Notice2026-04106
United States Department of Energy and United States Department of Defense v. Baltimore & Ohio Railroad Company, et al.; United States Department of Energy and United States Department of Defense v. Aberdeen & Rockfish Railroad Company, et al.
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
March 2, 2026
Issuing agencies
Surface Transportation Board
Abstract
On December 1, 2025, the United States Department of Energy and the United States Department of Defense (the Government) and CSX Transportation, Inc. (CSX) (collectively, Movants) filed a motion requesting approval of an agreement (CSX Settlement Agreement) that would settle these rate reasonableness disputes as between them only. The Board is adopting a procedural schedule for filing comments and replies addressing their proposed settlement agreement.
Full Text
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<title>Federal Register, Volume 91 Issue 40 (Monday, March 2, 2026)</title>
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[Federal Register Volume 91, Number 40 (Monday, March 2, 2026)]
[Notices]
[Pages 10179-10181]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-04106]
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SURFACE TRANSPORTATION BOARD
[Docket No. NOR 38302S; Docket No. NOR 38376S]
United States Department of Energy and United States Department
of Defense v. Baltimore & Ohio Railroad Company, et al.; United States
Department of Energy and United States Department of Defense v.
Aberdeen & Rockfish Railroad Company, et al.
AGENCY: Surface Transportation Board.
ACTION: Notice of proposed settlement agreement, issuance of procedural
schedule.
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SUMMARY: On December 1, 2025, the United States Department of Energy
and the United States Department of Defense (the Government) and CSX
Transportation, Inc. (CSX) (collectively, Movants) filed a motion
requesting approval of an agreement (CSX Settlement Agreement) that
would settle these rate reasonableness disputes as between them only.
The Board is adopting a procedural schedule for filing comments and
replies addressing their proposed settlement agreement.
DATES: Comments are due by April 16, 2026. Reply comments are due by
May 18, 2026.
ADDRESSES: Comments and replies submitted in these proceedings,
referring to Docket Nos. NOR 38302S and NOR 38376S, must be filed with
the Board either via e-filing on the Board's website or in writing
addressed to: Surface Transportation Board, 395 E Street SW,
Washington, DC 20423-0001. In addition, one copy of comments must be
sent to each of the following: (1) Jason M. Marques, CSX
Transportation, Inc., 500 Water Street, J-150 Jacksonville, FL 32202;
(2) Stephen C. Skubel, Assistant General Counsel for Litigation, Room
6H-087, U.S. Department of Energy, 1000 Independence Avenue SW,
Washington, DC 20585; and (3) Sarah E. McKenzie, Counsel, Naval
Reactors, 1333 Isaac Hull Avenue SE, Stop 1150, Washington Navy Yard,
DC 20376-1150. All comments and replies will be posted to the Board's
website.
FOR FURTHER INFORMATION CONTACT: Amy Ziehm, (202) 918-5462. If you
require an accommodation under the Americans with Disabilities Act,
please call (202) 245-0245.
SUPPLEMENTARY INFORMATION: In March 1981, the Government filed these
complaints against 21 railroads (the Railroad Defendants) under section
229 of the Staggers Rail Act of 1980, Public Law 96-448, 94 Stat. 1895.
The Government sought reparations and a rate prescription relating to
the nationwide movement of spent nuclear fuel, other high-level
radioactive wastes, and the empty containers (casks) and buffer and
escort cars used for their movement (together, radioactive materials).
In 1986, the Board's predecessor, the Interstate Commerce
Commission (ICC), found that the Railroad Defendants were engaging in
an unreasonable practice by imposing substantial and unwarranted cost
additives--above and beyond the regular train service rates--in an
effort to avoid transporting these radioactive materials. The ICC
directed the Railroad Defendants to cancel the existing rates and cost
additives, prescribed new rates, and awarded reparations. See
Commonwealth Edison Co. v. Aberdeen & Rockfish R.R., 2 I.C.C.2d 642
(1986). The United States Court of Appeals for the District of Columbia
Circuit set aside and remanded the decision. See Union Pac. R.R. v.
ICC, 867 F.2d 646 (D.C. Cir. 1989). On remand, the ICC ruled that the
movement of these radioactive materials for reprocessing was subject to
the rate cap on recyclables set out in former 49 U.S.C. 10731(e) and
directed
[[Page 10180]]
the parties to file revenue-to-variable cost (R/VC) evidence to resolve
the remaining reparations and rate prescription issues. See U.S. Dep't
of Energy v. Balt. & Ohio R.R., 10 I.C.C.2d 112 (1994). While judicial
review of that decision was pending, Congress enacted the ICC
Termination Act of 1995, Public Law 104-88, 109 Stat. 803, which
repealed Sec. 10731 in its entirety and directed that all proceedings
pending under the repealed statutory provision be terminated.
The Railroad Defendants petitioned the Board to dismiss the
complaints in 1996, and, in 1997, they invited the Government to
explore the possibility of settling the complaints. Discussions
commenced on a nationwide settlement covering all the Railroad
Defendants that might carry radioactive materials. See U.S. Dep't of
Energy v. Balt. & Ohio R.R., NOR 38302S et al. (STB served Nov. 5,
2004). The Government subsequently chose to negotiate only with Union
Pacific Railroad Company (UP), the destination carrier for most of the
movements of radioactive materials that were to be covered by the
nationwide settlement, after the parties concluded that there were
potential antitrust problems in negotiating with the Railroad
Defendants as a group. See id.
In 2004, the Government and UP moved for approval under 49 U.S.C.
10704 of a settlement agreement they had negotiated to resolve these
complaints as between them only. The Board approved that settlement
agreement in 2005 and directed the Government to file quarterly status
reports on the progress of settlement negotiations with other
railroads. See U.S. Dep't of Energy v. Balt. & Ohio R.R., NOR 38302S et
al. (STB served Aug. 2, 2005). In 2012, BNSF Railway Company (BNSF) and
the Government similarly moved for approval of a settlement agreement,
and the Board approved that agreement in a decision served the next
year. See U.S. Dep't of Energy v. Balt. & Ohio R.R., NOR 38302S et al.
(STB served Aug. 26, 2013). Thereafter, in 2017, the Board approved a
settlement agreement between the Government and Norfolk Southern
Railway Company (NSR). See U.S. Dep't of Energy v. Balt. & Ohio R.R.,
NOR 38302S et al. (STB served June 28, 2017). Movants state that the
settlement agreements with UP, BNSF, and NSR successfully resolved all
rate-setting, shipping, and service determinations between those
carriers and the Government.
Movants now jointly request that the Board approve the proposed CSX
Settlement Agreement and prescribe the rate methodology set forth in
it. (Joint Mot. 2, Dec. 1, 2025.) They assert that the agreement
achieves a long-term, system-wide settlement, as between CSX and the
Government, of all rate and service issues related to spent nuclear
fuel and related traffic now moving or likely to move in the future.
(Id. at 12.) Movants note that the UP, BNSF, and NSR settlements have
served as models to the Government for the CSX Settlement Agreement.
(Id. at 9.)
In particular, the CSX Settlement Agreement:
(1) provides for a term of 25 years, commencing on the effective
date of the Board's approval of the CSX Settlement Agreement, and
continues in effect for additional 5-year periods, subject to a 1-year
termination notice requirement. (Id., Ex. A ]] 21, 25; see also id. at
10.) The parties note that the 25-year term with the possibility of
extensions follows the BNSF settlement agreement but differs from the
UP and NSR settlement agreements, which each provide for unlimited
terms, (id. at 9-10);
(2) applies broadly to the nationwide movement on CSX's rail lines
of irradiated spent fuel, parts, and constituents; spent fuel moving
from foreign countries to the United States for disposal; empty casks;
radioactive wastes; and buffer and escort cars. (Id., Ex. A ] 1.A.)
With respect to those movements governed by the rate basis prescribed
in Trainload Rates on Radioactive Materials, E. Railroads, 362 I.C.C.
756 (1980) and 364 I.C.C. 981 (1981) (Eastern Prescription Case),\1\
this agreement (similar to the NSR agreement) incorporates a method of
determining rates for dedicated trains which grants CSX an increment
over the Eastern rate basis to equalize the cost of shipments
nationwide, (Joint Mot. 5, Dec. 1, 2025; see also id. at 10 (describing
the CSX lines that the Eastern rate basis applies to));
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\1\ In that proceeding, maximum R/VC ratios were prescribed on a
commodity-by commodity basis at various minimum weights as local and
proportional rate factors. The prescription was applicable within
the East but primarily was to be used for through movements destined
beyond the lines of the rail carriers covered by the prescription.
The ICC's 1980 decision was affirmed in Consolidated Rail Corp. v.
ICC, 646 F.2d 642 (D.C. Cir. 1981), cert. denied, 454 U.S. 1047
(1981).
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(3) establishes the parties' agreement that the movement of these
radioactive materials constitutes common carrier service; addresses the
elements of service required of CSX; adopts guidelines for safe
handling and security; and obligates CSX to provide, as needed, ``extra
services'' as described in the agreement, at the rates agreed upon,
(id. at 6-7, 11, 13; see also id., Ex. A ]] 4, 6.A, 6.B, & 10);
(4) adopts a rate methodology to: (a) apply to all future movements
of these radioactive materials in common carrier service. The
methodology adopts maximum R/VC markups of CSX's most current system-
average variable unit costs computed under the Board's Uniform Rail
Costing System (URCS). (Id. at 6; id., Ex. A ] 6.) The Government
agrees to limit the application of the Eastern rate basis established
in the Eastern Prescription Case to the former lines of those railroads
specifically listed in the Eastern Prescription Case, (id. at 10-11;
see also id., Ex. A ] 6); \2\ and (b), compensate CSX for ``extra
services'' and dedicated train service, when requested by the
Government, and procedures to calculate ``equitable compensation'' for
emergency-related costs that CSX may incur (Joint Mot. 6-7, 13, Dec. 1,
2025; see also id., Ex. A ]] 6.B & 6.C);
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\2\ The parties note, however, that the Eastern Rate will apply
to the applicable lines of Pan Am Railways which were acquired by,
and became part of, the CSX network in 2022. (Id. at 10); see also
CSX Corp.--Control & Merger--Pan Am Systems, Inc., FD 36472 et al.
(STB served Apr. 14, 2022).
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(5) adopts a procedure to update compensation for rates and ``extra
services'' when the Board ``issues new URCS and make-whole factors'' to
reflect changes in CSX's system-average unit costs, (id., Ex. A ] 7);
(6) extinguishes CSX's liability (and that of its predecessors and
subsidiaries) for reparations in all matters arising out of these
proceedings, (id., Ex. A ] 23; see also id. at 17);
(7) adopts alternative dispute resolution procedures with recourse
to the Board if those procedures do not resolve a dispute and
mechanisms to renegotiate portions of the agreement in a limited number
of circumstances or if changed circumstances make further adherence to
the terms of the agreement ``grossly inequitable'' to either party,
(id. at 13-14; see also id., Ex. A ]] 15 & 25); and
(8) incorporates language regarding indemnification pursuant to the
Price-Anderson Nuclear Industries Indemnity Act, 42 U.S.C. 2210 (Price
Anderson Act). Specifically, the CSX Settlement Agreement states that,
``as set forth in [the] Price Anderson [Act], such public liability
(including any clean-up costs and any loss of use to the extent such
damages are permitted by applicable law) shall extend to any CSX-owned
property (including but not limited to CSX rights-of-way, yards, rail
lines, tracks, locomotives, rolling stock cars, equipment, vehicles,
and buildings) (i) that is damaged by a nuclear incident
[[Page 10181]]
covered by Price Anderson, and (ii) for which atomic/nuclear insurance
cannot be obtained or would not be expected.'' (Joint Mot. 12, Dec. 1,
2025; see also id., Ex. A ] 6.E.)
Movants request that the Board: (1) prescribe the rate methodology
and maximum R/VC ratios that have been agreed to for the radioactive
materials and rail services that are the subject of the agreement; (2)
dismiss CSX as a defendant in these proceedings, extinguish CSX's
liability for reparations in all matters arising out of these
proceedings, and relieve CSX from any further requirement to
participate in these proceedings (except in response to a properly
issued subpoena under the Board's rules); (3) retain jurisdiction over
these proceedings and continue to hold them in abeyance pending further
settlement negotiations; and (4) publish notice of their motion and the
proposed CSX Settlement Agreement in the Federal Register and adopt a
procedural schedule for the filing of comments and replies.
Movants' request will be granted in part at this time. Notice of
the motion and proposed CSX Settlement Agreement will be published in
the Federal Register. A procedural schedule will be adopted for the
filing of comments on the proposed settlement agreement as well as to
permit replies responsive to Movants' remaining requests. Comments will
be due by April 16, 2026. Reply comments will be due by May 18, 2026.
In addition, the Government will be ordered to file, by April 16, 2026,
a list of remaining defendants in these proceedings to inform the Board
of the proceedings' status.
It is ordered:
1. Movants' request that notice of their motion and proposed
agreement be published in the Federal Register is granted.
2. Movants and interested persons must comply with the procedural
schedule and requirements outlined above.
3. This decision is effective on its date of service.
By the Board, Anika S. Cooper, Chief Counsel, Office of Chief
Counsel.
Zantori Dickerson,
Clearance Clerk.
[FR Doc. 2026-04106 Filed 2-27-26; 8:45 am]
BILLING CODE 4915-01-P
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</html>Indexed from Federal Register on March 2, 2026.
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