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CN Grain Revenue Over Cap: CTA

The Canadian Transportation

Agency ruled Dec. 31 that Canadian National Railway (CN) earned too much money from hauling grain in the 2008-09 crop year and ordered it to hand over more than $700,000.

Canadian Pacific Railway (CPR), meanwhile, did not exceed the government’s grain revenue cap, the CTA said.CN’s

grain revenue of $479,788,412 was $683,269, or 0.1 per cent, above its revenue cap, according to the agency. CPR’s grain revenue of $484,806,288 came in below its cap.CNnow has 30 days to

pay the amount of excess revenue plus a five per cent penalty, the agency said. The government requires such payments to go to the Western Grains Research Foundation’s endowment fund.CNis reviewing the CTA’s

calculations, said company spokesman Kevin Franchuk. A year ago, the agency also found CN had exceeded its grain revenue cap for the 2007-08 year, a decision CN appealed.

That appeal is still before the courts, Franchuk said.

Canada’s 2008-09 crops were large and the government boosted the railways’ combined revenue cap by $208 million.

The Canadian government implemented the grain revenue cap in the 1990s after it eliminated the Crow rate subsidy for grain movement by rail. The cap applies to revenue the railways earn by moving grain from the Prairies to ports.



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