# OPENING STATEMENT of 

# CHARLES D. NOTTINGHAM, CHAIRMAN

# COMMON CARRIER OBLIGATION HEARING --

**TRANSPORTATION OF HAZARDOUS MATERIALS**

# STB Ex Parte No. 677 (Sub-No. 1) 

# July 22, 2008

Good morning and welcome. Today we will hear further testimony on the
common carrier obligation, the topic of a prior Board hearing held on
April 24 and 25. During those two days of testimony we heard from a
number of parties discussing specifically how the common carrier
obligation applies to the transportation of hazardous material. It is on
that more narrow topic that we will hear further testimony today.

For those who may be attempting to read the tea leaves, I will say at
the outset that I have not called this hearing with any specific outcome
or proposal in mind. There is much discussion in the written testimony
regarding whether the Board has the ability to determine the scope of
the common carrier obligation. I would respond to that testimony by
noting that it is certainly within the Board's authority to define what
we will consider to be a reasonable request for service -- and there is
room for discretion within that analysis. However, it is not my
intention at this point for the Board to eliminate the common carrier
obligation as it applies to the transportation of hazardous chemicals.

Instead, I hope to hear in the testimony today how the parties involved
in this segment of the transportation industry can work together to find
solutions to the liability challenge that the transportation of these
commodities presents. I think we can all agree that for many hazardous
materials, including TIH, rail is the safest and most efficient mode of
transportation. But we have also heard that the railroads fear ruinous
liability in the event of an accident involving TIH. The potential
bankruptcy, closure or sale of a railroad due to liability exposure is
more than an academic concern to this Board. A railroad bankruptcy and
liquidation would likely disrupt commerce, eliminate jobs, hurt railroad
customers and stockowners, and would likely result in less competition
in the market for rail service. We have an obligation to ensure that the
risk of such a scenario is minimized.

Our hearing notice focused in large part on obtaining input into
potential policy solutions to this liability issue. I hope to hear today
about the Price Anderson model and how it could be applied here, the
role of the Board in developing a solution, and the basis for the wide
range of views held by our stakeholders as it relates to this matter.

It is my hope that, as you hear each other's testimony today, as well as
the views expressed by myself and my fellow Board members, we can get
closer to finding a policy solution to the very real challenge this
issue presents. Let's not permit a resolution of this very important
issue to be held captive by the policy agenda of any one particular
interest group.

Finally, just a few procedural notes regarding the testimony itself. As
usual, we will hear from all the speakers on a panel prior to questions
from the Commissioners. Speakers, please note that the timing lights are
in front of me on the dais. You will see a yellow light when you have
one minute remaining, and a red light when your time has expired. As you
can see from the published schedule, we have quite a few witnesses
appearing at this hearing. Therefore, I will be keeping an eye on the
clock and ask that you please keep to the time you have been allotted. I
assure you that we have read all of your submissions, and there is no
need to read them here. After hearing from the entire panel, we will
rotate with questions from each Board Member until we have exhausted the
questions. Additionally, just a reminder to please turn off your cell
phones.

I look forward to hearing the testimony of the parties. I would now like
to turn to Vice Chairman Mulvey for his opening remarks.