SURFACE TRANSPORTATION BOARD PROPOSES SEVERAL CHANGES TO ITS KEY COSTING METHODOLOGY

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-----------------------------***-----------------------------
>From the Surface Transportation Board, Washington, D.C.
-----------------------------***-----------------------------


The Surface Transportation Board today announced several proposed changes
to its general purpose costing system, the Uniform Railroad Costing System
(URCS).


                                                                      The
                                                                      Board
                                                                      is
                                                                      proposing
 to adjust the manner in which URCS calculates certain system-average unit
                                                                      costs
                                                                      to
                                                                      better
 reflect railroad operations. The proposal will automatically reflect
 economies
 of scale relative to shipment-size increases, eliminating the current need
                                                                      for a
                                                                      separate
 mathematical adjustment referred to as the "make-whole adjustment."


                                                                      The
                                                                      Board
                                                                      had
                                                                      previously
 identified the make-whole adjustment as an aspect of URCS warranting
 further
 review in a May 2010 report to Congress.  The Board also is proposing to
                                                                      make
                                                                      a
                                                                      number
 of related changes to URCS that would result in more accurate movement
                                                                      costs
                                                                      and
                                                                      to
                                                                      change
 two of the agency's reporting requirements to support these proposals.


                                                                      URCS
                                                                      enables
 the Board to determine a railroad's variable costs of providing rail
 transportation
 service, to determine the jurisdictional threshold in rate disputes
 between
 railroads and their customers, and to determine whether challenged rates
                                                                      are
                                                                      reasonable.
  URCS also is used in proceedings involving proposed rail-line
  abandonments.


                                                                      The
                                                                      Board's
 decision in
                                                                      Review
 of the General Purpose Costing System, EP 431 (Sub-No.
 4)( http://www.stb.dot.gov/decisions/readingroom.nsf/WebDecisionID/42587?OpenDocument )


                                                                      , may
                                                                      be
                                                                      viewed
 and downloaded at the Board's website,
                                                                      www.stb.dot.gov

                                                                      ,
                                                                      under
                                                                      "E-LIBRARY /
 Decisions & Notices / 02/04/13".


                                                                      ###


                                                                      -----------------------------***-----------------------------

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