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CN and CPR exceeded western grain revenue caps, Canadian Transportation Agency says


Canadian National Railway Co. and Canadian Pacific Railway exceeded their revenue caps for western grain moves for crop year 2007-2008, according to the Canadian Transportation Agency (CTA).

CN's grain revenue totaling $409.3 million was almost $26 million above its $383.3 million cap; CPR's grain revenue totaling $407.1 million exceeded its cap by $33.8 million, the CTA said.

“This is the largest amount that any railway has exceeded its revenue cap as well as the second time that both railways are over their caps in the same year,” CTA officials said in a prepared statement.

The Class Is now have 30 days to pay the amounts they exceeded their caps, plus a 15 percent penalty of $3.9 million for CN and $5 million for CPR. Per government regulations, payments will be made to the Western Grains Research Foundation, a farmer-funded organization that funds research projects benefiting western prairie farmers.

The CTA adjusted the revenue amounts to reflect the railroads’ actual costs for maintaining grain hopper cars and reduce historical maintenance costs that were "embedded" in the caps, the agency said.

Contact Progressive Railroading editorial staff.

More News from 1/2/2009