Railroad Shipper Protection Act of 1997

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Railroad Shipper Protection Act of 
1997''.

SEC. 2. FINDINGS.

    The Congress finds that--
            (1) the railroad industry has consolidated dramatically 
        since passage of the Staggers Rail Act of 1980 (94 Stat. 1895 
        et seq.), leaving the railroad industry with only a few major 
        carriers and providing shippers with limited competitive 
        options;
            (2) the financial health of the railroad industry has 
        improved substantially since the passage of the Staggers Rail 
        Act of 1980;
            (3) due partly to the continued consolidation of the 
        railroad industry, captive rail shippers--
                    (A) continue to exist; and
                    (B) are increasing in number; and
            (4) rail shippers, including captive rail shippers, will 
        benefit from increased competition among railroads and a 
        streamlined process under which the Surface Transportation 
        Board determines the reasonableness of captive rail shipper 
        rates.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Secretary.--The term ``Secretary'' means the Secretary 
        of Transportation.
            (2) Surface transportation board.--The term ``Surface 
        Transportation Board'' or ``Board'' means the Surface 
        Transportation Board established under section 701 of title 49, 
        United States Code.

SEC. 4. PURPOSES.

    The purposes of this Act are--
            (1) to clarify the rail transportation policy of the United 
        States;
            (2) to ensure rail competition for shippers in geographic 
        areas in which rail competition is physically available;
            (3) to ensure reasonable rates for captive rail shippers; 
        and
            (4) to remove unnecessary regulatory burdens from the rate 
        reasonableness process of the Surface Transportation Board.

SEC. 5. CLARIFICATION OF RAIL TRANSPORTATION POLICY.

    Section 10101 of title 49, United States Code, is amended--
            (1) by inserting ``(a) In General.--'' before ``In 
        regulating''; and
            (2) by adding at the end the following:
    ``(b) Primary Objectives.--The primary objectives of the rail 
transportation policy of the United States shall be--
            ``(1) to ensure effective competition among rail carriers 
        at origin and destination; and
            ``(2) to maintain reasonable rates in the absence of 
        effective competition.''.

SEC. 6. REQUIREMENT OF RAILROADS TO ESTABLISH RATES TO FACILITATE RAIL 
              TO RAIL COMPETITION.

    (a) Establishment of Rate.--Section 11101(a) of title 49, United 
States Code, is amended by inserting after the first sentence the 
following: ``Upon the request of a shipper, a rail carrier shall 
establish a rate for transportation requested by the shipper between 
any 2 points on the system of that rail carrier where traffic 
originates, terminates, or may be interchanged. A rate established 
under the preceding sentence shall apply to the shipper that makes the 
request for the rate without regard to whether the rate established is 
for part of a through transportation route between an origin and a 
destination or whether the shipper has made arrangements for 
transportation over any other part of that through route.''.
    (b) Review of Reasonableness of Rate.--Section 10701(d) of title 
49, United States Code, is amended--
            (1) by redesignating paragraph (3) as paragraph (4); and
            (2) by inserting after paragraph (2) the following:
    ``(3) If a rail carrier establishes a rate for transportation 
between any 2 points on the system of that rail carrier where rail 
traffic originates, terminates, or may be interchanged, the shipper may 
challenge the reasonableness of--
            ``(A) that rate; or
            ``(B) the aggregate rate between origin and destination (if 
        the rate established is for part of a through route).''.

SEC. 7. SIMPLIFIED STANDARD FOR MARKET DOMINANCE.

    Section 10707(d) of title 49, United States Code, is amended--
            (1) by striking paragraph (2);
            (2) by striking ``(1)(A)'' and inserting ``(3)'';
            (3) by striking ``(B) For purposes'' and inserting ``(4) 
        For purposes''; and
            (4) by inserting before paragraph (3), as redesignated, the 
        following:
    ``(1) In making a determination under this section, the Board shall 
find that the rail carrier establishing the challenged rate referred to 
in subsection (b) has market dominance over the transportation to which 
the rate applies if that rail carrier--
            ``(A) is the only rail carrier serving the origin, 
        destination, or intermediate portion of the route involved; and
            ``(B) does not prove to the Board that the rate charged 
        results in a revenue-variable cost percentage for that 
        transportation that is less than 180 percent.
    ``(2) In making a market dominance determination under this section 
in any case in which 2 or more rail carriers provide service at an 
origin or destination, the Board shall consider only transportation 
competition at that origin or destination.''.

SEC. 8. REVENUE ADEQUACY DETERMINATIONS.

    (a) Rail Transportation Policy.--Section 10101(3) of title 49, 
United States Code, is amended by striking ``, as determined by the 
Board;''.
    (b) Authority for Revenue Adequacy Determination.--Section 10704(a) 
of title 49, United States Code, is amended--
            (1) by striking ``(a)(1)'' and inserting ``(a)''; and
            (2) by striking paragraphs (2) and (3).

SEC. 9. REDUCTION OF PROCEDURAL BARRIERS FACED BY SMALL SHIPPERS.

    (a) Administrative Relief.--Not later than 180 days after the date 
of enactment of this Act, the Surface Transportation Board shall--
            (1) review the rules and procedures applicable to rate 
        complaints and other complaints filed with the Board by small 
        shippers;
            (2) identify any such rules or procedures that are unduly 
        burdensome to small shippers; and
            (3) take such action, including rulemaking, as is 
        appropriate to reduce or eliminate the aspects of the rules and 
        procedures that the Board determines under paragraph (2) to be 
        unduly burdensome to small shippers.
    (b) Legislative Relief.--The Board shall notify the Committee on 
Commerce, Science, and Transportation of the Senate and the Committee 
on Transportation and Infrastructure of the House of Representatives if 
the Board determines that additional changes in the rules and 
procedures described in subsection (a) are appropriate and require 
commensurate changes in statutory law. In making that notification, the 
Board shall make recommendations concerning those changes.

Summary: Railroad Shipper Protection Act of 1997 - Amends Federal transportation law to declare as primary objectives for US rail transportation policy: (1) ensuring effective competition among rail carriers at origin and destination. And (2) maintaining reasonable rates in the absence of such competition. Requires a rail carrier, upon request from a shipper, to establish a rail transportation rate between any two points on the carrier's system where traffic originates, terminates, or may be interchanged. Authorizes such shipper to then challenge the reasonableness of the rate established or the aggregate rate between origin and destination . Requires the Surface Transportation Board to find that the rail carrier establishing a challenged rail rate has market dominance over the transportation to which the rate applies if such carrier: (1) is the only carrier serving the origin, destination, or intermediate portion of the route involved. Or (2) does not prove to the Board that the rate charged results in a revenue-variable cost percentage for that transportation that is less than 180 percent. Terminates Board authority to determine the revenue adequacy of rail carriers. Directs the Board to: (1) review and take appropriate action with respect to the rules and procedures applicable to rate complaints and other complaints filed with the Board by small shippers. And (2) notify specified congressional committees if it determines that additional (legislative) changes in such rules and procedures are appropriate.