The Surface Transportation Board (STB) is a federal agency that regulates financial aspects of surface transportation, primarily freight rail. The Washington, D.C.–based board has jurisdiction over a broad range of railway issues, as well as some passenger rail activity and intercity buses. 

According to the STB’s mission statement, the body “resolves disputes in support of an efficient, competitive, and economically viable surface transportation network that meets the needs of its users.” As an independent agency, the STB operates outside of the U.S. Department of Transportation (DOT). 

Understanding the STB

One of the main areas of jurisdiction for the STB is to provide economic regulation of railway freight. Specifically, the agency makes decisions related to rate and service disputes along with business transactions such as mergers, railway line sales, line construction, and line abandonments.

For example, the board would have to approve a merger between two major rail companies, if such a transaction could potentially have anticompetitive effects, . The STB may also rule in cases where a shipper argues that a railway is charging an unreasonable fee to use its tracks, .

• Certain passenger rail matters
• The intercity bus industry
• Pipelines other than water, gas, or oil
• Household goods carriers’ tariffs
• Rate regulation of noncontiguous domestic water transportation, such as freight shipping between the mainland United States and Hawaii, Alaska, Puerto Rico, and other U.S. territories

STB History and Operations

The STB was created through the ICC Termination Act of 1995, effectively replacing the Interstate Commerce Commission, which operated from 1887 to 1995. At its inception in 1996, the board was essentially an offshoot of the DOT. However, the STB Reauthorization Act of 2015 severed those administrative ties, creating a fully independent agency.

Nonetheless, in the interest of preventing fraud and waste, the Inspector General of the DOT has the authority to monitor the agency’s financial management, property management, and business operations to ensure that they are in agreement with federal law.

The STB consists of five members, including one who serves as its chair. The members are appointed by the president and have to be confirmed by the U.S. Senate. Each board member’s term lasts for five years, with a two-term limit.

The agency has roughly 150 full-time employees, most of whom serve in one of six main offices. These include:

• Office of the General Counsel, which offers legal guidance to the board and represents the STB when it faces lawsuits because of its actions.
  
• Office of the Managing Director, which handles the agency’s budget and personnel management, as well as various administrative functions.
  
• Office of Proceedings, which helps draft decisions on behalf of the board and manages legal filings and recordations (recording actions and processes) when, for example, two parties enter into a business agreement.
  
• Office of Environmental Analysis, which reviews the environmental impact of board actions when relevant, often coordinating with other government agencies.
  
• Office of Economics, which provides economic and financial analysis to help guide the board when making decisions involving issues such as rates, mergers, and line construction.
  
• Office of Public Assistance, Governmental Affairs, and Compliance, which serves as an outreach body, providing information to members of Congress, as well as to media outlets and members of the public on STB actions.

The agency also has an Equal Employment Opportunity (EEO) Office that helps monitor compliance with EEO regulations to create equal employment access irrespective of a candidate’s race, color, sex, age, religion, national origin, or mental/physical disability.

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