[Federal Register Volume 78, Number 102 (Tuesday, May 28, 2013)]
[Proposed Rules]
[Pages 31882-31883]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-12543]
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DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
49 CFR Part 1333
[Docket No. EP 707]
Demurrage Liability
AGENCY: Surface Transportation Board, DOT.
ACTION: Initial regulatory flexibility analysis and request for
comments.
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SUMMARY: The Board is publishing this initial regulatory flexibility
analysis to aid the public in commenting on the impact on small rail
carriers, if any, of the proposed rules on demurrage liability.
DATES: Comments are due by June 27, 2013.
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: By decision served on May 7, 2012, the
Surface Transportation Board (the Board) issued a notice of proposed
rulemaking (NPR) regarding demurrage liability. Specifically, the Board
announced a proposed rule providing that any person receiving rail cars
from a rail carrier for loading or unloading who detains the cars
beyond a specified period of time may be held liable for demurrage if
that person has actual notice of the terms of the demurrage tariff
providing for such liability prior to the carrier's placement of the
rail cars. Demurrage Liability, EP 707, slip op. at 10 (STB served May
7, 2012). The NPR did not include an initial regulatory flexibility
analysis (IRFA) pursuant to the Regulatory Flexibility Act, but instead
included a certification that the proposed rules would not have a
significant economic impact on a substantial number of small entities.
Id., slip op. at 17-18. The certification was based on the fact that
rail carriers would be required to provide a one-time notice
(electronic or written) to their customers,\1\ and the Board noted that
these types of notices are generally already provided, often
electronically. A review of the 2011 Waybill Sample reveals that small
rail carriers, as defined by the Small Business Administration,\2\ have
an average of 10 terminating stations, which generally equates to 10
customers. As such, the burden imposed would be to provide
approximately 10 notices of a carrier's demurrage tariff, either
electronically or in writing, which is not significant. Additionally,
to the extent that their existing tariffs conflict with the proposed
rules, rail carriers would need to update their demurrage tariffs to
conform to the proposed rules.
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\1\ The Paperwork Reduction Act and Regulatory Flexibility Act
sections of the NPR assumed that rail carriers would only need to
provide a one-time notice. See, e.g., NPR at 21 (calculating burden
hours by assuming that it would take ``railroads eight hours to
provide initial notice to its customers''). Many commenters asked
for clarification on whether rail carriers would need to provide
notice with each delivery of rail cars, or whether a one-time notice
would suffice. In this IRFA, we are not deciding this issue, but
only noting that the analyses contained in the NPR were based on the
assumption that rail carriers would only need to provide a one-time
notice.
\2\ The Small Business Administration's Office of Size Standards
has established a size standard for rail transportation, pursuant to
which a ``line-haul railroad'' is considered small if its number of
employees is 1,500 or less, and a ``short line railroad'' is
considered small if its number of employees is 500 or less. 13 CFR
121.201 (industry subsector 482).
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In response to the NPR, the American Short Line and Regional
Railroad Association (ASLRRA) submitted comments in which it questioned
the necessity of imposing the actual notice requirement on small
carriers. ALSRRA summarily argued that ``small railroads . . . often
communicate with shippers by telephone,'' that Class III carriers are
``sometimes less electronically sophisticated,'' and that ``small
railroads, particularly those who are acting as handling lines, may not
even know who the receiver is.'' \3\
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\3\ ASLRRA's Comments 3-4.
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The Board continues to believe that its certification in the NPR is
appropriate because the impact of the proposed rules would not be
significant. Nevertheless, the Board has decided to publish the
following analysis to provide further information and opportunity for
public comment on the impact on small rail carriers, if any, of the
rules. The Board notes that it already afforded a period of public
comment on the proposed rules and that this solicitation of comments is
limited to the impact on small rail carriers, if any, of the rules.
[[Page 31883]]
In particular, we encourage ASLRRA to provide comments in response
to this IRFA. Although we appreciate that ASLRRA submitted comments
regarding the impact on small carriers, its comments were general in
nature. To fully evaluate ASLRRA's comments, the Board seeks more
specific information with which to evaluate the concerns raised by
ASLRRA. Specifically, we seek further comment on the number of small
carriers that would find electronic or written communication of notice
more difficult than communication of notice by phone, and why; and
information on small carriers that deliver rail cars but are unaware of
the receiver's identity. Additionally, we seek comment on the number of
customers served by small carriers. We also encourage any other
information that is relevant to the burden, if any, the proposed rules
would have on small rail carriers.
Description of the reasons that action by the agency is being
considered.
The Board instituted this proceeding in order to reexamine its
existing policies on demurrage liability and to promote uniformity in
the area in light of conflicting opinions from the United States Courts
of Appeals. In reviewing the decisions from the Courts of Appeals, the
Board determined that it was necessary to revisit its demurrage
precedent to consider whether the agency's policies accounted for
current statutory provisions and commercial practices. For a more
detailed description of the agency's historical regulation of
demurrage, the conflicting opinions from the Courts of Appeals, and the
Board's reasons for considering the proposed rules, see the NPR.
Succinct statement of the objectives of, and legal basis for, the
proposed rule.
The objectives are to update our policies regarding responsibility
for demurrage liability and to promote uniformity in the area by
defining who is subject to demurrage. The legal basis for the proposed
rule is 49 U.S.C. 721.
Description of and, where feasible, an estimate of the number of
small entities to which the proposed rule will apply.
In general, the rule would apply to any rail carrier providing rail
cars to a shipper at origin or delivering them to a receiver at end-
point or intermediate destination who wishes to charge demurrage for
the detention of rail cars beyond the free time. See Proposed Rule
Sec. 1333.3. The rule will apply to approximately 562 small rail
carriers.
Description of the projected reporting, recordkeeping, and other
compliance requirements of the proposed rule, including an estimate of
the classes of small entities that will be subject to the requirement
and the type of professional skills necessary for preparation of the
report or record.
The proposed rules would require that rail carriers make certain
third-party disclosures, i.e., provide persons receiving rail cars for
loading or unloading with notice of the demurrage tariff in order to
hold that person liable for demurrage charges. See Proposed Rule Sec.
1333.3. The Board is seeking, pursuant to the Paperwork Reduction Act,
approval from the Office of Management and Budget for this requirement.
See NPR Appendix B (description of collections). To provide this
initial notice, rail carriers would need to update their demurrage
tariffs to conform to the proposed rules to the extent that their
existing tariffs conflict with the proposed rules. In the NPR, the
Board estimated approximately eight hours to provide initial notice to
the railroads' customers. However, the Board seeks further comment on
the actual time, or costs or expenditures, if any, of providing a one-
time notice of the demurrage tariff and updating the demurrage tariff
to conform to the proposed rules, and the extent to which these costs
may differ or vary for small entities.
Identification, to the extent practicable, of all relevant federal
rules that may duplicate, overlap, or conflict with the proposed rule.
The Board is unaware of any duplicative, overlapping, or
conflicting federal rules. The Board seeks comments and information
about any such rules.
Description of any significant alternatives to the proposed rule
that accomplish the stated objectives of applicable statutes and that
minimize any significant economic impact of the proposed rule on small
entities, including alternatives considered, such as: (1) Establishment
of differing compliance or reporting requirements or timetables that
take into account the resources available to small entities; (2)
clarification, consolidation, or simplification of compliance and
reporting requirements under the rule for such small entities; (3) use
of performance rather than design standards; (4) any exemption from
coverage of the rule, or any part thereof, for such small entities.
Under the proposed rule, rail carriers would be free to choose
between providing notice electronically or in writing. In response to
the NPR, many commenters suggested that notice be fulfilled by
providing a link to the notice, rather than the complete text of the
notice of demurrage tariff. Additionally, as noted earlier, some
commenters also argued that a one-time notice should fulfill the notice
requirement, as opposed to providing notice with every shipment. Both
of these suggestions are potential alternatives to minimize the burden
on rail carriers.
Although the stated goal of the rulemaking is to ``promote
uniformity in the area,'' ASLRRA has suggested establishing a different
notice requirement for small carriers. An alternative to the proposed
rule, as suggested by ASLRRA, would be to eliminate the notice
requirement for small carriers that publish their demurrage tariffs on
the carriers' Web site. Other alternatives include eliminating the
notice requirement for small carriers altogether or permitting small
carriers to provide notice in different forms (e.g., by telephone).
Commenters should, if they advance any of these alternatives in their
comments, address how such alternatives would be consistent or
inconsistent with the goal of uniformity envisioned by the proposed
rules.
This action will not significantly affect either the quality of the
human environment or the conservation of energy resources.
It is ordered:
1. Comments are due by June 27, 2013.
2. A copy of this decision will be served upon the Chief Counsel
for Advocacy, Office of Advocacy, U.S. Small Business Administration.
3. Notice of this decision will be published in the Federal
Register.
Decided: May 21, 2013.
By the Board, Chairman Elliott, Vice Chairman Begeman, and
Commissioner Mulvey.
Jeffrey Herzig,
Clearance Clerk.
[FR Doc. 2013-12543 Filed 5-24-13; 8:45 am]
BILLING CODE 4915-01-P