[Federal Register Volume 65, Number 4 (Thursday, January 6, 2000)]
[Notices]
[Pages 805-806]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-193]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board
[STB Ex Parte No. 290 (Sub-No. 2) and (Sub-No. 5)]


Decision: Railroad Cost Recovery Procedures and Quarterly Rail 
Cost Adjustment Factor

Decided: December 29, 1999.
    In this decision, we grant the request of Western Coal Traffic 
League (WCTL) to inspect all RCAF workpapers used in developing the 
Rail Cost Adjustment Factor (RCAF). We order the American Association 
of Railroads (AAR) to make available for inspection the confidential 
RCAF workpapers under the condition that the proprietary workpapers are 
subject to a standard protective order and treated as ``Highly 
Confidential.''

Background

    Under the provisions of 49 U.S.C. 10708, the Board periodically 
issues the RCAF, which is an index reflecting changes in railroad 
costs. The RCAF data are developed by the AAR, and are reviewed by 
Board staff and audited by an independent accounting firm.\1\
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    \1\ The Board conducts regular staff reviews of the RCAF 
workpapers, and of the audits conducted by certified public 
accounting firms, whose audit plans are approved and monitored by 
Board staff.
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    In a filing transmitting to the Board its data for the fourth 
quarter 1999 RCAF, the AAR disclosed that the previous quarter's filing 
contained an error in the calculation of the weights for the Materials 
and Supplies component of the RCAF for the third quarter of 1999. The 
error, which was discovered by the AAR, was not of sufficient magnitude 
to alter the RCAF.
    Nonetheless, in a letter dated September 13, 1999, WCTL asks the 
Board to direct the AAR to permit private parties to review the AAR's 
RCAF calculations. WCTL notes that shippers use the RCAF to 
periodically adjust many rail rates, and thus it asks that affected 
shippers be given the opportunity to review the accuracy of the 
underlying calculations. The AAR did not respond to WCTL's request.

Discussion and Conclusions

    WCTL's request will be granted. Clearly, the accuracy of the RCAF 
is important, and although the data are already audited, mistakes are 
possible. Granting WCTL's request will enhance the accuracy of the 
data, and will also maintain shipper confidence in the RCAF process.
    We recognize that, in 1990, our predecessor, the Interstate 
Commerce Commission (ICC), issued an order denying WCTL and its 
consultants access to the RCAF workpapers on the ground that the 
information is proprietary and commercially sensitive.\2\ However, as 
WCTL notes, in various proceedings, the Board has authorized disclosure 
of commercially sensitive information provided the parties agreed to be 
bound by appropriate protective orders. Our experience has been that 
the protective orders and confidentiality agreements entered in recent 
Board proceedings have been effective.\3\ We see no reason

[[Page 806]]

why the RCAF workpapers can not be similarly protected pursuant to an 
appropriate order. Therefore, we grant WCTL's request and order the AAR 
to make available for inspection the confidential RCAF workpapers under 
the condition that the proprietary workpapers are subject to a standard 
protective order and treated as ``Highly Confidential.''
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    \2\ Railroad Cost Recovery Procedures, Ex Parte No. 290 (Sub-No. 
2) (ICC served September 21, 1990).
    \3\ For example, we protect the very sensitive STB Carload 
Waybill Sample data using confidentiality agreements. Protective 
orders were also successfully used to protect commercially sensitive 
information in STB Finance Docket 33388, CSX Corporation and CSX 
Transportation, Inc., Norfolk Southern Corporation and Norfolk 
Southern Railway Company--Control and Operating Leases/Agreements--
Conrail Inc. and Consolidated Rail Corporation, and STB Docket No. 
41989, Potomac Electric Power Company v. CSX Transportation, Inc.
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    It is ordered:
    1. WCTL's request is granted.
    2. AAR shall make available for inspection the confidential RCAF 
workpapers under the condition that the proprietary workpapers are 
subject to a standard protective order and treated as ``Highly 
Confidential.''
    3. This decision is effective on January 5, 2000.

    By the Board, Chairman Morgan, Vice Chairman Clyburn, and 
Commissioner Burkes.
Vernon A. Williams,
Secretary.
[FR Doc. 00-193 Filed 1-5-00; 8:45 am]
BILLING CODE 4915-00-P