CASPER, Wyo. — The governors of five states have signed a protest letter to the president of the Burlington Northern Santa Fe railroad, objecting to what they say are unfair preferential rates given to a handful of large grain shippers, a wire service reported.
Unless Burlington Northern addresses the situation, the governors may support increased federal railroad regulation, their letter to Mathew Rose says.
The letter was signed by Wyoming Gov. Jim Geringer and the governors of Montana, North Dakota, South Dakota and Nebraska.
BNSF has been encouraging development of new, large “shuttle train” elevators capable of loading 110 grain cars at a time. The elevators are able to offer lower shipping rates, and pass along the savings to their farmer customers.
North Dakota Gov. John Hoeven and South Dakota Gov. Bill Janklow said BNSF could take steps to help smaller elevators, such as using the same train to pick up grain shipments from neighboring elevators.
“When you’re a monopoly, what you have to understand is you can’t sit down and design the world like you want it to be, and then force everybody to turn it into your way of doing business,” Janklow said. “There has to be an accommodation, so society’s needs are balanced with the needs of the railroad’s, and we don’t have that now.”
North Dakota shippers say it costs less to ship grain from eastern North Dakota to Pacific Northwest ports than it does to ship from elevators in western North Dakota. That is because BNSF is charging less to move grain a greater distance, they say. BNSF says its rate schedule is meant to draw more grain supplies from eastern North Dakota and western Minnesota to the Pacific Northwest.
Montana grain farmers oppose that, saying the additional shipments could potentially flood their historic markets.
Gus Melonas, a BNSF spokesman, said the railroad agreed to allow an independent economist examine its rates at the request of Hoeven and the North Dakota Grain Dealers Association.
A week later, the Grain Dealers renounced the arrangement, Melonas said.