The House Rules Committee yesterday sent to the full House a bill that would pare back nearly a century of government regulation of the nation's railroads.
The bill was the second major transportation measure to be sent to the House floor in two days, following the Rules panel's go-ahead Tuesday for a bill to reduce significantly regulation of the nation's trucking industry.
Like the trucking bill, the rail bill contains a new national policy emphasizing competition to the maximum extent possible. According to its backers, the bill's provisions would free most railroad freight rates from regulation by the Interstate Commerce Commission. Any rail rate increase that don't exceed a certain ICC-set ratio would be exempt from ICC regulation. In addition, rates for rail movement of goods that could be shipped by an alternative means of transportation such as trucks or barges also would be exempt so long as a showing of effective competition could be made.
After three years, railroads no longer would be able to get together in their rate bureaus to decide jointly what general freight rate increase to seek from the ICC.
The Rules Committee action came on a voice vote after it narrowly defeated -- 8 to 7 -- a motion to put off any committee action on the measure until next week.
Although there appears to be broad support for freeing the railroads of much of the regulation under which they traditionally have operated, some proposed changes have engendered controversy and are being opposed by parties who think they will be affected adversely.
For instance, an amendment to limit the railroad's ability to raise coal rates likely will be introduced on the floor. Users of coal have claimed they are "captive" shippers and will be subject to unreasonable increases in rates for shipping coal if there is no protection.
Another amendment sure to be introduced will attempt to protect shortline railroads; they are worried about a provision in the bill that allows a railroad offering a joint rate with another to raise its portion of the rate as much as 10 percent above its variable costs or cancel the rate altogether.