[Congressional Record Volume 144, Number 138 (Tuesday, October 6, 1998)]
[Extensions of Remarks]
[Page E1919]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


[[Page E1919]]
       SURFACE TRANSPORTATION BOARD SHOULD NOT ACT ON AGREEMENTS

                                 ______
                                 

                         HON. NICK J. RAHALL II

                            of west virginia

                    in the house of representatives

                        Tuesday, October 6, 1998

  Mr. RAHALL. Mr. Speaker, in 1996, the Surface Transportation Board 
was established within the Department of Transportation as a result of 
Congressional action to terminate the Interstate Commerce Commission. 
The STB is an adjudicatory body with jurisdiction over certain surface 
transportation economic regulatory matters which were formally under 
ICC jurisdiction. The Board consists of three members and herein lies 
the crux of the problem. Today it consists of two members. By the end 
of the year, it will consist of only one member.
  This is not a situation the Congress envisioned when establishing the 
STB and enacting provisions such as those found under section 13703 of 
Title 49 of the United States Code. And I state this as the ranking 
Democrat on the Subcommittee on Surface Transportation which had a 
major role in drafting the ICC Termination Act of 1995.
  The provisions of section 13703 relate to the grant of antitrust 
immunity for certain collective activities pertaining to the motor 
carrier industry. In enacting the 1995 Act, and specifically section 
13703 of Title 49, Congress retained immunity for classification 
making, the collective establishment of through routes and joint rates, 
rates for the transportation of household goods, general rate 
adjustments, rules and divisions. These activities have historically 
had antitrust immunity as being in the public interest and Congress had 
the good sense not to change that arrangement.
  However, the 1995 Act contained a caveat. While immunity would be 
retained for an initial three year-period, which expires December 1998, 
the Act requires that the Board continue the immunity beyond the three-
year period unless it finds that renewal is not in the public interest. 
In other words, unless the Board affirmatively determines that there is 
some public interest basis for not continuing the immunity which 
Congress provided for in the statute, the immunity is to be renewed 
beyond the initial three year period.
  It is now being left up to a single Board member to make these 
determinations. In this regard, there is some question as to whether or 
not the board, when comprised of a single member, even has the 
authority to make any determinations of this nature. Apparently, the 
matter is not well settled. But in any event, any action taken by a STB 
comprised of a single member will be the subject of controversy if not 
litigation.
  As such, I would advise the STB not to take any actions on matters 
which fall within the purview of section 13703(c) of Title 49 while it 
lacks a quorum of its statutorily designated membership. Indeed, the 
clear intent of Congress in enacting the 1995 Act was for the grants of 
antitrust immunity to continue.
  We knew then, as we know now, that the efficient operation of the 
motor carrier industry, and its ability to serve both shippers and 
consumers alike, depends on the continuation of commodity 
classifications. Clearly, motor carriers could not, and would not, meet 
collectively without immunity and it is a fact that no system other 
than the National Classification Committee Agreement provides for the 
grouping of products with comparable characteristics, or the separation 
of products that are dissimilar, for transportation purposes.
  And we knew then, as we know now, that the motor carrier industry 
remains extremely competitive using the collective ratemaking process 
authorized by the immunity to provide procompetitive services to 
shippers. These principally regional motor carriers, by benefit of the 
immunity, have been able to establish together rates and routes for 
essentially multi-regional services, and these services compete with 
the single line services of the large carriers. In this way, these 
carriers, who compete with each other for regional and inter-regional 
freight, effectively join together to offer shippers competitive, and 
often times more cost effective, services. That these carriers are 
continuing to provide shippers with these services in a market of 
extreme competition is testimony to the positive competitive effect of 
the immunity.
  I would note that the household goods industry as we know it also 
depends on the antitrust immunity provided by law.
  For these reasons, I believe the public interest is best served by 
the continuation of the agreements in existence today, and that the 
public would be ill-served by an STB, comprised of a single member, 
taking any actions which would jeopardize the efficiencies embodied by 
the status quo.

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