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NGFA Concerned Over Rail Capacity |
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Established in 1896, the NGFA consists of 900 grain, feed, processing, exporting and other grain-related companies that operate about 6,000 facilities that handle more than 70 percent of all U.S. grains and oilseeds.
To enhance rail capacity, the NGFA said it intended to support legislation (H.R. 2116) that would amend the Internal Revenue Code to allow tax credits to help finance up to 25 percent of the cost of new qualified freight rail infrastructure property, provided shippers also are eligible and the funds are used solely to add capacity rather than replace existing track and equipment. “While railroads already are reinvesting some of their increasing profits into expanded infrastructure, we think that legislation like this could encourage higher levels and more rapid investment,” Keith said.
The NGFA said it also may request assistance from Congress if, as expected, the federal Surface Transportation Board’s (STB) recent changes do not make the process for filing smaller rail rate complaints more viable and less costly. The NGFA estimated that the cost of challenging an unreasonable rail rate at the STB via the method most likely to be used for typical agricultural shipments still will amount to about $250,000, and noted the agency had capped at only $1 million the maximum regulatory relief that could be obtained through a successful rate complaint.
“This cap is much too low, and effectively will put many potential agricultural rail rate cases out of reach economically,” Keith said. While the NGFA said it does not anticipate a significant increase in the number of rail rate cases being brought by shippers even if the STB’s rules were more practical, “we do think it’s important to have access to reasonable litigated solutions so that carriers are encouraged to negotiate with customers over rates.”
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Last Updated ( May 06, 2008 at 10:31 AM )
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