CPR Over, CN Under Western Grain Revenue Caps for Crop Year 2006-2007
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OTTAWA - December 28, 2007 - The Canadian Transportation Agency today announced that the revenues of the Canadian Pacific Railway Company (CPR) for the movement of Western grain had exceeded its revenue cap for crop year 2006-2007. The Agency has also ruled that the Canadian National Railway Company (CN)'s revenues from grain transportation for the same period were below its cap.
CPR's excess revenue of $3,760,353 is the largest such amount attributed to a single railway by the Agency since the revenue cap régime was established in 2000. The railway's grain revenue for 2006-2007 was $437,107,995, while its cap was set at $433,347,642. This marks the third time that CPR has exceeded its revenue cap, as it was also over in 2005-2006 and 2003-2004.
CPR now has 30 days to pay $3,948,371, representing the amount it was over its cap plus a five-percent penalty of $188,018, to the Western Grains Research Foundation, a farmer-funded and directed organization set up to fund research that benefits Prairie farmers.
On the other hand, the Agency has determined that CN's grain revenue for crop year 2006-2007 was $416,917,074, or $2,105,869 below its revenue cap of $419,022,943. Since the revenue cap régime's inception, CN has twice exceeded its cap, in 2005-2006 and 2004-2005.
The Canada Transportation Act requires the Agency to determine each railway company's revenue cap annually and whether each cap has been exceeded by the railway companies. The revenue caps apply to revenue the railways derive from the movement of grain from Prairie origins to terminals at Vancouver, Prince Rupert, Thunder Bay and Churchill. In the course of its determinations for 2006-2007, the Agency examined and verified detailed railway company submissions of grain traffic and revenue information.
The Canadian Transportation Agency is an independent quasi-judicial tribunal which operates like a court. It regulates various modes of transportation under Government of Canada jurisdiction, including air, marine and rail. The Agency deals with, among other things, rate and service complaints arising in the rail industry; disputes between railway companies and other parties; applications for certificates of fitness for the proposed construction and operation of railways; approvals for railway line construction; regulated railway interswitching rates; and revenue caps for the movement of Western grain by rail.
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