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10/19/2001



Rail News: Rail Industry Trends

STB requires tank-car charge negotiations between railroads, private fleet owners


Surface Transportation Board Oct. 17 ruled that Burlington Northern Santa Fe and Union Pacific Railroad — and eventually all railroads — should negotiate disputes with private tank-car owners per a 1986 industry agreement, adopted by Interstate Commerce Commission. The agreement established a calculation formula to determine allowances rails pay to private tank-car owners.
North America Freight Car Association and Railway Progress Institute's Committee on Tank Cars in June asked the board to interpret certain car storage or diversion charges — issued by BNSF, UP and, later, Norfolk Southern Railway — as improper departures from agreed-upon allowances because they apply to services already covered in allowance calculations.
NS withdrew the charges, but BNSF and UP moved to dismiss the proceedings, arguing that the charges aren't a departure from the agreement because they're within allowance calculations.
Because STB believes private parties are in a better position to determine how best to solve the issue, the board ordered BNSF and UP to privately seek a resolution with the private tank-car owners, and issue a progress report to STB by Jan. 14.
Additionally, the board ruled that future tank-car allowance discussions should be held on an industry-wide basis, enabling all affected parties to participate.


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