Class I Railroad Accounting and Financial Reporting-Transportation of Hazardous Materials, 248 [E8-31263]

Download as PDF 248 Federal Register / Vol. 74, No. 2 / Monday, January 5, 2009 / Proposed Rules Dated: December 22, 2008. Michael K. Buckley, Acting Assistant Administrator, Mitigation Directorate, Department of Homeland Security, Federal Emergency Management Agency. [FR Doc. E8–31279 Filed 1–2–09; 8:45 am] BILLING CODE 9110–12–P 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 Surface Transportation Board. Advance Notice of Proposed Rulemaking. AGENCY: ACTION: 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 EFILING link on the Board’s Web site, at https://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 https:// 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 VerDate Aug<31>2005 13:23 Jan 02, 2009 Jkt 217001 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. 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 hazardousmaterial 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 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.’’). PO 00000 Frm 00013 Fmt 4702 Sfmt 4702 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 subschedule. 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 tonmiles, 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 E:\FR\FM\05JAP1.SGM 05JAP1

Agencies

[Federal Register Volume 74, Number 2 (Monday, January 5, 2009)]
[Proposed Rules]
[Page 248]
From the Federal Register Online via the Government Printing 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 https://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 https://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.
---------------------------------------------------------------------------

    \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.'').
---------------------------------------------------------------------------

    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
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