Exclusion of Demurrage Regulation From Certain Class Exemptions
| Citation | 84 FR 55109 |
| Record Number | 2019-22201 |
| Published date | 15 October 2019 |
| Court | Surface Transportation Board |
Federal Register, Volume 84 Issue 199 (Tuesday, October 15, 2019)
[Federal Register Volume 84, Number 199 (Tuesday, October 15, 2019)]
[Proposed Rules]
[Pages 55109-55114]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-22201]
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SURFACE TRANSPORTATION BOARD
49 CFR Part 1039
[Docket No. EP 760]
Exclusion of Demurrage Regulation From Certain Class Exemptions
AGENCY: Surface Transportation Board.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Surface Transportation Board (STB or Board) 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.
DATES: Comments on the proposed rule are due by November 6, 2019. Reply
comments are due by December 6, 2019.
ADDRESSES: Comments and replies may be filed with the Board either via
e-filing or in writing addressed to: Surface Transportation Board,
Attn: Docket No. EP 760, 395 E Street SW, Washington, DC 20423-0001.
Comments and replies will be posted to the Board's website at
www.stb.gov.
FOR FURTHER INFORMATION CONTACT: Amy Ziehm at (202) 245-0391.
Assistance for the hearing impaired is available through the Federal
Relay Service at (800) 877-8339.
SUPPLEMENTARY INFORMATION: The Board's regulations exempt from the
provisions of subtitle IV of title 49 of the U.S. Code the rail
transportation of certain miscellaneous commodities (see 49 CFR
1039.11) and boxcar transportation (see 49 CFR 1039.14). The Board
proposes to amend these regulations to state more clearly that the
exemptions do not apply to the regulation of demurrage. Although the
regulations for these class exemptions have already been interpreted to
effectively exclude the regulation of demurrage, the Board finds these
regulations would be more easily understood by more clearly stating the
demurrage exclusion. Such clarification would also reflect the
longstanding court and agency precedent that these exemptions do not
apply to the regulation of demurrage.
The rail transportation of certain agricultural commodities is also
exempt.\1\ Section 1039.10 does not specifically state that demurrage
\2\ related to the transportation of these agricultural commodities
continues to be subject to Board regulation. The Board finds that
regulation of demurrage related to the non-intermodal transportation of
these agricultural commodities is necessary to carry out the rail
transportation policy of 49 U.S.C. 10101 \3\ and notes that, as
[[Page 55110]]
discussed above, other exemptions for the rail transportation of
certain miscellaneous commodities and for boxcar transportation already
effectively permit regulation of demurrage. Therefore, the Board
proposes, pursuant to 49 U.S.C. 10502(d), to revoke, in part, the
exemption for agricultural commodities at 1039.10 to provide that the
exemption does not apply to the regulation of demurrage related to the
non-intermodal transportation of these commodities.
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\1\ The agricultural commodity exemption under 49 CFR 1039.10
excepts the rail transportation of grain, soybeans, and sunflower
seeds, so the rail transportation of those commodities is subject to
the provisions of subtitle IV of title 49.
\2\ In Demurrage Liability, EP 707, slip op. at 15-16 (STB
served Apr. 11, 2014), the Board clarified that private car storage
is included in the definition of demurrage for purposes of the
demurrage rules established in that decision. The Board uses the
same definition for purposes of this notice of proposed rulemaking.
\3\ This proposed partial revocation is not intended to
authorize the regulation of demurrage related to intermodal
transportation under the exemption at 49 CFR 1039.13.
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Background
This notice of proposed rulemaking arises, in part, as a result of
the testimony and comments submitted in Oversight Hearing on Demurrage
& Accessorial Charges, Docket No. EP 754. The Board commenced that
docket by notice served on April 8, 2019, following concerns expressed
by users of the freight rail network (rail users) \4\ and other
stakeholders about recent changes to demurrage and accessorial tariffs
administered by Class I carriers, which the Board was actively
monitoring.\5\ Specifically, in Oversight Hearing on Demurrage &
Accessorial Charges (April 2019 Notice), EP 754, slip op. at 2 (STB
served Apr. 8, 2019), the Board announced a May 22, 2019 public
hearing, which was later extended to include a second day; \6\ directed
Class I carriers to appear at the hearing; and invited shippers,
receivers, third-party logistics providers, and other interested
parties to participate. The notice also directed Class I carriers to
provide specific information on their demurrage and accessorial rules
and charges and required all hearing participants to submit written
testimony, both in advance of the hearing. April 2019 Notice, EP 754,
slip op. at 2-4. Comments were also accepted from interested persons
who would not be appearing at the hearing. The Board received over 90
pre-hearing submissions from interested parties; heard testimony over a
two-day period from 12 panels composed of, collectively, over 50
participants; and received 36 post-hearing comments.
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\4\ As used in this proposed rule, the term ``rail users''
broadly means any person that receives rail cars for loading or
unloading, regardless of whether that person has a property interest
in the freight being transported.
\5\ In November 2018, the Board sent letters to two Class I
carriers, requesting that they examine, from the perspective of
reciprocity and commercial fairness, recently announced changes to
their policies and practices made in connection with new operating
plans they were implementing. After receiving responses from those
two carriers, the Board requested each Class I carrier to report its
revenues from demurrage and accessorial charges for each quarter of
2018, and, on a going-forward basis, for each quarter of 2019.
Because accessorial charges are not uniform among carriers, each
Class I carrier was asked to identify the specific accessorial items
that account for its reported revenues.
\6\ Oversight Hearing on Demurrage & Accessorial Charges, EP
754, slip op. at 1 (STB served May 3, 2019).
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Numerous parties, including those involved in rail transportation
subject to class exemptions, submitted comments and testified at the
hearing.\7\ For example, the U.S. Department of Agriculture explained
in its comments that ``[m]any agricultural shippers are concerned with
new and increasing charges and their unfair structure, which imposes
steep penalties on customer performance without reciprocal penalties on
railroad performance.'' U.S. Department of Agriculture Comments, May 8,
2019, Oversight Hearing on Demurrage & Accessorial Charges, EP 754.
After considering the submissions and hearing testimony and related
laws and regulations, the Board proposes to clarify its regulations
governing exemptions for certain miscellaneous commodities and boxcar
transportation to ensure that they unambiguously state that demurrage
continues to be subject to Board regulation. The Board also proposes to
partially revoke the exemption for transportation of certain
agricultural commodities to permit the regulation of demurrage, which
would make the agricultural commodities exemption consistent with
similar exemptions covering non-intermodal transportation.
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\7\ These parties include, among others: Ag Processing Inc;
American Forest & Paper Association; Bunge North America;
Consolidated Scrap Resources, Inc.; International Paper; the
Agricultural Retailers Association; the California League of Food
Producers; The Fertilizer Institute; the Freight Rail Customer
Alliance; the Institute of Scrap Recycling; the National Grain and
Feed Association; and the National Industrial Transportation League.
Comments and written testimony from these parties are available in
the docket for EP 754.
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Demurrage is subject to Board regulation under 49 U.S.C. 10702,
which requires railroads to establish reasonable rates and
transportation-related rules and practices, and under 49 U.S.C. 10746,
which requires railroads to compute demurrage charges, and establish
rules related to those charges, in a way that will fulfill national
needs related to freight car use and distribution and maintenance of an
adequate car supply. Demurrage is a charge that both compensates rail
carriers for the expense incurred when rail cars are detained beyond a
specified period of time (i.e., ``free time'') for loading and
unloading and serves as a penalty for undue car detention to encourage
the efficient use of rail cars in the rail network. See 49 CFR 1333.1;
see also 49 CFR 1201, category 106.
Pursuant to 49 U.S.C. 10502(a), the Board is required to exempt a
person, class of persons, or a transaction or service whenever the
Board finds that the application in whole or in part of 49 U.S.C.
subtitle IV (1) is not necessary to carry out the transportation policy
of 49 U.S.C. 10101, and (2) either the transaction or service is of
limited scope, or the application of the statute is not needed to
protect shippers from the abuse of market power.
However, after an exemption is granted, the agency continues to
``monitor the effects of the exemption to assure that continued
regulation is not needed.'' Improvement of TOFC/COFC Regulation, 364
I.C.C. 731, 733 (1981) (citing H. Rep. 96-1430, 96th Cong., 2d Sess.,
at 104-05). Congress accordingly provided a mechanism for revoking
exemptions in whole or in part. Specifically, 49 U.S.C. 10502(d)
provides that ``[t]he Board may revoke an exemption, to the extent it
specifies, when it finds that application in whole or in part of a
provision of this part to the person, class, or transportation is
necessary to carry out the transportation policy of section 10101 of
this title.'' In the 1980s, the Interstate Commerce Commission (ICC),
the Board's predecessor, exercised its exemption authority to exempt
from regulation, subject to various exceptions, several types of
commodities and all commodities transported in boxcars. See Rail Gen.
Exemption Auth.--Miscellaneous Manufactured Commodities, 6 I.C.C.2d
186, 186 (1989) (codified as amended at 49 CFR 1039.11); Rail Gen.
Exemption Auth.--Miscellaneous Agric. Commodities, 367 I.C.C. 298, 299
(1983) (codified as amended at 49 CFR 1039.10); Exemption from
Regulation--Boxcar Traffic, 367 I.C.C. 425, 455 (1983), aff'd in
relevant part, Brae Corp. v. ICC, 740 F.2d 1023 (DC Cir. 1984)
(codified at 49 CFR 1039.14).
The class exemptions for miscellaneous commodities and boxcar
transportation already exclude the regulation of demurrage.
Specifically, the regulations state that the exemption for
miscellaneous commodities ``shall not be construed as affecting in any
way the existing regulations . . . regarding the use of equipment,
whether shipper or railroad owned or leased, including car hire, per
diem and mileage allowances.'' 49 CFR 1039.11(a). The Board has also
explained that the exemption ``does not affect regulation regarding the
use of equipment,'' and
[[Page 55111]]
because ``[d]emurrage is a matter regarding use of equipment,'' such
matters are expressly excluded from the exemption. Savannah Port
Terminal R.R.--Pet. for Declaratory Order--Certain Rates & Practices as
Applied to Capital Cargo, Inc., FD 34920, slip op. at 7-8 (STB served
May 30, 2008) (rejecting argument that 1039.11 precluded the Board from
hearing a demurrage dispute related to commodities listed in that
section).
Similarly, under the boxcar transportation exemption, the Board
retains jurisdiction over ``[c]ar hire and car service'' and ``[c]ar
supply,'' 49 CFR 1039.14(b)(1), (4). The United States Court of Appeals
for the Second Circuit held in 1997 that these terms encompassed
demurrage, stating ``the terms `car supply' and `car service' are
defined in the [Interstate Commerce Act] as encompassing demurrage
charges.'' Del. & Hudson Ry. v. Offset Paperback Mfrs., 126 F.3d 426,
429 (2d Cir. 1997) (citing 49 U.S.C. 10746, 10102(2)). Moreover, when
the ICC promulgated 1039.14, it expressly stated that its decision
``does not affect the obligations of rail carriers to compute demurrage
charges and establish rules related to those charges.'' Exemption from
Regulation--Boxcar Traffic, 367 I.C.C. at 455. As the Board has stated,
demurrage is ``related to car service'' and therefore the boxcar
transportation exemption does not ``extend[] to controversies over
assessment of demurrage.'' Savannah Port Terminal R.R., FD 34920, slip
op. at 7 (citing Del. & Hudson Ry., 126 F.3d at 428-29).
Proposed Rule
The Board proposes to amend 49 CFR 1039.11 and 1039.14, consistent
with the Second Circuit's ruling in Delaware & Hudson Railway and the
Board's ruling in Savannah Port, to state unambiguously that the
exemptions for certain miscellaneous commodities and boxcar
transportation do not apply to the regulation of demurrage. In
addition, the Board proposes to amend 49 CFR 1039.10 by revoking, in
part, the exemption for the rail transportation of certain agricultural
products (except grain, soybeans, and sunflower seeds, which are
already subject to the Board's regulation) to permit the regulation of
demurrage related to the non-intermodal transportation of those
commodities. For the reasons discussed below, the Board finds that the
regulation of demurrage related to this transportation is necessary to
carry out the rail transportation policy of 49 U.S.C. 10101. See 49
U.S.C. 10502(d).
Amendments to 49 CFR 1039.11 and 1039.14
Court and agency decisions have concluded that the exemptions in
1039.11 and 1039.14 do not apply to the regulation of demurrage. See
Savannah Port, FD 34920, slip op. at 7-8; Del. & Hudson Ry., 126 F.3d
at 429. The Board recognizes, however, that the regulations themselves
do not use the term ``demurrage,'' which could cause confusion.
Therefore, the Board proposes amending 1039.11 to add the following
language: ``Consistent with the exemptions in 1039.10 and 1039.14, this
exemption shall not apply to the regulation of demurrage, except the
regulation of demurrage related to transportation that is subject to
1039.13.'' Additionally, the Board proposes amending 1039.14 to add the
following language: ``Consistent with the exemptions in 1039.10 and
1039.11, this exemption shall not apply to the regulation of demurrage,
except the regulation of demurrage related to transportation that is
subject to 1039.13.'' These proposed amendments to 1039.11 and 1039.14
are intended only to ensure that the regulations will be clearly
understood consistent with court and agency precedent, not to make a
substantive change.
Amendment to 49 CFR 1039.10
As noted above, numerous parties, including shippers and receivers
of certain agricultural commodities subject to 1039.10, have expressed
to the Board serious concerns about demurrage rules and charges. Those
concerns, including those expressed in the extensive testimony and
written submissions in Oversight Hearing on Demurrage & Accessorial
Charges, have led the Board to issue a 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, and to issue a separate notice of proposed
rulemaking addressing particular demurrage billing practices. See
Policy Statement on Demurrage & Accessorial Rules & Charges, EP 757
(STB served October 7, 2019); Demurrage Billing Requirements, EP 759
(STB served October 7, 2019). But the principles announced in the
proposed policy statement and the notice of proposed rulemaking would
be thwarted to the extent demurrage is not subject to regulation. To
help ensure that regulatory relief is on par with other, and accessible
to all, non-intermodal transportation shippers and receivers, the Board
proposes to partially revoke the exemption for agricultural
commodities.
The concerns expressed suggest that certain carrier demurrage rules
and charges may not be reasonable and may not fulfill the overarching
purpose of demurrage, and therefore may render freight rail service
less likely to meet the needs of the public. The Board is concerned
about the imposition of demurrage charges for circumstances beyond the
shipper's or receiver's reasonable control. Such charges--which may
arise in connection with the transportation of a wide range of
commodities, including agricultural commodities--do not incentivize
behavior on the part of shippers or receivers that would encourage the
efficient use of rail assets (both equipment and track), and therefore
would not fulfill the overarching purpose of demurrage. Therefore, the
Board finds that this partial revocation is necessary to ``ensure the
development and continuation of a sound rail transportation system . .
. to meet the needs of the public,'' 49 U.S.C. 10101(4); to foster
``sound economic conditions in transportation,'' 10101(5); and to
``encourage honest and efficient management of railroads,'' 10101(9).
Further, if demurrage is exempt from regulation, then agricultural
shippers or receivers seeking to bring a demurrage-related action
before the Board would need to request, and the Board would need to
grant, partial revocation of the class exemption as it applies to
demurrage in every individual case, which may add to the complexity,
length, and cost of such proceedings to the parties and the Board. The
proposed partial revocation is therefore necessary to ``require fair
and expeditious regulatory decisions when regulation is required,''
10101(2), and to ``provide for the expeditious handling and resolution
of all proceedings required or permitted to be brought under this
part,'' 10101(15). There does not appear to be any significant conflict
between the proposed partial revocation of the exemption for
transportation of agricultural commodities and the other aspects of the
rail transportation policy of 10101.
This proposed partial revocation is consistent with longstanding
agency practice and precedent. The Board, and the ICC before it, have
long regulated demurrage, including as related to certain
transportation otherwise exempt under 10502, and have declined to
exclude demurrage from regulation. For example, in 1996, the Board
considered but rejected two proposals that would have largely
eliminated the regulation of demurrage, finding that they did not
[[Page 55112]]
meet the exemption criteria of 10502(a). See Exemption of Demurrage
from Regulation, EP 462, slip op. at 2-4 (STB served Mar. 29, 1996).
The Board found that the first proposal, which was ``to exempt
demurrage following the first 24-hour period after a car is tendered
for loading and following the first 48-hour period after a car is
tendered for unloading,'' created the ``potential . . . for an abuse of
market power'' by making shippers potentially subject to ``unreasonable
charges.'' Id. at 3. The Board found that the second proposal, which
was to ``exempt demurrage as a separate and distinct area of
regulation'' except that demurrage charges could be included in rate
reasonableness challenges, would ``be far more cumbersome and costly
than the present regulatory scheme.'' Id. at 4.
Given that exemptions for certain miscellaneous commodities and
boxcar transportation do not apply to the regulation of demurrage, it
is reasonable to conclude that demurrage should be excluded from the
exemptions in 1039.10 as well. The Board finds no reason why demurrage
claims should be permitted under 1039.11 and 1039.14 but barred under
1039.10, given that all three exemptions are otherwise substantially
similar and were promulgated for similar reasons. See Rail Gen.
Exemption Auth.--Miscellaneous Agric. Commodities, 367 I.C.C. at 299-
303; Rail Gen. Exemption Auth.--Miscellaneous Manufactured Commodities,
6 I.C.C.2d at 186-96; Exemption from Regulation--Boxcar Traffic, 367
I.C.C. at 425-56.
Leaving 1039.10 unchanged could have undesirable effects. Shippers
and receivers of certain agricultural commodities might interpret the
absence of the exclusion of demurrage in 1039.10 (especially when
contrasted with the exclusions with respect to certain miscellaneous
commodities and boxcar transportation) to mean that the Board lacks the
authority (unless it revokes the exemption) to hear demurrage disputes
related to transportation of certain agricultural commodities. Although
the Board has a process for case-specific revocations, the Board finds
no basis for treating only this segment of exempt transportation
differently from other exempt, non-intermodal transportation.
Because the Board finds that regulation of demurrage is necessary
to carry out the rail transportation policy of 49 U.S.C. 10101, the
Board proposes to amend 1039.10, pursuant to 49 U.S.C. 10502(d), by
partially revoking the exemption to permit the regulation of demurrage
related to non-intermodal transportation of certain agricultural
commodities. The Board proposes to add the following sentence to
1039.10: ``Consistent with the exemptions in 1039.11 and 1039.14, this
exemption shall not apply to the regulation of demurrage, except the
regulation of demurrage related to transportation that is subject to
1039.13.'' By stating that 1039.10 is ``[c]onsistent with the
exemptions in 1039.11 and 1039.14,'' the Board intends to clarify that
all three provisions permit the regulation of demurrage. The proposed
language also clarifies that this revocation is not intended to
authorize the regulation of demurrage related to intermodal
transportation. See 49 CFR 1039.13.
Regulatory Flexibility Act. The Regulatory Flexibility Act of 1980
(RFA), 5 U.S.C. 601-612, generally requires a description and analysis
of new rules that would have a significant economic impact on a
substantial number of small entities. In drafting a rule, an agency is
required to: (1) Assess the effect that its regulation will have on
small entities; (2) analyze effective alternatives that may minimize a
regulation's impact; and (3) make the analysis available for public
comment. Section 601-604. In its notice of proposed rulemaking, the
agency must either include an initial regulatory flexibility analysis,
603(a), or certify that the proposed rule would not have a
``significant impact on a substantial number of small entities.''
605(b). Because the goal of the RFA is to reduce the cost to small
entities of complying with federal regulations, the RFA requires an
agency to perform a regulatory flexibility analysis of small entity
impacts only when a rule directly regulates those entities. In other
words, the impact must be a direct impact on small entities ``whose
conduct is circumscribed or mandated'' by the proposed rule. White
Eagle Coop. v. Conner, 553 F.3d 467, 480 (7th Cir. 2009).
The proposed rule could potentially have a significant economic
impact on a substantial number of small entities.\8\ In the past 10
years, two of the six cases involving alleged violations of the
statutes governing demurrage that have been referred to or filed with
the Board have involved Class III carriers, and one of those two cases
arose from a collection action instituted by the rail carrier. Parties
may comment on information relevant to the burden, if any, the proposed
rule would have on small rail carriers.
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\8\ For the purpose of RFA analysis, the Board defines a ``small
business'' as only including those rail carriers classified as Class
III rail carriers under 49 CFR 1201.1-1. See Small Entity Size
Standards Under the Regulatory Flexibility Act, EP 719 (STB served
June 30, 2016) (with Board Member Begeman dissenting). Class III
carriers have annual operating revenues of $20 million or less in
1991 dollars, or $39,194,876 or less when adjusted for inflation
using 2018 data. Class II rail carriers have annual operating
revenues of less than $250 million in 1991 dollars or up to
$489,935,956 when adjusted for inflation using 2018 data. The Board
calculates the revenue deflator factor annually and publishes the
railroad revenue thresholds on its website. 49 CFR 1201.1-1;
Indexing the Annual Operating Revenues of R.Rs., EP 748 (STB served
June 14, 2019).
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Description of the Reasons Why the Action by the Agency Is Being
Considered
The Board instituted this proceeding to address an issue related to
the Board's recent proceeding, Oversight Hearing on Demurrage &
Accessorial Charges, Docket No. EP 754. The Board commenced that docket
by notice served on April 8, 2019, following concerns expressed by rail
users and other stakeholders about recent changes to demurrage and
accessorial tariffs administered by Class I carriers, which the Board
was actively monitoring.
Succinct Statement of the Objectives of, and Legal Basis for, the
Proposed Rule
The objective of the proposed rule is (1) to clarify the Board's
regulations governing exemptions for certain miscellaneous commodities
and boxcar transportation to ensure that the regulations unambiguously
state that demurrage continues to be subject to Board regulation and
(2) to revoke, in part, the exemption for the transportation of certain
agricultural commodities (except grain, soybeans, and sunflower seeds,
which are already subject to the Board's regulation) to provide that
the exemption does not apply to the regulation of demurrage. Partial
revocation is necessary to carry out the rail transportation policy of
49 U.S.C. 10101. Partial revocation also would make the agricultural
commodities exemption consistent with similar exemptions for certain
miscellaneous commodities and boxcar transportation, neither of which
applies to the regulation of demurrage. Partial revocation would help
ensure that this segment of exempt transportation is not treated
differently from other exempt, non-intermodal transportation. The legal
basis for the proposed rule is 49 U.S.C. 10502(d), which gives the
Board authority to revoke an exemption, in whole or in part, when
necessary to carry out the rail transportation policy of 49 U.S.C.
10101.
[[Page 55113]]
Description of, and, Where Feasible, an Estimate of the Number of Small
Entities To Which the Proposed Rule Will Apply
The proposed rule would apply to rail carriers charging demurrage
in connection with the transportation of certain agricultural
commodities, certain miscellaneous commodities, and boxcar
transportation, subject to the exemptions at 49 CFR 1039.10, 1039.11,
and 1039.14, respectively. It therefore could potentially apply to
approximately 656 small rail carriers.
Description of the Projected Reporting, Recordkeeping, and Other
Compliance Requirements of the Proposed Rule, Including an Estimate of
the Classes of Small Entities That Will Be Subject to the Requirement
and the Types of Professional Skills Necessary for Preparation of the
Report or Record
The proposed rule would subject rail carriers that charge demurrage
in connection with the transportation of certain agricultural
commodities to the Board's statutes and regulations regarding
demurrage. Regulation would not impose new reporting requirements
directly or indirectly on small entities because the ICC Termination
Act of 1995 removed regulatory paperwork burdens (with limited
exceptions) on rail carriers to file tariffs or contract summary
filings for rail shipments, exempt or non-exempt.\9\ To the extent that
transportation of certain agricultural commodities would become subject
to Board regulation of demurrage, carriers would be required to provide
actual notice of demurrage liability and charges as a prerequisite to
assessing demurrage. However, these types of notices are generally
already provided, often electronically, for regulated commodities and
certain other exempt transportation. Rail carriers wishing to collect
demurrage may need to update their demurrage rules and charges to
conform to this notice requirement to the extent they do not already do
so. Only six cases involving alleged violations of the statutes
governing demurrage have been referred to or filed with the Board in
the past 10 years. Of those cases, only two involved a Class III
carrier, and one of those two cases arose from a collection action
instituted by the carrier. The Board seeks further comment on any
recordkeeping or other compliance requirements, if any, needed to
conform to the proposed rule.
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\9\ Railroads are required to file with the Board summaries of
all contracts for the transportation of agricultural products within
seven days of the contracts' effective dates. Summaries must contain
specific information contained in 49 CFR part 1313 and are posted on
the agency's website, www.stb.gov.
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Identification, to the Extent Practicable, of All Relevant Federal
Rules That May Duplicate, Overlap, or Conflict With the Proposed Rule
The Board is unaware of any duplicative, overlapping, or
conflicting federal rules. The Board seeks comments and information
about any such rules.
Description of any Significant Alternatives to the Proposed Rule That
Accomplish the Stated Objectives of Applicable Statutes and That
Minimize any Significant Economic Impact of the Proposed Rule on Small
Entities, Including Alternatives Considered, Such as: (1) Establishment
of Differing Compliance or Reporting Requirements or Timetables That
Take Into Account the Resources Available to Small Entities; (2)
Clarification, Consolidation, or Simplification of Compliance and
Reporting Requirements Under the Rule for Such Small Entities; (3) Use
of Performance Rather Than Design Standards; (4) any Exemption From
Coverage of the Rule, or any Part Thereof, for Such Small Entities
One alternative to the proposed rule would be to exempt certain or
all small rail carriers from coverage or compliance with the rule, in
whole or in part (partially revoking the exemption from demurrage
regulation for larger carriers but keeping the exemption in place for
some or all small carriers or excepting small carriers from certain
compliance obligations). This alternative, however, would greatly
complicate cases involving demurrage disputes that involve both large
and small carriers, and it could thwart the principles announced in the
Board's proposed policy statement in Docket No. EP 757 and its other
notice of proposed rulemaking regarding demurrage in Docket No. EP 759.
Another alternative would be to take no action--thereby implementing no
changes to the current regulations--however, this would also thwart the
aforementioned principles. Neither alternative would accomplish the
proposed rule's objective of making the agricultural commodities
exemption consistent with similar exemptions for miscellaneous
commodities and boxcar transportation, neither of which applies to the
regulation of demurrage. Commenters should, if they advance any of
these alternatives in their comments, address how such alternatives
would be consistent or inconsistent with the goals envisioned by the
proposed rules, particularly whether such alternatives carry out the
rail transportation policy of 49 U.S.C. 10101.
It is ordered:
1. The Board proposes to amend its rules as set forth in this
decision. Notice of the proposed rules will be published in the Federal
Register.
2. Comments are due by November 6, 2019. Reply comments are due by
December 6, 2019.
3. A copy of this decision will be served upon the Chief Counsel
for Advocacy, Office of Advocacy, U.S. Small Business Administration.
4. This decision is effective on its service date.
List of Subjects in 49 CFR Part 1039
Agricultural commodities, intermodal transportation, railroads.
Decided: October 4, 2019.
By the Board, Board Members Begeman, Fuchs, and Oberman.
Kenyatta Clay,
Clearance Clerk.
For the reasons set forth in the preamble, the Surface
Transportation Board proposes to amend part 1039 of title 49, chapter
X, of the Code of Federal Regulations as follows:
PART 1039--EXEMPTIONS
0
1. The authority citation for part 1039 continues to read as follows:
Authority: 49 U.S.C. 10502, 13301.
0
2. Amend Sec. 1039.10 by adding a sentence before the last sentence to
read as follows:
Sec. 1039.10 Exemption of agricultural commodities except grain,
soybeans, and sunflower seeds.
* * * Consistent with the exemptions in Sec. 1039.11 and Sec.
1039.14, this exemption shall not apply to the regulation of demurrage,
except the regulation of demurrage related to transportation that is
subject to Sec. 1039.13. * * *
0
3. Amend Sec. 1039.11 by adding a sentence at the end of paragraph (a)
to read as follows:
Sec. 1039.11 Miscellaneous commodities exemptions.
(a) * * * Consistent with the exemptions in Sec. 1039.10 and Sec.
1039.14, this exemption shall not apply to the regulation of demurrage,
except the regulation of demurrage related to transportation that is
subject to Sec. 1039.13.
0
4. Revise Sec. 1039.14(d) to read as follows:
[[Page 55114]]
Sec. 1039.14 Boxcar transportation exemptions and rules.
* * * * *
(d) Carriers must continue to comply with Board accounting and
reporting requirements. Railroad tariffs pertaining to the exempted
transportation of commodities in boxcars will no longer apply.
Consistent with the exemptions in Sec. 1039.10 and Sec. 1039.11, this
exemption shall not apply to the regulation of demurrage, except the
regulation of demurrage related to transportation that is subject to
Sec. 1039.13. This exemption shall remain in effect, unless modified
or revoked by a subsequent order of the Board.
[FR Doc. 2019-22201 Filed 10-11-19; 8:45 am]
BILLING CODE 4915-01-P
