[Federal Register Volume 78, Number 142 (Wednesday, July 24, 2013)]
[Rules and Regulations]
[Pages 44459-44460]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-17783]
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DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
49 CFR Part 1141
[Docket No. EP 715]
Rate Regulation Reforms
AGENCY: Surface Transportation Board.
ACTION: Final rules.
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SUMMARY: The Surface Transportation Board (Board) changes some of its
existing regulations and procedures concerning rate complaint
proceedings. The Board previously created two simplified procedures to
reduce the time, complexity, and expense of rate cases. The Board now
modifies its rules to remove the limitation on relief for one
simplified approach, and to raise the relief available under the other
simplified approach. The Board also makes technical changes to the full
and simplified rate procedures; changes the interest rate that
railroads must pay on reparations if they are found to have charged
unreasonable rates; and announces future proceedings on options for
addressing cross-over traffic and on proposals to address the concerns
of small agricultural shippers. The purpose of these actions is to
ensure that the Board's simplified and expedited processes for
resolving rate disputes are more accessible.
DATES: These rules are effective on August 17, 2013.
ADDRESSES: Information or questions regarding these final rules should
reference Docket No. EP 715 and be in writing addressed to: Chief,
Section of Administration, Office of Proceedings, Surface
Transportation Board, 395 E Street SW., Washington, DC 20423-0001.
FOR FURTHER INFORMATION CONTACT: Lucille Marvin, The Board's Office of
Public Assistance, Governmental Affairs, and Compliance at (202) 245-
0238. Assistance for the hearing impaired is available through the
Federal Information Relay Service (FIRS) at (800) 877-8339.
SUPPLEMENTARY INFORMATION: The Board modifies some of its existing
regulations and procedures regarding rate complaint proceedings and
announces two future proceedings. The Board's actions are
[[Page 44460]]
discussed in five parts. Part I addresses refinements to the
Simplified-SAC test, removing the limit on relief and requiring a more
precise calculation of RPI. Part II addresses an increase to the limit
on relief for a case brought under the Three-Benchmark test to $4
million. Part III discusses the decision not to curtail the use of
cross-over traffic in the Full-SAC test at this time, instead
announcing a future proceeding to address this issue in more detail,
and modifies the revenue allocation methodology for cross-over traffic.
Part IV sets out the change in the interest rate carriers must pay
shippers when the rate charged has been found unlawfully high (from the
current T-bill rate to the U.S. Prime Rate, as published in the Wall
Street Journal). Part V describes the concern that, even with changes
to the limitations on relief for simplified rate cases, shippers of
agricultural commodities may still not have a viable means of
challenging rail rates, and announces the Board's intent to institute a
separate proceeding to explore this concern more closely.
Additional information is contained in the Board's decision served
on July 18, 2013. To obtain a copy of this decision, visit the Board's
Web site at http://www.stb.dot.gov. Copies of the decision may also be
purchased by contacting the Board's Office of Public Assistance,
Governmental Affairs, and Compliance at (202) 245-0238.
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. 5 U.S.C. 601-604. The impact
must be a direct impact on small entities ``whose conduct is
circumscribed or mandated'' by the rule. White Eagle Coop. Ass'n v.
Conner, 553 F.3d 467, 480 (7th Cir. 2009). An agency has no obligation
to conduct a small entity impact analysis of effects on entities that
it does not regulate. United Dist. Cos. v. FERC, 88 F.3d 1105, 1170
(D.C. Cir. 1996). Under Sec. 605(b), an agency is not required to
perform an initial or final regulatory flexibility analysis if it
certifies that the proposed or final rules will not have a
``significant impact on a substantial number of small entities.''
The rule changes adopted here will not have a significant economic
impact upon a substantial number of small entities, within the meaning
of the Regulatory Flexibility Act.\1\ The changes impose no additional
reporting or recordkeeping requirements on small railroads. Nor do
these changes circumscribe or mandate any conduct by small railroads
that is not already required by statute: The establishment of
reasonable transportation rates. Small railroads have always been
subject to rate reasonableness complaints and their associated
litigation costs. And they have been subject to simplified rate
procedures since 1996. Finally, as the Board has previously concluded,
the majority of railroads involved in these rate proceedings are not
small entities within the meaning of the Regulatory Flexibility Act.\2\
In the 32 years since the passage of the Staggers Act--when Congress
limited the Board's rate reasonableness jurisdiction to where a carrier
has market dominance over the transportation at issue--virtually all
rate challenges have involved Class I carriers. Therefore, the Board
certifies under 5 U.S.C. 605(b) that these rules will not have a
significant economic impact on a substantial number of small entities
within the meaning of the Regulatory Flexibility Act.
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\1\ The Small Business Administration's (SBA) Office of Size
Standards develops the numerical definition of a 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 short
line railroad is considered small if its number of employees is 500
or less. Id. (industry subsector 482).
\2\ See Simplified Standards for Rail Rate Cases, EP 646 (Sub-
No. 1), slip op. at 33-34 (STB served Sept. 5, 2007), aff'd sub nom.
CSX Transp., Inc. v. STB, 568 F.3d 236 (D.C. Cir.), vacated in part
on reh'g, 584 F.3d 1076 (D.C. Cir. 2009).
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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 1141
Administrative practice and procedure.
Decided: July 18, 2013.
By the Board, Chairman Elliott, Vice Chairman Begeman, and
Commissioner Mulvey.
Jeffrey Herzig,
Clearance Clerk.
0
For the reasons set forth in the preamble, the Surface Transportation
Board revises part 1141 of title 49, chapter X, of the Code of Federal
Regulations to read as follows:
PART 1141--PROCEDURES TO CALCULATE INTEREST RATES
Authority: 49 U.S.C. 721.
Sec. 1141.1 Procedures to calculate interest rates.
(a) For purposes of complying with a Board decision in an
investigation or complaint proceeding, interest rates to be computed
shall be the most recent U.S. Prime Rate as published by The Wall
Street Journal. The rate levels will be determined as follows:
(1) For investigation proceedings, the interest rate shall be the
U.S. Prime Rate as published by The Wall Street Journal in effect on
the date the statement is filed accounting for all amounts received
under the new rates.
(2) For complaint proceedings, the interest rate shall be the U.S.
Prime Rate as published by The Wall Street Journal in effect on the day
when the unlawful charge is paid. The interest rate in complaint
proceedings shall be updated whenever The Wall Street Journal publishes
a change to its reported U.S. Prime Rate. Updating will continue until
the required reparation payments are made.
(b) For investigation proceedings, the reparations period shall
begin on the date the investigation is started. For complaint
proceedings, the reparations period shall begin on the date the
unlawful charge is paid.
(c) For both investigation and complaint proceedings, the annual
percentage rate shall be the same as the annual nominal (or stated)
rate. Thus, the nominal rate must be factored exponentially to the
power representing the portion of the year covered by the interest
rate. A simple multiplication of the nominal rate by the portion of the
year covered by the interest rate would not be appropriate because it
would result in an effective rate in excess of the nominal rate. Under
this ``exponential'' approach, the total cumulative reparations payment
(including interest) is calculated by multiplying the interest factor
for each period by the principal amount for that period plus any
accumulated interest from previous periods. The ``interest factor'' for
each period is 1.0 plus the interest rate for that period to the power
representing the portion of the year covered by the interest rate.
[FR Doc. 2013-17783 Filed 7-23-13; 8:45 am]
BILLING CODE 4915-01-P