Opinion ID: 351802
Heading Depth: 2
Heading Rank: 1

Heading: The Nature of the Revenue Orders

Text: 4 The general revenue orders are under attack for lack of economic justification: (1) Ex Parte No. 310, Increased Freight Rates and Charges, 1975, Nationwide, (2) Ex Parte No. 305, Nationwide Increase of Ten Percent in Freight Rates and Charges, 1974, 2 and (3) Ex Parte No. 313, Increased Freight Rates and Charges Labor Costs, 1975. 5 Ex Parte No. 310. On November 15, 1974, the railroads filed for permission to increase rates and charges by 7% Effective immediately without suspension by the ICC. The latter ordered an investigation on November 27, 1974, and in the same order also authorized an increase not to become effective before February 5, 1975. The order further reserved the right to prohibit, modify or suspend the increase prior to that date, accepted railroad evidence in support of the increase, sought evidence from protesting shippers, and scheduled hearings on the proposed increase. 6 The hearings resulted in suspension of Ex Parte No. 310 on January 29, 1975, for a seven-month period, but with a number of important exemptions, known as holddowns 3 and flag-outs. 4 Ex Parte No. 310 became effective on April 27, 1975, but motor vehicles, asphalt building and roofing materials, sugar beets, lumber, frozen foodstuffs, fresh fruits, fresh vegetables, and canned foodstuffs were specifically exempted by an order dated March 21, 1975. The railroads petitioned for reconsideration of these holddowns, which relief the Commission granted on June 10, 1975. Requests for reconsideration of the June 10 order by shippers were denied on September 9, 1975. 7 Ex Parte No. 305. On April 22, 1974, the Nation's railroads petitioned the ICC for permission to increase freight charges by 10%, effective May 2, 1974, based on the need to update rights of way and rolling stock. Various shippers filed protests against the increase, but the ICC authorized the railroads to file tariffs and supplements implementing the increase on thirty days' notice subject to protest and suspension. 8 The Commission issued an order suspending the increase on its effective date, June 3, 1974, but authorized the filing of a new increase incorporating conditions whereby some 70% Of the increased rates would be used for capital expenditures. Pursuant thereto, the railroads filed a new increase on June 5, 1974, which was allowed to become effective without investigation or suspension. 9 Ex Parte No. 313. On April 29, 1975, 419 railroads sought ICC permission to file two tariffs increasing freight rates and charges to cover already bargained and scheduled railroad wage increases. The first tariff was to become effective May 28, 1975 (5% Increase) and the second on October 1, 1975 (2.5% Increase). Following Commission consideration of both railroad and shipper evidence, the 5% Increase was granted on June 5, 1975, and the 2.5% Increase followed on September 26, 1975, both without investigation or suspension.