The No FEAR Act Notice
The Surface Transportation Board (Board) gives notice of the ``Notification and Federal Employee Antidiscrimination Act of 2002,'' the No FEAR Act, to former and current STB employees and to applicants for STB employment.
Methodology To Be Employed in Determining the Railroad Industry's Cost of Capital
The Board is seeking comments on the appropriate methodology to be employed in determining the railroad industry's estimated cost of capital to be used in future annual cost-of-capital determinations. We are also soliciting comments on how evidence should be submitted and analyzed in future cost-of-capital proceedings.
Quarterly Rail Cost Adjustment Factor
The Board has approved the fourth quarter 2006 rail cost adjustment factor (RCAF) and cost index filed by the Association of American Railroads. The fourth quarter 2006 RCAF (Unadjusted) is 1.250. The fourth quarter 2006 RCAF (Adjusted) is 0.591. The fourth quarter 2006 RCAF-5 is 0.562.
Railroad Cost of Capital-2005
On August 28, 2006, the Board served a decision to update its computation of the railroad industry's cost of capital for 2005. The composite after-tax cost-of-capital rate for 2005 is found to be 12.2%, based on a current cost of debt of 5.36%; a cost of common equity capital of 15.18%; and a capital structure mix comprised of 30.41% debt and 69.59% common equity. The cost-of-capital finding made in this proceeding will be used in a variety of Board proceedings.