The Surface Transportation Board (STB) has scheduled a public hearing on Oct. 22 to explore issues surrounding the National Industrial Transportation League's (NITL) petition to modify the board's standards for mandatory competitive switching.
NITL in 2011 filed the "reciprocal switching" petition, which proposes that certain captive shippers located in terminal areas be granted access to a competing railroad if there is a working interchange within about 30 miles. A competitive switching agreement would not be imposed if either rail carrier can establish that the arrangement is not feasible, unsafe or would "unduly hamper" either carrier's ability to serve its customers.
The STB has received numerous comments in response to the NIT League's proposal and scheduled the hearing to further explore the issues raised. For example, the Association of American Railroads (AAR) filed comments earlier this year opposing revised competitive switching rules. Class Is could lose revenue equaling up to 80 percent of their annual capital budgets if the rules proposed by NITL are adopted, AAR officials claim.
The switching rules also would require more rail-car switching and handling to move the same amount of goods, and could affect an estimated 7.5 million carloads annually, each having an estimated revenue loss to the railroads equaling $1,044 per carload, they believe. In addition, mandatory switching can lead to local service disruptions, degraded service throughout the rail system and a decline in rail productivity, requiring more resources to move the same amount of freight, AAR officials claim.
Parties interested in participating in the October hearing must file a notice of intent with the STB by Sept. 23.
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