Railroad Clearinghouse Update ACACSO – November 12 th, 2008 Orlando, FL Robert Sanford Manager Car Accounting

Electronic detail submitted to Railinc via the Car Hire Data Exchange (CHDX) –Supplemental detail submitted manually through paper documents Paper Appendix H submitted via US Mail to each business partner Appendix H may not balance to the CHDX details Prior Settlement Process

Cash settlement is made based on bilateral arrangements between business partners –Net basis –Gross basis –Form of payment – Check, Draft, EFT, ACH Timing of settlement varies –Some payments are timely –Some payments are late – sometimes significantly

RCH Settlement Process Detail records submitted electronically to Railinc through Car Hire Data Exchange (CHDX) CHDX Summary Records (Type 9) are used to determine the net car hire position of each participant Net-Net Position reports produced by Railinc

Process Flow - Data ROAD B CHDX RCH SYSTEM Processes CHDX data by the 19 th of each month Net/Net Position Report Reports created on the 20 th of each month ROAD AROAD C

Process Flow - Settlement ROAD BROAD AROAD C Net/Net Position Report Funds Transfer Clearing House Bank Roads retrieve reports from Railinc Website Funds due to bank by 11:30 A.M. on the 21st

Timeline Monthly RCH processing: 19 th - CHDX details processed through RCH 20 th – Net/Net Reports available by 10:00 A.M. 21 st – For net payable participants, funds must be received by 11:30 A.M. 21 st – For net receivable participants, funds are disbursed by 2:00 P.M. *RCH processing will occur on the next business day for any date which falls on a weekend or holiday

Designed to allow each participant to: Enter Negative Payable thresholds Contact information –Set up notifications Review rejected participant report –Current –Historical Designed to allow non-CHDX participants to: Enter CHDX detail records CHDX Application

Designed to allow each participant to confidentially: Set a threshold for negative car hire positions Set thresholds for individual participant roads –Default negative limit is $0.00 Set a specific time frame for each entry *Negative payable table entries must be updated by the 11 th of each month for current month RCH processing Negative Payable Table

Designed to allow each participant to: Access Net/Net Reports –Current –Historical View Carrier Roll Up Report –Defines participant controlling road relationships Unprocessed Road Report –CHDX roads which did not settle through RCH RCH Application

A.A.R. Code of Car Hire Rules 3 & 14 (Circular OT-10) A.A.R. Code of Trailer and Container Reporting Rules 3 &14 (Circular OT-36-I) Only applies to railroad owned rail equipment, trailers, and containers Car Hire Rules

Electronic settlement eliminates: –Paper Appendix H –Balancing errors between Appendix H and CHDX detail Decreased collection time Decreased costs from: –Processing payments –Reconciling accounts and bank statements Improved audit trail Benefits

1 st RCH processing and settlement occurred on September 23 rd, 2008 $50M average monthly settlement 80.4% of roads participating: –460 participating roads –112 non-participants (some are no longer active operating railroads) 7.9M CHDX records processed Current Status

Explore the possibility of adding: –Shippers –Private Car Owners –Leasing Companies –TTX Company Increase RCH participation Decrease errors submitted on CHDX Future of RCH

Important Information and Contacts Railinc Single Sign On Website Address: Contacts Mr. Warren Alvis - RCH Administrator – Jim Pinson – General Questions Robert Sanford – RCH TAG Chair

Questions?