alternatives that may minimize a regulation's
impact; and (3) make the analysis available for public comment.
Sec. Sec. 601-604. In its notice of proposed rulemaking, the agency
must either include an initial regulatory flexibility analysis, Sec.
603(a), or certify that the proposed rule would not have a
``significant impact on a substantial number of small entities.'' Sec.
605(b). The impact must be a direct impact on small entities ``whose
conduct is circumscribed or mandated'' by the proposed rule. White
Eagle Coop. v. Conner, 553 F.3d 467, 480 (7th Cir. 2009).
The regulations proposed here would affect railroads negotiating
contracts that contain interchange commitments. As noted below, the
Board estimates that a total of four respondents will be affected by
these additional reporting requirements annually, and that the
additional time required by each respondent is no more than eight
hours. The Board believes that an additional eight hours in the context
of putting together the relevant documents and filings does not create
a significant impact. Moreover, as only four respondents per year will
be affected, the proposed rule would not impact a substantial number of
small entities.\21\ Accordingly, pursuant to 5 U.S.C. 605(b), the Board
certifies that the regulations proposed herein would not have a
significant economic impact on a substantial number of small entities
within the meaning of the Regulatory Flexibility Act. A copy of this
decision will be served upon the Chief Counsel for Advocacy, Office of
Advocacy, U.S. Small Business Administration, Washington, DC 20416.
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\21\ The Small Business Administration's (SBA) Office of Size
Standards develops the numerical definition of small business. See
13 CFR 121.201. The SBA has established a size standard for rail
transportation, stating that a line-haul railroad is considered
small if its number of employees is 1,500 or less, and that a
shortline railroad is considered small if its number of employees is
500 or less. Id. (subsector 482).
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Paperwork Reduction Act. Pursuant to the Paperwork Reduction Act
(PRA), 44 U.S.C. 3501-3549, and Office of Management and Budget (OMB)
regulations at 5 CFR 1320.8(d)(3), the Board seeks comments regarding:
(1) Whether the collection of information as modified in the proposed
rule and further described in Appendix B, is necessary for the proper
performance of the functions of the Board, including whether the
collection has practical utility; (2) the accuracy of the Board's
burden estimates; (3) ways to enhance the quality, utility, and clarity
of the information collected; and (4) ways to minimize the burden of
the collection of information on the respondents, including the use of
automated collection techniques or other forms of information
technology, when appropriate. Information pertinent to these issues is
included in Appendix B. The modified collection in this proposed rule
will be submitted to OMB for review as required under 44 U.S.C. 3507(d)
and 5 CFR 1320.11.
This action will not significantly affect either the quality of the
human environment or the conservation of energy resources.
This rulemaking will affect the following subject: Parts 1121,
1150, and 1180 of title 49, chapter X, of the Code of Federal
Regulations. It is issued subject to the Board's authority under 49
U.S.C. 721(a).
It is ordered:
1. The Board proposes to amend its rules as set forth in this
decision. Notice of the proposed rules will be published in the Federal
Register.
2. Comments are due by December 3, 2012. Reply comments are due by
January 2, 2013.
3. This decision is effective on the day of service.
List of Subjects
49 CFR Part 1121
Administrative practice and procedure, Railroads.
49 CFR Part 1150
Administrative practice and procedure, Railroads.
49 CFR Part 1180
Administrative practice and procedure, Railroads, Reporting and
record keeping requirements.
Decided: October 29, 2012.
[[Page 66168]]
By the Board, Chairman Elliott, Vice Chairman Mulvey, and
Commissioner Begeman. Vice Chairman Mulvey commented with a separate
expression.
Vice Chairman Mulvey, commenting:
I commend the Board for proposing additional rules and soliciting
comments regarding interchange commitment disclosures requirements. As
explained in the decision, the goal of the proposed rules is to provide
the Board and interested parties early access to a wide range of
information regarding newly proposed interchange commitments. The
impact of interchange commitments on competition remains a serious
concern for many stakeholders. As we continue to grapple with questions
raised by interchange commitments established decades ago, the Board
must also be vigilant about the impact of any new restrictions on
competition. In responding to the proposed rules, I hope that
stakeholders will assist the Board in crafting a regime that provides
appropriate scrutiny to transactions that have the potential to
adversely impact competition.
Jeffrey Herzig,
Clearance Clerk.
For the reasons set forth in the preamble, the Surface
Transportation Board proposes to amend parts 1121, 1150, and 1180 of
title 49, chapter X, of the Code of Federal Regulations as follows:
PART 1121--RAIL EXEMPTION PROCEDURES
1. The authority citation for part 1121 continues to read as
follows:
Authority: 49 U.S.C. 10502 and 10704.
2. Amend Sec. 1121.3 by revising paragraph (d)(1) introductory
text and by adding paragraphs (d)(1)(iii) through (x) to read as
follows:
Sec. 1121.3 Content.
* * * * *
(d) Interchange commitments. (1) The filing party must certify
whether or not a proposed acquisition or operation of a rail line
involves a provision or agreement that may limit future interchange
with a third-party connecting carrier, whether by outright prohibition,
per-car penalty, adjustment in the purchase price or rental, positive
economic inducement, or other means (``interchange commitment''). If
such a provision exists, the following additional information must be
provided:
* * * * *
(iii) A list of shippers that currently use or have used the line
in question within the last two years;
(iv) The number of carloads those shippers specified in paragraph
(d)(1)(iii) of this section originated or terminated (submitted under
seal);
(v) A certification that the railroad has provided notice of the
proposed transaction and interchange commitment to the shippers
identified in paragraph (d)(1)(iii) of this section;
(vi) A list of third party railroads that could physically
interchange with the line sought to be acquired or leased;
(vii) The percentage of the purchasing/leasing railroad's revenue
projected to be derived from operations on the line with the
interchange commitment (submitted under seal);
(viii) An estimate of the difference between the sale or lease
price with and without the interchange commitment (submitted under
seal);
(ix) An estimate of the discounted annual value of the interchange
commitment to the Class I (or other incumbent carrier) leasing or
selling the line (submitted under seal); and
(x) A change in the case caption so that the existence of an
interchange commitment is apparent from the case title.
* * * * *
PART 1150--CERTIFICATE TO CONSTRUCT, ACQUIRE, OR OPERATE RAILROAD
LINES
3. The authority citation for part 1150 continues to read as
follows:
Authority: 49 U.S.C. 721(a), 10502, 10901, and 10902.
4. Amend Sec. 1150.33 by revising paragraph (h)(1) introductory
text and by adding paragraphs (h)(1)(iii) through (x) to read as
follows:
Sec. 1150.33 Information to be contained in notice--transactions that
involve creation of Class III carriers.
* * * * *
(h) Interchange commitments. (1) The filing party must certify
whether or not a proposed acquisition or operation of a rail line
involves a provision or agreement that may limit future interchange
with a third-party connecting carrier, whether by outright prohibition,
per-car penalty, adjustment in the purchase price or rental, positive
economic inducement, or other means (``interchange commitment''). If
such a provision exists, the following additional information must be
provided:
* * * * *
(iii) A list of shippers that currently use or have used the line
in question within the last two years;
(iv) The number of carloads those shippers specified in paragraph
(iii) originated or terminated (submitted under seal);
(v) A certification that the railroad has provided notice of the
proposed transaction and interchange commitment to the shippers
identified in paragraph (iii);
(vi) A list of third party railroads that could physically
interchange with the line sought to be acquired or leased;
(vii) The percentage of the purchasing/leasing railroad's revenue
projected to be derived from operations on the line with the
interchange commitment (submitted under seal);
(viii) An estimate of the difference between the sale or lease
price with and without the interchange commitment (submitted under
seal);
(ix) An estimate of the discounted annual value of the interchange
commitment to the Class I (or other incumbent carrier) leasing or
selling the line (submitted under seal); and
(x) A change in the case caption so that the existence of an
interchange commitment is apparent from the case title.
* * * * *
5. Amend Sec. 1150.43 by revising paragraphs (h)(1) introductory
text and by adding paragraphs (h)(1)(iii) through (x) to read as
follows:
Sec. 1150.43 Information to be contained in notice for small line
acquisitions.
* * * * *
(h) Interchange commitments. (1) The filing party must certify
whether or not a proposed acquisition or operation of a rail line
involves a provision or agreement that may limit future interchange
with a third-party connecting carrier, whether by outright prohibition,
per-car penalty, adjustment in the purchase price or rental, positive
economic inducement, or other means (``interchange commitment''). If
such a provision exists, the following additional information must be
provided:
* * * * *
(iii) A list of shippers that currently use or have used the line
in question within the last two years;
(iv) The number of carloads those shippers specified in paragraph
(h)(1)(iii) of this section originated or terminated (submitted under
seal);
(v) A certification that the railroad has provided notice of the
proposed transaction and interchange commitment to the shippers
identified in paragraph (h)(1)(iii) of this section;
[[Page 66169]]
(vi) A list of third party railroads that could physically
interchange with the line sought to be acquired or leased;
(vii) The percentage of the purchasing/leasing railroad's revenue
projected to be derived from operations on the line with the
interchange commitment (submitted under seal);
(viii) An estimate of the difference between the sale or lease
price with and without the interchange commitment (submitted under
seal);
(ix) An estimate of the discounted annual value of the interchange
commitment to the Class I (or other incumbent carrier) leasing or
selling the line (submitted under seal); and
(x) A change in the case caption so that the existence of an
interchange commitment is apparent from the case title.
* * * * *
PART 1180--RAILROAD ACQUISITION, CONTROL, MERGER, CONSOLIDATION
PROJECT, TRACKAGE RIGHTS, AND LEASE PROCEDURES
6. The authority citation for part 1180 continues to read as
follows:
Authority: 5 U.S.C. 553 and 559; 11 U.S.C. 1172; 49 U.S.C. 721,
10502, 11323-11325.
7. Amend Sec. 1180.4 by revising paragraph (g)(4)(i) introductory
text and by adding paragraphs (g)(4)(i)(C) through (J) to read as
follows:
Sec. 1180.4 Procedures.
* * * * *
(g) * * *
(4) Interchange commitments. (i) The filing party must certify
whether or not a proposed acquisition or operation of a rail line
involves a provision or agreement that may limit future interchange
with a third-party connecting carrier, whether by outright prohibition,
per-car penalty, adjustment in the purchase price or rental, positive
economic inducement, or other means (``interchange commitment''). If
such a provision exists, the following additional information must be
provided:
(C) A list of shippers that currently use or have used the line in
question within the last two years;
(D) The number of carloads those shippers specified in paragraph
(g)(4)(i)(C) of this section originated or terminated (submitted under
seal);
(E) A certification that the railroad has provided notice of the
proposed transaction and interchange commitment to the shippers
identified in paragraph (g)(4)(i)(C) of this section;
(F) A list of third party railroads that could physically
interchange with the line sought to be acquired or leased;
(G) The percentage of the purchasing/leasing railroad's revenue
projected to be derived from operations on the line with the
interchange commitment (submitted under seal);
(H) An estimate of the difference between the sale or lease price
with and without the interchange commitment (submitted under seal);
(I) An estimate of the discounted annual value of the interchange
commitment to the Class I (or other incumbent carrier) leasing or
selling the line (submitted under seal); and
(J) A change in the case caption so that the existence of an
interchange commitment is apparent from the case title.
* * * * *
Note: The following appendix will not appear in the Code of
Federal Regulations.
Appendix
The additional information below is included to assist those who
may wish to submit comments pertinent to review under the Paperwork
Reduction Act:
Description of Collection
Title: Disclosure of Rail Interchange Commitments.
OMB Control Number: 2140-0016.
STB Form Number: None.
Type of Review: Revision of an approved collection.
Respondents: Noncarriers and carriers seeking an exemption to
acquire (through purchase or lease) and/or operate a rail line, if
the proposed transaction includes an interchange commitment.
Number of Respondents: Four.
Estimated Time per Response: No more than eight hours.
Frequency: On occasion.
Total Burden Hours (annually including all respondents): 32
hours.
Total ``Non-hour Burden'' Cost: None identified. Respondents may
file the requested information electronically.
Needs and Uses: Under 49 U.S.C. 10502, noncarriers and carriers
may seek an exemption from the prior approval requirements of
sections 10901, 10902, and 11323 to acquire (through purchase or
lease) and operate a rail line. The collection of agreements with
interchange commitments has facilitated the case-specific review of
interchange commitments and the Board's monitoring of their usage
generally. The modifications proposed here will further ensure that
the Board has sufficient information about these transactions to
determine whether they are appropriate for the exemption process and
will also help parties objecting to a petition for exemption or
filing a petition to revoke an exemption by providing access to this
relevant information up front, thus minimizing the length of time
spent on the process of filing and deciding a petition to revoke.
Retention Period: Information in this report will be maintained
in the Board's confidential file for 10 years, after which it is
transferred to the National Archives.
[FR Doc. 2012-26882 Filed 11-1-12; 8:45 am]
BILLING CODE 4915-01-P