JOC Staff | Feb 08, 2013 1:45PM EST
The U.S. Surface Transportation Board, part of the U.S. Department of Transportation, has recommended changes to its Uniform Railroad Costing System.
The board is proposing to change the way URCS calculates certain system-average unit costs to better reflect railroad operations. The proposal will automatically reflect economies of scale relative to shipment-size increases, eliminating the current need for a separate mathematical adjustment referred to as the “make-whole adjustment.” It would also make a number of changes to URCS that the board expects would result in more accurate movement costs and change two of the agency's reporting requirements.
URCS enables the board to determine a railroad's variable costs of providing rail transportation service, the jurisdictional threshold in rate disputes between railroads and their customers and whether challenged rates are reasonable. URCS also is used in proceedings involving proposed rail-line abandonments.
