STB reveals three Class Is were ‘revenue adequate’ in 2018

(Source: Progressive Railroading 09/09/2019)

The Surface Transportation Board (STB) announced last week that the Class Is that achieved “revenue adequacy” in 2018 were CSXCanadian Pacific‘s Soo Line Corp. and Union Pacific Railroad.

A railroad is considered to be revenue adequate if it achieves a rate of return on net investment equal to at least the current cost of capital for the railroad industry  in 2018, which the board determined to be 12.22 percent.

The board determined that CSX, UP and CP’s Soo Line achieved a rate of return on net investment equal to or greater than the agency’s calculation of the railroad industry’s cost of capital, STB officials said in a press release.

Congress directed the board to conduct revenue adequacy determinations on an annual basis.