Rehberg Urges Swift Decision in Captive Shipper Case

Rehberg Urges Swift Decision in Captive Shipper Case

WASHINGTON, DC - Montana's Congressman, Denny Rehberg, in a letter to the Surface Transportation Board (STB), urged the Board to forgo a second rulemaking procedure and resolve a two-year long legal battle involving the Basin Electric Power Cooperative and Western Fuels Association and BNSF Railway Co. Basin Electric and Western Fuels have a case pending before the STB over BNSF's uncompetitive shipping rates that have driven up prices for Montana's farmers and energy producers. Basin Electric delivers power to co-ops in Central and Eastern Montana.

A ruling was expected in the case, which has already generated thousands of pages of evidence and $5 million in legal fees for both parties, in September of this year. However, the STB recently announced it was starting a new rulemaking procedure to consider several technical changes in how the Board considers rate cases. The effect of this rulemaking is to further delay a decision in Basin's rate case for at least another year.

"Captive shipping straps Montana's farmers and energy producers to high costs and low profit margins," Rehberg said. "Consumers and the local economy end up feeling the squeeze, too. STB needs to resolve this case, so reasonable rates can be established in the absence of true competition."

According to published reports, Montana's grain farmers pay $60 million to $80 million more a year in freight rates, especially to the ports in the Pacific Northwest, than do farmers residing in areas where competition exists. Coal producers throughout the state are also subject to higher input costs due to captive shipping. Some producers pay as much to ship their coal as they do to produce it. "The price of energy in Montana has sky-rocketed in recent years. This situation hurts families all over Montana and can be directly attributed to exorbitant shipping rates," added Rehberg.

"We've long needed a solution to the high costs associated with having only one rail shipping company serving our state," said Rehberg, a member of the House Appropriations Committee. "This is a major issue for Montana and we can't afford any further delays in the decision-making process. I'm going to keep leaning on STB to make a swift and fair ruling."
Last year, Rehberg sponsored the "Railroad Competition Improvement and Reauthorization Act of 2005," which will enhance competition among rail carriers to ensure reasonable rail rates for Montana's agricultural producers and electric cooperatives.

http://www.house.gov/apps/list/press/mt00_rehberg/041306_CaptiveShipperCase.html