 LEGISLATIVE
BULLETIN – April 4, 2004 URGE CONCURRENCE
ON FUEL SURCHARGES BILL: Grain
Dealers members should contact members of the ND House Transportation
Committee, especially Chmn Robin Weisz - rweisz@state.nd.us
- to urge concurrence with the Senate version of HB 1370.
The Senate passed it 45-0 on March 31, but its fate is still in
doubt unless the House and Senate agree on a common version.
We could still lose this bill.
The Senate version is better because it prohibits a surcharge in
excess of increased cost of fuel. The
House version calls for a mileage-based surcharge.
That is an improvement over the present rate-based surcharges,
but cost vs surcharge is the heart of the problem.
Members of the House Transportation Committee are on page 38 of
your Lawmakers book. Their
email addresses were in our broadcast fax to you dated February 8, 2005.
You can also refer to Contacting Legislators and Finding Bills on
the Internet at www.ndgda.org. BNSF SURCHARGE
ANNOUNCEMENTS UNIMPRESSIVE:
On Monday March 28 BNSF announced that its fuel surcharge will
increase 25% on May 1, from 8% of rate to 10%.
On March 29 BNSF announced that on January 1, 2006 it intends to
start a mileage-based fuel surcharge on shipments that originate and
terminate on BNSF and on the BNSF portion of Rule 11 shipments.
BNSF says this is about 75% of its volume.
The delay in implementation means BNSF’s excessive rate-based
surcharges will continue throughout all of 2005. The BNSF intends to use
the Rand McNally road map instead of track miles to calculate
surcharges. Rail miles are
already in its database and accessible on its website.
BNSF says a reason for the nine-month delay is that some
customers will need to make “certain systems modifications to verify
mileage-based fuel surcharges.” If
they’d use track miles there’d be one less reason for delay. BNSF says new surcharges
will “reflect the fuel intensity of four types of rail movements:
coal and taconite; carload and ag products; intermodal trailers;
and intermodal doublestack containers.”
This appears to mean different surcharges for each of the groups.
BNSF says it doesn’t know the factor it will multiply X miles
to get your surcharge. The
devil is in that detail. NUMBERS FROM BNSF’S 2004 ANNUAL REPORT: BNSF told our legislature it makes no money on fuel surcharges. However…..Page 16 of its 10-K report filed with the Securities and Exchange Commission says their "all-in cost" of fuel increased $124 million in 2004 over 2003. Page 14 says the fuel surcharge portion of revenue increased $247 million in the same period. In January 2004 BNSF committed to adding 6000 new hopper cars over four years. Some older cars would be retired, but there was to be a net gain. BNSF reports having 36,255 covered hoppers on December 31, 2003 and 35,066 on December 31, 2004, a net LOSS to almost 1200 cars.
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