The Prairie Star: Montana Ag Newspaper

GREAT FALLS, Mont. - Years of working with the local railroad company on resolving production issues and high freight rates have finally yielded some results as Montana agriculture organizations and the railroad have ironed out a compromise.

“We've been working with Burlington Northern Santa Fe to resolve some production issues like freight rates and making them more comparable to other states - making the rates competitive,” said Bing Von Bergen, Montana Grain Growers Association vice president of Moccasin, Mont. “The service this year has been excellent - a lot better than in the past.”

Yet, the rates still raise some eyebrows amongst the farming community.

With the railroad competition bill, which is supposed to benefit the captive shipper, stuck in committee, the Montana Grain Growers, Montana Farm Bureau Feder-ation and BNSF officials decided it was time to strike a deal and create a formal arbitration process to handle disagreements between farmers and the rail company.

“Montana Grain Growers supports entering into an agreement of mediation and binding arbitration with BNSF railway,” said Von Bergen. “Our members will have the opportunity to discuss this at our upcoming listening sessions and at our annual convention in Great Falls on Dec. 3-4. BNSF Railway is sincere in their willingness to commit to this process and long-term accountability by all parties is our common goal.”

However, BNSF in the past year threatened to increase the rates on the 52-car trains to increase the spread between the 52-car trains and shuttle trains to cheapen the shuttle train rates, said Von Bergen. The Montana Grain Growers expressed their disagreement with the proposed rate increase, thus starting the arbitrational relationship.

“We asked for a communication line with agriculture groups and the Montana Rail Coalition, to be represented by producers Lochiel Edwards and Dan Kidd,” explained Von Bergen. “The dialogue between the groups and the rail company is phenomenal right now.”

After developing a communication line, the ag groups recognized a need for a permanent process, something with formal structure, to be in place to continue the good work already accomplished, said Will Roehm, MGGA president of Great Falls, Mont.

“For many years, we have tried to find a forum to address the freight rates paid by our farmers,” he said. “This agreement will allow growers to initiate rail rate complaints, provide mediation of a disputed rate as a first step and, if necessary, provide for a panel of arbitrators to hear the case and to issue a binding judgment.”

“We realize Montana is the only truly captive state,” added Von Bergen. “We are trying to resolve that problem and improve the image with BNSF.”

The problem is there is no reliable and cost effective process for rail rate accountability, he said.

“The grain elevators have access to oversight by the Surface Transportation Board,” said Von Bergen. “The elevator's interest is only competition, but the producer pays the freight.”

“Because only grain companies could file as ‘shippers,' our only recourse in the past has been to rely on them to file a rate case with the Surface Transportation Board (STB). That has been of no help to our producers,” said Dave McClure, MFBF president of Lewistown, Mont. “This potential agreement between MFBF and BNSF would establish a process for mediation and an independent arbitration board to hear producer concerns. For the first time ever, producers can be represented directly in rate disputes with BNSF.”

There is a need for an alternative, a place where producers can access oversight, where disputes can be handled in a fair manner and specific to agriculture, he added.

Burlington Northern is willing to sign a two-year agreement with the Montana agriculture groups to administer mediation and binding arbitration for only Montana wheat and barley growers. The two-year agreement will automatically renew unless a 90-day notice is given.

The Montana agriculture groups and Burlington Northern will select five qualified experts who are knowledgeable about the whole industry for a pool of arbitrators, to which all parties must agree.

“This is a process that can work,” said Roehm. “I think it can work, but we can't gloss over how important these arbitrators will be.”

Eligible cases are those that deal with Burlington Northern customers on rail lines of 250 miles or longer and handle wheat and barley only.

Von Bergen said the rail company did seem perceptive to expanding the process to pea and lentil growers, but that remains to be seen.

“The unintended consequence of the shuttle is to shut down the person down the line,” said Von Bergen. “We don't want the shuttles to force all of the 52s out of business. Yet, everything in the railroad is geared toward speed and efficiency - just like in our operations.”

In order to file a complaint, the grower must be a customer of Burlington Northern and agree to be represented by a producer organization, such as the Montana Grain Growers Association or Montana Farm Bureau Federation. The producer organization then determines the merits and eligibility of the case and executes an agreement for mediation and arbitration if applicable.

The organization will contact BNSF, and mediation will start within 60 days and be completed within 30 days of its start. If the mediation fails, three arbitrators will hear the case within 45 days of the mediation failure and render judgment within 120 days.

All the evidence is confidential. The resulting judgment is public.

“One person can initiate the process, but all the producers in the area can participate once the case reaches arbitration,” said Von Bergen. “Only the participants will be paid reparations, which will be retroactive one year back and the adjusted price will be for one year forward. This process is modeled after the National Grain and Feed Association's mediation and arbitration process they have been doing for 100 years.”

The losing party pays the administrative costs and arbitrator fees.

“BN has offered to pay to retain the arbitrator pool, because the company doesn't want finances to be a reason to forego the process,” said Von Bergen. “All parties will support the outcome for one year. There are still some things we need to work on, but everybody is very excited about this. The railroad is willing to sit down and talk to us.”

Comments »

Jordan Fogal wrote on Nov 8, 2008 10:28 PM:

" TEXAS HAS NO SHAME
A story of pay and play

By Jordan Fogal

Once upon a time, in the land of pay and play, a wicked story began. It did not commence with a secret or clandestine meeting. There was no cloak and dagger stuff, like in a game of CLUE. There were no whispers of a deep throat. Nevertheless, this horrible story is repeated all over Texas. Misdeeds are committed without shame. They are cruel, open, arrogant, and ongoing. Peoples' lives are destroyed as if they are inconsequential. Their numbers grow and are reported on a daily basis like the body bag count from a war.

One would assume that this state would have learned something from its history and not allow it to keep repeating itself. Past events include the 1954, $100 million, Veterans' Land Board Scandal that was entangled in attempted murder, bribery, and political intrigue. This debacle involved none-other-than the governor, the attorney general, senators, and representatives; there were over 250 indictments handed down. How can things be allowed to get this out of control? Who says they don't do it bigger in Texas? Have we so soon forgotten Enron? The ill-effects of Texas greed and corrupt politics are not so easily forgotten by those whose lives are ruined. And now, once again, this same sort of pond-scum is allowed to take control. Do all of this state's mistakes have to reach Texas-size portions to be addressed?

These moneychangers are lead stories in magazines, written about in the Newspapers, and some make the 6 o'clock news. Then there is silence and nothing more. It is as if everyone develops amnesia, right after the information is disseminated. It is as if no one can acknowledge what is right-in-front of his or her eyes. The culprits and henchmen continue: as if no one sees anything is wrong, and God is in his heaven, and all is right with the world.

Sitting here, reading Texas Monthly Magazine, I am stunned. The article is titled, Bob Perry Needs a Hug. It is a powerful piece on the housing crisis, political power, intimidation, and injustice. It is all spelled out clearly; and it is written simply so, no matter what your level of education, you cannot miss the point. The story is actually a postscript to the November 2005 issue, Hurt? Injured? Need a Lawyer? Too Bad!, by Mimi Swartz. No one got sued because these articles told the truth. It is in black and white for anyone to read; and no one seems outraged, or even ashamed. Worst of all, it is ongoing; and no one is even stopped or punished. It is just dually noted in the text.

In another venue, is the new book, Blocking the Courthouse Door, by Stephanie Mencimer, Chapter Three; Mess with Texas: George W. Bush and the Texas Tort Moguls. It reads like chapter one from the starship, Enterprise ... but it is all true! It is an eye-popping look at the people in power, who spun tort reform like cotton candy and hand fed it to us. This expos is an in-depth assessment of the incredulous and ongoing assault on the American consumer. Indeed, this is an assault that began right here in the great state of Texas. Is this state now the breeding ground for infamy? ( Infamy: evil reputation brought about by something grossly criminal, shocking, or brutal 2: an extreme and publicly known criminal or evil act 3: the state of being infamous) How well defined must these actions be?

Government agencies are bought and paid for, and the owner's name is mentioned as off-handedly as if it were in the society page. The same names appear that are found in the magazines and the newspapers, and these people are allowed to continue to stomp down any fear of reprisals with their checkbooks? Have we, the people, just given up? If we no longer think we matter then we don't.

It is all so absurd; it makes me think it is a bad dream or has to be make-believe. It brings to mind a fairy tale by Hans Christian Anderson called "The Emperor's New Clothes". Remember it? The emperor is narcissistic, powerful, and vain. He struts around in new clothes to gain the admiration of his subjects. His only passion is his attire. He is so bad that he attracts swindlers to his court, and they play on his vanity. They sell him on the idea that they, for a price, can weave cloth so magnificent and elaborate... that it has special power and is completely invisible to everyone who is stupid or not fit for his post. The emperor, even-though he cannot see this material, cannot admit it because he would be, in essence, admitting he is stupid and unfit for his post. So he sends for his 'yes men'. They, fearing reprisal, tell him what he wants to hear. They assure him they see the fabric, and it is as magnificent as befits a man of his station. He somehow has convinced himself that their approval of his preening, condones his ridiculous behavior.

His aids suggest that he should have new clothes made from this splendid material for the great procession that was the following day. Throughout the night, the swindlers made motions of looming and weaving, cutting and sewing... nothing. All the while, attesting to the king that it was the most exquisite outfit ever to be worn. There was great excitement in the kingdom as every one had heard of the emperor's unbelievable threads. The rascal swindlers lifted up their arms to the emperor as if they were holding something. They proceeded with their scheme and asked the king to remove all his clothes so they could help him on with the new ones. They gave him the make-believe trousers and mantle. They remarked that the fabric was so light, it was as if he were wearing nothing, but remarked that - was the beauty of it.

All of his ministers cried out in unison, "Magnificent." The emperor looked at himself side to side in the mirror as if to observe the clothes that were not there. No one dared tell him the truth, as they would have declared themselves stupid and unfit for their posts. A canopy was held above him as he strolled out to greet his admiring public. They oohed and aahed along the route as he waved and smiled, confident of his importance. But all at once, a hushed little voice shockingly spoke up from the crowd. A small child gasped, "But he is not wearing any clothes!" People began to whisper to one another what the child had said, 'til everyone was saying, "But he isn't wearing any clothes." The emperor himself had the uncomfortable feeling that what they were saying might be true, but he had to go through with the procession. So, he drew himself up and walked with his head higher than before; and the courtiers held onto the train that wasn't there.

The moral of the story ... there are a lot of naked people strutting around in Texas, desperately in need of a child's honesty.

There is a real sickness in today's society when we have to search for that small child's voice in the masses to shed light on the horrendous, disgraceful truth, and finally get some kind of movement started. - Something has to done about defective, atrocious, uninhabitable housing; and we need to stop the homebuilders who shamefully erect them, ignore new homeowners' complaints, change the company name, and then go right on building.

Something has to be done NOW to protect consumers. Consumers are the very fabric of the American dream. We need to halt the resulting wave of decimation throughout our nation's economy. Something has to be done about reversing "Tort Reform" so the system is fair again. "

Comment on this story

Comments will be approved within 48 hours