Author: Dr. William Huneke

Commentary

Why CN’s Open Gateways Offer is a Big Deal

CN’s offer to keep gateways open on commercially reasonable terms is not getting the attention that it is due. This offer is a key part of its proposal to combine with Kansas City Southern—a transaction that significantly enhances competition.

Commentary

Put Aside Narrow Interests. Think About What’s Best

WATCHING WASHINGTON, JUNE 2020 ISSUE: This question should be at the forefront of the Surface Transportation Board’s agenda: What is the future of rail freight transportation? The STB should put all its other discretionary regulatory work to the side and call in the railroads and key stakeholders and facilitate a discussion of how the industry can recover to serve the future American economy. All internecine sniping and conflict should be pushed aside.

Commentary

STB “Whack a Mole”

When I was working at the Surface Transportation Board, I often felt trapped in a game of “Whack a Mole.” That was because STB rarely had time or staff to do more than react to the latest rate case, stakeholder petition or Congressional request. There is a sense of Whack a Mole in some of the flurry of STB regulatory reform proposals, particularly STB’s tinkering with the industry Cost of Capital calculation.

Commentary

Convenience Fees, Profit Centers and Fuel Surcharges

Recently, I purchased movie tickets on line. As I was checking out, I noticed I was getting charged a “convenience fee,” which for me begged the question: Just whose convenience? After all I was saving the theater the cost of printing the tickets and their employees’ time selling me the ticket. In my mind this convenience fee was really a profit center for the theater.

Commentary

URCS: Love It or Hate it, We’re Stuck With It

For a sleep inducer, consider working with the Uniform Rail Costing System (URCS), long a general costing system indispensable for determining maximum reasonable rail rates. Worse, its second side-effect is indigestion, as this 30-year-old accounting relic is much like a classic car lacking modern GPS and satellite radio. Practitioners too often become frustrated with its built-in averages from a time when railroads, rather than shippers, owned most of the freight car fleet and line hauls were shorter as the modern merger movement had not yet run its course.

Commentary

Observations on STB’s Rate Reform Task Force Report

Surface Transportation Board (STB) staff recently released a rate reform report with a series of recommendations. Readers should remember that before any of those recommendations become regulations, the Board must conduct rulemakings. This process could extend beyond 2020 and into the next Administration.