United States Rail Service Issues-Performance Data Reporting

AGENCY:

Surface Transportation Board (the Board or STB), Department of Transportation.

ACTION:

Notice of proposed rulemaking.

SUMMARY:

Through this Notice of Proposed Rulemaking, the Board is proposing to establish new regulations requiring all Class I railroads and the Chicago Transportation Coordination Office (CTCO), through its Class I members, to report certain service performance metrics on a weekly basis.

DATES:

Comments are due by March 2, 2015. Reply comments are due by April 29, 2015.

ADDRESSES:

Comments and replies 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: Docket No. EP 724 (Sub-No. 4), 395 E Street SW., Washington, DC 20423-0001.

Copies of written comments and replies will be available for viewing and self-copying at the Board's Public Docket Room, Room 131, and will be posted to the Board's Web site. Copies will also be available (for a fee) by contacting the Board's Chief Records Officer at (202) 245-0238 or 395 E Street SW., Washington, DC 20423-0001.

FOR FURTHER INFORMATION CONTACT:

Valerie Quinn at (202) 245-0382. Assistance for the hearing impaired is available through the Federal Information Relay Service (FIRS) at (800) 877-8339.

SUPPLEMENTARY INFORMATION:

The Surface Transportation Board has been closely monitoring the rail industry's performance since service problems began to emerge in late 2013. Service challenges have impacted a wide range of commodities, including grain, fertilizer, ethanol, coal, automobiles, chemicals, propane, consumer goods, crude oil, and industrial commodities.

In response to the service challenges affecting this broad cross-section of rail shippers, the Board held two public hearings this year, in April in Washington, DC, and in September in Fargo, N.D., to provide the opportunity for interested persons to report on service problems, to hear from rail industry executives on plans to address rail service problems, and to explore additional options to improve service. During and after these hearings, shippers expressed concerns about the lack of publicly available information related to rail service and requested access to performance data from the railroads to better understand the scope, magnitude, and impact of the service issues, as well as the underlying causes and the prospects for recovery.

Based on these concerns and our own need to better understand railroad operating conditions, on October 8, 2014, the Board ordered all Class I railroads and the Class I railroad members of the CTCO to file weekly reports on an interim basis, containing specific performance data. See U.S. Rail Serv. Issues—Data Collection (Interim Data Order), EP 724 (Sub-No. 3) (STB served Oct. 8, 2014). Specifically, railroads were asked to report weekly average train speeds, weekly average terminal dwell times, weekly average cars online, number of trains held short of destination or scheduled interchange, and loading metrics for grain and coal service, among other items. The data were intended to give both the Board and its stakeholders access to near real-time information about the operations and performance of the Class I railroads, and the fluidity of the Chicago gateway. In addition, the data were expected to assist rail shippers in making logistics decisions, planning operations and production, and mitigating losses amid the challenging railroad operating environment.

On October 22, 2014, the Class I railroads and the Association of American Railroads (AAR) (on behalf of the CTCO) filed the first set of weekly reports in response to the Interim Data Order. As requested by the Board, each carrier also provided an explanation of its methodology for deriving performance data in response to each request. Generally, the responses corresponded to the elements of the Interim Data Order; however, some railroads approached individual requests differently, leading to variations in the reported data. The different approaches primarily were due to the railroads' disparate data-keeping systems, different railroad operating practices, and/or unintended ambiguities in certain requests. Certain railroads also departed from the Board's prescribed reporting in order to maintain consistency with their own weekly data runs and analysis. For the most part, however, railroads made reasonable efforts to respond to each request, substituting analogous data when precise information could not readily be derived.

In addition to the weekly data reports, AAR, on behalf of its Class I freight railroad members (except Canadian Pacific Railway Company (CP)), submitted a letter to the Board indicating that it believes the public, the Board, and the railroads would have benefited from “[a] constructive public discourse regarding service data [which] could have led to a more productive and less burdensome collection of information that would have satisfied the Board's regulatory objectives.” With the first several weeks of filings in response to the Interim Data Order complete, we invite public comment to determine whether to establish new regulations for permanent reporting and to receive constructive input to revise, as necessary, and improve the existing data reporting structure.

The weekly filings have allowed the Board and rail stakeholders to monitor the industry's performance in near real-time, and allowed the Board to begin to develop baseline performance data. Based on the Board's experience with the reporting to date, and as expressly contemplated in the Interim Data Order, the Board is now moving forward with a rulemaking to determine whether to establish new regulations for permanent reporting by the members of the Class I railroad industry, the Class I carriers operating in the Chicago gateway, and the CTCO through its Class I members. The permanent collection of performance data on a weekly basis would allow continuity of the current reporting and improve the Board's ability to identify and help resolve future regional or national service disruptions more quickly, should they occur. Transparency would also benefit rail shippers and other stakeholders, by helping them to better plan operations and make informed decisions based on publicly available, near real-time data, and their own analysis of performance trends over time.

The proposed data requirements have been designed to impose as small a burden as possible on the carriers that would be subject to the rule, while achieving the Board's goal of continued rail service performance transparency. The Board believes that the benefit to the Board, rail shippers, and other stakeholders would outweigh the burden of reporting under the proposed rule. The data collected pursuant to the rule would continue to provide for service performance transparency in the industry and allow the Board to more rapidly identify and respond to service performance issues.

Accordingly, the Board seeks public comments on proposed new regulations to be codified at 49 CFR 1250.1-1250.3 to require Class I rail carriers, Class I carriers operating in the Chicago gateway, and the CTCO, through its Class I members, to submit to the Board weekly reports on railroad performance. The proposed reporting requirements are based on and include those contained in the Interim Data Order, but include the following modifications:

• In subsection (a), instructions have been added to Requests nos. 1-3 to align the requests with performance data being published by AAR;
• In subsection (a), Request no. 4 has been modified to capture average dwell time for “loaded” unit trains at origin “or interchange receipt,” and to clarify that the data is to be reported by the railroad receiving the loaded train at a shipper facility or interchange location;
• In subsection (a), Requests nos. 5 and 6 have been revised to cure ambiguities that emerged during the initial reporting periods and to clarify the data intended to be reported. Request no. 5 is intended to capture every instance during the reporting week in which specific types of loaded or empty trains are held at a location on the reporting railroad's system short of destination or scheduled interchange for longer than six consecutive hours. Request no. 6 is intended to capture an average of daily snap shots of cars in specific services that have not moved for the specified durations (48-120 hours; greater than 120 hours);
• In subsection (a), Request no. 9 has been deleted from the proposed requirements because it appears to have limited application to the carriers' disparate grain unit train operations; however, we ask that commenters propose an appropriate measure to capture performance data for grain unit train operations;
• In subsection (a), Request no. 10 has been renumbered as Request no. 9 and revised to allow carriers to report weekly total coal unit train loadings or weekly total coal car loadings by coal production region;
• In subsection (b), Request no. 1 has been modified to clarify that the request is for the average daily car “volume” at the key Chicago yards, meaning cars on hand, rather than cars processed;
• In subsection (b), Request no. 2 has been modified to clarify the method for deriving trains held outside the Chicago gateway;
• A new item has been added in subsection (d) to request a quarterly listing of all work-in-progress, major rail infrastructure projects, including project location by state, planned completion date for the project, percentage complete at the time of reporting, and project description and purpose. For purposes of this request, “work-in-progress” refers to projects for which ground breaking has taken place, “major” refers to any rail infrastructure project budgeted at $25 million or more over the life of the project, and “rail infrastructure” refers to capacity expansion or enhancement projects, excluding maintenance-of-way.

As the Board noted in the Interim Data Order, at both hearings, carriers cited congestion in Chicago as one significant cause of the service problems. While congestion in the area was particularly acute last winter, it has been a recurring problem at this crucial network hub. The Board continues to recognize the longstanding importance of Chicago as a hub in national rail operations and the impact that recent extreme congestion in Chicago has had on rail service in the Upper Midwest and nationwide. CP asserts, in its response to the Interim Data Order, that if either the Belt Railway of Chicago (BRC) or the Indiana Harbor Belt Railroad (IHB) becomes congested, the Chicago Terminal then becomes congested and that congestion then “reverberates throughout the system.” CP urges the Board to require BRC and IHB to report appropriate metrics on a weekly basis. Under the Interim Data Order, AAR has been reporting average daily car counts in key Chicago area yards, including Clearing and Blue Island, which are BRC and IHB yards, respectively. Commenters are invited to propose the reporting of additional metrics, from the BRC and IHB or others, that could improve oversight and support a better understanding of service issues in the Chicago area. Finally, the Board in the Interim Data Order directed the Class I members of the CTCO to file a general summary of the CTCO's service contingency protocols. However, given that the Chicago gateway remains a concern, we believe that having more information about how the Class I carriers are managing operations in Chicago would be beneficial. Accordingly, the Class I members of the CTCO are directed to file a detailed explanation of the CTCO's service contingency protocols, including the protocol triggers and countermeasures. Should the members need to provide proprietary information to sufficiently explain the CTCO protocols (such as car counts and specific locations that trigger the protocols), they may request a protective order.

The Board also asks that Class I railroads comment on the capabilities of their respective internal data-keeping systems for capturing and generating data and the appropriate timeframe (i.e., starting day and ending day) for the reporting week and for filing reports. Commenters are also asked to address whether and how geographical parameters could be practically incorporated into the requests in order to identify parts of the freight rail network experiencing acute congestion or service issues. The proposed rules address the same specific commodities covered under the Interim Data Order. If commenters believe it would advance the Board's goals, they may include metrics focused on other commodities along with an explanation of why it would be beneficial to collect that information. Additionally, commenters may propose revised definitions for terms used in the data requests, such as “unit train,” if they believe such revised definitions would be necessary or helpful to the uniform collection of data, and methodologies for deriving data.

Additionally, on October 22, 2014, Kansas City Southern Railway Company (KCS) filed a petition for a waiver from certain requirements due to the nature of its grain business and its very limited number of customers in a discrete number of states in its service territory. In response to the petition, the Board proposes to exempt KCS from filing state-specific information in response to Request nos. 7 and 8. Commenters may address whether this exemption is appropriate.

Because the Board is considering whether to implement a standardized set of weekly reporting requirements, proposals for new reporting items should take into account whether they may be obtained from data likely maintained by railroads in the ordinary course of business. Proposed items should not call for narrative responses or impose requirements that vary from week to week. Also, the Class I railroads are asked to comment on which requests can be reported through AAR or Railinc Corporation on behalf of the industry.

In seeking public comments, the Board requests that interested stakeholders evaluate the utility of each data request, offer proposed modifications, and/or propose other requests that would assist the Board and the public in gaining complete and accurate near real-time assessment of the performance of Class I railroads.

Regulatory Flexibility Act. The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, generally requires a description and analysis of new rules that would have a significant economic impact on a substantial number of small entities. In drafting a rule, an agency is required to: (1) Assess the effect that its regulation will have on small entities; (2) analyze effective alternatives that may minimize a regulation's impact; and (3) make the analysis available for public comment. §§ 601-604. In its notice of proposed rulemaking, the agency must either include an initial regulatory flexibility analysis, § 603(a), or certify that the proposed rule would not have a “significant impact on a substantial number of small entities.” § 605(b). The impact must be a direct impact on small entities “whose conduct is circumscribed or mandated” by the proposed rule. White Eagle Coop. v. Conner, 553 F.3d 467, 480 (7th Cir. 2009).

The rules proposed here would not have a significant economic impact upon a substantial number of small entities, within the meaning of the RFA. The reporting requirements would apply only to Class I rail carriers, which, under the Board's regulations, have annual carrier operating revenues of $250 million or more in 1991 dollars (adjusted for inflation using 2013 data, the revenue threshold for a Class I rail carrier is $467,063,129). Class I carriers generally do not fall within the Small Business Administration's definition of a small business for the rail transportation industry. Therefore, the Board certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities within the meaning of the RFA. A copy of this decision will be served upon the Chief Counsel for Advocacy, Office of Advocacy, U.S. Small Business Administration, Washington, DC 20416.

Paperwork Reduction Act. Pursuant to the Paperwork Reduction Act (PRA), 44 U.S.C. 3501-3549, and Office of Management and Budget (OMB) regulations at 5 CFR 1320.8(d)(3), the Board seeks comments regarding: (1) Whether the collection of information in the proposed rule, and further described in the Appendix, is necessary for the proper performance of the functions of the Board, including whether the collection has practical utility; (2) the accuracy of the Board's burden estimates; (3) ways to enhance the quality, utility, and clarity of the information collected; and (4) ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology, when appropriate. Information pertinent to these issues is included in the Appendix. The collection in this proposed rule will be submitted to OMB for review as required under 44 U.S.C. 3507(d) and 5 CFR 1320.11.

This proposal would not significantly affect either the quality of the human environment or the conservation of energy resources.

It is ordered:

1. Comments are due by March 2, 2015. Reply comments are due by April 29, 2015.

2. A copy of this decision will be served upon the Chief Counsel for Advocacy, Office of Advocacy, U.S. Small Business Administration.

3. Notice of this decision will be published in the Federal Register.

4. The Class I members of the CTCO shall file a detailed explanation of the CTCO's service contingency protocols, including the protocol triggers and countermeasures, by January 14, 2015.

5. This decision is effective on its service date.

List of Subjects

49 CFR Part 1250

• Administrative practice and procedure
• Railroads
• Reporting and record keeping requirements

For the reasons set forth in the preamble, the Surface Transportation Board proposes to amend title 49, chapter X, subchapter D, of the Code of Federal Regulations by adding Part 1250 as follows:

PART 1250—RAILROAD PERFORMANCE DATA REPORTING

Authority: 49 U.S.C. 721 and 11145.