Posts Tagged ‘Surface Transportation Board’

Foote Confident Pan Am Sale Will be OKed

June 4, 2021

CSX CEO James Foote expressed optimism this week that his company’s plan to acquire New England regional Pan Am Railways will be successful.

The U.S. Surface Transportation Board has twice complicated spurned CSX’s efforts to buy Pan Am, most recently saying its merger application was incomplete.

“We’re just in the early stages of seeking authority to complete the transaction from the Surface Transportation Board,” Foote said in addressing the Bernstein Strategic Decisions Conference.

“And I’m confident just because of the positive nature of it. Clearly it improves the overall rail transportation network, especially in the New England region.”

CSX announced last November its plans to acquire Pan Am. The STB in March ruled the transaction was a significant one that would thus receive a more comprehensive regulatory review.

The two carriers had sought to have the merger treated as a minor transaction that would have received less stringent review.

CSX said it is pulling tougher more information to share with the STB, including a full analysis of how the deal will affect railroad competition and rail-truck competition in New England.

A decision by the STB on the merger is not expected until sometime in 2022.

Foote says he doesn’t believe the proposed Canadian National-Kansas City Southern merger will trigger a round of Class I railroad mergers.

“You can make a case that consolidation might be good,” Foote said.

He pointed out that in 1980 there were 61 Class 1 railroads, some of which were not in good financial condition.

“They were a basket case, their service was horrible, there was no capital investment,” Foote said. “And over the years the railroads consolidated into what they are today and the core infrastructure of the rail industry now is significantly better than it was. And, No. 1 and most importantly, the seamless nature and the single line service provided today is much better than it was.”

STB Denies CN Bid to Put KCS in Voting Trust

May 18, 2021

A request by Canadian National to place Kansas City Southern into a voting trust has been denied for now by the U.S. Surface Transportation Board.

CN, which is seeking to buy KCS for $33.6 billion, sought to create the voting trust while the transaction is reviewed by federal regulators.

The STB denied the request by saying CN has not yet filed its merger application and therefore the record is incomplete.

CN said it plans to re-file the voting trust proposal once it completes sending documents to the STB pertaining to its merger with KCS.

The KCS board of directors has accepted CN’s proposal after earlier accepting a bid from Canadian Pacific to buy KCS for $29 billion.

KCS will pay CP a $700 million breakup fee for backing out of its earlier deal with CP although KCS has also given CP a week to make a counter offer to the CN bid.

However, CP has said it will not engage in a bidding war with CN over control of KCS.

The voting trust arrangement will enable shareholders of KCS to receive cash and shares of the acquiring company while the merger review process plays out.

Class 1 Rail Employment Up Slightly in February

April 1, 2021

Employment at Class 1 railroads in the United Stated ticked upward slightly in mid February.

The U.S. Surface Transportation Board said the carriers employed 114,068, an increase of 0.53 percent over mid January.

However, the February 2021 figure was down 10.63 percent compared with the same month in 2020.

Four of six employment categories saw gains in February compared with January’s level.

They were maintenance of way and structures, up 1.19 percent to 27,948 workers; transportation (train and engine), up 0.6 percent to 45,794; transportation (other than train and engine), up 0.53 percent to 4,750; and maintenance of equipment and stores, up 0.17 percent to 18,115.

Categories that lost workers on a month-over-month  comparison included executives, officials and staff assistants, down 0.37 percent to 7,266 employees, and professional and administrative, down 0.23 percent to 10,195.

On a year-over year comparison, all categories posted declines.

They were maintenance of equipment and stores, down 18.29 percent; transportation (train and engine), down 10.99 percent; transportation (other than train and engine), down 10.65 percent; maintenance of way and structures, down 7.77 percent; professional and administrative, down 5.75 percent; and executives, officials and staff assistants, down 4.09 percent.

STB OKs Waybill Rule Change

September 5, 2020

A rule that seek to improve waybill sample data collection has been adopted by the U.S. Surface Transportation Board.

The agency said the rule, which takes effect on Jan. 1, 2021, will result in the creation a more robust data set for decision-making and analyses.

In a news release, STB officials said the agency will increase sampling rates of certain non-intermodal carload shipments and specific separate sampling strata and rates for intermodal shipments.

Board members expect the enhanced data set to provide more comprehensive information to the STB and other users of waybill sample data in a variety of contexts, including exemption decisions, stratification reports, traffic volume and rate studies, board-initiated investigations and certain rate cases.

The final rule also eliminates the paper system for reporting waybill data.

Promulgation of the rule began in November 2019.

House Passes Surface Transportation Bill

July 3, 2020

The U.S. House this week passed a five year reauthorization of surface transportation programs.

H.R. 2, which was named the Moving Forward Act, authorizes spending of $1.5 trillion on various transportation-related programs, including Amtrak.

The legislation approves $500 billion to reauthorize surface transportation programs and funding for infrastructure projects.

That includes $105 billion for public transportation and $60 billion for commuter rail, Amtrak and other high-performance rail service.

The bill has received mixed reviews from railroad trade associations because of various mandates that railroads generally oppose.

H.R. 2 faces considerable opposition in the Senate, which is expected to adopt its own surface transportation reauthorization bill with differences to be worked out in a conference committee.

The current surface transportation law, known as the FAST Act, will expire on Sept. 30.

Aside from specific transportation programs, H.R. 2 also authorizes $130 billion for schools, $100 billion for rural broadband and $100 billion for affordable housing.

G&W Subsidiary to Acquire Ohi-Rail

January 23, 2020

The Mahoning Valley Railway has filed noticed with the U.S. Surface Transportation Board that it plans to acquire Ohi-Rail, a short-line carrier based in Minerva.

The noticed, filed on Jan. 17, seeks an exemption from certain regulations as provided by federal law to consummate the purchase of 44.7 miles of Ohi-Rail track in Carroll, Stark, Columbiana, Jefferson, and Harrison counties.

The Mahoning Valley is a subsidiary of Genesee & Wyoming. The STB filing did not disclose the purchase price of the transaction but said G&W and Ohi-Rail have executed an asset purchase agreement to acquire the rail lines.

A map included in the filing shows that the track in question includes the Tuscarawas Industrial Track between Minerva and Bayard, the Tuscarawas Secondary Track between Minerva and Pekin, a route between Minerva and Hopedale, and the Wolf Run Branch between Philips and East Springfield.

MVRY said in the filing that it expected to begin operations on the Ohi-Rail network “upon the closing of the acquisition, which will occur following the date on which this Notice of Exemption is effective.”

The filing noted that if the exemption is granted that the transaction would not be subject to labor protection conditions, and would not require environmental and historic reports.

MVRY said the agreement does not include an interchange commitment and that the projected revenues from taking over Ohi-Rail lines will not exceed the threshold that qualifies MVRY as a Class III carrier.

The MVRY asked the STB to issue a notice allowing the acquisition to become effective 30 days from the filing of the notice of exemption.

Class 1 Railroad Employment Down 1% in November

December 28, 2019

The U.S. Surface Transportation Board reported this week that Class I railroads in mid November employed 133,225 people, which was down 1 percent from mid-October’s level and down 10.58 percent from November 2018.

All six workforce categories posted month-to-month employment decreases.
Executives, officials and staff assistants were down 0.31 percent to 7,629 employees; professional and administrative was down 0.83 percent to 10,910; maintenance of way and structures was down 0.28 percent to 31,242; maintenance of equipment and stores was down 1.72 percent to 23,370; transportation (other than train and engine) was down 0.35 percent to 5,438; and transportation (train and engine) was down 1.31 percent to 54,636.
On a year-over-year basis, all categories also logged decreases.

Executives, officials and staff assistants was down 7.97 percent; professional and administrative was down 7.75 percent; maintenance of way and structures was down 3.54 percent; maintenance of equipment and stores was down 15 percent; transportation (other than train and engine) was down 4.6 percent; and transportation (train and engine) was down 13.66 percent.

In November BNSF employed 41,551 people; Union Pacific had 37,013 workers, Norfolk Southern had 22,818; CSX had 18,783; Canadian National/Grand Trunk had 7,123; Kansas City Southern had 3,024; and  Canadian Pacific/Soo Line had 2,913.

STB Proposes Changes in Waybill Sampling Procedure

December 4, 2019

The U.S. Surface Transportation Board is seeking public comment about a proposed revision to the waybill samples that railroads submit to the agency.

In a news release, the STB said the proposed changes are part of its revisions to rate review procedures.

The STB uses waybill data for such things as exemption decisions, stratification reports, traffic volume and rate studies, and certain rate cases.

Currently the agency uses waybill sampling based on the number of carloads on a railroad’s waybill.

It is proposing to simplify the sampling rates for non-intermodal carload shipments and to specify separate sampling strata and rates for intermodal shipments.

In a statement, STB officials said the changes would create a more robust waybill sample in order to help the agency with its decision-making and analyses as well as other users of the data, without creating an undue burden on railroads.

Comments are due by Jan. 28, 2020.

Class 1 Employment Fell 1.74% in September

October 29, 2019

U.S. Class 1 railroad employment in mid September was down 1.74 percent from August to 136,865 the U.S. Surface Transportation Board said this week.

The September figure was down 7.63 percent from the workforce size in September 2018.

All six workforce categories saw decreases in September compared with August.

Employment by category in September was professional and administration, down 2.38 percent to 11,050 employees; transportation (train and engine), down 2.35 percent to 57,115; maintenance of equipment and stores, down 2.07 percent to 24,118; executives, officials and staff assistants, down 1.01 percent to 7,625; transportation (other than train and engine), down 0.74 percent to 5,474; and maintenance of way and structures, down 0.46 percent to 31,483.

On a year-over-year basis, the categories reflected the following decreases: Maintenance of equipment and stores, down 11.03 percent; executives, officials and staff assistants, down 9.38 percent; transportation (train and engine), down 8.82 percent; professional and administrative, down 6.77 percent; transportation (other than train and engine), down 3.32 percent; and maintenance of way and structures, down 3.11 percent.

Individual railroad employment in September by railroad was BNSF, 42,030; Union Pacific, 38,803; Norfolk Southern, 23,698; CSX, 19,003; Canadian National/Grand Trunk, 7,309; Kansas City Southern, 3,051; and Canadian Pacific/Soo Line, 2,971.

STB Issues Notices in 3 Dumurrage Cases

October 8, 2019

In three notices the U.S. Surface Transportation Board is taking on the contention issue of demurrage, which are fees charged by railroads to shippers who hold onto freight cars for a longer period of time than that had set by the carrier.

In Policy Statement on Demurrage and Accessorial Rules and Charges, docket No. EP 757, the STB said it “is issuing this proposed policy statement to provide the public with information on principles the Board would consider in evaluating the reasonableness of demurrage and accessorial rules and charges.”

Public comment is being sought in this case through Nov. 6, 2019, while reply comments are due by Dec. 6, 2019.

The second case is docket No. 760—Exclusion of Demurrage Regulation From Certain Class Exemptions.

In its ruling it said, “The STB proposes to clarify its regulations governing exemptions for certain miscellaneous commodities and boxcar transportation so that those regulations unambiguously state that demurrage continues to be subject to Board regulation.

“The Board also proposes to revoke, in part, the exemption that currently covers certain agricultural commodities so that the exemption would not apply to the regulation of demurrage, thereby making the agricultural commodities exemption consistent with similar exemptions covering non-intermodal transportation.”

Comments on this proposed notice are due by Nov. 6, with reply comments due by Dec. 6, 2019.

The final notice in docket No. 759, Demurrage Billing Requirements, said the STB “proposes changes to the Board’s regulations governing demurrage liability. Specifically, the Board proposes certain requirements regarding Class I carriers’ demurrage invoices, as well as a requirement that a Class I carrier directly bill the shipper if the shipper and warehouseman agree to that arrangement and have so notified the rail carrier.”

Public comments to this notice are due by Nov. 6 with a Dec. 6 reply comments deadline.

Railway Age reported that the cases are in response to shippers who want the STB to rule that railroads cannot unilaterally bill shippers and demand payment without providing more factual information.” observed Railway Age Capitol Hill Contributing Editor Frank. N. Wilner.

The STB had last May held a two day hearing on railroad demurrage and accessorial charges.

That hearing was prompted by significant recent changes in demurrage and accessorial rules made by several Class I railroads.