Update: Legal Challenge Progressing in California Hazmat Shipments Case
BNSF would like to update customers on a development regarding the litigation surrounding the state of California's intention to impose a new $45 charge on hazmat transported by rail in the state. A hearing date of October 13, 2016 has been set for the preliminary injunction sought by BNSF and Union Pacific in this federal case. The court's decision on the preliminary injunction is expected within a few weeks of that October 13 hearing.
The federal court hearing the case has also ordered the California Office of Emergency Services to not require collection of the hazmat charge before November 13. Previously, the state of California advised that railroads operating in the state of California would be required to begin collecting the charge as early as October 1 and remit the collected charge beginning January 31, 2017. The new order by the federal court delays the collection by six weeks - from October 1 to November 13. The order, however, does not change the January 31, 2017 date for when the railroads are required to remit the charge to the state.
As we previously reported, this proposed new charge is part of California Senate Bill 84 that was signed into law by Governor Brown and would apply to the top 25 hazmat commodities transported into and within the state of California.
This new law, unless overturned, means BNSF customers shipping hazardous materials into and within the state of California may be subject to the charge plus a 5% administrative expense per rail car (or intermodal container or trailer) carrying any amount of the top 25 hazardous materials that are moved by rail (see 25 most hazardous materials).
BNSF Railway and Union Pacific Railroad are aggressively challenging the proposed new charge in a federal lawsuit. The railroads argue in the lawsuit that the $45 charge is illegal because it singles out and targets rail transportation. Federal law already bars states from unreasonably burdening rail transportation, and singling out railroads for disfavored treatment.
BNSF will continue to provide potentially affected customers updates as developments occur. Should you have any questions in the meantime, please feel free to contact your BNSF marketing representative.