The History of Tank Car Mileage Compensation and its Financial Concerns

Author

Ethan Allen, Fontbonne College

Year of Award

1987

Degree

Master of Business Administration (MBA)

College

College of Business & Professional Studies

Degree Program

Business

Department

Business Administration

Keywords

Elkins Act, I.C.C., Rockefeller, Interstate Commerce, Shipping, Railways, Trains

Abstract

Tank car mileage compensation has had legal, financial, and business management concerns since its inception in 1867. The legal concerns include the I.C.C. Act of 1887, The Elkins Act of 1903, and the I.C.C. Act Amended 1917. These Acts provide the basis for the responsibility of the subject matter by the Interstate Commerce commission. The El Dorado case heard by the Supreme Court in 1946 defines the amount of mileage compensation that a lessee of a tank car is entitled to receive from the car owner.

The financial concerns are stated in chapters 10 through 17, which include the financial impact on the railroads for the years 1979 through 1982. Ex Parte 328 provides the basis for current mileage compensation philosophy and computation. Chapters 16 and 17 describe the railroads' legal rights to control mileage payments with contracts.

The management concerns are stated primarily in chapters 12 and 13 which cover the strategy utilized by the tank car owners and tank car lessors in their arguments to the I.C.C. in response to the railroads request to lower mileage compensation.

There is no discussion concerning mileage equalization since, from a financial point of view, the subject is irrelevant to this paper.

To the researcher this paper provides the legal basis for tank car mileage compensation, the financial basis to include the Ex Parte 328 (1986) formula and an example of the formula, and a brief look into what the future may bring. To a transportation manager, with the assignment of participating in the 1988 session of Ex Parte 328, this paper will provide the necessary background for active participation. The text and the tables provide tank car mileage compensation schedules since 1867.

Document Type

Restricted Thesis

Recommended Citation

Allen, Ethan, "The History of Tank Car Mileage Compensation and its Financial Concerns" (1987). All Theses, Dissertations, and Capstone Projects. 568.
https://griffinshare.fontbonne.edu/all-etds/568