LINCOLN, NE (AP)--Two railroads plan to increase penalties by $25 per car each day elevators are late filling grain cars, a move the Nebraska Grain and Feed Association said will hurt an already ailing farm industry.
Union Pacific Railroad spokesman Mark Davis said recently his railroad plans to increase penalties from $50 to $75 which began Oct. 1, but the timing and rates were under review and could vary.
Burlington Northern Santa Fe planned a similar increase.
The penalties provide incentives to keep rail traffic on schedule, Davis said. The proposed increases, the first since 1992, also help Union Pacific pay for increased equipment costs, he said.
But the executive vice president of the Nebraska Grain and Feed Association, Pat Ptacek, said elevators are concerned increased costs, and about safety if workers have to put in longer hours to meet a railroad's schedule.
Union Pacific recently announced an average 3% increase in freight rates beginning in early October to help it pay for increased fuel costs. Ptacek said the penalties combined with increased hauling costs will hurt agriculture producers.