E8-6846. Railroad Cost Recovery Procedures-Productivity Adjustment

AGENCY:

Surface Transportation Board, DOT.

ACTION:

Adoption of a railroad cost recovery procedures productivity adjustment.

SUMMARY:

In a decision served on February 22, 2008, we proposed to adopt 1.008 (0.8% per year) as the measure of average change in railroad productivity for the 2002-2006 (5-year) averaging period. This value was a decline of 0.9 of a percentage point from the current measure of 1.7% that was developed for the 2001-2005 period. That decision stated that comments may be filed addressing any perceived data and computational errors in our calculation. It also stated that, if there were no further action taken by the Board, the proposed productivity adjustment would become effective on March 17, 2008.

On March 13, 2008, the Board received comments from both the Association of American Railroads and the Western Coal Traffic League. Both parties requested that the Board revisit the development of the output index calculation and make certain other clarifications. By a decision served on March 17, 2008, we postponed the effective date of the annual productivity adjustment.

We have reviewed the calculations of the output index for 2006. During that review, we found inconsistencies in the weights associated with certain movements reported in the waybill sample data, and found that these inconsistencies caused a distortion in the resulting productivity calculation. This circumstance has been rectified and the Board is issuing modifications to its annual productivity decision. The Board's original calculation of the output index for 2006 of 0.994 should be modified to 1.018.

We will adopt 1.013 (1.3% per year) as the measure of average change in railroad productivity for the 2002-2006 (5-year) averaging period. This value is a decline of 0.4 of a percentage point from the current measure of 1.7% that was developed for the 2001-2005 period. The proposed 5-year (2002-2006) productivity trend calculated using a geometric average is 1.012, or 1.2% per year.

EFFECTIVE DATE:

The productivity adjustment is effective March 28, 2008.

FOR FURTHER INFORMATION CONTACT:

Pedro Ramirez, [phone]. [Federal Information Relay Service (FIRS) for the hearing impaired: 1-800-877-8339.]

SUPPLEMENTARY INFORMATION:

Additional information is contained in the Board's decision, which is available on our Web site http://www.stb.dot.gov. To purchase a copy of the full decision, write to, e-mail or call the Board's contractor, ASAP Document Solutions; 9332 Annapolis Rd., Suite 103, Lanham, MD 20706; e-mail [e-mail]; phone [phone]. [Assistance for the hearing impaired is available through FIRS: 1-800-877-8339.]

This action will not significantly affect either the quality of the human environment or energy conservation.

Pursuant to 5 U.S.C. 605(b), we conclude that our action will not have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act.

Decided: March 27, 2008.

By the Board, Chairman Nottingham, Vice Chairman Mulvey, and Commissioner Buttrey.

Anne K. Quinlan,

Acting Secretary.