0. Mileage Equalization
ACACSO
November 2011

1. Introduction DEFINITION OF MILEAGE EQUALIZATION MILEAGE ADJUSTMENTS
MONTHLY PROCESSING
SAMPLE REPORT
10 YEAR TREND
CANADIAN EQUALIZATION

2. Definition of Mileage Equalization
Mileage Equalization is the process by which RR’s are compensated for the movement of excessive empty routing of cars
Implemented as part of an agreement on how RR’s will be compensated for private car moves
In the US it applies to only Tank cars and is covered under Tariff 6007
In Canada it is covered under individual tariffs by CN and CPRS
There is no equalization in Mexico

3. Definition of Mileage Equalization
US mileage equalization is covered under tariff 6007 Item 187
Rate is set annually in September retroactive to the first of each year and is determined by the formula in the Ex. Parte 328 agreement between RR’s and tank car owners
Equalization invoices are issued by Railinc in July for movements during the previous year

4. Mileage Adjustments
Adjustments to equalization miles are sent to the RR’s and can be made for up to three years
Adjustments for the current accounting year, including any adjustments for prior accounting years must be reported by May 20, of each year
Adjustments made after May 20 will be reported in the current year, not the year of the adjustment

5. Mileage Adjustments – Car Owners
If RR’s do not automatically adjust discrepancies, then report discrepancies to RR’s in writing, copy to AAR
Carriers have 30 days to make adjustments. Advise car owner when adjustment made – ALSO ADVISE AAR IF OWNER REQUEST FOR ADJUSTMENT SHOWS COPY TO AAR
AAR will make adjustments if the Rail carrier fails to respond to your request (This is done prior to year end)

6. Monthly Processing
RR’s report loaded and empty mileage data on the CHDX file to Railinc
Type 900 Summary records indicates all mileage that should be included in the equalization account
Railinc pulls Equalization records from the CHDX and creates Equalization Registers
Registers are sent to Car Owners and RR’s monthly
Registers are accumulated by Car Mark Owner
Data is accumulated on an annual basis
Railinc prepares and sends annual equalization invoices

7. Monthly Processing - Calculation
Accumulated by Car Mark Owner; reported by RR and month
Aggregate Equalization Loaded Miles
Aggregate Equalization Empty Miles
Multiply Loaded Miles by 1.06 (106%)
Subtract Adjusted Loaded Miles from Empty Miles
Result is Excess Empty Miles
Multiply Excess Empty Miles by Equation Rate
Result is Equalization Amount Due

8. Sample Report USING YTD MILEAGE @ 0.67/MI – TOTAL BILL $1,279.03
Equalization of Private Tank Car Mileage
March 2011
Year to Date by Paid-To Owner: DEFX
DEF Tank Car Company
Paid To Paying Paying Date Loaded Empty Empty Miles Over Percentage
Mark Owner Mark Earned Miles Miles 106% of Loaded Variance
DEFX ABCD ABCD
DEFX
OWNER TOTAL YTD
USING YTD 0.67/MI – TOTAL BILL $1,279.03

9. Sample Report 3341 USING YTD MILEAGE @ 0.67/MI – TOTAL BILL $1,279.03
Equalization of Private Tank Car Mileage
March 2011
Year to Date by Paid-To Owner: DEFX
DEF Tank Car Company
Paid To Paying Paying Date Loaded Empty Empty Miles Over Percentage
Mark Owner Mark Earned Miles Miles 106% of Loaded Variance
DEFX ABCD ABCD
DEFX
OWNER TOTAL YTD x
3341
USING YTD 0.67/MI – TOTAL BILL $1,279.03

10. Sample Report 3341 USING YTD MILEAGE @ 0.67/MI – TOTAL BILL $1,279.03
Equalization of Private Tank Car Mileage
March 2011
Year to Date by Paid-To Owner: DEFX
DEF Tank Car Company
Paid To Paying Paying Date Loaded Empty Empty Miles Over Percentage
Mark Owner Mark Earned Miles Miles 106% of Loaded Variance
DEFX ABCD ABCD
DEFX
OWNER TOTAL YTD x x$
3341
USING YTD 0.67/MI – TOTAL BILL $1,279.03

11. US Tank Car Equalization – 10 Year Trend

12. Canadian Mileage Equalization
Canadian equalization covers moves within Canada and are determined by tariffs by CN and CPRS
CN Equalization:
Covered under CN Tariff 6544 for moves within Canada
All private marked cars – despite car type are covered under the tariff
Mileage Adjustments should be made under the rules as outlined in US tariff RIC-6007
Allowance = 6% Rate = CDN $1.00
CPRS Equalization:
Covered under CPRS Tariff 6 for moves within Canada
Applies to covered hoppers and Tank cars only
Disputes to mileage/invoice must be made within the terms of the invoice
Allowance = 6% Rate = CDN $1.10

13. Questions?
FURMAN:
I will be pleased to take questions after we finish the formal part of this meeting.
LEAVE SLIDE ON. 13