[Federal Register Volume 71, Number 52 (Friday, March 17, 2006)]
[Notices]
[Pages 13896-13897]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-3931]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

[STB Ex Parte No. 661]


Rail Fuel Surcharges

AGENCY: Surface Transportation Board, DOT.

ACTION: Notice of public hearing.

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SUMMARY: The Surface Transportation Board (Board) will hold a public 
hearing beginning at 9 a.m. on Thursday, May 11, 2006, at its offices 
in Washington, DC, to provide interested persons an opportunity to 
express their views on the subject of fuel surcharges collected by 
railroads. Persons wishing to speak at the hearing should notify the 
Board in writing.

DATES: The public hearing will take place on May 11, 2006. Any person 
wishing to speak at the hearing should file with the Board a written 
notice of intent to participate, and should indicate a requested time 
allotment, as soon as possible but no later than April 20, 2006. Each 
speaker should also file with the Board his/her written testimony by 
April 27, 2006. Written submissions by interested persons who do not 
wish to appear at the hearing will also be due by April 27, 2006.

ADDRESSES: All notices of intent to participate and testimony may be 
submitted either via the Board's e-filing format or in the traditional 
paper format. Any person using e-filing should comply with instructions 
on the Board's http://www.stb.dot.gov Web site, at the ``E-FILING'' 
link. Any person submitting a filing in the traditional paper format 
should send an original and 10 copies of the filing (referring to STB 
Ex Parte No. 661) to: Surface Transportation Board, Attn: STB Ex Parte 
No. 661, 1925 K Street, NW., Washington, DC 20423-0001.

FOR FURTHER INFORMATION, CONTACT: Joseph H. Dettmar, (202) 565-1609. 
[Assistance for the hearing impaired is available through the Federal 
Information Relay Service (FIRS) at: (800) 877-8339.]

SUPPLEMENTARY INFORMATION: The Board will hold a public hearing to 
provide a forum for the expression of views by rail shippers, 
railroads, and other interested persons, on the manner in which fuel 
surcharges are calculated and charged by railroads. The cost of fuel is 
a significant component of the operating costs of providing rail 
service, and railroads can reasonably be expected to devise methods to 
collect increases in those costs from their shippers. However, the rail 
shipper community has voiced concerns that recent fuel surcharges 
collected by railroads are designed to recover amounts over and above 
increased fuel costs.
    A surcharge is a separately identified component of the total rate 
that is charged for the transportation involved. The Board's authority 
to regulate the level of a railroad's rates is limited. The Board only 
has jurisdiction over a railroad's common carriage rates, not rates 
governed by a rail transportation contract negotiated by the shipper 
and railroad. 49 U.S.C. 10709. Even as to a railroad's common carriage 
rates, the Board can review the level of the rate only if there is no 
effective competition from other rail carriers or modes of 
transportation for the transportation to which the rate applies. 49 
U.S.C. 10707(a). Moreover, Congress has precluded the Board from 
regulating rates which produce revenues that are less than 180% of the 
carrier's variable costs of providing the service involved. 49 U.S.C. 
10707(d)(1)(A). Therefore, this hearing is not intended to address the 
level of surcharges.
    On the other hand, the Board has broad authority over the 
reasonableness of a railroad's practices. 49 U.S.C. 10702(2). The Board 
cannot use its authority over the reasonableness of a carrier's 
practices to regulate the level of a carrier's rates. See Union Pacific 
R.R. v. ICC, 867 F.2d 646 (DC Cir. 1989). But, to the extent that 
shippers are complaining of the railroad practice of labeling a rate 
increase as a fuel surcharge when the increase is not directly and 
closely correlated to

[[Page 13897]]

increases in the cost of fuel for the particular movement to which the 
surcharge is applied, the Board arguably could consider that as a 
possible unreasonable practice.\1\ Thus, it is that aspect of the 
shippers' concerns--whether railroad fuel surcharges are being set in 
such a manner as to insure that they are used only to recover the 
increased cost of fuel for the particular movements to which the 
surcharge is applied--that will be the subject of this hearing. 
Railroads are asked to present (individual not collective) testimony on 
how they set fuel surcharges, and whether their fuel surcharges fairly 
reflect the increasing fuel costs of the particular movements to which 
they are applied.
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    \1\ If a complainant sought to challenge a particular fuel 
surcharge that applied to exempt classes of traffic, the complainant 
would have to seek revocation of the exemption (under 49 U.S.C. 
10502(d)) to the extent necessary before the Board could take 
regulatory action with regard to that traffic.
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    We are holding this hearing based on the Board's authority to 
inquire into the management of railroads and to obtain information that 
is needed to carry out the statute that the Board administers. 49 
U.S.C. 721(b). To carry out its various statutory responsibilities, the 
Board requires railroads to collect and submit to the Board extensive 
cost and revenue information. 49 CFR parts 1200-1280. In this hearing, 
shippers and railroads are asked to comment on whether and how those 
reporting requirements should be adjusted to provide rail customers 
with better information on a carrier's fuel costs and the revenues 
collected through fuel surcharges. Making this information publicly 
available should enable shippers to better identify and protect against 
inappropriate surcharges and to more reliably forecast their future 
transportation costs.
    Railroads have expressed concern that engaging in multi-carrier 
discussions regarding their fuel surcharge practices could expose them 
to potential liability under federal antitrust laws. This hearing will 
be structured to avoid such concerns. Railroads will be expected to 
submit separate, independent testimony at this hearing. They will not 
be asked to exchange information privately regarding their respective 
fuel surcharge practices or to agree upon a common method to calculate 
fuel surcharges. The agency is exercising its power to obtain from the 
regulated carriers information it needs to determine if a problem 
exists that requires agency action. 49 U.S.C. 721(b). Such a public 
conversation at the formal request of the agency should not implicate 
the federal antitrust laws. See Eastern R.R. Presidents Conference v. 
Noerr Motor Freight, Inc., 365 U.S. 127 (1961) (petitioning immunity); 
United Mine Workers v. Pennington, 381 U.S. 657 (1965) (Noerr immunity 
extends to petitioning government administrative agencies). Nor should 
any inference to the contrary be drawn merely from their participation 
at these hearings.
    Date of Hearing. The hearing will begin at 9 a.m. on May 11, 2006, 
in the 7th floor hearing room at the Board's headquarters in 
Washington, DC, and will continue, with short breaks if necessary, 
until every person scheduled to speak has been heard.
    Board Releases and Live Audio Available Via the Internet. Decisions 
and notices of the Board, including this notice, are available on the 
Board's Web site at http://www.stb.dot.gov. This hearing will be 
available on the Board's website by live audio streaming. To access the 
hearing, click on the ``Live Audio'' link under ``Information Center'' 
at the left side of the home page beginning at 9 a.m. on May 11, 2006.
    This action will not significantly affect either the quality of the 
human environment or the conservation of energy resources.

    Dated: March 13, 2006.
Vernon A. Williams,
Secretary.
[FR Doc. E6-3931 Filed 3-16-06; 8:45 am]
BILLING CODE 4915-01-P