-4 lacking competitive modes of transportation and the fact that we are a major producer and shipper of raw bulk commodities, mainly coal, grain and lumber, adequate and economical rail transportation is vital to keeping our products market competi tive. Montana's only other transportation alternative for bulk commodities is truck, which is substantially less efficient in the transportation of bulk commodities over long distances. Average rail costs per net ton mile to move wheat from Montana to Pacific North Coast are 1.9 cents. Truck/barge movements average 3.25 cents per net ton mile. The river transfer charge of $2.70/ton is not included in truck/barge costs, but would further increase these costs to make them even less competitive with rail movements. The lowest truck/barge costs per net ton mile exceeds the highest Burlington Northern costs. The fact is that the truck/barge does not provide effective competition that would constrain rail rates. The Burlington Northern far exceeds the 2,500 level of Herfindahl-Hirschman Index which the U.S. Department of Justice uses to determine whether a company is in a monopoly position. For Pacific Rim markets, the Index for Burlington Northern is 3,588; for Asia and for the Pacific Rim it is 2,652. We know that a financially healthy rail system is vital to our economy. We also understand that the Staggers Act is apparently working well where intra and intermodal competition exists. We do not feel the ICC has properly interpreted and carried out the congressional intent of Staggers, particularly in areas pertaining to captive shippers, rate reasonableness and determination of revenue adequacy. While the antitrust concept of H.R. 1140 is not the sole answer to our rail transportation problems, it would help prevent monopoly pricing by railroads and is a step forward in addressing the concerns of captive shippers. 2 Rate x Minimum Weight = Revenue/Car 3 Revenue/Car ÷ Actual Miles = Per Car Mile Earnings |