(The Canadian Press circulated the following on October 22.)
SASKATOON, Sask. — The Western Grains Research Foundation says it is being asked to repay $870,783 to Canadian Pacific Railway (TSX:CP).
The payment comes after CPR appealed a notice from the Canadian Transportation Agency that required it to pay $1.6 million for going over its grain freight rate cap for the 2005-06 crop year.
The appeal decision said CPR overpaid by $871,000 and that the money must be returned, the foundation said in a release Monday.
Any penalties paid go to the foundation which invests the principal and uses the interest earned to fund research projects.
“While this will have an impact on our future research plans, we shouldn’t have to cut any project commitments that have been made,” Lanette Kuchenski, the foundation’s executive director said in a statement.
She said the foundation is working with CPR on a repayment plan that reduces any penalties it could receive from pulling the money out of long term investments.
The foundation said it also received more than $2.8 million from Canadian National (TSX:CNR) due to grain freight revenue exceeding the legislated cap.
CN is arguing that the Canadian Transportation Agency’s calculations are $522,383 too high.
A final decision on that appeal is expected next year.