The process by which a shipper and railroad negotiate the terms of a transportation contract, including rates, volume commitments, service standards, and car supply provisions. Effective negotiation requires understanding market alternatives, the railroad's cost structure, and the shipper's volume and service needs. The Staggers Act enables these confidential bilateral agreements.
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 reference rate used to evaluate the reasonableness of a proposed contract or tariff rate, derived from comparable market transactions or the railroad's own tariff rates. Benchmarks help shippers assess whether a negotiated rate is competitive. In STB proceedings, benchmark rates may be used in rate reasonableness analysis.
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.
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.