[Federal Register Volume 59, Number 163 (Wednesday, August 24, 1994)] [Unknown Section] [Page 0] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 94-20841] [[Page Unknown]] [Federal Register: August 24, 1994] ======================================================================= ----------------------------------------------------------------------- INTERSTATE COMMERCE COMMISSION 49 CFR Part 1039 [Ex Parte No. 346 (Sub-No. 35)] Rail General Exemption Authority--Exemption of Ferrous Recycles AGENCY: Interstate Commerce Commission. ACTION: Notice of proposed rulemaking. ----------------------------------------------------------------------- SUMMARY: The Commission is considering whether to exempt from regulation the rail transportation of ferrous recyclables, Standard Transportation Commodity Code (STCC) Nos. 40211 (iron and steel scrap), 33119 (blast furnace, open hearth, rolling mill or coke oven products, NEC), and 34912 (steel shipping containers). If these commodities are exempted, they will be added to the list of exempt commodities in the Commission's regulations, and the exemption will be subject to the conditions and limitations provided therein. DATES: Comments are due on September 23, 1994. ADDRESSES: Participants must send an original and 10 copies of their statement referring to Ex Parte No. 346 (Sub-No. 35) to: Office of the Secretary, Case Control Branch, Interstate Commerce Commission, Washington, DC 20423. FOR FURTHER INFORMATION CONTACT:Beryl Gordon, (202) 927-5610. [TDD for hearing impaired: (202) 927-5721.]. SUPPLEMENTARY INFORMATION: The Association of American Railroads (AAR), numerous member railroads in their individual capacities,\1\ and the Institute of Scrap Recycling Industries, Inc. (ISRI) (collectively, petitioners) have petitioned the Commission to institute a proceeding to consider the exemption from regulation under 49 U.S.C. 10505 of the rail transportation of ferrous recycles, i.e., STCC Nos. 40211 (iron and steel scrap), 33119 (blast furnace, open hearth, rolling mill, or coke over products, NEC), and 34912 (steel shipping containers).\2\ The proposed exemption would be effected by adding these ferrous recyclables to the list of exempt commodities set forth at 49 CFR 1039.11(a) and adding conforming language at the beginning of the second full paragraph of paragraph (a), as set forth below. The proposed exemption would encompass all provisions of Subtitle IV of Title 49 of the United States Code, subject to the exceptions set forth in 49 CFR 1039.11, for all rail carriers nationwide. As discussed below, we are instituting this rulemaking. --------------------------------------------------------------------------- \1\These railroads are: Burlington Northern Railroad Co., Chicago and North Western Railway Company, Consolidated Rail Corp., CSX Transportation, Inc., Norfolk Southern Railway Co., The Atchison, Topeka and Santa Fe Railway Company, Soo Line, Inc., Southern Pacific Transportation Co., and Union Pacific Railroad Co. \2\Accompanying the proposal are supporting verified statements from AAR, AAR member railroad Consolidated Rail Corp., and ISRI members Columbia Iron and Metal Co. and David J. Joseph Co. --------------------------------------------------------------------------- Section 10505 requires us to grant an exemption when we find that: (1) regulation is not necessary to carry out the national rail transportation policy of 49 U.S.C. 10101a (NRTP); and (2) either (a) the transaction or service is of limited scope, or (b) regulation is not needed to protect shippers from an abuse market power. Petitioners assert that their proposal meets these criteria. Petitioners propose the subject commodities for exemption for the following reasons: (1) Continued regulation of these commodities is not necessary to carry out the NRTP at 49 U.S.C. 10101a. According to petitioners, although the transportation of this traffic is highly competitive, an exemption would further increase competition for this traffic and promote numerous NRTP goals, such as (a) increased competition for the traffic, (b) safe and efficient transportation, (c) reduced administrative burdens for both rail carriers and shippers, and (d) increased ratemaking flexibility and financial stability for rail carriers (including, by eliminating tariff and contract filing requirements, the ability to respond more quickly to market changes and shipper demand for resulting rates and services). Current competition is reflected in statistics on rates and revenues from rail transportation of ferrous recyclables. These allegedly demonstrate that market share, rates, and revenue for this traffic have all declined in real dollar terms over the last 10-15 years.\3\ --------------------------------------------------------------------------- \3\Petitioners claim that rail market share has dropped since 1977 from a high of 54.1% to 34% in 1990. Petitioners state that industry revenue per ton-mile for ferrous recyclables declined from 8 cents in 1981 to 4.9 cents in 1991, a 39% decrease. --------------------------------------------------------------------------- (2) The involved rail transportation is limited in scope. The transportation of ferrous recyclables is a small percentage of total rail transportation.\4\ --------------------------------------------------------------------------- \4\Petitioners state that ferrous recyclable traffic comprised only 1.3% of total rail carloads of traffic in the United States in 1991. --------------------------------------------------------------------------- (3) This traffic is subject to significant intermodal, intramodal, and geographic competition, making regulation unnecessary to protect shippers from market power abuse. According to petitioners, this competition in the transportation market is enhanced by competition in the market for the commodities themselves. We invite comments and data concerning the proposal. Persons submitting comments should address whether the exemption of the subject commodities meets the statutory criteria of 49 U.S.C. 10505. Persons also may address the appropriateness of the exemption for any of these commodities on an individual basis. Environmental and Energy Considerations We preliminarily conclude that, if an exemption is granted, it will not significantly affect either the quality of the human environment or the conservation of energy resources. We invite comments in this area. Initial Regulatory Flexibility Analysis Pursuant to 5 U.S.C. 605(b), we preliminarily conclude that an exemption would not have a significant economic impact on a substantial number of small entities. No new regulatory requirements would be imposed, directly or indirectly, on such entities. The impact, if any, would be to reduce the amount of paperwork, tariff filing, and related activities. An exemption, if granted, would be based on a finding that (a) the transportation at issue is of limited scope, and/or (b) regulation of this transportation is not necessary to protect shippers (including small shippers) from abuse of market power. See 49 U.S.C. 10505(a). Such findings, if made, would indicate that a significant number of small entities would not be substantially affected. We invite comments in this area. List of Subjects in 49 CFR Part 1039 Agricultural commodities, Internmodal transportation, Manufactured commodities, Railroads. Decided: August 16, 1994. By the Commission, Chairman McDonald, Vice Chairman Phillips, and Commissioners Simmons and Morgan. Commissioner Simmons dissented in part with a separate expression. Vernon A. Williams, Acting Secretary. For the reasons set forth in the preamble, title 49, chapter X, part 1039 of the Code of Federal Regulations is proposed to be amended as follows: PART 1039--EXEMPTIONS 1. The authority citation for part 1039 would continue to read as follows: Authority: 49 U.S.C. 10321 and 10505; and 5 U.S.C. 553. 2. In Sec. 1039.11, paragraph (a), the following new entries are added at the end of the table, and the text following the table is amended in the first sentence by removing the word ``Also'' and adding in its place ``Other than the specific recyclable commodities listed above, also''. Sec. 1039.11 Miscellaneous commodities exemptions. (a) * * * ------------------------------------------------------------------------ STCC No. STCC tariff Commodity ------------------------------------------------------------------------ ***** 33119.. 6001-V, eff. 1- Blast furnance, open hearth, rolling mill or 1-94. coke oven products, NEC. 34912.. ......do....... Steel shipping containers. 40211.. ......do....... Iron and steel scrap. ***** ------------------------------------------------------------------------ [FR Doc. 94-20841 Filed 8-23-94; 8:45 am] BILLING CODE 7035-01-P-M