AAR president and CEO Ian Jefferies issued the following statement regarding the recent report from the Surface Transportation Board (STB) Rate Reform Task Force, developed by staff as a set of recommendations for the Board members to consider:

“AAR and its member railroads are pleased that the STB’s Rate Reform Task Force has completed its report and has affirmed the economic soundness of the Board’s Stand Alone Cost (SAC) test. We continue to be committed to participation in a constructive conversation among freight railroads, shippers and the Board regarding possible improvements to the Board’s rate reasonableness procedures.”

“We are concerned, however, that the report lacks balance and objective support for many of its conclusions, mischaracterizes the law, and that many of the proposals in the report would move the Board backward towards discredited methods of heavy-handed rate regulation. As recently as 2015, Congress made clear that the STB’s role is to assist freight railroads in earning revenues adequate for the infrastructure and investment needed for present and future freight demand. The Task Force’s proposals recommending profit regulation through rate caps and forced access as a result of achieving revenue adequacy goes in the opposite direction, and would hobble the railroads’ ability to serve current and future demand for transportation. The AAR and its member railroads will carefully consider the proposals in the report and will offer constructive suggestions for how the Board can address its legitimate goals for improving its rate case processes and procedures, including procedures for the smallest rate disputes and improving the Stand Alone Cost test, while also complying with the law and preserving the core economic principles on which those analyses are based.”