U.S. GOVERNMENT PUBLISHING OFFICE

WASHINGTON : 

1 

49–010 

" ! SENATE 

114TH CONGRESS

1st Session 

REPORT 

2015

114–52 

Calendar No. 94 

SURFACE TRANSPORTATION BOARD 

REAUTHORIZATION ACT OF 2015 

R E P O R T 

OF THE

COMMITTEE ON COMMERCE, SCIENCE, AND 

TRANSPORTATION 

ON

S. 808 

MAY 21, 2015.—Ordered to be printed 


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(II) 

SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION 

ONE HUNDRED FOURTEENTH CONGRESS

FIRST SESSION

JOHN THUNE, South Dakota, Chairman 

ROGER F. WICKER, Mississippi BILL NELSON, Florida 

ROY BLUNT, Missouri MARIA CANTWELL, Washington 

MARCO RUBIO, Florida CLAIRE MCCASKILL, Missouri 

KELLY AYOTTE, New Hampshire AMY KLOBUCHAR , Minnesota 

TED CRUZ, Texas RICHARD BLUMENTHAL, Connecticut 

DEB FISCHER, Nebraska BRIAN SCHATZ, Hawaii 

JERRY MORAN, Kansas ED MARKEY, Massachusetts 

DAN SULLIVAN, Alaska CORY BOOKER, New Jersey 

RON JOHNSON, Wisconsin TOM UDALL, New Mexico 

DEAN HELLER, Nevada JOE MANCHIN, West Virginia 

CORY GARDNER, Colorado GARY PETERS, Michigan 

STEVE DAINES, Montana 

DAVID SCHWIETERT, Staff Director 

NICK ROSSI, Deputy Staff Director 

REBECCA SEIDEL, General Counsel 

KIM LIPSKY, Democratic Staff Director 

CHRISTOPHER DAY, Democratic Deputy Staff Director 

CLINT ODOM, Democratic General Counsel 


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1P.L. 96–448 

2Palley, Joel, ‘‘Impact of the Staggers Act of 1980,’’ Federal Railroad Administration, March 

8, 2011, at http://www.fra.dot.gov/eLib/Details/L03012 

Calendar No. 94 

114TH CONGRESS REPORT " ! SENATE 1st Session 114–52 

SURFACE TRANSPORTATION BOARD REAUTHORIZATION 

ACT OF 2015 

MAY 21, 2015.—Ordered to be printed 

Mr. THUNE, from the Committee on Commerce, Science, and 

Transportation, submitted the following 

R E P O R T 

[To accompany S. 808] 

The Committee on Commerce, Science, and Transportation, to 

which was referred the bill (S. 808) to establish the Surface Transportation Board as an independent establishment, and for other 

purposes, having considered the same, reports favorably thereon 

without amendment and recommends that the bill do pass. 

PURPOSE OF THE BILL

The purpose of this legislation is to reauthorize the Surface 

Transportation Board for fiscal years (FYs) 2016 through 2020, and 

for other purposes. 

BACKGROUND AND NEEDS

The U.S. freight railroad industry has undergone a remarkable 

transformation since the enactment of the Staggers Rail Act of 

1980.1 In the decades preceding the enactment of the Staggers Act, 

railroads experienced traffic losses due in part to regulatory policies and procedures that prevented railroads from easily adjusting 

their rates to reflect changing market or cost environments. These 

policies and procedures led to financial strain in the industry, ultimately resulting in the bankruptcy of many railroads by the 

1970s.2 The Staggers Act permitted railroads to have more freedom 

to set rates for rail service. Specifically, it permitted the railroads 


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3 Ibid. 

4 U.S. Congress, Senate Committee on Commerce, Science and Transportation, Oversight and 

Investigations Majority Staff Report, Update on the Financial State of the Class I Freight Rail 

Industry (Washington, DC: 2013) 5 Association of American Railroads, ‘‘U.S. Freight Railroad Statistics,’’ July 15, 2014, at 

https://www.aar.org/Documents/Railroad-Statistics.pdf 6 Association of American Railroads, ‘‘Overview of America’s Freight Railroads,’’ April 2014, 

at https://www.aar.org/BackgroundPapers/Overview of Americas Freight Railroads.pdf 7 Association of American Railroads, ‘‘AAR Reports Increased Freight Rail Traffic for 2014,’’ 

January 8, 2015, at https://www.aar.org/newsandevents/Press-Releases/Pages/2015-01-08- 

railtraffic.aspx 8 Association of American Railroads, ‘‘AAR’s Hamberger: America’s Rail Industry Taking on 

Changing Economy,’’ November 20, 2014, at https://www.aar.org/newsandevents/Press-Releases/ 

Pages/AARs-Hamberger-Americas-Rail-Industry-Taking-on-Changing-Economy.aspx 

to charge lower rates to their customers who operate in a competitive environment and higher rates to customers who are ‘‘captive’’ 

to one railroad carrier for transportation service (i.e., demandbased differential pricing). The Staggers Act also lowered many 

regulatory barriers to help the railroads more easily rationalize 

their networks, such as easing the requirements for railroads to 

abandon unprofitable lines. Despite these extensive regulatory 

changes, the Staggers Act still envisioned a role for the Federal 

Government to ensure that captive shippers were not subject to unreasonable rates or poor service and charged the Interstate Commerce Commission, and later the Surface Transportation Board, 

with the authority to oversee the railroad industry.3

Since the Staggers Act was enacted, the industry has evolved 

and the railroads’ financial viability has drastically improved.4

There have been numerous acquisitions and consolidations among 

the larger railroads and a proliferation of short line railroads. 

There are currently seven Class I railroads (BNSF Railway Company, Canadian National Railway Company, Canadian Pacific Railway, CSX Transportation Inc., Kansas City Southern Railway Company, Norfolk Southern Corporation, and Union Pacific Railroad). 

In 2014, Class I railroads were categorized as those with operating 

annual revenue of $467 million or more. As recently as 2013, the 

7 Class I railroads reported approximately $71 billion in freight 

revenues.5 Overall, Class I railroads account for 69 percent of 

freight rail mileage, 90 percent of employees, and 94 percent of revenue.6 In addition to the Class I railroads, there are more than 550 

Class II and Class III railroads. 

The U.S. freight rail industry continues to be integral to the Nation’s economy and global competitiveness. In 2014, the Association 

of American Railroads (AAR) reported that rail carload plus intermodal traffic volume was about 29 million units, which represents 

a 4.5 percent increase over the same period the prior year and the 

highest year-to-date total since 2007.7 According to the AAR, October 2014 was the best month in history for U.S. rail intermodal 

traffic.8

Surface Transportation Board 

The Federal agency charged with economic oversight of the Nation’s freight rail system is the Surface Transportation Board (STB 

or Board). The three-member, bipartisan Board has regulatory jurisdiction over railroad rate reasonableness, mergers, line acquisitions, new rail-line construction, abandonments of existing rail 

lines, and the conversion of rail rights-of-way into hiking and 

biking trails. 


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9Surface Transportation Board, ‘‘Budget Request for FY 2016,’’ February 2015, at http:// 

www.dot.gov/sites/dot.gov/files/docs/FY2016-BudgetEstimate-STB.pdf 10 Ibid. 11P.L. 113-235 12Surface Transportation Board, ‘‘Budget Request for FY 2016,’’ February 2015, at http:// 

www.dot.gov/sites/dot.gov/files/docs/FY2016-BudgetEstimate-STB.pdf 13 United States Department of Agriculture, ‘‘Rail Service Challenges in the Upper Midwest: 

Implications for Agricultural Sectors,’’ January 2015, at 14 Ibid. 

The Board is decisionally independent, although it is administratively housed within the Department of Transportation (DOT). 

Since the economies of freight rail regulation are so important to 

the national economy and involve a national network, Congress 

gave the STB sole jurisdiction over rail mergers and consolidations, 

regulating everything from Federal antitrust laws to State and municipal laws. The STB also has exclusive authority to determine 

whether railroad rates and services are reasonable.9

The STB’s authorization expired in 1998, and it has remained 

unauthorized since that time, each year submitting a budget request directly to Congress for necessary appropriations. It has 156 

full-time equivalent employees and receives an annual appropriation that is partially offset with collections from filing fees.10 In the 

Consolidated and Further Continuing Appropriations Act of 2015, 

the STB received $31.375 million for its operations and staffing, 

partially offset by $1.25 million in fees.11

The STB’s major responsibilities related to railroads include: 

overseeing and monitoring railroad commercial practices nationally; enforcing the railroads’ common-carrier obligation; ensuring 

that charged rates to captive shippers (those with no other transportation options) are reasonable; monitoring rail carriers to ensure 

they are able to earn adequate returns necessary for the health of 

the rail system; calculating the rail carriers’ cost of capital; and approving construction and abandonments of rail lines. 

In addition to formal cases brought by shippers, the STB has several other programs to help resolve shipper and carrier disputes, 

including complaints lodged against railroads for service inadequacies, rates, and car supply concerns. The STB’s Rail Consumer and 

Public Assistance (RCPA) program helps address these concerns 

through a more informal process. The STB sees this program as 

beneficial to both shippers and carriers, because it places shipper 

concerns immediately before the involved railroad, which can facilitate a prompt response and is less burdensome for both parties 

than a formal proceeding. With this program, the parties have an 

opportunity to resolve their issues in an environment that can 

produce a timely and cost-effective result.12

Rail service issues 

The United States Department of Agriculture (USDA) has reported that in 2013 and 2014 a combined record harvest of corn, 

soybeans, and wheat, and increased demand to ship intermodal 

containers, energy products, and crushed stone, challenged the capacity of the United States rail network.13 In addition, the harsh 

winter weather conditions often required rail operators to cut train 

lengths by as much as 50 percent, directly limiting the availability 

of rail services.14 Specifically, rail carriers noted that the weather 

conditions exacerbated existing congestion in Chicago, a crucial 


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15Surface Transportation Board, ‘‘United States Rail Service Issues—Data Collection,’’ Ex 

Parte 724, October 8, 2014, at http://www.stb.dot.gov/decisions/readingroom.nsf/WebDecisionID/ 

43850?OpenDocument 16 Ibid. 17 United States Department of Agriculture, ‘‘Rail Service Challenges in the Upper Midwest: 

Implications for Agricultural Sectors,’’ January 2015, at http://www.thune.senate.gov/public/ 

index.cfm/files/serve/?Filelid=3777bd24-0350-4894-a654-48a800fcbcce 18 Ibid. 19 Ibid. 20 Xcel Energy Comments, ‘‘United States Rail Service Issues,’’ Ex Parte 724, July 31, 2014 21 Alliance of Automobile Manufacturer Comments, ‘‘United States Rail Service Issues, Ex 

Parte 724, April 17, 2014 22Franz, Justin. ‘‘Amtrak’s Empire Builder struggles in freight boom,’’ Washington Times, August 15, 2014, at http://www.washingtontimes.com/news/2014/aug/15/amtraks-empire-builderstruggles-in-freight-boom/?page=all. 23 Amtrak, ‘‘Amtrak Calls on Surface Transportation Board to Investigate Canadian National 

Railway,’’ press release, September 2, 2014, at http://www.amtrak.com/ccurl/306/662/AmtrakSTB-Investigation-CN-ATK-14-078.pdf 24Letters from Daniel R. Elliott III, Chairman, and Ann D. Begeman, Vice Chairman, STB, 

to Carl Ice, President and Chief Executive Officer, BNSF Railway. Company, February 5, 2014 

network hub.15 Broad increases in demand and service available 

issues resulted in significant service problems in the industry.16

Agricultural commodities– particularly in the Upper Midwest 

States of Minnesota, Montana, North Dakota, and South Dakota – 

were hit especially hard by rail service issues. Farmers in that region have limited local markets for their products, less access to 

barge or other transportation alternatives, and more limited crop 

storage relative to the recent expansion of corn production.17 The 

region experienced significant grain car backlogs, storage issues, 

and rail car premiums increases. For example, the USDA found capacity and service issues caused shippers to pay record-high car 

premiums, 28 to 150 percent above the average previous levels for 

roughly 65 consecutive weeks.18 The extra costs of transportation 

and storage drove down crop prices throughout the region.19

The agricultural sector was not the only sector that experienced 

rail service issues. Coal-fired utilities, ethanol manufacturers, propane shippers, and others in the energy industry voiced concerns 

throughout 2014 about unreliable service and growing wait times 

for rail cars.20 The auto industry has also alleged that rail service 

delays cost manufacturers millions of dollars in storage fees, alternate transport costs, and vehicle shortages at dealerships.21 While 

a particularly severe winter has been responsible for some rail 

service delays, the auto industry contends that additional factors 

exacerbated the service disruptions, including a shortage of railcars 

and an inadequate response to ameliorate this shortage, the annual 

month-over-month growth in auto production and auto exports, and 

the boom in crude oil shipped by rail. 

Passenger rail operators have stated they have also faced delay 

issues. For example, Amtrak has stated that the harsh weather 

conditions and increased demand for freight services has caused 

delays for its Empire Builder train service.22 In addition, on August 29, 2014, Amtrak filed a complaint against Canadian National 

Railway (CN) for causing unacceptable train delays on the Illini/ 

Saluki service that uses the CN line from Chicago to Carbondale, 

Illinois.23

The service issues of 2013 and 2014 prompted increased oversight from STB. In March of 2014, the STB’s members wrote to Canadian Pacific and BNSF Railway Company representatives to express their concerns that poor rail service was negatively affecting 

agricultural, coal, passenger, and other traffic.24 On April 10, 2014, 


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and E. Hunter Harrison, Chief Executive Officer and Director Canadian Pacific Railway Company, March 6, 2014 25Surface Transportation Board, ‘‘Surface Transportation Board to Hold Hearing on Rail Service Issues,’’ press release, April 1, 2014, at http://www.stb.dot.gov/ll85256593004F576F.nsf/0/ 

B9B95D1200B9D81985257CAD006A133A?OpenDocument 26Surface Transportation Board, ‘‘United States Rail Service Issues—Grain,’’ August 18, 2014, 

at http://www.stb.dot.gov/decisions/readingroom.nsf/WebDecisionID/43956?OpenDocument 27 Ibid. 28 Ibid. 29Surface Transportation Board, ‘‘U.S. Rail Service Issues,’’ Ex Parte 724, April 15, 2014 30 Ibid. 31Doering, Christopher, ‘‘Improved rail service is a start, S.D. senators say,’’ Argus Leader, 

May 14, 2014, at http://www.argusleader.com/story/news/2014/05/14/thune-johnson-see-improvement-freight-rail-service-urge-railroads/9098043/ 32Surface Transportation Board, ‘‘U.S. Rail Service Issues-Grain,’’ Ex Parte 724, June 20, 

2014 

in response to a significant decline in reliable rail service for shippers over the preceding months, the STB held a public hearing in 

Washington, D.C. to address service problems affecting the U.S. 

freight rail network. Given that service problems have been particularly acute on the systems of Canadian Pacific and BNSF Railway Company, representatives from those two companies testified 

at the hearing.25 During the hearing, railroad representatives described several factors that contributed to the deterioration of rail 

service, including strained track capacity, unexpected volume 

growth, crew shortages, lack of locomotives, severe weather, and 

congestion in major corridors, particularly the Chicago corridor.26

At the hearing, farmers and agricultural producers also expressed concern about delayed fertilizer deliveries, backlogged 

grain car orders, and delayed shipments of loaded grain cars. There 

were a number of impacts as a result, including: little to no storage 

capacity at many grain elevators; stored grain spoiling; lost sales; 

penalties incurred by grain shippers for products not delivered on 

time; and buyers shifting to foreign suppliers.27 Also at the hearing, representatives from other industries, such as coal, chemicals, 

feed, sugar, and paper expressed similar supply chain disruptions.28

Subsequent to the hearing, on April 15, 2014, the STB directed 

Canadian Pacific and BNSF Railway Company to provide plans to 

ensure delivery of fertilizer shipments, as well as provide status reports of the fertilizer shipments over a six-week period.29 In response, BNSF Railway Company added rail cars to the existing fertilizer service fleet and allowed locomotives to remain with fertilizer cars during loading and unloading in an effort to reduce potential delays and expedite turn-around times.30

Since the directive in April, the STB has closely monitored Canadian Pacific’s and BNSF Railway Company’s progress in moving 

the 2013/2014 crop. In May 2014, STB representatives conducted 

meetings in Sioux Falls, SD, Malta, MT, Bloomington, MN, and 

other cities in the region.31 On June 20, 2014, in recognition of the 

limited amount of time until next harvest and the large quantities 

of grain that still needed to be moved, the Board again directed Canadian Pacific and BNSF Railway Company to provide and/or update their plans to reduce unfilled grain car orders, to resolve grain 

car delays, and to provide weekly status reports on the movement 

of grain on their networks.32

On October 8, 2014, the Board expanded on the June 2014 action 

and required all Class I rail carriers and the Chicago Transportation Coordination Office (CTCO), through its Class I members, to 


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33Surface Transportation Board, ‘‘U.S. Rail Service Issues-Data Collection,’’ Ex Parte 724, October 8, 2014, at http://www.stb.dot.gov/decisions/readingroom.nsf/WebDecisionID/ 

43850?OpenDocument 34 Ibid. 35Surface Transportation Board, ‘‘U.S. Rail Service Issues-Performance Data Reporting,’’ Ex 

Parte 724, December 30, 2014, at http://www.stb.dot.gov/RailServiceIssues.nsf/ 

358097664f8d5cae85257e0500747798/dd91cdf262293ab985257dbf00680321/$FILE/44168.pdf 36Office of U.S. Senator John Thune, ‘‘Following Request from Thune, STB Issues Reporting 

Requirements to Improve Rail Service,’’ press release, August 18, 2014, at http:// 

www.thune.senate.gov/public/index.cfm/2014/8/following-request-from-thune-stb-issues-reportingrequirements-to-improve-rail-service 37 U.S. Congress, Senate Committee on Commerce, Science, and Transportation, Freight Rail 

Service: Improving the Performance of America’s Rail System, hearings, 113th Cong., 2nd sess., 

September 10, 2014 (Washington, DC: GPO, 2014). U.S. Congress, Senate Committee on Commerce, Science, and Transportation, Freight Rail Transportation: Enhancing Safety, Efficiency, 

and Commerce, hearings, 114h Cong., 1st sess., January 28, 2015 (Washington, DC: GPO, 2015) 38Surface Transportation Board, ‘‘EP 724: Rail Service Issues,’’ April 11, 2015, at http:// 

www.stb.dot.gov/stb/railserviceupdateslanding.html 39 BNSF Status Report, Attachment C, ‘‘U.S. Rail Service Issues-Grain,’’ Ex Parte 724, August 

8, 2014 40 BNSF Railway Company, ‘‘Improving Our Network Performance: BNSF Service Update,’’ 

April 2015, at http://www.bnsf.com/customers/service-page/pdf/bnsf-service-deck.pdf 41Surface Transportation Board, ‘‘Rail Service Issues Reports,’’ Ex Parte 724, BNSF reports 

posted on April 15, 2015 and October 22, 2014, at http://www.stb.dot.gov/stb/railserviceissues/ 

raillservicelreports.html#loaded 42 Association of American Railroads, ‘‘Freight Railroad Capacity and Investment,’’ January 

2015, at https://www.aar.org/BackgroundPapers/Freight Railroad Capacity and Investment.pdf 

submit weekly performance reports.33 In making the decision, the 

Board noted that the United States rail system is an interconnected network, and one carrier’s service issues can affect the 

performance of other carriers.34 Further, although severity differed, 

shippers reported problems on multiple carriers. On December 30, 

2014, the STB issued a notice of proposed rulemaking soliciting 

comment on new regulations requiring all Class I railroads and the 

CTCO, through its Class I members, to report certain service performance metrics on a weekly basis.35

The Committee has conducted active oversight to better understand and address current and emerging service issues. For example, in July 2014 Senator Thune requested that the STB collect additional performance measures on locomotive use and grain car 

backlogs, and in August the STB required those additional measures.36 The Committee also held oversight hearings in September 

2014 and January 2015, where grain, chemical, automobile, and 

fertilizer company representatives provided detailed testimony on 

rail service issues.37 Throughout 2014, Committee members also 

engaged with railroads, shippers, and the STB to ensure service 

improvement. 

Following the recent actions, outreach, and changing conditions, 

rail carriers have made considerable progress across a variety of 

service metrics, including dwell times and turn times.38 For example, according to the STB, BNSF Railway Company has reduced 

not only the number of backlogged orders but also the average 

number of days late for these orders.39 In 2014, BNSF Railway 

Company invested about $5.5 billion in its capacity, expanding its 

locomotive, railcar, workforce, and double track miles.40 BNSF 

Railway Company decreased their grain car orders past due from 

6,166 as of October 18, 2014, to 550 cars as of April 11, 2015, 

though some of this decrease occurred as a result of usual seasonal 

variability.41 Across the industry, AAR estimated that in 2014 

freight railroads spent a total of $27 billion on infrastructure and 

equipment, and it estimates investments in 2015 will exceed $29 

billion.42


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43Surface Transportation Board, ‘‘Rate Regulation Reforms,’’ Ex Parte 715, March 13, 2015, 

at http://www.stb.dot.gov/decisions/readingroom.nsf/UNID/ 

C945E11FDC839C5A85257E06006D3D45/$file/44230.pdf 

While STB has worked diligently to address service issues, and 

rail carriers have improved performance, the recent challenges 

have highlighted inefficiencies at the agency. Congressional oversight, including extensive communication with STB leadership and 

the Committee hearings in September 2014 and January 2015, has 

identified several areas for improvement. Some inefficiencies result 

from insufficient authority. For example, the STB currently does 

not have authority to proactively investigate rail issues on its own 

initiative. Other inefficiencies result from burdensome processes. 

For example, though STB has taken action to improve simplified 

rate review methodologies, it recently found the litigation costs for 

the ‘‘Simplified Stand-Alone Cost’’ are about $4 million.43 The 

STB’s previous authorization expired in 1998, and S. 808 includes 

provisions to improve the efficiency of the agency. 

SUMMARY OF PROVISIONS

S. 808, the Surface Transportation Board Reauthorization Act of 

2015, would establish the STB as an independent agency outside 

of DOT. It would authorize the DOT Office of Inspector General 

(OIG) to review financial management, property management, and 

business operations of the STB. It also would authorize the STB for 

fiscal year 2016 through fiscal year 2020. 

To address inefficient quorum requirements, it would expand 

membership of the STB from three members to five members, and 

it would allow for limited instances in which a majority of Board 

members can communicate without requiring a full public meeting. 

It would set disclosure requirements for those meetings. 

To better allow for proactive engagement, S. 808 would allow the 

STB to initiate certain investigations on its own initiative and set 

restrictions on those investigations. It also would set notification 

requirements, timelines, and other due process requirements for 

parties under investigation. 

To improve review processes, S. 808 would set rate review 

timelines for full stand-alone cost rate challenges to ensure the 

STB efficiently decides on petitioned relief. It also would require 

the STB to maintain one or more streamlined processes for rate 

cases in which the full stand-alone cost presentation is too costly, 

given the value of the case. 

To increase the efficiency of dispute resolution, S. 808 would expand existing work at the STB to encourage and provide voluntary 

arbitration processes. S. 808 would maintain the current practice 

in which arbitration process may be commenced only when both 

relevant parties opt-in, and it would set the issues, such as rates 

and practices, that are eligible for arbitration. It also would set 

conditions for arbitration, such as only if the rail carrier has market dominance. It would cap relief from arbitration at $2 million 

for practice disputes and $25 million for rate dispute damages. It 

would allow the STB to review arbitration decisions based on specified factors. 

To improve transparency and accountability, S. 808 would include several reporting requirements. It would require quarterly reVerDate Sep 11 2014 04:33 May 23, 2015 Jkt 049010 PO 00000 Frm 00009 Fmt 6659 Sfmt 6602 E:\HR\OC\SR052.XXX SR052

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44 Interstate Commerce Commission, ‘‘Coal Rate Guidelines Nationwide,’’ Ex Parte 347 (SubNo. 1) (1985), 535-6 (acknowledging the relevance of ‘‘current and future service needs’’ when 

determining the financial soundness of carriers). Concerned Shipper Associations Comments, 

‘‘Railroad Revenue Adequacy,’’ Ex Parte 722, September 5, 2014 

ports that describe the STB’s progress toward addressing the issues 

raised in unfinished regulatory proceedings. It also would require 

quarterly reports of rail rate review cases pending or completed by 

the STB during the previous quarter. In addition, it would require 

the STB to post on its public website quarterly reports formal and 

informal service complaints received by the STB during the previous quarter. Further, it would require the STB to submit an annual report on its activities, including each instance where it initiates an investigation on its own initiative. 

S. 808 would require studies on important rail issues. It would 

require the Government Accountability Office to commence a study 

of rail transportation contract proposals containing multiple originto-destinations movements. It also would require the STB to complete a report that indicates whether current large rate case methodologies are sufficient, not unduly complex, and cost effective. The 

report must also indicate whether alternative methodologies exist, 

or could be developed, to streamline, expedite, or address the complexity of large rate cases. 

S. 808 would make other technical corrections, minor changes, 

and clarifications. It would remove various obsolete provisions. It 

also would allow for a rail carrier’s agent to be located outside of 

Washington, D.C. S. 808 also would clarify that a carrier’s capability to meets its current and future service needs is relevant 

when considering revenue adequacy.44

LEGISLATIVE HISTORY

S. 808 was introduced on March 19, 2015, and is sponsored by 

Senators Thune and Nelson. On March 25, 2015, the Committee 

met in Executive Session during which S. 808 was considered. The 

bill was reported favorably by voice vote. 

ESTIMATED COSTS

In accordance with paragraph 11(a) of rule XXVI of the Standing 

Rules of the Senate and section 403 of the Congressional Budget 

Act of 1974, the Committee provides the following cost estimate, 

prepared by the Congressional Budget Office: 

S. 808—Surface Transportation Board Reauthorization Act of 2015 

Summary: S. 808 would authorize appropriations for the programs of the Surface Transportation Board (STB), establish the 

STB as a government agency independent of the Department of 

Transportation (DOT), and authorize other changes in the agency’s 

operations. Based on information from the STB, CBO estimates 

that implementing the bill would cost $198 million over the 2016– 

2020 period, assuming the appropriation of the amounts authorized 

and estimated to be necessary. 

Enacting S. 808 would not affect direct spending or revenues; 

therefore, pay-as-you-go procedures do not apply. 


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S. 808 contains no intergovernmental or private-sector mandates 

as defined in the Unfunded Mandates Reform Act (UMRA) and 

would not affect the budgets of state, local, or tribal governments. 

Estimated cost to the Federal Government: The estimated budgetary effect of S. 808 is shown in the following table. The costs of 

this legislation fall within budget function 400 (transportation). 

By fiscal year, in millions of dollars— 

2016 2017 2018 2019 2020 2016– 

2020 

CHANGES IN SPENDING SUBJECT TO APPROPRIATION 

Operation of the Surface Transportation Board: 

Authorization Level .............................................................. 33 35 36 36 36 176 

Estimated Outlays ............................................................... 30 34 36 36 36 172 

Additional Activities by the Surface Transportation Board: 

Estimated Authorization Level ............................................. 6 6 6 6 6 30 

Estimated Outlays ............................................................... 3 5 6 6 6 26 

Total Changes: 

Estimated Authorization Level .................................... 39 41 42 42 42 206 

Estimated Outlays 33 39 42 42 42 198 

Basis of estimate: For this estimate, CBO assumes the bill will 

be enacted late in fiscal year 2015 and that the amounts authorized and estimated to be necessary will be appropriated. 

S. 808 would specifically authorize the appropriation of an additional $176 million for the operation of the STB over the 2016–2020 

period. The STB received an appropriation of $31 million in fiscal 

year 2015. 

According to the STB, the requirements in the bill to expand the 

number of board members and their associated staff, to allow it to 

initiate proceedings against companies, and to make it independent 

of DOT would impose additional costs on the board. CBO estimates 

those additional responsibilities would cost $6 million a year in addition to the amounts specifically authorized in the bill. Those additional amounts would primarily cover salaries and benefits for additional employees needed over the 2016–2017 period and to modify 

information technology systems. In total, CBO estimates that implementing S. 808 would cost $198 million over the 2016–2020 period. 

Pay-As-You-Go considerations: None. 

Intergovernmental and private-sector impact: S. 808 contains no 

intergovernmental mandates or private-sector mandates as defined 

in UMRA and would not affect the budgets of state, local, or tribal 

governments. 

Estimate prepared by: Federal costs: Sarah Puro; Impact on 

state, local, and tribal governments: Melissa Merrell; Impact on the 

private sector: Amy Petz. 

Estimate approved by: Theresa Gullo, Assistant Director for 

Budget Analysis. 

REGULATORY IMPACT

In accordance with paragraph 11(b) of rule XXVI of the Standing 

Rules of the Senate, the Committee provides the following evaluation of the regulatory impact of the legislation, as reported: 


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NUMBER OF PERSONS COVERED

S. 808 is intended to improve the efficiency of the STB by making modifications to the STB’s existing statutory authority. The bill 

would codify actions already undertaken by the STB, improve the 

processes for rate and practice cases, and expedite review 

timelines, which would have no effect on the number of individuals 

regulated. For railroads and shippers, the efficiencies at the STB 

may reduce the cost of compliance. S. 808 also would give the STB 

the authority to initiate certain investigations; however, the investigations would still need to be within the scope of their existing 

authority, which would not expand the persons or entities covered. 

S. 808 would expand the number of Board members, which would 

not have any foreseeable effect on the issues or entities regulated 

by the STB. While S. 808 would require certain studies and reports 

on rail issues, such as on multiple origin-to-destination pairs, and 

on rate case procedures and methodologies these provisions do not 

prescribe any particular finding or any action as a result of those 

findings. 

ECONOMIC IMPACT

S. 808 is expected to have a positive impact on the U.S. economy. 

The bill would improve inefficiencies at the STB and reduce delays 

in the case review process. The bill would allow for the STB to better assist shippers and railroads, helping to ensure rail service 

problems are addressed in a balanced and timely manner. These 

improvements would have helpful economic benefits, such as helping businesses to get goods to market more efficiently. 

PRIVACY

The reported bill is not expected to have any impact on the privacy rights of individuals. 

PAPERWORK

It is not anticipated that there would be a major increase in paperwork burdens resulting from the enactment of S. 808. 

CONGRESSIONALLY DIRECTED SPENDING

In compliance with paragraph 4(b) of rule XLIV of the Standing 

Rules of the Senate, the Committee provides that no provisions 

contained in the bill, as reported, meet the definition of congressionally directed spending items under the rule. 

SECTION-BY-SECTION ANALYSIS

Section 1. Short title; table of contents. 

This section titles the bill, the ‘‘Surface Transportation Board Reauthorization Act of 2015.’’ 

Section 2. References to title 49, United States Code. 

The section would explain that changes made in this bill, except 

where expressly provided otherwise, are made to title 49 of the 

United States Code. 


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11 

Section 3. Establishment of Surface Transportation Board as an 

independent establishment. 

This section would amend administrative provisions to clarify 

STB’s role as an independent body and require that submissions or 

transmissions of budgetary or legislative matters be submitted concurrently to the President and the Office of Management and 

Budget, the Committee on Commerce, Science, and Transportation 

of the Senate, and the Committee on Transportation and Infrastructure of the House of Representatives. This section also would 

repeal a requirement that the DOT provide administrative support 

to the STB. The section would make other technical amendments 

re-organizing the location of text in the United States Code. 

Section 4. Surface Transportation Board membership. 

This section would expand membership of the STB from three 

members to five in order to address inefficient quorum requirements. 

The nonpublic collaborative discussions provisions in section 5 of 

this bill are intended to apply for any number of STB board members, with or without the expansion to five members. 

Section 5. Nonpublic collaborative discussions. 

This section would allow for limited instances in which a majority of Board members can communicate without requiring a full 

public meeting. During such communications, no vote may be 

taken, the STB General Counsel must be present, and only Board 

members or staff may attend. In addition, the STB would be required to disclose meeting topics and participants within two business days of the meeting, unless the discussion relates to an ongoing proceeding, in which case the disclosure must be made on the 

date of the final Board decision. This section would also require the 

STB to provide a summary with as much general information as 

possible on any sensitive matter withheld from the public based on 

current law. 

Section 6. Reports. 

This section would require the STB to submit an annual report 

on its activities, including each instance where it initiates an investigation on its own initiative. 

This section would also require the STB to post on its public 

website quarterly reports of rail rate review cases pending or completed by the STB during the previous quarter. To help with compliance monitoring of the rate case procedures in section 11 of this 

Act, such a report must include summary information and key 

dates involved in the case. 

This section would also require the STB to post on its public 

website quarterly reports of formal and informal service complaints 

received by the STB during the previous quarter. The database 

must include the type, geographic origin, and resolution of each 

complaint. 

Section 7. Authorization of appropriations. 

This section would authorize STB appropriations for fiscal year 

2016 through 2020 at $33 million, $35 million, $35.5 million, $35.5 


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million, and $36 million, respectively. Current STB funding in fiscal year 2015 is $31.4 million. 

Section 8. Agent in the District of Columbia. 

This section would allow for a rail carrier’s agent to be located 

outside of Washington, D.C. 

Section 9. Department of Transportation Inspector General authority. 

This section would authorize the DOT OIG to review financial 

management, property management, and business operations of 

the STB. It would require the DOT OIG to keep the appropriate 

congressional committees informed, issue findings and recommendations, and report on STB progress in addressing problems. It would allow the DOT OIG to use investigative powers (e.g., 

subpoenas), authorize DOT to use necessary sums for DOT OIG activities, and authorize reimbursable agreements. 

All activities subject to this section are to be paid for by DOT. 

Section 10. Amendment to table of sections. 

This section would make conforming technical amendments to 

the table of sections. 

Section 11. Procedures for rate cases. 

This section would require the STB to maintain one or more 

streamlined processes for rate cases in which the full stand-alone 

cost presentation is too costly, given the value of the case. This requirement would build on existing work at the STB, and it would 

ensure the simplified reviews are accompanied by expedited handling. 

This section would also set rate review timelines for full standalone cost rate challenges to ensure the STB efficiently decides on 

relief. Timelines would apply to: discovery (150 days); development 

of evidentiary record (155 days); closing brief (60 days); and final 

Board decision (180 days). The section would provide an option for 

a Board-granted extension upon request or in the interest of due 

process. 

Finally, the section would require the STB to initiate a proceeding to assess other procedures, including procedures common 

in other litigation settings, to help expedite rate cases. 

Section 12. Investigative authority. 

This section would allow the STB to initiate investigations on its 

own initiative and set restrictions on those investigations. Current 

law only allows investigations upon complaint. For STB-initiated 

investigations, the STB would be required to: provide 30-day notice 

to parties under investigation; only investigate issues of national or 

regional significance; permit parties under investigation to file a 

written statement on the matter subject to investigation; make 

available to parties under investigation and Board members any 

recommendations and a summary of findings; dismiss any investigation that is not concluded by the STB with administrative finality within 1 year after the date on which it was commenced; would 

require the STB to separate investigating and decision-making 

functions of staff to the maximum extent practicable; and, within 


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90 days of receiving findings or recommendations, dismiss an investigation or initiate a proceeding to determine whether a violation has occurred. 

The requirement to dismiss any investigation that is not concluded by the Board with administrative finality within 1 year 

after the date on which it was commenced would only include the 

time period needed to generate recommendations and summary of 

findings. The time period needed to complete a proceeding, after receipt of the recommendations and summary of findings, would not 

be included in the 1 year time limitation for investigations. 

For STB-initiated investigations, if the Board determines a violation has occurred, this section would allow for de novo review of the 

Board’s order and provide authority for the United States court of 

appeals to affirm, modify, or set aside all or part of the order or 

remand the proceeding. This section also would limit any Board-ordered remedies to be prospective-only. 

Finally, this section would require, not later than 1 year after 

the date of enactment of this act, the STB to issue rules for the 

investigations that it initiates. 

Section 13. Arbitration of certain rail rates, practices, and common 

carrier service expectation disputes. 

This section would expand existing work at the STB to encourage 

and provide arbitration for dispute resolution. This section would 

require, not later than 1 year after the enactment of this Act, the 

STB to promulgate regulations establishing a voluntary and binding arbitration process for certain rate and practice disputes. 

Among other issues, this arbitration process would apply to rates, 

accessorial charges, and rules and practices as applied to particular 

rail transportation, but it would not apply to labor protective conditions, issues of industry-wide applicability, certain license issues, 

and disputes solely between two or more carriers. 

This section would require arbitration process only to be commenced when relevant parties opt-in. The process is available only 

if the rail carrier has market dominance. This section would set 

forth terms that require any arbitration decision to: be consistent 

with sound principles of rail regulation economics; be in writing; 

contain findings of fact and conclusions; bind the parties; and not 

have any precedential effect. It would limit the STB from separately reviewing cases, and it requires that arbitrators give due 

consideration to certain rail rate regulation issues. 

This section would specifies timelines for the: arbitrator selection 

(14 days after initiation); evidentiary process (90 days); and decision (30 days after evidentiary record closes). It would allow certain 

discretionary extensions. The section would also set a selection 

process for arbitrators and establishes equal sharing for the cost of 

the arbitrators, but not other associated arbitration costs. 

This section would cap relief at $2 million for practice disputes 

and $25 million for rate dispute damages. It would limit rate prescription from arbitration to not longer than five years from the 

date of the decision. The Board would only be able to review an arbitration decision if there is a clear abuse of arbitral authority or 

discretion, it does not comply with statute, the relief award cap, or 

sound principles of rail regulation economics. 


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Section 14. Effect of proposals for rates from multiple origins and 

destinations. 

This section would require, within 90 days of the date of the enactment of this Act, the Government Accountability Office to commence a study of rail transportation contract proposals containing 

multiple origin-to-destinations movements and to report results to 

the Committee on Commerce, Science, and Transportation of the 

Senate and the Committee on Transportation and Infrastructure of 

the House of Representatives. 

Section 15. Reports. 

This section would require the STB to submit, within 1 year of 

the enactment of this Act, a report to the Committee on Commerce, 

Science, and Transportation of the Senate and the Committee on 

Transportation and Infrastructure of the House of Representatives 

that indicates whether current large rate case methodologies are 

sufficient, not unduly complex, and cost effective. The report would 

also be required to indicate whether alternative methodologies 

exist, or could be developed, to streamline, expedite, or address the 

complexity of large rate cases. Any alternative methodologies must 

to be consistent with sound economic principles. 

This section would require the STB to provide, within 60 days of 

the date of enactment of this Act, quarterly reports to the Committee on Commerce, Science, and Transportation of the Senate 

and the Committee on Transportation and Infrastructure of the 

House of Representatives that describe the STB’s progress toward 

addressing the issues raised in unfinished regulatory proceedings. 

Section 16. Criteria. 

This section would clarify standards and procedures for evaluating revenue adequacy and emphasizes the infrastructure needed 

in order for rail carriers to be able to meet the present and future 

demand for rail service. This section would not require any change 

to how the STB determines railroad revenue adequacy. 

Section 17. Construction. 

This section would clarify that nothing in the bill affects any 

cases being considered by the STB at the time of enactment. 

CHANGES IN EXISTING LAW

In compliance with paragraph 12 of rule XXVI of the Standing 

Rules of the Senate, changes in existing law made by the bill, as 

reported, are shown as follows (existing law proposed to be omitted 

is enclosed in black brackets, new material is printed in italic, existing law in which no change is proposed is shown in roman): 


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TITLE 49. TRANSPORTATION 

SUBTITLE I. DEPARTMENT OF TRANSPORTATION

øCHAPTER 7.¿ CHAPTER 13. SURFACE TRANSPORTATION BOARD

SUBCHAPTER I. ESTABLISHMENT

§ ø701¿1301. Establishment of Board 

ø(a) ESTABLISHMENT.—There is hereby established within the 

Department of Transportation the Surface Transportation Board.¿ 

(a) ESTABLISHMENT.—The Surface Transportation Board is an 

independent establishment of the United States Government. 

(b) MEMBERSHIP.— 

(1) The Board shall consist of ø3 members¿ 5 members, to be 

appointed by the President, by and with the advice and consent of the Senate. Not more than ø2 members¿ 3 members 

may be appointed from the same political party. 

ø(2) At any given time, at least 2 members of the Board shall 

be individuals with professional standing and demonstrated 

knowledge in the fields of transportation or transportation regulation, and at least one member shall be an individual with 

professional or business experience (including agriculture) in 

the private sector.¿ 

(2) At all times— 

(A) at least 3 members of the Board shall be individuals 

with professional standing and demonstrated knowledge in 

the fields of transportation, transportation regulation, or 

economic regulation; and 

(B) at least 2 members shall be individuals with professional or business experience (including agriculture) in the 

private sector. 

(3) The term of each member of the Board shall be 5 years 

and shall begin when the term of the predecessor of that member ends. An individual appointed to fill a vacancy occurring 

before the expiration of the term for which the predecessor of 

that individual was appointed, shall be appointed for the remainder of that term. When the term of office of a member 

ends, the member may continue to serve until a successor is 

appointed and qualified, but for a period not to exceed one 

year. The President may remove a member for inefficiency, neglect of duty, or malfeasance in office. 

ø(4) On January 1, 1996, the members of the Interstate 

Commerce Commission serving unexpired terms on December 

29, 1995, shall become members of the Board, to serve for a period of time equal to the remainder of the term for which they 

were originally appointed to the Interstate Commerce Commission. Any member of the Interstate Commerce Commission 

whose term expires on December 31, 1995, shall become a 

member of the Board, subject to paragraph (3).¿ 

ø(5)¿(4) No individual may serve as a member of the Board 

for more than 2 terms. In the case of an individual øwho becomes a member of the Board pursuant to paragraph (4), or an 

individual¿ appointed to fill a vacancy occurring before the expiration of the term for which the predecessor of that indiVerDate Sep 11 2014 04:33 May 23, 2015 Jkt 049010 PO 00000 Frm 00017 Fmt 6659 Sfmt 6602 E:\HR\OC\SR052.XXX SR052

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vidual was appointed, such individual may not be appointed for 

more than one additional term. 

ø(6)¿(5) A member of the Board may not have a pecuniary 

interest in, hold an official relation to, or own stock in or bonds 

of, a carrier providing transportation by any mode and may not 

engage in another business, vocation, or employment. 

ø(7)¿(6) A vacancy in the membership of the Board does not 

impair the right of the remaining members to exercise all of 

the powers of the Board. The Board may designate a member 

to act as Chairman during any period in which there is no 

Chairman designated by the President. 

(c) CHAIRMAN.— 

(1) There shall be at the head of the Board a Chairman, who 

shall be designated by the President from among the members 

of the Board. The Chairman shall receive compensation at the 

rate prescribed for level III of the Executive Schedule under 

section 5314 of title 5. 

(2) Subject to the general policies, decisions, findings, and 

determinations of the Board, the Chairman shall be responsible for administering the Board. The Chairman may delegate 

the powers granted under this paragraph to an officer, employee, or office of the Board. The Chairman shall— 

(A) appoint and supervise, other than regular and fulltime employees in the immediate offices of another member, the officers and employees of the Board, including attorneys to provide legal aid and service to the Board and 

its members, and to represent the Board in any case in 

court; 

(B) appoint the heads of offices with the approval of the 

Board; 

(C) distribute Board business among officers and employees and offices of the Board; 

(D) prepare requests for appropriations for the Board 

and submit those requests to the President and Congress 

with the prior approval of the Board; and 

(E) supervise the expenditure of funds allocated by the 

Board for major programs and purposes. 

§ ø702¿1302. Functions 

Except as otherwise provided in the ICC Termination Act of 

1995, or the amendments made thereby, the Board shall perform 

all functions that, immediately before January 1, 1996, were functions of the Interstate Commerce Commission or were performed by 

any officer or employee of the Interstate Commerce Commission in 

the capacity as such officer or employee. 

§ ø703¿1303. Administrative provisions 

ø(a) EXECUTIVE REORGANIZATION.—Chapter 9 of title 5, United 

States Code, shall apply to the Board in the same manner as it 

does to an independent regulatory agency, and the Board shall be 

an establishment of the United States Government. 

øø(b)¿(a) OPEN MEETINGS.—For purposes of section 552b of title 

5, United States Code, the Board shall be deemed to be an agency.¿ 

(a) OPEN MEETINGS.— 


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(1) IN GENERAL.—The Board shall be deemed to be an agency 

for purposes of section 552b of title 5. 

(2) NONPUBLIC COLLABORATIVE DISCUSSIONS.— (A) IN GENERAL.—Notwithstanding section 552b of title 5, 

a majority of the members may hold a meeting that is not 

open to public observation to discuss official agency business if— 

(i) no formal or informal vote or other official agency 

action is taken at the meeting; 

(ii) each individual present at the meeting is a member or an employee of the Board; and 

(iii) the General Counsel of the Board is present at 

the meeting. 

(B) DISCLOSURE OF NONPUBLIC COLLABORATIVE DISCUSSIONS.—Except as provided under subparagraph (C), not 

later than 2 business days after the conclusion of a meeting 

under subparagraph (A), the Board shall make available to 

the public, in a place easily accessible to the public— 

(i) a list of the individuals present at the meeting; 

and 

(ii) a summary of the matters discussed at the meeting, except for any matters the Board properly determines may be withheld from the public under section 

552b(c) of title 5. 

(C) SUMMARY.—If the Board properly determines matters 

may be withheld from the public under section 555b(c) of 

title 5, the Board shall provide a summary with as much 

general information as possible on those matters withheld 

from the public. 

(D) ONGOING PROCEEDINGS.—If a discussion under subparagraph (A) directly relates to an ongoing proceeding before the Board, the Board shall make the disclosure under 

subparagraph (B) on the date of the final Board decision. 

(E) PRESERVATION OF OPEN MEETINGS REQUIREMENTS

FOR AGENCY ACTION.—Nothing in this paragraph may be 

construed to limit the applicability of section 552b of title 

5 with respect to a meeting of the members other than that 

described in this paragraph. 

(F) STATUTORY CONSTRUCTION.—Nothing in this paragraph may be construed— 

(i) to limit the applicability of section 552b of title 5 

with respect to any information which is proposed to be 

withheld from the public under subparagraph (B)(ii); 

or 

(ii) to authorize the Board to withhold from any individual any record that is accessible to that individual 

under section 552a of title 5, United States Code. 

ø(c) INDEPENDENCE.—In the performance of their functions, the 

members, employees, and other personnel of the Board shall not be 

responsible to or subject to the supervision or direction of any officer, employee, or agent of any other part of the Department of 

Transportation.¿ 

ø(d)¿(b) REPRESENTATION BY ATTORNEYS.—Attorneys designated 

by the Chairman of the Board may appear for, and represent the 

Board in, any civil action brought in connection with any function 


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18 

carried out by the Board pursuant to this chapter or subtitle IV or 

as otherwise authorized by law. 

ø(e)¿(c) ADMISSION TO PRACTICE.—Subject to section 500 of title 

5, the Board may regulate the admission of individuals to practice 

before it and may impose a reasonable admission fee. 

ø(f) BUDGET REQUESTS.—In each annual request for appropriations by the President, the Secretary of Transportation shall identify the portion thereof intended for the support of the Board and 

include a statement by the Board— 

ø(1) showing the amount requested by the Board in its budgetary presentation to the Secretary and the Office of Management and Budget; and 

ø(2) an assessment of the budgetary needs of the Board. 

ø(g) DIRECT TRANSMITTAL TO CONGRESS.—The Board shall transmit to Congress copies of budget estimates, requests, and information (including personnel needs), legislative recommendations, prepared testimony for congressional hearings, and comments on legislation at the same time they are sent to the Secretary of Transportation. An officer of an agency may not impose conditions on or impair communications by the Board with Congress, or a committee 

or Member of Congress, about the information.¿ 

(d) SUBMISSION OF CERTAIN DOCUMENTS TO CONGRESS.— (1) IN GENERAL.—If the Board submits any budget estimate, 

budget request, supplemental budget estimate, or other budget 

information, legislative recommendation, prepared testimony for 

a congressional hearing, or comment on legislation to the President or to the Office of Management and Budget, the Board 

shall concurrently submit a copy of such document to— 

(A) the Committee on Commerce, Science, and Transportation of the Senate; and 

(B) the Committee on Transportation and Infrastructure 

of the House of Representatives. 

(2) NO APPROVAL REQUIRED.—No officer or agency of the 

United States has any authority to require the Board to submit 

budget estimates or requests, legislative recommendations, prepared testimony for congressional hearings, or comments on legislation to any officer or agency of the United States for approval, comments, or review before submitting such recommendations, testimony, or comments to Congress. 

§ ø704¿1304. øAnnual report¿ Reports 

(a) ANNUAL REPORT.—The Board shall annually transmit to the 

Congress a report øon its activities.¿ on its activities, including 

each instance in which the Board has initiated an investigation on 

its own initiative under this chapter or subtitle IV. 

(b) RATE CASE REVIEW METRICS.— 

(1) QUARTERLY REPORTS.—The Board shall post a quarterly 

report of rail rate review cases pending or completed by the 

Board during the previous quarter that includes— 

(A) summary information of the case, including the docket number, case name, commodity or commodities involved, 

and rate review guideline or guidelines used; 

(B) the date on which the rate review proceeding began; 

(C) the date for the completion of discovery; 

(D) the date for the completion of the evidentiary record; 


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(E) the date for the submission of closing briefs; 

(F) the date on which the Board issued the final decision; 

and 

(G) a brief summary of the final decision; 

(2) WEBSITE POSTING.—Each quarterly report shall be posted 

on the Board’s public website. 

(c) COMPLAINTS.— (1) IN GENERAL.—The Board shall establish and maintain a 

database of complaints received by the Board. 

(2) QUARTERLY REPORTS.—The Board shall post a quarterly 

report of formal and informal service complaints received by the 

Board during the previous quarter that includes— 

(A) the date on which the complaint was received by the 

Board; 

(B) a list of the type of each complaint; 

(C) the geographic region of each complaint; and 

(D) the resolution of each complaint, if appropriate. 

(3) WRITTEN CONSENT.—The quarterly report may identify a 

complainant that submitted an informal complaint only upon 

the written consent of the complainant. 

(4) WEBSITE POSTING.—Each quarterly report shall be posted 

on the Board’s public website. 

§ ø705¿1305. Authorization of appropriations 

There are authorized to be appropriated for the activities of the 

Board— 

ø(1) $8,421,000 for fiscal year 1996; 

ø(2) $12,000,000 for fiscal year 1997; and 

ø(3) $12,000,000 for fiscal year 1998.¿ 

(1) $33,000,000 for fiscal year 2016; 

(2) $35,000,000 for fiscal year 2017; 

(3) $35,500,000 for fiscal year 2018; 

(4) $35,500,000 for fiscal year 2019; and 

(5) $36,000,000 for fiscal year 2020. 

§ ø706¿1306. Reporting official action 

(a) REPORTS ON PROCEEDINGS.—The Board shall make a written 

report of each proceeding conducted on complaint or on its own initiative and furnish a copy to each party to that proceeding. The report shall include the findings, conclusions, and the order of the 

Board and, if damages are awarded, the findings of fact supporting 

the award. The Board may have its reports published for public 

use. A published report of the Board is competent evidence of its 

contents. 

(b) SPECIAL RULES FOR MATTERS RELATED TO RAIL CARRIERS.— 

(1) When action of the Board in a matter related to a rail 

carrier is taken by the Board, an individual member of the 

Board, or another individual or group of individuals designated 

to take official action for the Board, the written statement of 

that action (including a report, order, decision and order, vote, 

notice, letter, policy statement, or regulation) shall indicate— 

(A) the official designation of the individual or group 

taking the action; 

(B) the name of each individual taking, or participating 

in taking, the action; and 


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(C) the vote or position of each participating individual. 

(2) If an individual member of a group taking an official action referred to in paragraph (1) does not participate in it, the 

written statement of the action shall indicate that the member 

did not participate. An individual participating in taking an official action is entitled to express the views of that individual 

as part of the written statement of the action. In addition to 

any publication of the written statement, it shall be made 

available to the public under section 552(a) of title 5. 

§ ø721¿1321. Powers 

(a) IN GENERAL.—The Board shall carry out this chapter and 

subtitle IV. Enumeration of a power of the Board in this chapter 

or subtitle IV does not exclude another power the Board may have 

in carrying out this chapter or subtitle IV. The Board may prescribe regulations in carrying out this chapter and subtitle IV. 

(b) INQUIRIES, REPORTS, AND ORDERS.—The Board may— 

(1) inquire into and report on the management of the business of carriers providing transportation and services subject 

to subtitle IV; 

(2) inquire into and report on the management of the business of a person controlling, controlled by, or under common 

control with those carriers to the extent that the business of 

that person is related to the management of the business of 

that carrier; 

(3) obtain from those carriers and persons information the 

Board decides is necessary to carry out subtitle IV; and 

(4) when necessary to prevent irreparable harm, issue an appropriate order without regard to subchapter II of chapter 5 of 

title 5. 

(c) SUBPOENA WITNESSES.— (1) The Board may subpoena witnesses and records related 

to a proceeding of the Board from any place in the United 

States, to the designated place of the proceeding. If a witness 

disobeys a subpoena, the Board, or a party to a proceeding before the Board, may petition a court of the United States to enforce that subpoena. 

(2) The district courts of the United States have jurisdiction 

to enforce a subpoena issued under this section. Trial is in the 

district in which the proceeding is conducted. The court may 

punish a refusal to obey a subpoena as a contempt of court. 

(d) DEPOSITIONS.— 

(1) In a proceeding, the Board may take the testimony of a 

witness by deposition and may order the witness to produce 

records. A party to a proceeding pending before the Board may 

take the testimony of a witness by deposition and may require 

the witness to produce records at any time after a proceeding 

is at issue on petition and answer. 

(2) If a witness fails to be deposed or to produce records 

under paragraph (1), the Board may subpoena the witness to 

take a deposition, produce the records, or both. 

(3) A deposition may be taken before a judge of a court of 

the United States, a United States magistrate judge, a clerk of 

a district court, or a chancellor, justice, or judge of a supreme 

or superior court, mayor or chief magistrate of a city, judge of 


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a county court, or court of common pleas of any State, or a notary public who is not counsel or attorney of a party or interested in the proceeding. 

(4) Before taking a deposition, reasonable notice must be 

given in writing by the party or the attorney of that party proposing to take a deposition to the opposing party or the attorney of record of that party, whoever is nearest. The notice shall 

state the name of the witness and the time and place of taking 

the deposition. 

(5) The testimony of a person deposed under this subsection 

shall be taken under oath. The person taking the deposition 

shall prepare, or cause to be prepared, a transcript of the testimony taken. The transcript shall be subscribed by the deponent. 

(6) The testimony of a witness who is in a foreign country 

may be taken by deposition before an officer or person designated by the Board or agreed on by the parties by written 

stipulation filed with the Board. A deposition shall be filed 

with the Board promptly. 

(e) WITNESS FEES.—Each witness summoned before the Board or 

whose deposition is taken under this section and the individual 

taking the deposition are entitled to the same fees and mileage 

paid for those services in the courts of the United States. 

§ ø722¿1322. Board action 

(a) EFFECTIVE DATE OF ACTIONS.—Unless otherwise provided in 

subtitle IV, the Board may determine, within a reasonable time, 

when its actions, other than an action ordering the payment of 

money, take effect. 

(b) TERMINATING AND CHANGING ACTIONS.—An action of the 

Board remains in effect under its own terms or until superseded. 

The Board may change, suspend, or set aside any such action on 

notice. Notice may be given in a manner determined by the Board. 

A court of competent jurisdiction may suspend or set aside any 

such action. 

(c) RECONSIDERING ACTIONS.—The Board may, at any time on its 

own initiative because of material error, new evidence, or substantially changed circumstances— 

(1) reopen a proceeding; 

(2) grant rehearing, reargument, or reconsideration of an action of the Board; or 

(3) change an action of the Board. 

(1) An interested party may petition to reopen and reconsider an action of the Board under this subsection under regulations of the Board. 

(d) FINALITY OF ACTIONS.—Notwithstanding subtitle IV [49 

USCS §§ 10101 et seq.], an action of the Board under this section 

is final on the date on which it is served, and a civil action to enforce, enjoin, suspend, or set aside the action may be filed after 

that date. 

§ ø723¿1323. Service of notice in Board proceedings 

(a) DESIGNATION OF AGENT.—A carrier providing transportation 

subject to the jurisdiction of the Board under subtitle IV shall designate an agent øin the District of Columbia,¿ on whom service of 


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22 

notices in a proceeding before, and of actions of, the Board may be 

made. 

(b) FILING AND CHANGING DESIGNATIONS.—A designation under 

subsection (a) shall be in writing and filed with the Board. The designation may be changed at any time in the same manner as originally made. 

(c) SERVICE OF NOTICE.—Except as otherwise provided, notices of 

the Board shall be served on its designated agent at the office or 

usual place of residence øin the District of Columbia¿ of that agent. 

A notice of action of the Board shall be served immediately on the 

agent or in another manner provided by law. If that carrier does 

not have a designated agent, service may be made by posting the 

notice in the office of the Board. 

(d) SPECIAL RULE FOR RAIL CARRIERS.—In a proceeding involving 

the lawfulness of classifications, rates, or practices of a rail carrier 

that has not designated an agent under this section, service of notice of the Board on an attorney in fact for the carrier constitutes 

service of notice on the carrier. 

§ ø724¿1324. Service of process in court proceedings 

(a) DESIGNATION OF AGENT.—A carrier providing transportation 

subject to the jurisdiction of the Board under subtitle IV shall designate an agent øin the District of Columbia¿ on whom service of 

process in an action before a district court may be made. Except 

as otherwise provided, process in an action before a district court 

shall be served on the designated agent of that carrier at the office 

or usual place of residence øin the District of Columbia¿ of that 

agent. If the carrier does not have a designated agent, service may 

be made by posting the notice in the office of the Board. 

(b) CHANGING DESIGNATION.—A designation under this section 

may be changed at any time in the same manner as originally 

made. 

ø§ 725. Administrative support 

øThe Secretary of Transportation shall provide administrative 

support for the Board.¿ 

§ ø726¿1325. Railroad-Shipper Transportation Advisory 

Council 

(a) ESTABLISHMENT; MEMBERSHIP.—There is established the Railroad-Shipper Transportation Advisory Council (in this section referred to as the ‘‘Council’’) to be composed of 19 members, of which 

15 members shall be appointed by the Chairman of the Board, 

after recommendation from rail carriers and shippers, within 60 

days after December 29, 1995. The members of the Council shall 

be appointed as follows: 

(1) The members of the Council shall be appointed from 

among citizens of the United States who are not regular fulltime employees of the United States and shall be selected for 

appointment so as to provide as nearly as practicable a broad 

representation of the various segments of the railroad and rail 

shipper industries. 

(2) Nine of the members shall be appointed from senior executive officers of organizations engaged in the railroad and rail 

shipping industries, which 9 members shall be the voting memVerDate Sep 11 2014 04:33 May 23, 2015 Jkt 049010 PO 00000 Frm 00024 Fmt 6659 Sfmt 6602 E:\HR\OC\SR052.XXX SR052

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bers of the Council. Council action and Council positions shall 

be determined by a majority vote of the members present. A 

majority of such voting members shall constitute a quorum. Of 

such 9 voting members— 

(A) at least 4 shall be representative of small shippers 

(as determined by the Chairman); and 

(B) at least 4 shall be representative of Class II or III 

railroads. 

(3) The remaining 6 members of the Council shall serve in 

a nonvoting advisory capacity only, but shall be entitled to participate in Council deliberations. Of the remaining members— 

(A) 3 shall be representative of Class I railroads; and 

(B) 3 shall be representative of large shipper organizations (as determined by the Chairman). 

(4) The Secretary of Transportation and the members of the 

Board shall serve as ex officio, nonvoting members of the 

Council. The Council shall not be subject to the Federal Advisory Committee Act. A list of the members appointed to the 

Council shall be forwarded to the Chairmen and ranking members of the Committee on Commerce, Science, and Transportation of the Senate and the Committee on Transportation and 

Infrastructure of the House of Representatives. 

(5) Each ex officio member of the Council may designate an 

alternate, who shall serve as a member of the Council whenever the ex officio member is unable to attend a meeting of the 

Council. Any such designated alternate shall be selected from 

individuals who exercise significant decision-making authority 

in the Federal agency involved. 

(b) TERM OF OFFICE.—The members of the Council shall be appointed for a term of office of 3 years, except that of the members 

first appointed— 

(1) 5 members shall be appointed for terms of 1 year; and 

(2) 5 members shall be appointed for terms of 2 years, 

(1) as designated by the Chairman at the time of appointment. Any member appointed to fill a vacancy occurring before 

the expiration of the term for which the member’s predecessor 

was appointed shall be appointed only for the remainder of 

such term. A member may serve after the expiration of his 

term until his successor has taken office. Vacancies on the 

Council shall be filled in the same manner in which the original appointments were made. No member of the Council shall 

be eligible to serve in excess of two consecutive terms. 

(c) ELECTION AND DUTIES OF OFFICERS.—The Council Chairman 

and Vice Chairman and other appropriate officers of the Council 

shall be elected by and from the voting members of the Council. 

The Council Chairman shall serve as the Council’s executive officer 

and shall direct the administration of the Council, assign officer 

and committee duties, and shall be responsible for issuing and communicating the reports, policy positions and statements of the 

Council. In the event that the Council Chairman is unable to serve, 

the Vice Chairman shall act as Council Chairman. 

(d) EXPENSES.— (1) The members of the Council shall receive no compensation for their services as such, but upon request by the Council 

Chairman, based on a showing of significant economic burden, 


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24 

the Secretary of Transportation or the Chairman of the Board, 

to the extent provided in advance in appropriation Acts, may 

provide reasonable and necessary travel expenses for such individual Council members from Department or Board funding 

sources in order to foster balanced representation on the Council. 

(2) Upon request by the Council Chairman, the Secretary or 

Chairman of the Board, to the extent provided in advance in 

appropriations Acts, may pay the reasonable and necessary expenses incurred by the Council in connection with the coordination of Council activities, announcement and reporting of 

meetings, and preparation of such Council documents as are 

required or permitted by this section. 

(3) The Council may solicit and use private funding for its 

activities, subject to this subsection. 

(4) Prior to making any Federal funding requests, the Council Chairman shall undertake best efforts to fund such activities privately unless the Council Chairman determines that 

such private funding would create a conflict of interest, or the 

appearance thereof, or is otherwise impractical. The Council 

Chairman shall not request funding from any Federal agency 

without providing written justification as to why private funding would create any such conflict or appearance, or is otherwise impractical. 

(5) To enable the Council to carry out its functions— 

(A) the Council Chairman may request directly from any 

Federal agency such personnel, information, services, or 

facilities, on a compensated or uncompensated basis, as 

the Council Chairman determines necessary to carry out 

the functions of the Council; 

(B) each Federal agency may, in its discretion, furnish 

the Council with such information, services, and facilities 

as the Council Chairman may request to the extent permitted by law and within the limits of available funds; and 

(C) each Federal agency may, in its discretion, detail to 

temporary duty with the Council, such personnel as the 

Council Chairman may request for carrying out the functions of the Council, each such detail to be without loss of 

seniority, pay, or other employee status. 

(e) MEETINGS.—The Council shall meet at least semi-annually 

and shall hold other meetings at the call of the Council Chairman. 

Appropriate Federal facilities, where available, may be used for 

such meetings. Whenever the Council, or a committee of the Council, considers matters that affect the jurisdictional interests of Federal agencies that are not represented on the Council, the Council 

Chairman may invite the heads of such agencies, or their designees, to participate in the deliberations of the Council. 

(f) FUNCTIONS AND DUTIES; ANNUAL REPORT.— 

(1) The Council shall advise the Secretary, the Chairman, 

the Committee on Commerce, Science, and Transportation of 

the Senate, and the Committee on Transportation and Infrastructure of the House of Representatives with respect to rail 

transportation policy issues it considers significant, with particular attention to issues of importance to small shippers and 

small railroads, including car supply, rates, competition, and 


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25 

effective procedures for addressing legitimate shipper and 

other claims. 

(2) To the extent the Council addresses specific grain car 

issues, it shall coordinate such activities with the National 

Grain Car Council. The Secretary and Chairman shall cooperate with the Council to provide research, technical and other 

reasonable support in developing any reports and policy statements required or authorized by this subsection. 

(3) The Council shall endeavor to develop within the private 

sector mechanisms to prevent, or identify and effectively address, obstacles to the most effective and efficient transportation system practicable. 

(4) The Council shall prepare an annual report concerning its 

activities and the results of Council efforts to resolve industry 

issues, and propose whatever regulatory or legislative relief it 

considers appropriate. The Council shall include in the annual 

report such recommendations as it considers appropriate with 

respect to the performance of the Secretary and Chairman 

under this chapter, and with respect to the operation and effectiveness of meetings and industry developments relating to the 

Council’s efforts, and such other information as it considers appropriate. Such annual reports shall be reviewed by the Secretary and Chairman, and shall include the Secretary’s and 

Chairman’s views or comments relating to— 

(A) the accuracy of information therein; 

(B) Council efforts and reasonableness of Council positions and actions; and 

(C) any other aspects of the Council’s work as they may 

consider appropriate. 

The Council may prepare other reports or develop policy 

statements as the Council considers appropriate. An annual report shall be submitted for each fiscal year and shall be submitted to the Secretary and Chairman within 90 days after the 

end of the fiscal year. Other such reports and statements may 

be submitted as the Council considers appropriate. 

ø§ 727. Definitions 

øAll terms used in this chapter that are defined in subtitle IV 

shall have the meaning given those terms in that subtitle.¿ 

§ 1326. Authority of the Inspector General 

(a) IN GENERAL.—The Inspector General of the Department of 

Transportation, in accordance with the mission of the Inspector 

General to prevent and detect fraud and abuse, shall have authority 

to review only the financial management, property management, 

and business operations of the Surface Transportation Board, including internal accounting and administrative control systems, to 

determine the Board’s compliance with applicable Federal laws, 

rules, and regulations. 

(b) DUTIES.—In carrying out this section, the Inspector General 

shall— 

(1) keep the Chairman of the Board, the Committee on Commerce, Science, and Transportation of the Senate, and the Committee on Transportation and Infrastructure of the House of 

Representatives fully and currently informed about problems reVerDate Sep 11 2014 04:33 May 23, 2015 Jkt 049010 PO 00000 Frm 00027 Fmt 6659 Sfmt 6603 E:\HR\OC\SR052.XXX SR052

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lating to administration of the internal accounting and administrative control systems of the Board; 

(2) issue findings and recommendations for actions to address 

the problems referred to in paragraph (1); and 

(3) submit periodic reports to the Committee on Commerce, 

Science, and Transportation of the Senate, and the Committee 

on Transportation and Infrastructure of the House of Representatives that describe any progress made in implementing actions 

to address the problems referred to in paragraph (1). 

(c) ACCESS TO INFORMATION.—In carrying out this section, the Inspector General may exercise authorities granted to the Inspector 

General under subsections (a) and (b) of section 6 of the Inspector 

General Act of 1978 (5 U.S.C. App.). 

(d) AUTHORIZATION OF APPROPRIATIONS.— (1) FUNDING.—There are authorized to be appropriated to the 

Secretary of Transportation for use by the Inspector General of 

the Department of Transportation such sums as may be necessary to cover expenses associated with activities pursuant to 

the authority exercised under this section. 

(2) REIMBURSABLE AGREEMENT.—In the absence of an appropriation under this subsection for an expense referred to in 

paragraph (1), the Inspector General and the Board shall have 

a reimbursement agreement to cover such expense. 

SUBTITLE IV. INTERSTATE TRANSPORTATION

PART A. RAIL

CHAPTER 107. RATES

SUBCHAPTER I. GENERAL AUTHORITY

§ 10701. Standards for rates, classifications, through routes, 

rules, and practices 

* * * * * * * 

(d)(1) If the Board determines, under section 10707 of this title, 

that a rail carrier has market dominance over the transportation 

to which a particular rate applies, the rate established by such carrier for such transportation must be reasonable. 

(2) In determining whether a rate established by a rail carrier is reasonable for purposes of this section, the Board shall 

give due consideration to— 

(A) the amount of traffic which is transported at revenues which do not contribute to going concern value and 

the efforts made to minimize such traffic; 

(B) the amount of traffic which contributes only marginally to fixed costs and the extent to which, if any, rates on 

such traffic can be changed to maximize the revenues from 

such traffic; and 

(C) the carrier’s mix of rail traffic to determine whether 

one commodity is paying an unreasonable share of the carrier’s overall revenues, recognizing the policy of this part 

that rail carriers shall earn adequate revenues, as established by the Board under section 10704(a)(2) of this title. 

ø(3) The Board shall, within one year after January 1, 1996, 

complete the pending Interstate Commerce Commission nonVerDate Sep 11 2014 04:33 May 23, 2015 Jkt 049010 PO 00000 Frm 00028 Fmt 6659 Sfmt 6602 E:\HR\OC\SR052.XXX SR052

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coal rate guidelines proceeding to establish a simplified and expedited method for determining the reasonableness of challenged rail rates in those cases in which a full stand-alone cost 

presentation is too costly, given the value of the case.¿ 

(3) The Board shall maintain 1 or more simplified and expedited 

methods for determining the reasonableness of challenged rates in 

those cases in which a full stand-alone cost presentation is too costly, given the value of the case. 

§ 10704. Authority and criteria: rates, classifications, rules, 

and practices prescribed by Board 

(a)(1) When the Board, after a full hearing, decides that a rate 

charged or collected by a rail carrier for transportation subject to 

the jurisdiction of the Board under this part, or that a classification, rule, or practice of that carrier, does or will violate this part, 

the Board may prescribe the maximum rate, classification, rule, or 

practice to be followed. The Board may order the carrier to stop the 

violation. When a rate, classification, rule, or practice is prescribed 

under this subsection, the affected carrier may not publish, charge, 

or collect a different rate and shall adopt the classification and observe the rule or practice prescribed by the Board. 

(2) The Board shall maintain and revise as necessary standards and procedures for establishing revenue levels for rail carriers providing transportation subject to its jurisdiction under 

this part that are adequate, under honest, economical, and efficient management, for the infrastructure and investment needed to meet the present and future demand for rail services and 

to cover total operating expenses, including depreciation and 

obsolescence, plus a reasonable and economic profit or return 

(or both) on capital employed in the business. The Board shall 

make an adequate and continuing effort to assist those carriers 

in attaining revenue levels prescribed under this paragraph. 

Revenue levels established under this paragraph should— 

(A) provide a flow of net income plus depreciation adequate to support prudent capital outlays, assure the repayment of a reasonable level of debt, permit the raising of 

needed equity capital, and cover the effects of inflation; 

and 

(B) attract and retain capital in amounts adequate to 

provide a sound transportation system in the United 

States. 

(3) On the basis of the standards and procedures described 

in paragraph (2), the Board shall annually determine which 

rail carriers are earning adequate revenues. 

* * * * * * * 

ø(d) Within 9 months after January 1, 1996, the Board shall establish procedures to ensure expeditious handling of challenges to 

the reasonableness of railroad rates.¿ (d)(1) The Board shall maintain procedures to ensure the expeditious handling of challenges to 

the reasonableness of railroad rates. The procedures shall include 

appropriate measures for avoiding delay in the discovery and evidentiary phases of such proceedings and exemption or revocation 

proceedings, including appropriate sanctions for such delay, and for 

ensuring prompt disposition of motions and interlocutory administrative appeals. 


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(2)(A) Except as provided under subparagraph (B), in a standalone cost rate challenge, the Board shall comply with the following 

timeline: 

(i) Discovery shall be completed not later than 150 days after 

the date on which the challenge is initiated. 

(ii) The development of the evidentiary record shall be completed not later than 155 days after the date on which discovery 

is completed under clause (i). 

(iii) The closing brief shall be submitted not later than 60 

days after the date on which the development of the evidentiary 

record is completed under clause (ii). 

(iv) A final Board decision shall be issued not later than 180 

days after the date on which the evidentiary record is completed 

under clause (ii). 

(B) The Board may extend a timeline under subparagraph (A) 

after a request from any party or in the interest of due process. 

§ 10709. Authority and criteria: rates, classifications, rules, 

and practices prescribed by Board 

* * * * * * * 

ø(h)(1) Any rail carrier may, in accordance with the terms of this 

section, enter into contracts for the transportation of agricultural 

commodities (including forest products, but not including wood 

pulp, wood chips, pulpwood or paper) involving the utilization of 

carrier owned or leased equipment not in excess of 40 percent of 

the capacity of such carrier’s owned or leased equipment by major 

car type (plain boxcars, covered hopper cars, gondolas and open top 

hoppers, coal cars, bulkhead flatcars, pulpwood rackcars, and flatbed equipment, including TOFC/COFC). 

ø(2) The Board may, on request of a rail carrier or other 

party or on its own initiative, grant such relief from the limitations of paragraph (1) of this subsection as the Board considers 

appropriate, if it appears that additional equipment may be 

made available without impairing the rail carrier’s ability to 

meet its common carrier obligations under section 11101 of this 

title. 

ø(3)(A) This subsection shall cease to be effective after September 30, 1998. 

ø(B) Before October 1, 1997, the National Grain Car 

Council and the Railroad-Shipper Transportation Advisory 

Council shall make recommendations to Congress on 

whether to extend the effectiveness of or otherwise modify 

this subsection.¿ 

SUBTITLE IV. INTERSTATE TRANSPORTATION

PART A. RAIL

CHAPTER 117. ENFORCEMENT: INVESTIGATIONS, RIGHTS, AND

REMEDIES

§ 11701. General authority 

(a) Except as otherwise provided in this part, the Board may 

begin an investigation under this part øonly on complaint¿ on the 

Board’s own initiative or upon receiving a complaint pursuant to 

subsection (b). If the Board finds that a rail carrier is violating this 


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29 

part, the Board shall take appropriate action to compel compliance 

with this part. If the Board finds a violation of this part in a proceeding brought on its own initiative, any remedy from such proceeding may only be applied prospectively. 

(b) A person, including a governmental authority, may file with 

the Board a complaint about a violation of this part by a rail carrier providing transportation or service subject to the jurisdiction 

of the Board under this part. The complaint must state the facts 

that are the subject of the violation. The Board may dismiss a complaint it determines does not state reasonable grounds for investigation and action. However, the Board may not dismiss a complaint made against a rail carrier providing transportation subject 

to the jurisdiction of the Board under this part because of the absence of direct damage to the complainant. 

(c) A formal investigative proceeding begun by the Board under 

subsection (a) of this section is dismissed automatically unless it is 

concluded by the Board with administrative finality by the end of 

the third year after the date on which it was begun. 

(d) In any investigation commenced on the Board’s own initiative, 

the Board shall— 

(1) not later than 30 days after initiating the investigation, 

provide written notice to the parties under investigation, which 

shall state the basis for such investigation; 

(2) only investigate issues that are of national or regional significance; 

(3) permit the parties under investigation to file a written 

statement describing any or all facts and circumstances concerning a matter which may be the subject of such investigation; 

(4) make available to the parties under investigation and 

Board members— 

(A) any recommendations made as a result of the investigation; and 

(B) a summary of the findings that support such recommendations; 

(5) to the extent practicable, separate the investigative and decisionmaking functions of staff; 

(6) dismiss any investigation that is not concluded by the 

Board with administrative finality within 1 year after the date 

on which it was commenced; and 

(7) not later than 90 days after receiving the recommendations and summary of findings under paragraph (4)— 

(A) dismiss the investigation if no further action is warranted; or 

(B) initiate a proceeding to determine if a provision 

under this part has been violated. 

(e)(1) Any parties to an investigation against whom a violation is 

found as a result of an investigation begun on the Board’s own initiative may, not later than 60 days after the date of the order of the 

Board finding such a violation, institute an action in the United 

States court of appeals for the appropriate judicial circuit for de 

novo review of such order in accordance with chapter 7 of title 5. 

(2) The court— 


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30 

(A) shall have jurisdiction to enter a judgment affirming, 

modifying, or setting aside, in whole or in part, the order of the 

Board; and 

(B) may remand the proceeding to the Board for such further 

action as the court may direct. 

§ 11708. Voluntary arbitration of certain rail rates and practices disputes 

(a) IN GENERAL.—Not later than 1 year after the date of the enactment of the Surface Transportation Board Reauthorization Act of 

2015, the Board shall promulgate regulations to establish a voluntary and binding arbitration process to resolve rail rate and practice complaints subject to the jurisdiction of the Board. 

(b) COVERED DISPUTES.—The voluntary and binding arbitration 

process established pursuant to subsection (a)— 

(1) shall apply to disputes involving— 

(A) rates, demurrage, accessorial charges, misrouting, or 

mishandling of rail cars; or 

(B) a carrier’s published rules and practices as applied to 

particular rail transportation; 

(2) shall not apply to disputes— 

(A) to obtain the grant, denial, stay, or revocation of any 

license, authorization, or exemption; 

(B) to prescribe for the future any conduct, rules, or results of general, industry-wide applicability; 

(C) to enforce a labor protective condition; or 

(D) that are solely between 2 or more rail carriers; and 

(3) shall not prevent parties from independently seeking or 

utilizing private arbitration services to resolve any disputes the 

parties may have. 

(c) ARBITRATION PROCEDURES.— 

(1) IN GENERAL.—The Board— 

(A) may make the voluntary and binding arbitration 

process established pursuant to subsection (a) available 

only to the relevant parties; 

(B) may make the voluntary and binding arbitration 

process available only— 

(i) after receiving the written consent to arbitrate 

from all relevant parties; and 

(ii)(I) after the filing of a written complaint; or 

(II) through other procedures adopted by the Board 

in a rulemaking proceeding; 

(C) with respect to rate disputes, may make the voluntary 

and binding arbitration process available only to the relevant parties if the rail carrier has market dominance (as 

determined under section 10707); and 

(D) may initiate the voluntary and binding arbitration 

process not later than 40 days after the date on which a 

written complaint is filed or through other procedures 

adopted by the Board in a rulemaking proceeding. 

(2) LIMITATION.—Initiation of the voluntary and binding arbitration process shall preclude the Board from separately reviewing a complaint or dispute related to the same rail rate or 

practice in a covered dispute involving the same parties. 


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(3) RATES.—In resolving a covered dispute involving the reasonableness of a rail carrier’s rates, the arbitrator or panel of 

arbitrators, as applicable, shall consider the Board’s methodologies for setting maximum lawful rates, giving due consideration 

to the need for differential pricing to permit a rail carrier to collect adequate revenues (as determined under section 

10704(a)(2)). 

(d) ARBITRATION DECISIONS.—Any decision reached in an arbitration process under this section— 

(1) shall be consistent with sound principles of rail regulation 

economics; 

(2) shall be in writing; 

(3) shall contain findings of fact and conclusions; 

(4) shall be binding upon the parties; and 

(5) shall not have any precedential effect in any other or subsequent arbitration dispute. 

(e) TIMELINES.— 

(1) SELECTION.—An arbitrator or panel of arbitrators shall be 

selected not later than 14 days after the date of the Board’s decision to initiate arbitration. 

(2) EVIDENTIARY PROCESS.—The evidentiary process of the 

voluntary and binding arbitration process shall be completed 

not later than 90 days after the date on which the arbitration 

process is initiated unless— 

(A) a party requests an extension; and 

(B) the arbitrator or panel of arbitrators, as applicable, 

grants such extension request. 

(3) DECISION.—The arbitrator or panel of arbitrators, as applicable, shall issue a decision not later than 30 days after the 

date on which the evidentiary record is closed. 

(4) EXTENSIONS.—The Board may extend any of the timelines 

under this subsection upon the agreement of all parties in the 

dispute. 

(f) ARBITRATORS.— 

(1) IN GENERAL.—Unless otherwise agreed by all of the parties, an arbitration under this section shall be conducted by an 

arbitrator or panel of arbitrators, which shall be selected from 

a roster, maintained by the Board, of persons with rail transportation, economic regulation, professional or business experience, including agriculture, in the private sector. 

(2) INDEPENDENCE.—In an arbitration under this section, the 

arbitrators shall perform their duties with diligence, good faith, 

and in a manner consistent with the requirements of impartiality and independence. 

(3) SELECTION.— 

(A) IN GENERAL.—If the parties cannot mutually agree on 

an arbitrator, or the lead arbitrator of a panel of arbitrators, the parties shall select the or lead arbitrator from the 

roster by alternately striking names from the roster until 

only 1 name remains meeting the criteria set forth in paragraph (1). 

‘‘(B) PANEL OF ARBITRATORS.—If the parties agree to select a panel of arbitrators, instead of a single arbitrator, 

the panel shall be selected under this subsection as follows: 


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(i) The parties to a dispute may mutually select 1 arbitrator from the roster to serve as the lead arbitrator 

of the panel of arbitrators. 

(ii) If the parties cannot mutually agree on a lead arbitrator, the parties shall select a lead arbitrator using 

the process described in subparagraph (A). 

(iii) In addition to the lead arbitrator selected under 

this subparagraph, each party to a dispute shall select 

1 additional arbitrator from the roster, regardless of 

whether the other party struck out the arbitrator’s 

name under subparagraph (A). 

(4) COST.—The parties shall share the costs incurred by the 

Board and arbitrators equally, with each party responsible for 

paying its own legal and other associated arbitration costs. 

(g) RELIEF.— 

(1) IN GENERAL.—Subject to the limitations set forth in paragraphs (2) and (3), an arbitral decision under this section may 

award the payment of damages or rate prescriptive relief. 

(2) PRACTICE DISPUTES.—The damage award for practice disputes may not exceed $2,000,000. 

(3) RATE DISPUTES.— (A) MONETARY LIMIT.—The damage award for rate disputes, including any rate prescription, may not exceed 

$25,000,000. 

(B) TIME LIMIT.—Any rate prescription shall be limited to 

not longer than 5 years from the date of the arbitral decision. 

(h) BOARD REVIEW.—If a party appeals a decision under this section to the Board, the Board may review the decision under this section to determine if— 

(1) the decision is consistent with sound principles of rail regulation economics; 

(2) a clear abuse of arbitral authority or discretion occurred; 

(3) the decision directly contravenes statutory authority; or 

(4) the award limitation under subsection (g) was violated. 

Æ 


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