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[Federal Register Volume 90, Number 7 (Monday, January 13, 2025)]
[Notices]
[Pages 2777-2779]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-00443]

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DEPARTMENT OF TRANSPORTATION

Federal Railroad Administration

[FRA-2025-0017]

Notice of Proposed Waiver of Buy America Requirements for Tier 0, 
Tier 1, and Non-Tiered Locomotives

AGENCY: Federal Railroad Administration (FRA), Department of 
Transportation (DOT).

ACTION: Notice; request for comments.

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SUMMARY: The Federal Railroad Administration (FRA) is seeking comments 
on whether to grant a general applicability public interest waiver of 
its Buy America requirements for the purchase of used locomotives that 
would serve as the underframe or chassis to convert them to all-
electric, renewable diesel, battery-powered, or other renewable-energy 
locomotives. Such projects would remove highly polluting locomotives 
from the national rail network and replace them with more efficient 
locomotives that will reduce overall emissions, address environmental 
burdens on communities, and create domestic jobs. Purchases of these 
locomotives under FRA-funded projects are subject to FRA's Buy America 
requirements. However, given the age of these used locomotives, it is 
difficult and may not be possible to verify whether they are fully 
compliant with FRA's Buy America requirements. In this general 
applicability waiver, FRA does not propose to waive the applicable 
Build America, Buy America Act (BABA) requirements. This proposed 
waiver would not apply to any other manufactured products, steel, iron, 
or construction materials.

DATES: Comments must be received by January 28, 2025.

ADDRESSES: Please submit all comments electronically to the federal 
rulemaking Portal. Go to https://www.regulations.gov and follow the 
instructions for submitting comments.
    Instructions: All submissions must refer to the Federal Railroad 
Administration and the docket number in this notice (FRA-2025-0017). 
Note that all submissions received, including any personal information 
provided, will be posted without change and will be available to the 
public at https://www.regulations.gov. You may review the U.S. 
Department of Transportation's (DOT) complete Privacy Act Statement in 
the Federal Register published April 11, 2000 (65 FR 19477), or at 
https://www.transportation.gov/privacy.

FOR FURTHER INFORMATION CONTACT: For questions about this notice, 
please

[[Page 2778]]

contact Shreyas Bhatnagar, Regional Supervisor, Office of Regional 
Outreach & Project Delivery--South Central Region, Office of Railroad 
Development, FRA; telephone: (202) 617-0212; email: 
[email protected]. For legal questions, please contact Faris 
Mohammed, Attorney-Advisor, Office of the Chief Counsel, FRA; 
telephone: (202) 763-3230; email: [email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    Stakeholders have expressed concerns to FRA regarding the 
applicability of FRA's Buy America requirements on used locomotives 
that are purchased for an FRA-funded project and rehabilitated or 
remanufactured to meet higher emission standards. The U.S. 
Environmental Protection Agency (EPA) sets emissions standards for line 
haul and switch locomotives under different tiers, each of which 
corresponds to when the locomotive engine was originally manufactured, 
as follows:
     Tier 0 includes locomotive engines from 1973-1992 (line 
haul) and 1973-2001 (switch),
     Tier 1 includes locomotive engines from 1993-2004 (line 
haul) and 2002-2004 (switch),
     Tier 2 includes locomotive engines from 2005-2011 (line 
haul) and 2005-2010 (switch),
     Tier 3 includes locomotive engines from 2012-2014 (line 
haul) and 2011-2014 (switch), and
     Tier 4 includes locomotive engines from 2015 or later 
(line haul and switch).
    Locomotives produced before 1973 are classified as non-tiered.
    Tier 0 and Tier 1 locomotives have been in operation in the United 
States for decades, and many of them are still operating on the 
national rail network. Locomotive manufacturers may purchase these old 
non-tiered, Tier 0, and Tier 1 locomotives, remove the diesel engine, 
and replace the engine with an alternative power source, such as an 
electric motor and battery, which can result in a more efficient, 
higher-tier locomotive.
    The Infrastructure Investment and Jobs Act (IIJA), also known as 
the Bipartisan Infrastructure Law, created historic federal investment 
opportunities in domestic infrastructure, clean energy manufacturing, 
and electric vehicles and batteries that have grown clean energy jobs 
across the country. Although rail transportation is generally 
considered a more efficient mode of transportation, older locomotives 
are less efficient than newer, higher-tiered locomotives.
    In addition, locomotive emissions from rail yards contribute to 
poor air quality and other environmental effects for nearby 
communities. Reducing locomotive emissions in rail yards can help 
alleviate environmental burdens, including exhaust and noise, and 
improve the quality of life for these communities.
    In the IIJA, Congress amended FRA's Consolidated Rail 
Infrastructure and Safety Improvements (CRISI) Grant Program to 
authorize FRA to fund projects for rehabilitating, remanufacturing, 
procuring, or overhauling locomotives, provided that such activities 
result in a significant reduction of emissions. 49 U.S.C. 22907(c)(16). 
FRA has defined significant reduction of emissions to mean 
rehabilitating, remanufacturing, procuring, or overhauling: (1) a Non-
Tiered, Tier 0, or Tier 1 locomotive to at least the Tier 2 level; (2) 
a Tier 2 or Tier 3 locomotive to at least a Tier 4 level; or (3) any 
locomotive to an all-electric, renewable diesel, battery-powered, or 
other renewable energy locomotive.\1\
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    \1\ See Notice of Funding Opportunity for the FY 2023-2024 
Consolidated Rail Infrastructure and Safety Improvements Grant 
Program, 89 FR 22206 (March 29, 2024).
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    As such, FRA-funded projects may include the purchase of an older 
Tier 0, Tier 1, or non-tiered locomotive currently in service for the 
purpose of rehabilitating or remanufacturing the locomotive, converting 
it to a higher tier by replacing the diesel engine with an alternative 
power source. FRA's Buy America requirements apply to FRA's CRISI Grant 
Program. Therefore, these requirements would apply to the purchase of 
older locomotives as part of projects to convert them to a higher 
emissions tier. Although it is possible that Tier 0, Tier 1, and non-
tiered locomotives that have been in operation in the United States for 
decades may be compliant with FRA's Buy America requirements, due to 
their age it is difficult for grant recipients to verify that all of 
the components used in the locomotive were produced in the United 
States. Although a grant recipient may be able to confirm that the 
locomotive was assembled in the United States, documentation verifying 
the country of origin of the locomotive's components is typically 
unavailable due to the passage of time.
    FRA proposes to issue this general applicability waiver of its Buy 
America requirements for FRA-funded projects that involve the purchase 
of these used locomotives for the purpose of rehabilitating, 
remanufacturing, or overhauling the used locomotive to deliver a 
locomotive with significantly reduced emissions. FRA is not proposing 
to waive its Buy America requirements for any other manufactured 
products, steel, iron, or construction materials used in FRA-funded 
projects, nor does this waiver apply to the purchase of any new items 
necessary for the project, such as the battery system and its 
components. This general applicability waiver will facilitate the 
delivery of innovative locomotive projects that seek to develop and 
deploy alternative power sources to produce more efficient locomotives, 
reduce locomotive emissions throughout the country, address 
environmental burdens on communities, and create domestic jobs.
    This notice summarizes FRA's Buy America requirements and FRA's 
proposed waiver. FRA also seeks comments as to whether it should 
consider issuing a waiver for any other products required to 
manufacture locomotive batteries or locomotive charging stations and 
equipment due to the domestic nonavailability of such products. Should 
it obtain such information, FRA will consider proposing additional 
nonavailability waivers as appropriate.

II. FRA's Buy America Requirements and Policy

    Projects that receive funding under the CRISI Grant Program are 
subject to FRA's Buy America requirements. This means that FRA can fund 
a project ``only if the steel, iron, and manufactured goods used in the 
project are produced in the United States'' (49 U.S.C. 22905(a)). In 
addition, FRA-funded projects must also comply with the relevant 
provisions of BABA, specifically the requirement that all construction 
materials used in the project must also be produced in the United 
States (Pub. L. 117-58, sec. 70914(a)).
    FRA strictly enforces compliance with Buy America to ensure that 
FRA-funded projects use materials produced in the United States. FRA 
expects grantees to work with suppliers to conduct thorough market 
research and adequately consider, where appropriate, using qualifying 
alternate items, products, or materials. Compliance with FRA's Buy 
America requirement supports domestic industry and well-paying jobs.

[[Page 2779]]

III. FRA's Authority To Waive Buy America Requirements

    FRA can waive its Buy America requirements in limited 
circumstances. FRA will grant a waiver that is consistent with the 
statutory criteria.
    FRA may waive its Buy America requirements if FRA determines that 
applying the Buy America requirements would be inconsistent with the 
public interest; the steel, iron, and goods produced in the United 
States are not produced in a sufficient and reasonably available amount 
or are not of satisfactory quality; rolling stock or power train 
equipment cannot be bought and delivered in the United States within a 
reasonable time; or including domestic material would increase the cost 
of the overall project by more than 25 percent (49 U.S.C. 22905(a)(2); 
see also Pub. L. 117-58, sec. 70914(b); prescribing similar statutory 
conditions for waivers).
    FRA may issue a general applicability waiver when doing so is 
necessary to advance the agency's mission and goals. This waiver would 
apply generally across FRA's grant programs.\2\ In addition, a waiver 
in the public interest is appropriate when the agency determines that 
other important policy goals cannot be achieved consistent with FRA's 
Buy America requirements and the Buy America requirements established 
by BABA, and the proposed waiver does not meet the requirements for a 
non-availability or unreasonable cost waiver.\3\
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    \2\ See Implementation Guidance on Application of Buy America 
Preference in Federal Financial Assistance Programs for 
Infrastructure, M-24-02, at p. 13 (Oct. 25, 2023).
    \3\ Id., at p. 11.
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    If FRA determines a waiver is appropriate, FRA will provide notice 
and seek comment from the public.

IV. Proposed Waiver

    FRA has determined that applying its Buy America requirements to 
the purchase of Tier 0, Tier 1, and non-tiered locomotives for the 
purpose of rehabilitating or remanufacturing the locomotive to 
significantly reduce emissions would be inconsistent with the public 
interest as it would be overly burdensome or, in some instances, not 
possible to verify whether the used locomotive is fully compliant with 
FRA's Buy America requirements. To advance rail projects that deploy 
more efficient locomotives, reduce emissions, address environmental 
burdens on communities, and create domestic jobs, FRA proposes to waive 
its Buy America requirements for the purchase of used Tier 0, Tier 1, 
and non-tiered locomotives, provided that the used locomotive:
     has been in continuous service in the United States from 
the date of manufacture;
     was not purchased outside the United States;
     was manufactured prior to 2004 (line haul or switch); and
     will be used in an FRA-funded project that will result in 
a significant reduction in emissions.
    The proposed waiver does not apply to any other manufactured 
products, steel, or iron used in the FRA-funded project, nor does it 
apply to the purchase of any new items necessary for the project, such 
as the battery system and its components. FRA is not proposing to waive 
any applicable BABA requirements, and the proposed waiver does not 
apply to any construction materials.
    The proposed waiver would be effective for five years from the date 
the final waiver is issued and would apply to awards obligated within 
that period.

V. Request for Comment

    FRA will consider comments received during the 15-day public 
comment period. FRA may consider comments received after this period to 
the extent practicable. Consistent with 49 U.S.C. 22905(a)(4), 
following the public comment period, if FRA determines it is necessary 
to waive its Buy America requirements, FRA will publish its decision in 
the Federal Register and provide an opportunity for public comment on 
such finding for a reasonable period not to exceed 15 days. After such 
a period, FRA's decision will be effective.
    FRA also seeks input from the public as to whether it should 
consider issuing a separate waiver for any other products required to 
manufacture locomotive batteries or locomotive charging stations and 
equipment due to their nonavailability in the domestic market.

    Issued in Washington, DC.
Amitabha Bose,
Administrator.
[FR Doc. 2025-00443 Filed 1-10-25; 8:45 am]
BILLING CODE 4910-06-P
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