Landmark 1980 U.S. legislation that substantially deregulated the freight railroad industry, allowing railroads to negotiate confidential contract rates, abandon unprofitable lines, and set market-based prices. The Staggers Act is credited with revitalizing a financially troubled industry by giving railroads pricing flexibility. It preserved regulatory oversight for captive shippers through revenue adequacy and rate reasonableness standards.
The independent U.S. federal agency responsible for the economic regulation of the nation's freight railroads, including jurisdiction over rates, mergers, acquisitions, line sales, and abandonments. The STB was created by the ICC Termination Act of 1995 as the successor to the Interstate Commerce Commission. It adjudicates shipper complaints about unreasonable rates and competitive access.
A proceeding before the Surface Transportation Board in which a shipper challenges a railroad rate as unreasonably high, typically under the Simplified Standards for Rail Rate Cases or the Full Stand-Alone Cost methodology. Rate cases are complex, expensive, and time-consuming, often involving detailed economic and engineering analyses. A successful rate case can result in a refund of overcharges and a maximum reasonable rate going forward.
A regulatory standard under which a railroad is considered revenue adequate if its revenues are sufficient to cover all costs and earn a return on investment equal to that of a company of comparable risk. The STB annually determines whether each Class I railroad is revenue adequate. Revenue adequacy status affects a railroad's ability to defend rates in STB proceedings.
A confidential rate negotiated between a railroad and a shipper under a transportation contract authorized by the Staggers Rail Act. Contract rates are not publicly filed and may include volume commitments, service guarantees, and other terms. They are the primary pricing mechanism for large shippers and most intermodal traffic.
A formal filing by a shipper with the Surface Transportation Board alleging that a railroad's rate or practice is unreasonable, discriminatory, or otherwise unlawful. Complaints can seek rate relief, damages, or changes in railroad practices. The complaint process provides shippers a regulatory remedy when commercial negotiations fail.