Feds To Examine Freight Rail Pricing

Federal regulators say they will consider new policy initiatives that could make it easier for chemical manufacturers and other “captive shippers” to challenge rates charged by freight railroad companies in areas currently served by only a single carrier. The Surface Transportation Board plans to explore the issue at a hearing in Washington, D.C., on May 3. “We need to strike a balance between providing access to competitive rail transportation for shippers while maintaining the rail industry’s impressive economic renaissance,” STB Chairman Daniel R. Elliott III says. Nearly two-thirds of chemical facilities that rely on rail transportation are served by only one railroad. The industry has long complained that these facilities are routinely subject to poor service and exorbitant prices because railroads enjoy government protections that give them monopoly-like power. Among other things, freight rail customers want STB to lower its filing fees so more rate dispute cases can be brought before the board.