Surface Transportation Board

STB’s Cost of Capital Dilemma

NEWS ITEM: The Surface Transportation Board (STB) proposes to change the formula for computing the cost of the equity component of the railroad industry’s cost of capital. This is of consequence to railroads, shippers and investors because cost of capital is a determinant of railroad revenue adequacy and a threshold for a host of other regulatory limitations on rail ratemaking.

Comments on STB Ex Parte 711

To: The Honorable Ann D. Begeman, Chairman, Surface Transportation Board: I am submitting this testimony to be included in the consideration and record on Ex Parte 711, Reciprocal Switching. Having served 44 years in the railroad industry, both as a Class I marketing/rate department officer and as President and CEO of short line Maryland Midland Railway, I have a unique and comprehensive view of this entire subject.

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.

Wall Street Darlings or Revenue Inadequate?

RAILWAY AGE, WATCHING WASHINGTON, SEPTEMBER 2019 – Although a purchase is said to be worth precisely what a buyer agrees to pay, not all buyers possess equivalent market power as sellers. United Parcel Service (UPS), for example, may choose between truck and rail. But where freight cannot efficiently move by truck, shippers wishing to remain in business typically pay higher freight rates than if they had effective alternatives to rail.

STB Takes “Bye” on Fuel Surcharge Case

Imagine Surface Transportation Board (STB) members Ann D. Begeman, Patrick J. Fuchs and Martin J. Oberman dining family-style, where one entree is shared. Ann wants fish, Marty chicken, and Patrick says he wants neither and wishes to leave. Unable to agree on an order, the three depart the restaurant.