Exclusion of Demurrage Regulation From Certain Class Exemptions

Published date04 March 2020
Citation85 FR 12749
Record Number2020-04460
SectionRules and Regulations
CourtSurface Transportation Board
Federal Register, Volume 85 Issue 43 (Wednesday, March 4, 2020)
[Federal Register Volume 85, Number 43 (Wednesday, March 4, 2020)]
                [Rules and Regulations]
                [Pages 12749-12756]
                From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
                [FR Doc No: 2020-04460]
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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: Final rule.
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                SUMMARY: The Surface Transportation Board (STB or Board) is adopting a
                final rule amending its regulations governing the class exemptions for
                the rail transportation of certain miscellaneous commodities and rail
                transportation by boxcar to state more clearly that the exemptions do
                not apply to the regulation of demurrage. The final rule also revokes,
                in part, the class exemption that currently covers the rail
                transportation of certain agricultural commodities so that the
                exemption will not apply to the regulation of demurrage, thereby making
                the agricultural commodities exemption consistent with similar class
                exemptions covering non-intermodal rail transportation.
                DATES: This rule will be effective on April 3, 2020.
                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 provisions of 49 U.S.C. 10502, which
                authorize the Board to exempt types of rail services from its
                regulation, also provide that the Board may revoke an exemption (in
                whole or in part) should it determine that regulation is necessary to
                carry out the rail transportation policy (RTP). See 49 U.S.C. 10502(d).
                Currently, the Board's regulations exempt the rail transportation of
                certain miscellaneous commodities (see 49 CFR 1039.11) and boxcar
                transportation (see 49 CFR 1039.14). Although the language in the
                regulations for these class exemptions has consistently been
                interpreted by courts and the agency to effectively exclude the
                regulation of demurrage, the Board finds these regulations would be
                more easily understood by more clearly stating the demurrage exclusion.
                 The rail transportation of agricultural commodities (except grain,
                soybeans, and sunflower seeds \1\) is also exempt (see 49 CFR 1039.10).
                Unlike the miscellaneous commodities and boxcar transportation
                exemptions, however, the agricultural commodities exemption in section
                1039.10 does not contain language that has been interpreted to
                effectively exclude the regulation of demurrage.
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                 \1\ Because the agricultural commodities exemption under 49 CFR
                1039.10 excepts the rail transportation of grain, soybeans, and
                sunflower seeds, the rail transportation of those commodities
                continues to be subject to the provisions of subtitle IV of title 49
                and is not impacted by this decision.
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                 Last October, the Board issued a notice of proposed rulemaking to
                address both of the above issues. Exclusion of Demurrage Regulation
                from Certain Class Exemptions (NPRM), EP 760 (STB served Oct. 7, 2019).
                The NPRM proposed first to modify the language in section 1039.11 and
                section 1039.14 to reflect the longstanding court and agency precedent
                by more clearly stating that the miscellaneous commodities and boxcar
                transportation exemptions do not apply to the regulation of demurrage.
                The NPRM also proposed to revoke, in part, the exemption applicable to
                non-intermodal rail transportation of agricultural commodities (section
                1039.10) so that the exemption would not apply to the regulation of
                demurrage, thereby making the agricultural commodities exemption
                consistent with similar class exemptions covering non-intermodal rail
                transportation.\2\
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                 \2\ As noted in the NPRM, this 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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                 After considering the comments, the Board will adopt the rule as
                proposed in the NPRM. Specifically, the Board will add language to
                section 1039.11 and section 1039.14 to state more clearly, consistent
                with longstanding court and agency precedent, that these exemptions do
                not apply to the regulation of demurrage. Additionally, the Board finds
                that regulation of demurrage related to the non-intermodal rail
                transportation of agricultural commodities is necessary to carry out
                the RTP of 49 U.S.C. 10101. Therefore, pursuant to 49 U.S.C. 10502(d),
                the Board revokes in part the exemption for agricultural commodities at
                section 1039.10 to provide that the exemption does not apply to the
                regulation of demurrage related to the non-intermodal rail
                transportation of these commodities.
                Background
                 Demurrage is a charge that is assessed when rail cars are detained
                beyond a specified period of time (i.e., ``free time'') for loading and
                unloading. Demurrage is subject to Board regulation under 49 U.S.C.
                10702, which, among other things, requires railroads to establish
                reasonable 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.\3\
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                 \3\ 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 regulations established in that decision. The Board uses
                the same definition in this decision.
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                 This proceeding arose, in part, as a result of the testimony and
                comments submitted in Oversight Hearing on Demurrage & Accessorial
                Charges, Docket No. EP 754, in which numerous
                [[Page 12750]]
                parties, including those involved in rail transportation subject to
                class exemptions, submitted comments and testified at the hearing on
                May 22 and 23, 2019, about, among other things, their concerns
                regarding recent railroad demurrage rules and charges.\4\ The U.S.
                Department of Agriculture (USDA) submitted comments, expressing its
                concerns, as well as the concerns of agricultural shippers generally,
                about ``new and increasing [demurrage] charges and their unfair
                structure, which imposes steep penalties on customer performance
                without reciprocal penalties on railroad performance.'' USDA Comments
                2, Oversight Hearing on Demurrage & Accessorial Charges, EP 754. After
                considering the submissions and hearing testimony, along with the
                relevant laws and regulations, the Board issued the NPRM and sought
                public comment.
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                 \4\ Comments and written testimony from these parties are
                available in Docket No. EP 754.
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                 As discussed in the NPRM, the class exemptions for miscellaneous
                commodities and boxcar transportation already effectively exclude the
                regulation of demurrage. See NPRM, EP 760, slip op. at 4. Specifically,
                the regulations state that the exemption for miscellaneous commodities
                ``shall not be construed as affecting in any way the existing
                regulations, agreements, prescriptions, conditions, allowances or
                levels of compensation 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). Similarly, under the boxcar
                transportation exemption, the Board retains regulatory authority over
                ``[c]ar hire and car service'' and ``[c]ar supply.'' 49 CFR
                1039.14(b)(1), (4). Both the courts and the agency have found that the
                language of these provisions effectively excludes demurrage from the
                miscellaneous commodities and boxcar transportation exemptions. See
                NPRM, EP 760, slip op. at 4. The existing agricultural commodities
                exemption, however, does not specifically exclude car hire, car
                service, car supply, or equipment usage. The NPRM explained that the
                Board sought to make the agricultural commodities exemption more
                consistent with the miscellaneous commodities and boxcar transportation
                exemptions and that the regulation of demurrage related to agricultural
                commodities was necessary to carry out the RTP.
                Final Rule
                 In response to the NPRM, the Board received comments and reply
                comments from over a dozen interested parties.\5\ After considering the
                comments, the Board is adopting the rule proposed in the NPRM. Text of
                the final rule is below.
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                 \5\ The Board received comments and/or reply comments from the
                following: The Association of American Railroads (AAR), the American
                Forest & Paper Association (AF&PA), the American Iron and Steel
                Institute (AISI), ArcelorMittal USA LLC (ArcelorMittal), the
                American Short Line and Regional Railroad Association (ASLRRA),
                Auriga Polymers, Inc. (Auriga), CSX Transportation, Inc. (CSXT), the
                Freight Rail Customer Alliance (FRCA), the Industrial Minerals
                Association--North America (IMA-NA), the Institute of Scrap
                Recycling Industries, Inc. (ISRI), International Paper, the National
                Industrial Transportation League (NITL), the Portland Cement
                Association (Portland Cement), and the Private Railcar Food and
                Beverage Association (PRFBA).
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                Amendments to 49 CFR 1039.11 and Section 1039.14
                 As noted above, the exemptions in 49 CFR 1039.11 and 1039.14 have
                long been interpreted by courts and the agency to permit regulation of
                demurrage. See 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) (``neither of these
                exemptions extends to controversies over assessment of demurrage'');
                Del. & Hudson Ry. v. Offset Paperback Mfrs., 126 F.3d 426, 429 (2d Cir.
                1997) (explaining that the language of section 1039.14(b)
                ``encompass[es] demurrage charges''). The regulations themselves,
                however, do not explicitly refer to ``demurrage.'' To avoid confusion
                due to this lack of explicit reference, the NPRM proposed to formalize
                what has been established practice for many years by amending each of
                those regulations to clarify that they would ``not apply to the
                regulation of demurrage, except the regulation of demurrage related to
                [intermodal] transportation that is subject to section 1039.13.'' NPRM,
                EP 760, slip op. at 5. These amendments were proposed only to clarify
                and ensure that the regulations are consistent with court and agency
                precedent, not to make a substantive change. Id.
                 Most commenters either supported or did not oppose the proposed
                amendments to section 1039.11 and section 1039.14, and they will be
                adopted as proposed.\6\ These changes will clarify that it is not
                necessary to first seek an exemption revocation when demurrage matters
                relating to miscellaneous commodities and boxcar transportation are
                brought to the Board. Moreover, the amendments will state more clearly
                that carriers must comply with the statutes and Board regulations
                governing demurrage related to miscellaneous commodity and boxcar
                transportation. Although this was already the case given court and
                agency interpretations of the regulatory text, clarifying language will
                mitigate the potential for confusion among stakeholders and make the
                regulations more easily understood.
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                 \6\ (See, e.g., Portland Cement Comments 1-2 (supporting the
                proposed amendments); AAR Comments 1 (stating that ``AAR does not
                object'' to these proposed amendments).) ASLRRA generally objects to
                the proposed rule and, among other things, mentions these conforming
                amendments, arguing that the proposed rule would have significant
                adverse effects on small entities. (ASLRRA Comments 3.) However, any
                objection that amending Sec. 1039.11 and Sec. 1039.14 would
                increase the burden on Class II and Class III railroads, (see id. at
                2-3), is unfounded. As noted, these amendments are not substantive
                changes but rather clarifications that ensure that the regulations
                will be clearly understood consistent with court and agency
                precedent.
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                 Several commenters asked the Board to add language stating that the
                exemptions in section 1039.11 and section 1039.14 also do not apply to
                accessorial programs. (AISI Comments 4; Portland Cement Comments 2;
                ArcelorMittal Comments 6 n.3.) The Board declines to add the requested
                language. As explained in the NPRM, EP 760, slip op. at 5, the purpose
                of the proposed amendments to section 1039.11 and section 1039.14 is
                ``to ensure that the regulations will be clearly understood consistent
                with court and agency precedent, not to make a substantive change.''
                Court and agency precedent specifically addresses demurrage but does
                not discuss accessorial charges. See Savannah Port, FD 34920, slip op.
                at 7-8; Del. & Hudson Ry., 126 F.3d at 429. Adding language addressing
                the broad category of accessorial charges, some of which are unrelated
                to the categories carved out of the section 1039.11 and section 1039.14
                exemptions (e.g., car hire, car supply, car service, and the use of
                equipment) and which were not discussed in the precedent, would be a
                substantive change, not a clarification, beyond the purpose of the
                amendments proposed in the NPRM.\7\ The Board notes, however, that to
                the extent specific accessorial charges relate to categories that are
                already carved out (e.g., car hire, car supply, car service, and the
                use of equipment), they are already excluded from the section 1039.11
                and section 1039.14 exemptions. Adding an express reference to
                ``demurrage'' to section 1039.11 and section 1039.14 does not change
                the scope of the existing
                [[Page 12751]]
                categories carved out of these exemptions.
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                 \7\ (See also AAR Reply Comments 6-7 (opposing the addition of
                the broad category of accessorial charges because it would be
                contrary to the Board's stated purpose for its clarification
                proposed in the NPRM).)
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                Amendment to 49 CFR 1039.10
                 As noted above, numerous parties have expressed to the Board
                serious concerns about recent demurrage rules and charges. Those
                concerns, including those reflected in the extensive record compiled in
                Docket No. EP 754, 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 Oct. 7, 2019); Demurrage Billing Requirements, EP 759 (STB
                served Oct. 7, 2019). But as the Board noted in the NPRM, EP 760, slip
                op. at 5, the general principles and statutory goals articulated by the
                Board in those proceedings would be thwarted to the extent demurrage is
                not generally subject to regulation. To ensure that the regulatory
                relief available to agricultural shippers is on par with relief
                available to other non-intermodal rail transportation shippers and
                receivers, the Board proposed to partially revoke the exemption for
                agricultural commodities at section 1039.10 to exclude demurrage.
                 Three commenters (AAR, CSXT, and ASLRRA) oppose the proposed
                amendment to section 1039.10. The Board will address their arguments
                below.
                Market Power
                 AAR and CSXT argue that no revocation of any exemption is
                permissible unless the Board first makes a finding that railroads have
                market power over transportation of the relevant commodities. (AAR
                Comments 5-6; CSXT Comments 1-2.) AAR states that the NPRM is ``legally
                insufficient due to the absence of any discussion of railroad market
                power over the commodities at issue.'' (AAR Comments 5.) CSXT asserts
                that the Board must provide ``evidence that the agency's prior
                conclusions that railroads lack market power over those commodities are
                no longer correct'' and that the NPRM ``does not establish the
                essential element of any exemption revocation: proof that railroads
                possess and have abused market power for the particular commodities
                subject to the exemption.'' (CSXT Comments 1.)
                 AAR and CSXT's arguments mischaracterize the Board's statutory
                requirements. The exemption revocation statute, 49 U.S.C. 10502(d),
                provides that the Board may revoke an exemption in whole or in part
                when it finds that regulation ``is necessary to carry out the
                transportation policy of'' 49 U.S.C. 10101. Notably, the exemption-
                revocation provision does not say anything about market power, in
                contrast to the exemption-granting provision, which, as pertinent here,
                requires a finding that regulation is not needed to advance the RTP or
                to protect shippers from the abuse of market power. Compare 49 U.S.C.
                10502(d) with id. section 10502(a).
                 Even though it is not mentioned in the exemption-revocation
                statute, the agency has treated market power as an important issue in
                some of its past exemption revocation decisions. See, e.g., WTL Rail
                Corp. Pet. for Declaratory Order & Interim Relief, NOR 42092 et al.,
                slip op. at 3 (STB served Feb. 17, 2006) (``[W]e have held that the
                extent of railroad market power is an essential issue in exemption
                revocation proceedings.'').\8\ The statute itself, however, does not
                require such an analysis.\9\ Moreover, the Board has decided exemption
                revocation cases without mentioning market power. See, e.g., BNSF Ry.--
                Temporary Trackage Rights Exemption--Union Pac. R.R., FD 35963 (Sub-No.
                1), slip op. at 2 (STB served Dec. 17, 2015) (granting partial
                revocation of an exemption because it would ``promot[e] RTP policy
                goals''); S. Plains Switching, Ltd.--Acquis. Exemption--BNSF Ry., FD
                33753 (Sub-No. 1), slip op. at 2 (STB served Sept. 15, 2006)
                (revocation is appropriate ``if we find that: Regulation is necessary
                to carry out the rail transportation policy of 49 U.S.C. [section]
                10101; or revocation is necessary to ensure the integrity of the
                Board's processes'').\10\
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                 \8\ See also Mr. Sprout, Inc. v. United States, 8 F.3d 118, 122-
                23 (2d Cir. 1993), in which the reviewing court deferred to the
                agency's interpretation that ``the initial inquiry in a reregulation
                case is whether the carrier has market power.''
                 \9\ AAR relies heavily on some of the legislative history
                provided in the Conference Report accompanying the ICC Termination
                Act of 1995 (ICCTA). (AAR Comments 5.) While the legislative history
                does provide that the conferees expected the Board, in considering
                requests for revocation, to ``examine all competitive transportation
                factors that restrain rail carriers' actions and that affect the
                [relevant] market for transportation,'' as AAR emphasizes, it also
                provides that when the Board considers a revocation request, it
                should require either ``demonstrated abuse of market power that can
                be remedied only by reimposition of regulation or that regulation is
                needed to carry out the national transportation policy.'' H.R. Rep.
                No. 104-422, at 169 (1995), as reprinted in 1995 U.S.C.C.A.N. 850,
                853 (emphasis added). The Conference Report language that AAR
                emphasizes does not overcome the clear statutory language giving the
                Board authority to revoke based solely on RTP concerns.
                 \10\ See also Norfolk & W. Ry.--Trackage Rights Exemption--
                Norfolk S. Ry., FD 32961, slip op. at 2 (STB served Aug. 22, 1997)
                (``Under 49 U.S.C. [Sec. ] 10502(d), we may revoke an exemption if
                we find that regulation of the transaction at issue is necessary to
                carry out the RTP of 49 U.S.C. [Sec. ] 10101.''); Consol. Rail
                Corp.--Declaratory Order--Exemption, 1 I.C.C.2d 895, 900 (1986)
                (party seeking revocation of an exemption must show that
                ``regulation is needed to carry out the national rail transportation
                policy.'').
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                 Although not statutorily required to do so, and contrary to the
                contentions of AAR and CSXT that the Board failed to examine market
                power, the Board nevertheless addressed market power in the NPRM. The
                NPRM explained that in 1996, the Board found that a proposed exemption
                of demurrage from most regulation created the ``potential . . . for an
                abuse of market power'' because it could make shippers potentially
                subject to ``unreasonable charges.'' NPRM, EP 760, slip op. at 6
                (quoting Exemption of Demurrage from Regulation (Exemption of
                Demurrage), EP 462, slip op. at 4 (STB served Mar. 29, 1996)). The
                Board's 1996 decision elaborates on how the proposed exemption could
                result in shippers being charged demurrage due to circumstances beyond
                their control:
                 As the shippers point out, demurrage, which could extend well
                beyond the free period covered by the proposed exemption, is often
                caused by factors that are beyond their control. Sometimes, the
                carriers themselves may be responsible for the conditions giving
                rise to car detention. Other times, demurrage is incurred not as a
                storage charge, but because cars cannot reach their intended
                destination due to congestion in the stream of transit. And in other
                instances, demurrage charges accrue due to circumstances beyond the
                control of either the carrier or the shipper (e.g., strikes,
                bunching, run-around, fire/explosion, and weather). Deregulating
                demurrage, shippers claim, could subject them to abusive practices
                resulting from circumstances over which they have no control.
                 The shippers' concerns are not without basis. Although the
                arguments favoring the limited exemption have some appeal, the
                exemption could result in shippers paying unreasonable charges for
                detention that they did not cause. Thus, there is the potential with
                such an exemption for an abuse of market power.
                Exemption of Demurrage, EP 462, slip op. at 4.
                 The testimony and comments in Docket No. EP 754 validate the
                Board's concerns expressed in 1996 that there is a potential for abuse
                of market power in the context of demurrage. See NPRM, EP 760, slip op.
                at 6. As the Board explained in the NPRM, the testimony and comments
                ``suggest that certain carrier demurrage rules and charges may
                [[Page 12752]]
                not be reasonable,'' \11\ and the Board ``is concerned about the
                imposition of demurrage charges for circumstances beyond the shipper's
                or receiver's reasonable control.'' Id.
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                 \11\ The record in Docket No. EP 754 demonstrates that shippers
                and receivers can be particularly susceptible to unreasonable
                practices with respect to demurrage. For example, a shipper or
                receiver may not know in advance whether there will be issues in
                transit that could lead to loading or unloading delays subject to
                demurrage charges. Further, a shipper or receiver may not receive
                sufficient information to assess the validity of demurrage charges
                even after it receives an invoice. Concerns such as these are
                addressed in Docket Nos. EP 757 and EP 759, and the goals of those
                proceedings would be thwarted for the transportation of agricultural
                commodities at Sec. 1039.10 to the extent demurrage is not subject
                to regulation.
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                 The concerns that led the Board to find the potential for abuse of
                market power in the 1996 decision--unreasonable practices and charges
                for circumstances beyond the shipper's or receiver's control--have been
                borne out by the Board's observations of recent practices relating to
                demurrage rules and charges. For example, several carriers have
                implemented or announced significant reductions to ``free time'' (i.e.,
                the specified period of time for loading and unloading before demurrage
                charges are imposed) that, according to interested parties from a broad
                range of industries, have made it difficult, if not impossible, to
                avoid demurrage charges. See Policy Statement on Demurrage &
                Accessorial Rules & Charges, EP 757, slip op. at 2, 9-11 & nn.25-28,
                30-31 (citing comments filed in Docket No. EP 754, and applicable to
                demurrage generally, from, among others, the Agricultural Retailers
                Association, the Corn Refiners Association, the National Grain and Feed
                Association (NGFA), NITL, and The Fertilizer Institute). In addition,
                the Board has received reports of recent increases in ``bunched''
                deliveries of rail cars--deliveries that are not reasonably timed or
                spaced--that make it difficult to avoid demurrage charges no matter how
                promptly and efficiently the receiving party acts. Id. at 13-14 &
                nn.37-39 (citing comments filed in Docket No. EP 754 from, among
                others, NGFA, the American Chemistry Council, PRFBA, and the
                International Association of Refrigerated Warehouses). Agricultural
                shippers and organizations generally, and the USDA, are among the
                commenters that have expressed concerns about such changes in demurrage
                rules and charges.\12\ Therefore, the Board reaffirms its conclusion in
                the 1996 decision and finds partial revocation for these agricultural
                commodities is appropriate.
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                 \12\ See, e.g., USDA Comments, May 8, 2019, Oversight Hearing on
                Demurrage & Accessorial Charges, EP 754; NGFA Comments, May 8, 2019,
                Oversight Hearing on Demurrage & Accessorial Charges, EP 754;
                Agricultural Retailers Ass'n Comments, May 8, 2019, Oversight
                Hearing on Demurrage & Accessorial Charges, EP 754; Bunge North
                America Comments, May 8, 2019, Oversight Hearing on Demurrage &
                Accessorial Charges, EP 754; California League of Food Producers
                Comments, May 8, 2019, Oversight Hearing on Demurrage & Accessorial
                Charges, EP 754; Ag Processing, Inc. Comments, May 8, 2019,
                Oversight Hearing on Demurrage & Accessorial Charges, EP 754.
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                 As the Board pointed out in the NPRM, EP 760, slip op. at 6, the
                1996 Exemption of Demurrage decision broadly discussed the potential
                for the abuse of market power, and neither the participants at the
                Board's hearing nor the commenters in this proceeding identified any
                basis for treating agricultural commodities in section 1039.10
                differently from other commodities with respect to demurrage charges.
                The only difference that AAR raises between the transportation of these
                agricultural commodities and that of other commodities is that the
                agricultural commodities exemption did not exclude demurrage. (AAR
                Comments 7.) But that does not mean that the agency in 1983
                affirmatively found that rail carriers should be free to levy demurrage
                charges at will. The 1983 decision establishing the agricultural
                commodities exemption contains no specific reference to demurrage. Rail
                Gen. Exemption Auth.--Miscellaneous Agric. Commodities, 367 I.C.C. 298,
                302-03 (1983).
                 The Board recognizes that the market power discussion is not
                particularly robust in either the 1983 decision, which broadly exempted
                many agricultural commodities, or the 1996 Exemption of Demurrage
                decision, which rejected a railroad proposal for a broad exemption for
                demurrage. But, as discussed above, the 1996 decision--unlike the 1983
                exemption decision--did directly address the demurrage market power
                concerns that are before the Board today. So even if the general
                discussion of car supply in the 1983 decision, see id., could be read
                as encompassing demurrage, the explicit language in the more recent
                decision in Exemption of Demurrage specifically finds that the
                potential for abuse of market power exists with respect to demurrage
                (and provides no reason to conclude that this potential varies by
                commodity). In addition, the practices documented in the Board's 2019
                demurrage hearing confirm that the Board's concerns about the
                ``potential'' for abuses in 1996 were well-founded. Therefore, even if
                a finding about market power were necessary--which it is not--the
                specific findings in the 1996 decision are more persuasive than any
                inferences about market power and demurrage that might be drawn from
                the 1983 exemption decision.
                Rail Transportation Policy
                 As noted above, the exemption revocation statute, 49 U.S.C.
                10502(d), provides that the Board may revoke an exemption in whole or
                in part when it finds that regulation ``is necessary to carry out the
                transportation policy of'' 49 U.S.C. 10101. In the NPRM, the Board
                identified five relevant provisions of the RTP and explained how the
                revocation of section 1039.10 with respect to demurrage is necessary to
                carry out these policies.\13\ NPRM, EP 760, slip op. at 6 (quoting 49
                U.S.C. 10101(2), (4), (5), (9), (15)).
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                 \13\ When the Board considers the RTP, it does not need to
                ``address each and every one of the policy's fifteen components, for
                some may be completely unrelated to the exemption.'' Ill. Commerce
                Comm'n v. ICC, 787 F.2d 616, 627 (D.C. Cir. 1986). Rather, the Board
                is entitled to wide deference when deciding which factors of the RTP
                are relevant in decisions regarding exemptions. See Alaska Survival
                v. STB, 705 F.3d 1073, 1083-84 (9th Cir. 2013).
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                 AAR alleges that the NPRM ``fails to even address the first two RTP
                factors,'' specifically section 10101(1) (``to allow, to the maximum
                extent possible, competition and demand for services to establish
                reasonable rates for transportation by rail'') and section 10101(2)
                (``to minimize the need for Federal regulatory control over the rail
                transportation system and to require fair and expeditious regulatory
                decisions when regulation is required''). (AAR Comments 3-4.) AAR
                acknowledges that the NPRM quotes part of section 10101(2) but argues
                that the Board failed to consider the remaining part. (AAR Comments 3.)
                 Regarding section 10101(1), demurrage is not generally considered
                to be a rate for ``rail transportation.'' See, e.g., Demurrage
                Liability, EP 707, slip op. at 10 (explaining that the term ``rates for
                transportation'' as used in 49 U.S.C. 10743 applies to ``shipping or
                line-haul charges,'' not demurrage, which is addressed in section
                10746). Indeed, the statute, at 49 U.S.C. 10701-10707, contains
                elaborate procedures for determining rate reasonableness, none of which
                have been applied to demurrage. But even if demurrage were considered
                to be a rate,\14\ revocation
                [[Page 12753]]
                here is fully consistent with section 10101(1). As the Board explained
                in the NPRM and in its 1996 decision, exempting demurrage from
                regulation could make ``shippers potentially subject to `unreasonable
                charges.' '' NPRM, EP 760, slip op. at 6 (quoting Exemption of
                Demurrage, EP 462, slip op. at 4). This is not a situation where
                ``competition and the demand for services'' are sufficient to ensure
                ``reasonable'' demurrage charges.
                ---------------------------------------------------------------------------
                 \14\ The Board included a reference to Sec. 10101(1) in
                Exemption of Demurrage, EP 462, slip op. at 3, in its discussion of
                eliminating antitrust immunity for the collective establishment of
                demurrage charges. However, the Board did not discuss Sec. 10101(1)
                in the portion of the decision that declined to exempt demurrage
                from regulation, and the only discussion about the meaning of
                ``rates'' in that portion was its citation to a shipper's comment
                that ``demurrage is not part of the transportation rate.'' Exemption
                of Demurrage, EP 462, slip op. at 4 n.7.
                ---------------------------------------------------------------------------
                 Regarding section 10101(2), AAR points out that the NPRM quotes
                only the part of the provision that discusses requiring fair and
                expeditious regulatory decisions when regulation is required, and not
                the part about minimizing the need for Federal regulatory control over
                the rail transportation system. (AAR Comments 3.) AAR concludes from
                this that the NPRM ``fails to even address'' section 10101(2). (AAR
                Comments 3.) But any action either adopting or revoking an exemption,
                by definition, looks at whether regulatory control over the rail system
                is needed, so in any exemption proceeding, the merits discussion will
                distinguish between situations where the Board should ``minimize the
                need for Federal regulatory control over the rail transportation
                system'' and situations ``when regulation is required.'' The NPRM, EP
                760, slip op. at 5-7, explained why regulation of demurrage related to
                rail transportation of the commodities in section 1039.10 is necessary,
                which illustrates that the Board has concluded that this is a situation
                ``when regulation is required''--and, therefore, not one where
                ``minimiz[ing]'' regulation is appropriate. The NPRM adequately
                considered section 10101(2) even though it did not quote it in its
                entirety.
                Case-Specific Revocations
                 AAR contends that the NPRM fails to explain why the Board cannot
                handle partial revocations of section 1039.10 on a case-by-case basis
                where any aggrieved shipper can seek revocation in an individual case.
                (AAR Comments 7-8.) But demurrage cases tend to be smaller cases
                involving less money than is typically at stake in rate cases, which
                can involve tens of millions of dollars; \15\ thus, as the Board
                explained, requiring that demurrage-related revocations be processed
                case-by-case for agricultural commodities would unduly ``add to the
                complexity, length, and cost of such proceedings to the parties and the
                Board.'' NPRM, EP 760, slip op. at 6. Particularly given that no other
                non-intermodal rail transportation shipper or receiver is required to
                take the extra step of demurrage-related revocation requests, the Board
                further explained that requiring proceedings that are unnecessarily
                complex, lengthy, and costly would be inconsistent with the directive
                in 49 U.S.C. 10101(2) to ``require fair and expeditious regulatory
                decisions when regulation is required,'' and the directive in section
                10101(15) to ``provide for the expeditious handling and resolution of
                all proceedings required or permitted to be brought under this part.''
                NPRM, EP 760, slip op. at 6.
                ---------------------------------------------------------------------------
                 \15\ Six cases involving alleged violations of the statutes
                governing demurrage have been referred to or filed with the Board in
                the past 10 years. Half of those cases involved contested demurrage
                charges of between $70,000-$110,000. See Utah Central Ry.--Pet. for
                Declaratory Order--Kenco Logistic Services, LLC, Kenco Group, &
                Specialized Rail Service, Inc., FD 36131, slip op. at 3 (STB served
                Mar. 20, 2019); Portland & Western R.R.--Pet. for Declaratory
                Order--RK Storage & Warehousing, Inc., FD 35406, slip op. at 1 (STB
                served Sept. 29, 2011); Compl. 6, Brampton Enters., LLC v. Norfolk
                S. Ry., NOR 42118 (Mar. 29, 2010). Even the case with the largest
                amount at issue during that period, Finch Paper LLC--Petition for
                Declaratory Order, FD 35981 (Pet. 2, Dec. 7, 2015), involved a
                fraction of what is typically at stake in a rate reasonableness
                matter. See, e.g., Consumers Energy Co. v. CSX Transp., NOR 42142,
                slip op. at 44 (STB served Aug. 2, 2018) (rate case with award of
                $94.9 million).
                ---------------------------------------------------------------------------
                Burden of the Exemption Revocation on Class II and III Carriers
                 ASLRRA raises concerns about the Board's analysis of the impact of
                the partial revocation on Class II and Class III carriers. In
                particular, ASLRRA argues that the Board has not sufficiently analyzed
                the adverse effects on small entities that could be caused by the
                partial revocation. (ASLRRA Comments 3.) ASLRRA asserts that the rule
                would require small carriers to engage in more paperwork and
                recordkeeping, including by subjecting them to the requirement in 49
                CFR 1333.3 that they provide actual notice of demurrage liability and
                charges as a prerequisite to assessing demurrage. (ASLRRA Comments 3.)
                However, as discussed further in the Regulatory Flexibility Act (RFA)
                section below, section 1333.3 already requires small (and large)
                carriers to provide such notice in order to collect demurrage charges.
                Given that transportation of the agricultural commodities exempted at
                section 1039.10 accounts for less than 1% of all rail traffic,\16\ the
                final rule adopted here only very slightly expands the amount of
                traffic for which small carriers would need to provide notice if they
                want to collect demurrage.
                ---------------------------------------------------------------------------
                 \16\ Analysis of the 2018 Waybill Sample shows that the relevant
                agricultural commodity traffic constitutes only 0.53% percent of all
                traffic by tonnage, and 0.62% by carload.
                ---------------------------------------------------------------------------
                 The Board understands why some small carriers, simply by virtue of
                their size, might believe they would have difficulty complying with
                certain regulations, including those relating to demurrage. But an
                exemption, or a revocation of an exemption, considers whether
                enforcement of an entire regulatory scheme enacted by Congress and
                implemented by the Board is appropriate, and ASLRRA has not attempted
                to show that its members, simply because of their size, should not be
                subject to any of the statutes and regulations governing demurrage for
                the agricultural commodities subject to the exemption. Indeed, with
                respect to miscellaneous commodities and boxcar transportation, court
                and agency precedent has already interpreted the demurrage statutes and
                regulations to apply to carriers of all sizes. See NPRM, EP 760, slip
                op. at 4-5. To the extent that certain regulations cause particular
                issues for small carriers, the Board has considered, and will continue
                to consider, the merits of excluding Class II and III carriers from the
                relevant regulations; \17\ however, ASLRRA has not shown that the Board
                ought not apply any of the statutes and regulations related to
                demurrage, including those that protect against the potential for
                unreasonable rules and charges. Accordingly, the Board finds no basis
                for a finding that the revocation should not apply to small rail
                carriers.
                ---------------------------------------------------------------------------
                 \17\ The Board regularly analyzes and addresses the concerns of
                Class II and Class III railroads in its rulemaking process. See,
                e.g., Demurrage Liability, EP 707, slip op. at 20-21, 27-28;
                Reporting Requirements for Positive Train Control Expenses & Invs.,
                EP 706, slip op. at 12 (STB served Aug. 14, 2013).
                ---------------------------------------------------------------------------
                 ASLRRA also claims that there is no ``indication in this record
                that the STB notified the Small Business Administration Office of
                Advocacy of the proposed rules.'' (ASLRRA Comments 3.) This is
                incorrect. A copy of the decision was ``served upon the Chief Counsel
                for Advocacy, Office of Advocacy, U.S. Small Business Administration.''
                See NPRM, EP 760, slip op. at 10; see also Docket No. EP 760 service
                list (listing the U.S. Small Business Administration, Chief Counsel for
                Advocacy as a non-party).
                 ASLRRA's comments express concerns about the impacts on small
                entities of the proposals in Docket Nos. EP 759 and EP 757. The Board
                notes, however, that the proposal in Docket No. EP 759 excludes Class
                II and III carriers from its requirements. Moreover, the proposed
                policy
                [[Page 12754]]
                statement in Docket No. EP 757 is not a proposed rule and is not
                subject to the RFA's requirements. See 5 U.S.C. 603(a).
                 Finally, ASLRRA's concern that the proposed rule in this proceeding
                ``could lead to the removal of the exemptions that are under
                consideration in Docket No. [EP] 704 [(Sub-No.1)],'' which it says
                would create additional burdens, see ASLRRA Comments 4, should be
                addressed in that docket.
                Conclusion
                 For the reasons discussed above, the Board will clarify its
                regulations governing exemptions for certain miscellaneous commodities
                and boxcar transportation to ensure that the regulations more clearly
                state that demurrage continues to be subject to Board regulation.
                Additionally, the Board concludes that the records in this proceeding
                and in Docket No. EP 754 support a finding that regulation of demurrage
                related to the non-intermodal rail transportation of agricultural
                commodities is necessary to carry out the RTP, and that partial
                revocation of the exemption to achieve that purpose is warranted.
                 Regulatory Flexibility Act. The Regulatory Flexibility Act of 1980,
                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.
                Sections 601-604. In its final rule, the agency must either include a
                final regulatory flexibility analysis, section 604(a), or certify that
                the final rule would not have a ``significant impact on a substantial
                number of small entities,'' section 605(b).\18\ 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 rule. White Eagle Coop. v. Conner, 553 F.3d 467, 480 (7th Cir.
                2009).
                ---------------------------------------------------------------------------
                 \18\ 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).
                ---------------------------------------------------------------------------
                 In the NPRM, the Board stated that the proposed rule could
                potentially have a significant economic impact on a substantial number
                of small entities. The NPRM therefore included an initial regulatory
                flexibility analysis (IRFA) and request for comments in order to
                explore further the impact, if any, of the proposed rule on small rail
                carriers. A copy of the NPRM was served on the Chief Counsel for
                Advocacy, U.S. Small Business Administration (SBA). The Board received
                comments regarding the IRFA from one organization, ASLRRA. Having
                reviewed ASLRRA's comments, the Board finds it unlikely that the rule
                will have a significant economic impact on a substantial number of
                small entities. However, out of an abundance of caution, and to ensure
                that ASLRRA's comments are fully considered, the Board now publishes
                this final regulatory flexibility analysis.\19\
                ---------------------------------------------------------------------------
                 \19\ Pursuant to the Small Business and Work Opportunity Act of
                2007, 15 U.S.C. 631 note, the Board is also publishing a Small
                Entity Compliance Guide on the Board's website, available at
                www.stb.gov (click on ``About STB'', then ``Agency Materials'').
                ---------------------------------------------------------------------------
                 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. In Docket No. EP 754, USDA, among others,
                submitted comments expressing concerns about the new and increasing
                demurrage charges related to the transportation of agricultural
                commodities generally and the potential for those charges to have
                negative effects on agricultural shippers and society. See, e.g., USDA
                Comments 5, Oversight Hearing on Demurrage & Accessorial Charges, EP
                754.
                 Succinct statement of the objectives of, and legal basis for, the
                final rule.
                 For the purposes of regulatory flexibility analysis, the relevant
                objective of this rule is 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.\20\ Partial revocation--by removing barriers
                to shippers' ability to contest improper demurrage charges--is
                necessary to carry out the RTP of 49 U.S.C. 10101. Partial revocation
                also would make the exemption for the rail transportation of certain
                agricultural commodities at 49 CFR 1039.10 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 rail transportation. The legal basis for the final 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 RTP of
                49 U.S.C. 10101.
                ---------------------------------------------------------------------------
                 \20\ Additionally, this rule also clarifies, for miscellaneous
                commodities and boxcar transportation, that court and agency
                precedent has already interpreted the demurrage statutes and
                regulations to apply to carriers of all sizes. Because this part of
                the rule simply codifies already existing law, it will not have a
                significant economic impact on a substantial number of small
                entities.
                ---------------------------------------------------------------------------
                 Description of and, where feasible, an estimate of the number of
                small entities to which the final rule will apply.
                 The rule will 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, section 1039.11, and section
                1039.14, respectively. It therefore could potentially apply to
                approximately 656 Class II and III rail carriers.
                 Description of the projected reporting, recordkeeping, and other
                compliance requirements of the final rule, including an estimate of the
                classes of small entities that will be subject to the requirement and
                the type of professional skills necessary for preparation of the report
                or record.
                 The rule will subject rail carriers that charge demurrage in
                connection with the rail 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 ICCTA removed
                regulatory paperwork burdens (with limited exceptions) on rail carriers
                to file tariffs or contract summary filings for rail shipments, whether
                exempt or non-
                [[Page 12755]]
                exempt.\21\ To the extent that the rail transportation of certain
                agricultural commodities will become subject to Board regulation of
                demurrage, carriers will be required to provide actual notice of the
                demurrage tariff under which liability would arise, prior to the
                placement of the rail cars, as a prerequisite to assessing demurrage.
                See 49 CFR 1333.3. However, these types of notices are generally
                already provided, often electronically, for regulated commodities and
                certain other exempt transportation.\22\ Rail carriers wishing to
                collect demurrage may need to update their demurrage practices 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 brought to 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.
                ---------------------------------------------------------------------------
                 \21\ All 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.
                 \22\ In the rulemaking adopting Sec. 1333.3, ASLRRA
                acknowledged that only a subset of Class III rail carriers would
                need to hire or equip personnel to perform the task of providing
                notice of their demurrage tariff to their customers. See Demurrage
                Liability, EP 707, slip op. at 27 (STB served Apr. 11, 2014).
                ---------------------------------------------------------------------------
                 In its comments, ASLRRA asserts that the Board has overlooked
                adverse effects on small entities that could be caused by the exemption
                revocation. (ASLRRA Comments 3.) \23\ ASLRRA claims that the rule would
                require small carriers to engage in more paperwork and recordkeeping.
                In response to the Board's statement that, by adopting the rule, small
                carriers would be subject to the requirement that they provide actual
                notice of demurrage liability and charges as a prerequisite to
                assessing demurrage, ASLRRA states that ``many small railroads do not
                issue such notices today and many do not have the capacity to send
                notices electronically.'' (Id.) However, section 1333.3 already
                requires small (and large) carriers to provide such notice ``in
                [either] written or electronic form'' in order to collect demurrage
                charges. Given that transportation of the agricultural commodities
                exempted at section 1039.10 accounts for less than 1% of all traffic,
                the final rule adopted here only slightly expands the amount of traffic
                for which small carriers must provide notice if they want to collect
                demurrage.
                ---------------------------------------------------------------------------
                 \23\ ASLRRA also points to the proposed regulation in Demurrage
                Billing Requirements, EP 759, and proposed policy statement in
                Policy Statement on Demurrage and Accessorial Rules and Charges, EP
                757, as possibly having adverse effects on small entities. (ASLRRA
                Comments 3.) However, as noted, the proposal in Docket No. EP 759
                excludes Class II and Class III carriers from its requirements, and
                the policy statement proposed in Docket No. EP 757 does not impose
                compliance obligations or requirements that ``circumscribe[ ] or
                mandate [ ]'' the conduct of any entity, small or otherwise. White
                Eagle, 553 F.3d at 480. The Board also noted in Docket No. EP 757
                that it will remain attentive to the need to consider future action
                to ensure that smaller rail carriers, as well as shippers and
                receivers, are not being forced to bear the burden of delays due to
                actions not attributable to them. Policy Statement on Demurrage &
                Accessorial Rules & Charges, EP 757, slip op. at 6 (STB served Oct.
                7, 2019) (citing Utah Central, FD 36131, slip op. at 12 n.38).
                ---------------------------------------------------------------------------
                 The Board notes that the rule adopted here does not prescribe
                specific carrier action and that the existing rule at section 1333.3
                also does not require carriers to do anything--it simply states that a
                carrier may not collect demurrage from a party unless that party has
                first been given notice. While ASLRRA alludes generally to an increased
                risk of litigation for small railroads if the Board were to adopt this
                rule ``as well as'' taking other actions, ASLRRA does not specify any
                particular increased litigation risk from this rule. (ASLRRA Comments
                3.) Nor is any such risk likely to be significant, given that demurrage
                related to the rail transportation of miscellaneous commodities and
                boxcar transportation was already subject to Board regulation and
                exemption revocation was an available remedy for agricultural
                commodities exempted at section 1039.10 (which, as noted, constitute
                less than 1% of overall rail traffic).
                 ASLRRA also cites potential burdens that small carriers might incur
                if the Board were to revoke exemptions that are currently under
                consideration in a separate, unrelated docket. (ASLRRA Comments 4.)
                However, for the purpose of this final regulatory flexibility analysis,
                the Board is tasked with considering the impacts of the rule at issue
                in this docket.
                 Identification, to the extent practicable, of all relevant federal
                rules that may duplicate, overlap, or conflict with the final rule.
                 The Board is unaware of any duplicative, overlapping, or
                conflicting federal rules.
                 Description of any significant alternatives to the final rule that
                accomplish the stated objectives of applicable statutes and that
                minimize any significant economic impact of the 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.
                 The Board considered two alternatives to the final rule: (1) Taking
                no action (thereby implementing no changes to the current regulations),
                and (2) exempting 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).
                 ASLRRA asserts that ``the best alternative . . . is for the Board
                to take no action,'' but that, if adopted, the rule should exempt all
                Class II and Class III carriers. (ASLRRA Comments 4.) The Board
                explained in its initial regulatory flexibility analysis that both
                alternatives would thwart the principles announced in the Board's
                proposed policy statement in Docket No. EP 757, and that neither
                alternative would accomplish the rule's objective of making the
                agricultural commodities exemption consistent with similar exemptions
                for miscellaneous commodities and boxcar transportation.\24\ With
                respect to the second alternative, the Board also explained that it
                would greatly complicate cases involving demurrage disputes that
                involve both large and small carriers.
                ---------------------------------------------------------------------------
                 \24\ The ``no action'' alternative would also thwart the
                principles established in the Board's notice of proposed rulemaking
                in Docket No. EP 759 relating to demurrage billing requirements for
                Class I carriers.
                ---------------------------------------------------------------------------
                 ASLRRA takes exception to the Board's observation that exempting
                Class II and III carriers would complicate cases involving demurrage
                disputes, arguing that ``it is likely that small railroads would play
                little or no substantive part in any such case, so a case could easily
                proceed'' without the small railroad having to participate, and that
                ``fewer parties in a case would simplify the case, not complicate it.''
                (ASLRRA Comments 4-5.) However, when a small railroad chooses to
                collect demurrage as the originating or terminating carrier, its
                participation to facilitate the resolution of cases involving disputed
                charges is both necessary and appropriate.
                Congressional Review Act
                 Pursuant to the Congressional Review Act, 5 U.S.C. 801-808, the
                Office of
                [[Page 12756]]
                Information and Regulatory Affairs has designated this rule as a non-
                major rule, as defined by 5 U.S.C. 804(2).
                List of Subjects in 49 CFR Part 1039
                 Agricultural commodities, intermodal transportation, railroads.
                 It is ordered:
                 1. The Board adopts the final rule as set forth in this decision.
                Notice of the adopted rule will be published in the Federal Register.
                 2. A copy of this decision will be served upon the Chief Counsel
                for Advocacy, Office of Advocacy, U.S. Small Business Administration.
                 3. This decision is effective April 3, 2020.
                 Decided: February 28, 2020.
                 By the Board, Board Members Begeman, Fuchs, and Oberman.
                Jeffrey Herzig,
                Clearance Clerk.
                 For the reasons set forth in the preamble, the Surface
                Transportation Board amends 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 prior to the last sentence
                (after the table) 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)
                (after the table) 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. Amend Sec. 1039.14 by revising paragraph (d) to read as follows:
                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. 2020-04460 Filed 3-3-20; 8:45 am]
                 BILLING CODE 4915-01-P
                

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