You are more than likely familiar with OT-5 application process and the various charges and penalties that many rail shippers have been charged as a result. The OT-5 application process had some inherent problems including:
- The OT-5 application itself was a time-consuming process.
- Each railroad had different criteria to approve/reject applications
- Some railroads would not review OT-5 applications in a timely manner
The good news is that one thing shippers and railroads alike have agreed on is that the OT-5 process was problematic. Since they came to this understanding, a committee was formed to address what the true “need” was and how to best handle it. The committee was comprised of various rail shippers, railroads, and Railinc.
The committee agreed that the number one objective is that the railroads need a way to contact the person that is responsible for a railcar when a railcar is on their line but without good dispo instructions. If the railroads can’t identify a contact, then they need a storage location that has been defined by the railcar contact. The idea is that each car needs to be accounted for and have good instructions, which helps maintain fluidity on the rail network. If the railroad does not have a contact or a storage location is not available within a 5 day window, then railroad tariffs, publications and policies will govern.
The resulting change is the OT-5 application will be deactivated as of February 3, 2020. The OT-57 application will be effective as of February 3, 2020. The OT-5 and OT-57 application is managed by Railinc. Railinc has acted extremely quick to launch the OT-57 changes. The initial changes will be launched in phases and training resources will be made available.
The OT-57 application itself is much simpler because less information is required. Up to 50,000 cars can be uploaded from a spreadsheet.
If you are responsible for a private fleet of railcars, you should be thinking about how to register your railcars in the OT-57 process! You can begin as early as December 12, 2019, but it must be completed by February 2, 2020. Now is the time to start preparing. The good news is that this is much simpler than the prior process! Additional proposed changes to improve usability will be rolled out in additional phases over the next couple of years – there will be more information to come on what these phases include.
The main difference is that there is no longer an approval process. Railroads will not reject applications due to storage limitations or mechanical specification issues in UMLER. As long as your railcar is on an application with a point of contact, you are all set!
Below is a quick summary of the steps you need to take and when they need to be completed.
We are managing this process for many of our client today. If this leaves you with more questions, please reach out. RSI is here to help!