[Federal Register Volume 74, Number 2 (Monday, January 5, 2009)]
[Proposed Rules]
[Page 248]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-31263]
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DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
49 CFR Parts 1201 and 1242
[STB Ex Parte No. 681]
Class I Railroad Accounting and Financial Reporting--
Transportation of Hazardous Materials
AGENCY: Surface Transportation Board.
ACTION: Advance Notice of Proposed Rulemaking.
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SUMMARY: The Surface Transportation Board (STB) seeks comment on
whether and how it should update its accounting and financial reporting
for Class I rail carriers and refine its Uniform Railroad Costing
System (URCS) to better capture the operating cost of transporting
hazardous materials.
DATES: Comments on the advance notice are due on or before February 4,
2009.
ADDRESSES: Comments may be submitted either via the Board's e-filing
format or in the traditional paper format. Any person using e-filing
should attach a document and otherwise comply with the instructions at
the E-FILING link on the Board's Web site, at http://www.stb.dot.gov.
Any person submitting a filing in the traditional paper format should
send an original and 10 copies to: Surface Transportation Board, Attn:
STB Ex Parte No. 681, 395 E Street, SW., Washington, DC 20423-0001.
Copies of written comments received by the Board will be posted to
the Board's Web site at http://www.stb.dot.gov and will be available
for viewing and self-copying in the Board's Public Docket Room, Suite
131, 395 E Street, SW., Washington, DC. Copies of the comments will
also be available (for a fee) by contacting the Board's Chief Records
Officer at (202) 245-0235 or 395 E Street, SW., Washington, DC 20423-
0001.
FOR FURTHER INFORMATION CONTACT: Paul Aguiar, (202) 245-0323.
[Assistance for the hearing impaired is available through Federal
Information Relay Service (FIRS) at 1-800-877-8339.]
SUPPLEMENTARY INFORMATION: The Board uses its Uniform Railroad Costing
System (URCS) to determine a carrier's variable costs in a variety of
regulatory proceedings.\1\ The URCS model determines, for each Class I
railroad, what portion of each category of costs shown in that
carrier's Annual Report to the Board (STB Form R-1) represents its
system-average variable cost for that year, expressed as a unit cost.
URCS does this through a series of computer programs and manual
procedures that are organized into three phases. Phase I compiles the
raw data provided by the carrier into a useable format, and then uses
statistical estimation procedures to determine the proportion of
specific expense account groupings that vary with changes in the volume
of activity (such as running track maintenance, which varies with gross
ton-miles). In Phase II, these cost/volume relationships are then used
to develop the unit variable costs that allow costing of specific rail
movements. Finally, in Phase III, these variable cost units are applied
to specific movements via an interactive computer program that permits
the user to enter data for the specific movements under consideration.
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\1\ See Adoption of the Uniform Railroad Costing System As A
General Purpose Costing System For All Regulatory Costing Purposes,
5 I.C.C.2d 894, 899 (1989) (Adoption of URCS) (The URCS model is the
Board's ``general purpose costing system for all regulatory costing
purposes.'').
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There may be unique operating costs associated with the
transportation of hazardous materials, however, that URCS does not
attribute to those movements. For example, transportation of hazardous
material may require the carriers to pay higher insurance premiums.
While carriers report those insurance expenses in the R-1 reports, URCS
spreads those expenses across all traffic of the railroad, rather than
attributing those higher insurance costs specifically to the
transportation of the hazardous materials. Nor does the Uniform System
of Accounts (USOA)--which Class I carriers must use to prepare the
financial statements that they submit to the Board--include a separate
classification for hazmat operations so as to allow an accounting of
the assets used and costs incurred in providing such service.
The Board seeks public comment on whether and how it should improve
its informational tools to better identify and attribute the costs of
hazardous-material transportation movements. This would require both
revising the USOA--to obtain more detailed accounting and reporting of
expenses and operating statistics associated with hazmat
transportation--and improving the analytic capabilities of URCS to
better reflect the costs associated with the transportation of
hazardous materials. We therefore seek comments on both (1) whether it
is appropriate to refine URCS to cost hazmat operations better, and (2)
how to identify the costs of hazmat operations through our accounting
and reporting rules.
To add a hazmat adjustment to URCS, we would need more accounting
detail. Currently, the costs of hazmat operations are reported
throughout the Operating Expense Matrix (Schedule 410). Those costs
could, however, be separately identified in Schedule 417--Specialized
Service Sub-Schedule--Transportation. Further, the costs of assets
devoted to hazmat operations are not explicitly provided for in the
existing property accounts. Establishing a new category of assets
within the existing accounting and reporting framework may be
beneficial. Parties are encouraged to comment on how best to define
those operations and expenses that could be reported in this sub-
schedule. Please be specific. We encourage parties to offer a specific
definition of what should constitute a movement of hazardous material
for this purpose, and to address whether it should be limited to
movements of ``Toxic Inhalation Hazards'' (TIH) or should be broader or
narrower. Parties should also provide assistance in identifying and
defining the operating costs of hazmat shipments, as well as assets
devoted to hazmat operations.
Parties should also comment on the best operating statistic for
URCS to use to allocate these specified hazmat costs to individual
movements. Examples might include car-miles, revenue ton-miles, or
revenue tons of hazardous materials movements. (If some form of this
proposal is adopted, carriers would then be required to report that
operating statistic in Schedule 755 of the R-1 annual financial report
so the modification to URCS could be implemented.) We would propose to
treat hazmat expenses as 100% variable, just as other specialized costs
are treated in URCS.
This decision will not significantly affect the quality of the
human environment or the conservation of energy resources.
Decided: December 22, 2008.
By the Board, Chairman Nottingham, Vice Chairman Mulvey, and
Commissioner Buttrey.
Jeffrey Herzig,
Clearance Clerk.
[FR Doc. E8-31263 Filed 1-2-09; 8:45 am]
BILLING CODE 4915-01-P