Document ID: PHMSA-RSPA-2004-18730-0216
Agency: phmsa
Document Type: Rule
Title: Hazardous Materials: Enhancing Rail Transportation Safety and Security for Hazardous Materials Shipments
Posted Date: 2008-11-26T05:00Z

[Federal Register: November 26, 2008 (Volume 73, Number 229)]
[Rules and Regulations]               
[Page 72181-72194]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26no08-18]                         

[[Page 72181]]

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Part III

Department of Transportation

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Pipeline and Hazardous Materials Safety Administration

Federal Railroad Administration

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49 CFR Parts 172, 174 and 209

Hazardous Materials: Enhancing Rail Transportation Safety and Security 
for Hazardous Materials Shipments; Railroad Safety Enforcement 
Procedures; Enforcement, Appeal and Hearing Procedures for Rail Routing 
Decisions; Final Rules

[[Page 72182]]

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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

49 CFR Parts 172 and 174

[Docket No. PHMSA-RSPA-2004-18730] \1\
RIN 2137-AE02

 
Hazardous Materials: Enhancing Rail Transportation Safety and 
Security for Hazardous Materials Shipments

AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA), 
Department of Transportation (DOT).

ACTION: Final rule.

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SUMMARY: The Pipeline and Hazardous Materials Safety Administration, in 
coordination with the Federal Railroad Administration (FRA) and the 
Transportation Security Administration (TSA), is improving safety by 
revising the current requirements in the Hazardous Materials 
Regulations applicable to the safe and secure transportation of 
hazardous materials by rail. We are requiring rail carriers to compile 
annual data on certain shipments of explosive, toxic by inhalation, and 
radioactive materials; use the data to analyze safety and security 
risks along rail routes where those materials are transported; assess 
alternative routing options; and make routing decisions based on those 
assessments. We are also clarifying rail carriers' responsibility to 
address in their security plans issues related to en route storage and 
delays in transit. In addition, we are adopting a new requirement for 
rail carriers to inspect placarded hazardous materials rail cars for 
signs of tampering or the presence of suspicious items, including 
improvised explosive devices. We adopted these requirements in an 
interim final rule published April 16, 2008. This final rule fulfills 
requirements in Section 1551 of the Implementing Recommendations of the 
9/11 Commission Act of 2007. Also, in today's edition of the Federal 
Register, both FRA and TSA are publishing final rules adopting 
requirements and procedures that promote rail transportation security.
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    \1\ This rulemaking was formerly designated as HM-232E; however, 
with the transition to a new government-wide regulations portal, 
docket number nomenclature has since changed. Some references to the 
old docket number are still present in this document.

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DATES: This final rule is effective December 26, 2008.

FOR FURTHER INFORMATION CONTACT: William Schoonover, (202) 493-6229, 
Office of Safety Assurance and Compliance, Federal Railroad 
Administration; or Susan Gorsky or Ben Supko, (202) 366-8553, Office of 
Hazardous Materials Standards, Pipeline and Hazardous Materials Safety 
Administration.

SUPPLEMENTARY INFORMATION:

I. Background

    On December 21, 2006, the Pipeline and Hazardous Materials Safety 
Administration (PHMSA) in coordination with the Federal Railroad 
Administration (FRA) and the Transportation Security Administration 
(TSA), published a notice of proposed rulemaking (NPRM) under Docket 
PHMSA-RSPA-2004-18730 (71 FR 76834) proposing to revise the current 
requirements in the HMR applicable to the safe and secure 
transportation of hazardous materials by rail. Specifically, we 
proposed to require rail carriers to compile annual data on specified 
shipments of hazardous materials, use the data to analyze safety and 
security risks along rail routes where those materials are transported, 
assess alternative routing options, and make routing decisions based on 
those assessments. We also proposed clarifications of the current 
security plan requirements to address en route storage, delays in 
transit, delivery notification, and additional security inspection 
requirements for hazardous materials shipments.
    On April 16, 2008, PHMSA, once again coordinating with FRA and TSA, 
published an interim final rule (IFR) under Docket PHMSA-RSPA-2004-
18730 (73 FR 20751) that amended the Hazardous Materials Regulations 
(HMR; 49 CFR Parts 171-180) to establish requirements that enhance the 
safe and secure transportation of hazardous materials by rail. The IFR 
requires rail carriers to compile annual data on certain shipments of 
explosive, toxic by inhalation, and radioactive materials; use the data 
to analyze safety and security risks along rail routes where those 
materials are transported; assess alternative routing options; and make 
routing decisions based on those assessments. It also clarifies that 
each rail carrier must address issues related to en route storage and 
delays in transit in its security plan. In addition, the IFR 
establishes a new requirement for rail carriers to inspect placarded 
hazardous materials rail cars for signs of tampering or suspicious 
items, including improvised explosive devices (IEDs).
    We published the rulemaking as an IFR to account for changes 
mandated by the Implementing Recommendations of the 9/11 Commission Act 
of 2007 (9/11 Commission Act or Act) (Pub. L. 110-53; 121 Stat. 266). 
Congress enacted the 9/11 Commission Act, which the President signed 
into law on August 3, 2007, as the final rule was being developed for 
the Docket PHMSA-RSPA-2004-18730 proceeding. The 9/11 Commission Act, 
among other requirements, directed the Secretary of Transportation, in 
consultation with the Secretary of Homeland Security, to publish a 
final rule by May 3, 2008, based on a NPRM published under this docket 
on December 21, 2006. We elected to publish the rule as an IFR rather 
than a final rule to provide interested persons with an opportunity to 
comment on changes made to the NRPM that directly relate to the 
mandates established by the 9/11 Commission Act.
    In accordance with Section 1551(e) of the Act, PHMSA's final rule 
must require rail carriers of ``security-sensitive materials'' to 
``select the safest and most secure route to be used in transporting'' 
those materials, based on the rail carrier's analysis of the safety and 
security risks on primary and alternate transportation routes over 
which the carrier has authority to operate. Specifically, the final 
rule must require such rail carriers to perform the following tasks 
each calendar year:
    (1) Collect and compile security-sensitive commodity data, by 
route, line segment, or series of line segments, as aggregated by the 
rail carrier and identify the geographic location of the route and the 
total number of shipments by UN identification number;
    (2) Identify practicable alternative routes over which the carrier 
has authority to operate as compared to the current route for such 
shipments;
    (3) Seek relevant information from state, local, and tribal 
officials, as appropriate, regarding security risks to high-consequence 
targets along or in proximity to a route used by a rail carrier to 
transport security-sensitive materials;
    (4) Consider the use of interchange agreements with other rail 
carriers when determining practicable alternative routes and the 
potential economic effects of using an alternative route;
    (5) Analyze for both the primary route and each practicable 
alternative route the safety and security risks for the route, railroad 
facilities, railroad storage facilities, and high-consequence targets 
along or in proximity to the route; these analyses must be in writing 
and performed for each calendar year;
    (6) Compare the safety and security risks on the primary and 
alternative routes, including the risk of a catastrophic release from a 
shipment

[[Page 72183]]

traveling along these routes, and identify any remediation or 
mitigation measures implemented on the primary and alternative 
transportation routes; and
    (7) Use the analysis described above to select the practicable 
route posing the least overall safety and security risk.
    In addition, the Act mandates that PHMSA require a covered rail 
carrier, at least once every three years, to analyze its route 
selection determinations, including a comprehensive, system-wide review 
of all operational changes, infrastructure modifications, traffic 
adjustments, changes in the nature of high-consequence targets located 
along or in proximity to the route, or other changes affecting the 
safety and security of the movements of security-sensitive materials 
that were implemented since the previous analysis was completed. 
Finally, the Act mandates that PHMSA require covered rail carriers to 
retain in writing all route review and selection decision documentation 
and restrict the distribution, disclosure, and availability of this 
information to appropriate persons.
    In this final rule, we are responding to comments submitted on the 
IFR that relate to our interpretation and application of Sec.  1551 of 
the 9/11 Commission Act. To review rulemakings, regulatory evaluations, 
environmental assessments, comments, or public meeting and 
congressional briefing transcripts for this docket go to http://
www.regulations.gov under docket number PHMSA-RSPA-2004-18730.

II. Summary of Interim Final Rule

    Based on comments received in response to the NPRM and the 
provisions of the 9/11 Commission Act, the April 16 IFR adopted the 
following revisions to the HMR:
     Rail carriers transporting certain explosives, poisonous 
by inhalation (PIH), and radioactive materials must compile information 
and data on the commodities transported, including the routes over 
which these commodities are transported.
     Rail carriers transporting the specified hazardous 
materials must use the data they compile and relevant information from 
state, local, and tribal officials, as appropriate, regarding security 
risks to high-consequence targets along or in proximity to a route to 
analyze the safety and security risks for each route used and 
practicable alternative routes to the route used.
     Using these analyses, rail carriers must select the safest 
and most secure practicable route for the specified hazardous 
materials.
     In developing security plans required under Subpart I of 
Part 172 of the HMR, rail carriers must specifically address the 
security risks associated with shipments delayed in transit or 
temporarily stored in transit.
     Rail carriers transporting the covered hazardous materials 
must notify consignees of any significant unplanned delays affecting 
the delivery of the hazardous material.
     Rail carriers must work with shippers and consignees to 
minimize the time a rail car containing one of the specified hazardous 
materials is placed on track awaiting pick-up, delivery, or transfer.
     Rail carriers must conduct security visual inspections at 
ground level of rail cars containing hazardous materials to check for 
signs of tampering or the introduction of an IED.
    The IFR became effective on June 1, 2008. Beginning January 1, 
2009, rail carriers must compile information on the commodities they 
transport and the routes they use for the six-month period from July 1, 
2008 to December 31, 2008. Rail carriers must complete their data 
collection by March 1, 2009. By September 1, 2009, rail carriers must 
complete the safety and security analyses of routes currently utilized 
and available alternatives, and select the safest, most secure routes 
for transporting the specified explosive, PIH, and radioactive 
materials. Beginning January 1, 2010, and for subsequent years, rail 
carriers must compile information on the commodities they transport and 
the routes used for the previous calendar year and complete route 
assessments and selections by the end of the calendar year.

III. Comments in Response to the Interim Final Rule

    We received ten sets of comments in response to the IFR. The 
majority of the comments were submitted by companies, but we also 
received comments from a public interest group; a state government 
agency; a county government agency; a university; and an industry 
association. Overall, commenters are supportive of the rulemaking and 
welcome enhanced routing requirements that promote the safe and secure 
transportation of hazardous materials by rail. A major concern for rail 
carriers is the requirement for consultation with state, local, and 
tribal officials, as appropriate. Carriers suggest that it is 
impractical for railroads to consult on a continuous basis with all 
local governments along railroad rights-of-way. Several commenters also 
suggest that DOT establish a process for evaluating transportation 
safety and security risks across the entire rail transportation system, 
including facilitating the analysis and selection of routes involving 
more than one carrier. Some commenters suggest that the Federal 
government should mandate specific routing for high-hazard materials 
rather than provide rail carriers the discretion to make routing 
decisions.
    The comments in the docket for this rulemaking may be reviewed at 
http://www.regulations.gov under docket number PHMSA-RSPA-2004-18730. 
For your convenience, a listing of the docket entries is provided 
below.

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                   Name/company                                              Docket No.
----------------------------------------------------------------------------------------------------------------
Contra Costa County Board of Supervisors..........  PHMSA-RSPA-2004-18730-0203
Friends of the Earth..............................  PHMSA-RSPA-2004-18730-0204
The Dow Chemical Company (Dow)....................  PHMSA-RSPA-2004-18730-0205
California Public Utilities Commission (CalPUC)...  PHMSA-RSPA-2004-18730-0206
The Dow Chemical Company (Dow)....................  PHMSA-RSPA-2004-18730-0207
Theodore S. Glickman..............................  PHMSA-RSPA-2004-18730-0208
Norfolk Southern Railway Company (Norfolk           PHMSA-RSPA-2004-18730-0211
 Southern).
The Association of American Railroads (AAR).......  PHMSA-RSPA-2004-18730-0212
PPG Industries (PPG)..............................  PHMSA-RSPA-2004-18730-0213
BNSF Railway Company (BNSF).......................  PHMSA-RSPA-2004-18730-0215
----------------------------------------------------------------------------------------------------------------

[[Page 72184]]

IV. Discussion of Comments and Section-by-Section Analysis

    In the following paragraphs, we discuss the comments as they apply 
to the 9/11 Commission Act and explain the impact of the comments on 
the regulatory text in this final rule.

A. General (Sec.  172.820(a))

    In accordance with the IFR, rail carriers must implement enhanced 
safety and security measures for shipments of the following classes and 
quantities of hazardous materials:
    (1) More than 2,268 kg (5,000 lbs) in a single carload of a 
Division 1.1, 1.2 or 1.3 explosive;
    (2) A bulk quantity of a PIH material, as defined in Sec.  171.8 of 
the HMR; or,
    (3) A highway route-controlled quantity of a Class 7 (radioactive) 
material, as defined in Sec.  173.403 of the HMR.
    Two commenters focus on the need to include additional hazardous 
materials. CalPUC suggests that, while the rule will improve the safety 
and security of rail shipments of explosive, PIH, and radioactive 
materials, it will not adequately protect the public from accidents or 
terrorist acts against other types of hazardous materials. CalPUC 
recommends that the route selection requirements apply to flammable 
gases, flammable liquids, hydrogen peroxide over 60 percent, Class 5 
materials (ammonium nitrate), Class 6 materials (poisons), Class 8 
materials (corrosives), and certain marine pollutants. Contra Costa 
County raises similar concerns regarding the inclusion of liquefied 
petroleum gas tank cars.
    As discussed in more detail in the IFR, PHMSA, FRA, and TSA 
assessed the safety and security vulnerabilities associated with the 
transportation of different types and classes of hazardous materials. 
The list of materials to which the proposed enhanced safety and 
security requirements apply is based on specific railroad 
transportation scenarios. These scenarios depict how hazardous 
materials could be deliberately used to cause significant casualties 
and property damage or accident scenarios resulting in similar 
catastrophic consequences. DOT and TSA determined that the materials 
specified in the IFR present the greatest rail transportation safety 
and security risks--because of the potential consequences of an 
unintentional release of these materials--and are the most attractive 
targets for terrorists--because of the potential for these materials to 
be used as weapons of opportunity or weapons of mass destruction. While 
DOT and TSA agree that materials identified by CalPUC and Contra Costa 
County pose certain safety and security risks in rail transportation, 
the risks are not as great as those posed by the explosive, PIH, and 
radioactive materials specified in the IFR, and we are not persuaded 
that they warrant the additional precautions required by the IFR. We 
note that the hazardous materials listed by both commenters are 
currently subject to the security plan requirements in Subpart I of 
Part 172 of the HMR. Thus, shippers and carriers of these materials 
must develop and implement security plans based on an assessment of the 
transportation security risks posed by the materials. Security plans 
must include measures to address personnel security, unauthorized 
access, and en route security. DOT, in consultation with TSA, will 
continue to evaluate the transportation safety and security risks posed 
by all types of hazardous materials and the effectiveness of our 
regulations in addressing those risks and will consider revising 
specific requirements as necessary.
    The IFR applied the route analysis and selection requirements to 
PIH residue shipments in bulk quantities. Several commenters request 
that we exclude residue shipments from the list of hazardous materials 
subject to the rail routing provisions, noting that rail security rules 
proposed by Transportation Security Administration apply only to full 
tank car loads of PIH materials. In addition, Dow notes that the term 
``bulk quantity'' is not currently defined in the HMR and suggests that 
if PHMSA decides to regulate residue quantities, we should define the 
term in the final rule.
    As discussed in the IFR, we believe the safety risks posed by the 
rail transportation of residue quantities of PIH materials should be 
addressed through enhanced safety requirements, including route 
assessments. Although target attractiveness from a security standpoint 
is diminished for residue shipments, significant safety risks persist. 
We continue to believe that these safety risks are reduced by a 
requirement for residue quantities of PIH materials remaining in tank 
cars to travel on the ``best'' route available--the route that 
considers factors such as population density, emergency response 
capabilities, environmentally-sensitive and significant areas, and 
event venues. Dow is correct that the term ``bulk quantity'' is not 
currently defined in the HMR. Our intention in the IFR was to require 
residue shipments over 119 gallons to be subject to the route analysis 
and selection criteria. In attempting to develop a definition for the 
term ``bulk quantity,'' however, we realized that applying such a 
definition to shipments of compressed gases, such as chlorine and 
anhydrous ammonia, would be very difficult. Moreover, rail carriers do 
not have the capability to ascertain the precise amount of residue that 
may remain in a rail tank car; thus, attempting to distinguish residue 
shipments that would be subject to the routing requirements from 
residue shipments that would not would be virtually impossible. For 
these reasons, in this final rule, we are clarifying that the data 
collection, route analyses, and route selection requirements apply to 
shipments of PIH materials, including residue shipments, in a bulk 
packaging. We note that there will be few, if any, rail routes over 
which only residue quantities of PIH travel. It is likely that the 
routes used to transport these residue shipments also carry fully 
loaded packages of PIH or one of the other hazardous materials covered 
by this rulemaking, and that the routes would therefore be included in 
a route analysis.

B. Commodity Data (Sec.  172.820(b))

    The IFR requires rail carriers to begin compiling commodity data by 
no later than 90 days after the end of the calendar year for the 
previous calendar year for the covered hazardous materials, including 
an identification of the routes utilized and the total number of 
shipments transported. The data are to be used by the rail carriers to 
identify the routes over which the specified hazardous materials are 
transported and the number of shipments utilizing each route. Rail 
carriers are required to analyze the safety and security risks of the 
routes identified. This provision of the IFR is consistent with the 9/
11 Commission Act mandate that rail carriers collect and compile 
security-sensitive commodity data, by route, line segment, or series of 
line segments, as aggregated by the rail carrier, and identify the 
geographic location of the route and the total number of shipments by 
UN identification number. We did not receive comments addressing this 
aspect of the IFR. Therefore, in this final rule, we are adopting the 
commodity flow data collection requirements without change.
    AAR requests clarification of the actual date by which the 
commodity flow data must be compiled in 2009. In addition, AAR seeks 
clarification of IFR preamble language stating, ``For the initial route 
analysis, we anticipate rail carriers will review the prior two-year 
period when considering the criteria contained in Appendix D.'' (73 FR 
20762).

[[Page 72185]]

    Section 172.820(b) requires commodity data to be compiled no later 
than 90 days after the end of the calendar year; in 2009 the data must 
be compiled by March 31. In addition, this section requires the initial 
data to cover six months, from July 1, 2008 to January 31, 2008. 
PHMSA's preamble language indicating that we anticipate that carriers 
will review the data from the prior two years when conducting route 
analysis was our opinion based on knowledge of the data that rail 
carriers routinely collect. For their initial analysis, rail carriers 
are only required to collect data from the six-month period described 
in this section, additional data may be included, but is not required 
by the IFR or this final rule. As discussed in more detail below, in 
this final rule we are providing rail carriers the option to use data 
for all of 2008 in conducting their initial route analyses. If a rail 
carrier elects to utilize this option, its route analysis and selection 
process must be completed by March 31, 2010.

C. Rail Transportation Route Analysis (Sec.  172.820(c))

    The IFR requires rail carriers to use the data collected in 
accordance with Sec.  172.820(b) to analyze the rail routes over which 
the specified materials are transported. Carriers must analyze the 
specific safety and security risks for routes identified in the 
commodity data and the railroad facilities along those routes. 
Consistent with the 9/11 Commission Act, they are required to seek 
relevant information from state, local, and tribal officials regarding 
the security risks to high-consequence targets along or in proximity to 
the route(s) utilized. If a rail carrier is unable to acquire relevant 
information from state, local, or tribal officials, then it must 
document that in its analysis. The route analyses must be in writing 
and consider, at a minimum, a number of factors specific to each 
individual route. A non-inclusive list of factors is provided in 
Appendix D to Subpart I of Part 172.
    Several commenters express concern regarding the IFR requirement to 
seek relevant information from state, local, and tribal officials 
regarding the security risks to high-consequence targets along or in 
proximity to a rail transportation route. Contra Costa County suggests 
that state and local governments be given the opportunity to consult 
with the railroads and provide all relevant information, rather than be 
limited to providing specific data requested by the railroads. 
According to Contra Costa County, local governments should have access 
to the person who is managing the route analysis so they may request a 
consultation with the railroad or provide information that goes beyond 
the specific data requested by the railroad. In addition, Contra Costa 
County suggests that the final rule specify the types of local agencies 
that will be part of the consultation process.
    By contrast, Norfolk Southern indicates that emergency response 
capability would be best served by receiving communication from a 
single state agency, preferably the state homeland security agency. 
Norfolk Southern also expresses concern regarding the overwhelming 
amount of state and local correspondence railroads are likely to 
receive as a result of this requirement. Norfolk Southern suggests the 
creation of individual railroad Web sites that allow state and local 
governments to provide data and information that rail carriers should 
consider when they conduct route evaluations. Similarly, AAR suggests 
that the Department of Homeland Security (DHS) designate high-
consequence targets along railroad lines and serve as the main source 
of information on security risks to high-consequence targets. AAR also 
suggests that communication between railroads and state and local 
governments should, for the most part, be led by a single state agency 
that advises the railroads on security matters concerning the state and 
its local governments.
    As we noted in the IFR, among the factors to be considered by rail 
carriers in conducting the safety and security analysis are population 
density along the route; environmentally-sensitive or significant 
areas; venues along the route (stations, events, places of 
congregation); emergency response capability along the route; measures 
and countermeasures already in place to address apparent safety and 
security risks; proximity to iconic targets; and areas of high 
consequence along the route. State and local governments may well be 
able to assist rail carriers in identifying and assessing this type of 
information. Moreover, state and local government entities may also be 
able to assist rail carriers in addressing any safety or security 
vulnerabilities identified along selected routes, in the scheduling of 
public events, for example, or enhancing emergency response 
capabilities. For these reasons, we agree with commenters that rail 
carriers should seek the broadest possible input from state and local 
governments as they conduct route analyses. We also agree with Contra 
Costa County that designation of a single point of contact for routing 
issues at each railroad would help to facilitate communication and 
interaction between rail carriers and state and local governments.
    At the same time, we recognize the difficulties that rail carriers 
may encounter in seeking information from every community along a given 
route and appreciate the need to simplify such interactions to the 
greatest extent practicable. We believe that rail carriers should have 
the flexibility to establish mechanisms to accomplish the required 
consultations that are tailored to each railroad's specific 
circumstances, routes, and operating environments. Web-based systems 
for providing and assessing state and local concerns, as suggested by 
Norfolk Southern, are certainly options that may prove to be very 
effective. Alternatively, a railroad may wish to work with state 
governments to establish a state government focal point for 
consolidating and communicating local government concerns.
    Since 2003, many states and larger cities have created State and 
Local fusion centers, and States have created regional fusion centers 
to share security and first responder information and intelligence 
within their jurisdictions as well as with the Federal government. 
Fusion centers vary from State to State, but most contain similar 
elements, including members of State law enforcement, public health, 
social services, public safety, and public works organizations. 
Increasingly, Federal agencies such as the Department of Homeland 
Security, Federal Bureau of Investigation, Drug Enforcement 
Administration, and Bureau of Alcohol Tobacco, Firearms, and Explosives 
have stationed representatives at State-level fusion centers. Most 
centers operate as ``all hazard'' centers, addressing all types of 
emergencies, and not just those that might be related to homeland 
security or terrorism. As of March 2008, there were 58 fusion centers 
around the country.
    Railroads have been coordinating with these fusion centers on 
railroad police and security issues, and the Federal government has 
officially recognized the importance of these centers in addressing 
security issues. The 9/11 Commission Act recognized the importance of 
fusion centers and established a DHS State, Local, and regional fusion 
center initiative to foster partnerships between centers at all levels 
of government. Specific language provided at 6 U.S.C. 124(h) 
establishes: (1) DHS responsibility to support and coordinate with the 
fusion centers; (2) authority and guidelines for assigning DHS 
personnel to state fusion centers; (3) uniform guidelines for fusion 
centers; and (4) funding of $10 million

[[Page 72186]]

per year for each of fiscal years 2008-2012 to carry out the Fusion 
Center Initiative. Since 2001, the Federal government has provided some 
$380 million to help fund fusion centers that meet guidelines jointly 
established by DHS and the Department of Justice.
    In this final rule, in response to comments related to simplifying 
and facilitating coordination on routing issues between rail carriers 
and state and local governments, PHSMA is modifying the IFR to require 
rail carriers to designate a single point of contact (including the 
name, title, phone number and e-mail address) on routing issues, and to 
provide this information to: (1) The State and regional fusion centers 
located in the portion of the country encompassed by their rail 
systems; and (2) State, Local, and Tribal officials in jurisdictions 
that may be affected by a rail carrier's routing decisions who directly 
contact the railroad to discuss these decisions.
    States, Local Governments, and Indian tribes may contact the State 
and regional fusion centers to obtain rail carriers' point of contact 
information. The Department of Homeland Security's National Operation 
Center is available 24 hours a day to facilitate public and private 
entities locating and contacting their State or regional fusions 
centers; the Center's contact number is (202) 282-8101. States, Local 
Governments, and Indian tribes will have the flexibility to directly 
consult with rail carriers on matters affecting the railroads' routing 
decisions, or channeling this information to the railroads through the 
fusion centers.
    PHMSA and FRA note that we are working with DHS to provide 
railroads with information regarding high-consequence targets, as 
specified in the 9/11 Commission Act.
    The AAR reiterates its comment that PHMSA should adopt a shipment 
threshold to trigger the route analysis requirement. Specifically, AAR 
suggests that if there are no more than 15 shipments along a particular 
route then the route analysis established by the IFR should not be 
required. AAR comments utilizing such a threshold eliminates 
unnecessary analysis of routes used only in emergencies and other 
unique circumstances.
    As we stated in the IFR, we are declining to adopt such a 
threshold. We understand that there may be times when a route is used 
that would not normally be used in the everyday course of business, and 
we would expect the analysis to demonstrate that the routing was out of 
the ordinary. We believe there is utility in doing such an analysis 
even on a little-used route. Traffic densities and circumstances may 
change, and natural disasters such as floods and hurricanes may occur. 
There is an advantage in knowing the characteristics, risks and 
necessary mitigating measures for a route that may have to be used, 
even in temporary emergency circumstances.

D. Alternative Route Analysis (Sec.  172.820(d))

    Consistent with 9/11 Commission Act requirements, the IFR requires 
carriers to analyze and assess the feasibility of all available 
alternative routes over which they have authority to operate in 
addition to the routes normally and regularly used for hazardous 
materials movements. Practicable routes (or routes that are feasible 
options, both logically and commercially) must be identified and 
analyzed using, at a minimum, the Rail Risk Analysis Factors of 
Appendix D to Part 172. Rail carriers must retain a copy (or an 
electronic image thereof) of all route review and selection decision 
documentation used when selecting the safest and most secure 
practicable route available. This documentation should include, but is 
not limited to, comparative analyses, charts, graphics, or rail system 
maps.
    In accordance with Sec.  1551 of the 9/11 Commission Act, 
alternative routes must consider the use of interchange agreements. For 
the purposes of route selection, interchange agreements allow railroads 
to exchange railcars at specified junction point where rail lines of 
two or more different railroads meet. Interchange agreements may 
increase the number of available routes for certain shipments. Routes 
that utilize interchange agreements may provide a safer, more secure 
routing option than would otherwise be available.
    Overall, rail carriers must account for safety and security risks; 
comparison of safety and security risks to the primary route, including 
the risk of catastrophic release; any remediation or mitigation 
measures taken; and potential economic effects. The goal of the routing 
analysis requirement is to require that each route used for the 
transportation of the specified hazardous materials is the one 
presenting the fewest overall safety and security risks. If the use of 
an alternative route would significantly increase a carrier's operating 
costs, as well as the costs to its customers, the carrier should 
consider and document the cost in its route analysis.
    We received several comments on this section of the IFR. One area 
of concern for commenters is the role that economic factors play in 
selecting ``practicable'' alternative routes. Friends of the Earth 
asserts that these requirements will spare railroads from any 
inconvenience or even minor expense in having to re-route cargoes onto 
available alternative routes and suggests that we have put 
``practicability'' on par with safety and security. CalPUC contends 
that it is not reasonable to make costs to railroads and shippers the 
ultimate determinant for routing decisions and suggests that in doing 
so, we have excluded the overall costs and damages to the nation and 
its population in general. Contra Costa County asserts that the IFR 
provides too much opportunity for the railroads to let economic 
concerns drive the process. According to Contra Costa County, the 
railroads should be required to analyze all possible routes on safety 
factors alone to determine the safest route.
    We do not agree that the consideration of the ``practicability'' of 
specific routes will result in routing decisions that are driven solely 
by economic considerations. Rail carriers must assess available routes 
using the 27 factors listed in Appendix D to Part 172 to determine the 
safest, most secure routes. The factors address both safety and 
security issues, such as the condition of the track and supporting 
infrastructure; the presence or absence of signals; past incidents; 
population density along the route; environmentally-sensitive or 
significant areas; venues along the route (stations, events, places of 
congregation); emergency response capability along the route; measures 
and countermeasures already in place to address apparent safety and 
security risks; and proximity to iconic targets. However, when carriers 
consider the ``practicability'' of a specific route some consideration 
must be given to economic factors. We note in this regard that the 
Congress recognized this by including in Sec.  1551(d) of the 9/11 
Commission Act a requirement for the alternative route analyses to 
include the potential economic effects of using an alternative route. 
In accordance with the IFR, rail carriers must balance economic factors 
with safety and security factors in making route selections. If using a 
possible alternative route would significantly increase a carrier's 
operating costs, as well as the costs to its customers, the carrier 
should consider and document these facts in its route analysis.
    Several commenters address the use of interchange agreements 
between rail carriers when determining practicable alternative routes. 
Friends of the Earth asserts that the key flaw in the IFR is that it 
does not force a railroad to ``interchange'' its most dangerous cargo

[[Page 72187]]

over to another railroad to go around a target city. Theodore Glickman 
suggests that because we require railroads to consider only routes over 
which they have authority to operate, we are missing an opportunity for 
identifying routes that reduce time in transit and pose fewer safety 
and security risks. PPG states that carriers should be required to work 
together to select the safest, most secure routes. Dow and AAR both 
suggest that we consider mechanisms, including 49 U.S.C. 333, that 
would assist a rail carrier in analyzing the safety and security risks 
of an alternative route over which it has no authority to operate. AAR 
notes that the Sec.  333 conference discussed in the IFR appears to be 
the best way to conduct discussions of rerouting through interchanges.
    The requirement in the IFR for railroads to consider interchange 
agreements as they identify and assess alternative routes is consistent 
with the 9/11 Commission Act. The Act does not mandate the use of 
interchange agreements. However, we agree with Dow and AAR that safety 
and security would be further enhanced if rail carriers could together 
evaluate the safety and security of routes across the entire rail 
transportation system. We also agree that utilizing existing statutory 
authority under 49 U.S.C. 333, which provides relief for potential 
antitrust concerns, provides a mechanism to facilitate a systems 
approach to evaluating and mitigating safety and security risks. 
Section 333 authorizes the FRA Administrator, as delegate of the 
Secretary of Transportation, to convene conferences at the request of 
one or more railroads to address coordination of operations and 
facilities of rail carriers in order to achieve a more efficient, 
economical, and viable rail system. Persons attending a Sec.  333 
conference are immune from antitrust liability for any discussions at 
the conference, and can also receive immunity for any resulting 
agreements that receive FRA approval. As discussed in the IFR, in 2005, 
FRA convened a conference under this authority to discuss ways to 
minimize security and safety risks associated with the transportation 
of PIH materials. FRA plans to consider ways to expand this conference 
to provide a forum for rail carriers to evaluate the safety and 
security of the covered hazardous materials across the entire rail 
system, and specifically to evaluate risk-reducing arrangements on a 
national scale. FRA will also consider including shippers as part of 
the conference.
    We continue to believe that the route analyses and selection 
requirements in the IFR will reduce safety and security risks 
associated with the rail transportation of explosive, PIH, and 
radioactive materials. We are not convinced that mandating the use of 
interchange agreements as part of this process is the most effective 
way to reduce risk across the entire rail transportation system. 
Rather, we believe that the next step should be the joint shipper-
carrier consultations described above. Therefore, we are adopting the 
alternative route analysis requirements as established by the IFR.

E. Route Selection (Sec.  172.820(e))

    Consistent with requirements in the 9/11 Commission Act, the IFR 
requires a carrier to use the analysis, including any remediation 
measures implemented on a route, to select the route posing the least 
overall safety and security risk. In selecting a route, the carrier 
must analyze the safety and security risk for both the primary route 
and each practicable alternative route including railroad facilities, 
railroad storage facilities, and high-consequence targets along or in 
proximity to the route. The analyses must be in writing and performed 
for each calendar year. Carriers must compare the safety and security 
risks on the primary and alternative routes, including the risk of a 
catastrophic release from a shipment traveling along these routes, and 
identify any remediation or mitigation measures implemented on the 
primary and alternative transportation routes. The route selection 
documentation and underlying data will qualify as sensitive security 
information (SSI), will be handled in accordance with the SSI 
regulations at 49 CFR Parts 15 and 1520, and may be distributed only to 
``covered persons'' with a ``need to know.'' State and local government 
officials generally are considered to be ``covered persons'' with a 
``need to know'' for purposes of sharing data and information 
applicable to a railroad's route analysis.
    One commenter, Contra Costa County, suggests that the analysis and 
route selection performed by the rail carriers should be made available 
to local law enforcement, fire, and public health/hazardous materials 
officials. It also suggests that a distribution chain be established so 
these agencies can review the route analysis methodology and results of 
the railroads.
    Similar comments were addressed during the IFR stage of this 
rulemaking proceeding. Specifically, in its comments on the December 
2006 NPRM, the City of Cleveland, Ohio, suggested that we revise the 
proposal in the NPRM to require rail carriers to share the commodity 
data with local governments responsible for the geographic areas 
through which hazardous materials are transported. In the preamble to 
the IFR, we agreed that state and local governments should have access 
to such information, provided access to the information is limited to 
those with a ``need to know'' for transportation safety and security 
purposes, and further provided that such information may not be 
publicly disclosed pursuant to any state, local, or tribal law. (73 FR 
20759). Again, as part of a vulnerability assessment, the commodity 
data that will be collected by the railroads will qualify as SSI and 
will be handled in accordance with those regulations. Because of the 
security sensitivity of the data and route selection information, it is 
not appropriate for it to be broadly disclosed to government or private 
entities. State and local governments may contact FRA to voice concerns 
and request an inspection of a route plan, security vulnerability, or, 
more generally, a rail carrier.
    Some of the comments raise issues discussed in the IFR, including 
the availability of rail routing tools and accounting for persons that 
are more susceptible to exposure from the listed hazardous materials. 
Contra Costa County asks that rail routing tools be made available to 
local parties upon request, along with an explanation of how the tool 
functions and suggests that local governments have an opportunity to 
appeal the railroad's finding, through a process identified in the 
final rule for resolving disputes.
    Tools used by railroads to complete the route analyses and 
selection process mandated by this rule will include sensitive 
information that should not be broadly disseminated. However, we agree 
that sharing information with state or local government officials about 
how a rail carrier performed its route analysis and made its route 
selections could be beneficial to both the carrier and the affected 
government jurisdictions. Such information will qualify as SSI and must 
be handled in accordance with SSI regulations, but nothing in this 
final rule is intended to prohibit sharing of this information upon 
request to ``covered persons'' with a ``need to know.''
    We do not believe it is necessary to provide a separate process for 
local governments to appeal railroad route selections to FRA. FRA has a 
process in place under which state and local governments may contact 
FRA to voice concerns about route selections and request an inspection 
of a route plan, security vulnerability, or, more generally, a rail 
carrier.

[[Page 72188]]

    In its comments, AAR suggests that we clarify the meaning of the 
statement ``subpopulations particularly susceptible to such risk and/or 
more highly exposed'' as used in the preamble of the IFR in regard to 
the population included in the rail carrier's route selection analysis. 
(73 FR 20763). When assessing the safety and security risks along a 
specific route, carriers must consider possible impacts to the total 
population in proximity to that route. In addition, carriers should 
consider possible impacts on subpopulations--such as children or the 
elderly--if there are locations or facilities such as schools, 
hospitals, or assisted living facilities along the route or if such 
subpopulations are a disproportionate part of the population as a 
whole.
    Some commenters, including BNSF, suggested that PHMSA should 
dictate to the carriers the routes to be used for transportation of the 
covered hazardous materials. BNSF has also suggested that once FRA has 
completed its review of a rail carrier's route selection, the route 
selected by the carrier should be classified as an approved route. The 
9/11 Commission Act does not direct the Federal Government to mandate 
specific rail routes for security-sensitive materials; rather Sec.  
1551 of the Act specifically directs the Secretary of Transportation 
to, through this final rule, require rail carriers to select the safest 
and most secure routes for the movement of these materials. We continue 
to believe that rail carriers are in the best position to select the 
safest and most secure routes, taking into consideration mitigation 
measures that they may wish to implement to address safety and security 
vulnerabilities they identify.
    As explained in the IFR, we are not requiring rail carriers to 
submit their route analyses and route selections to DOT for approval. 
Federal review and approval of these analyses would be resource-
intensive and time-consuming and could result in shipment delays if a 
rail carrier had to await approval from DOT prior to transporting 
hazardous materials along the routes it identified as posing the fewest 
safety and security risks. Moreover, the 9/11 Commission Act does not 
provide for an approval process for route selections made by rail 
carriers. That being said, we intend to aggressively oversee railroads' 
route analyses and route selection determinations and will use all 
available tools to enforce compliance with the rule. As the agency with 
primary responsibility for railroad safety enforcement, FRA will 
incorporate review and inspection of route analyses and selections into 
its inspection programs. FRA inspectors may offer suggestions for 
modifying or improving the analysis or make changes to a route if the 
route selection documentation or underlying analysis is found to be 
deficient. If an inspector's recommendations are not implemented, FRA 
may compel a rail carrier to make changes and/or assess a civil 
penalty. Further, if the carrier's chosen route is found not to be the 
safest and most secure practicable route available, FRA may require the 
use of an alternative route.
    After consideration of comments received, in this final rule, we 
are adopting the requirements applicable to route selection as 
established by the IFR.

F. Completion of Route Analysis (Sec.  172.820(f))

    The IFR requires rail carriers to conduct their initial rail 
transportation route analysis, alternative route analysis, and route 
selection by September 1, 2009, based on routing data for the six month 
period from July 1, 2008 to December 31, 2008. In subsequent years, the 
rail transportation route analysis, alternative route analysis, and 
route selection, including a comprehensive review of all operational 
changes, infrastructure modifications, traffic adjustments, or other 
changes implemented, must be conducted no later than the end of the 
calendar year following the year to which the analyses apply.
    In its comments, AAR suggests that the September 1, 2009, deadline 
for completing an initial route analysis and route selection may be 
difficult for rail carriers to meet. AAR explains that the first set of 
analyses will be resource-intensive and time-consuming and that 
subsequent analyses will be less so because they can build off previous 
analyses. AAR suggests that its member railroads would be willing to 
analyze data for a full year in 2009 (data for all of 2008) in return 
for elimination of the special September 1 deadline for route analyses 
in 2009.
    We recognize that the IFR established an aggressive timeline for 
completion of an initial route analysis and route selection process. 
The IFR provides over 16 months (from April 16, 2008 to September 1, 
2009) for completion of this process. We believe that the safety and 
security risks addressed in the IFR warrant an aggressive approach. 
However, we recognize that in some cases the last six months of 2008 
data may not accurately reflect the seasonality of the rail movement of 
certain PIH materials (such as anhydrous ammonia) on some carriers, and 
that an analysis of data for all of 2008 may help facilitate the review 
in the subsequent year. In this final rule, therefore, we are providing 
the following options for completing the initial route analysis, 
alternative route analysis, and route section: (1) A rail carrier may 
complete the process by September 1, 2009, as established in the IFR, 
using data for the six month period from July 1, 2008 to December 31, 
2008; or (2) a rail carrier may complete the process by March 31, 2010, 
using data for all of 2008, so long as the rail carrier notifies FRA in 
writing by September 1, 2009, that it has chosen this second option.
    Several commenters also addressed our decision to require rail 
carriers to conduct an annual comprehensive review of the route 
analysis and selection process rather than once every three years. 
Section 1551(g) of the 9/11 Commission Act requires rail carriers to 
perform a comprehensive review of its route selection determinations at 
least once every three years. The analysis is to include a system-wide 
review of all operational changes, infrastructure modifications, 
traffic adjustments, changes in the nature of high-consequence targets 
located along or in proximity to the route, and any other changes 
affecting the safety and security of the movement of security-sensitive 
materials that were implemented since the previous analysis was 
completed.
    Dow requests that we amend the IFR to require the comprehensive 
review to be completed once every three years. Dow suggests that PHMSA 
lacks support in the current administrative record to impose an unduly 
burdensome annual comprehensive review requirement. On the other hand, 
CalPUC provided comments in strong support of the requirement to 
perform comprehensive reviews on an annual basis.
    As we indicated in the IFR, we believe there is value in conducting 
an annual review of the route analysis even in the absence of changes 
to the way a carrier operates. Conditions along the selected routes may 
change, for example, or there may be changes affecting other factors 
utilized in the analyses, such as incidents on the selected route, the 
capabilities of local emergency response agencies, or venues located in 
proximity to the selected route. Again, performance of the initial data 
gathering and analysis will be the most burdensome. We expect that the 
subsequent yearly analyses will build on the initial analysis and will 
be easier to do. Therefore, we are adopting the annual comprehensive 
review

[[Page 72189]]

requirement as established by the IFR in this final rule.

G. Storage, Delays in Transit, and Notification (Sec.  172.820(g))

    The IFR clarifies that rail carriers must address delays in transit 
and en route storage in their security plans. Thus, rail carrier 
security plans must include: (1) A procedure for consulting with 
offerors and consignees to minimize the time a material is stored 
incidental to movement; (2) measures to limit access to the materials 
during storage and delays in transit; (3) measures to mitigate risk to 
population centers during storage incidental to transportation; (4) 
measures to be taken in the event of an escalating threat level during 
storage incidental to transportation; and (5) a procedure that is 
acceptable by both the rail carrier and consignee for notifying the 
consignee in the event of transportation delays.
    The IFR included language to the effect that all affected parties 
should agree upon measures to be implemented by the rail carriers to 
minimize the time that PIH, explosive, and radioactive materials are 
stored in transit. In its comments, AAR suggests that this provision of 
the IFR unnecessarily restricts rail carriers' flexibility. According 
to AAR, customers often lack incentive to reduce storage on railroad 
property because of their own lack of storage capacity. AAR notes that 
railroads welcome opportunities to discuss with their customers ways of 
minimizing the extent to which cars may be delayed on railroad property 
due to the inability of their customers to receive cars. Norfolk 
Southern agrees with AAR's comments and adds that if the parties cannot 
agree, then the railroad carrier must have the final say concerning 
storage occurring on the railroad's own property.
    The intent of the requirement in Sec.  172.820(g)(1) is to 
establish a procedure that provides an opportunity for offerors and 
consignees to work with rail carriers to minimize incidental storage of 
shipments. It was not our intention to limit a carrier's flexibility 
concerning the storage of rail cars on railroad property. We are aware 
that rail carriers have worked closely with TSA to voluntarily 
implement measures to reduce the number of hours PIH cars are held in 
high-threat urban areas. Therefore, in this final rule, we are removing 
the sentence in Sec.  172.820(g)(1) that suggests that all parties 
should agree on measures to be implemented to minimize the time that 
rail cars are stored in transit.
    AAR also requests clarification of the phrase ``formally consult,'' 
as it applies to the rail carriers working with offerors and consignees 
to minimize storage incidental to transportation. The requirement for a 
``formal'' procedure should not be read to imply that rail carriers 
must develop an agenda for the meeting or maintain documentation to 
keep a record of the consultation. By requiring that the process be 
formal, we are simply indicating that rail carriers must make offerors 
and consignees fully aware of the process and how it will work. The 
procedure should involve offerors and consignees when storage decisions 
are made that directly affect their operations. The consultation 
requirement may be met as part of the normal course of communication 
between the railroad and its customers.

H. Recordkeeping (Sec.  172.820(h))

    Consistent with requirements in the 9/11 Commission Act, in the 
IFR, we require each rail carrier to maintain an accessible copy of the 
information and analyses associated with the collection of commodity 
data and route assessment and selection processes. We further require 
the distribution of such information to be limited to ``covered 
persons'' with a ``need to know'' in accordance with SSI regulations in 
49 CFR Parts 15 and 1520. There were no comments in response to this 
paragraph; therefore, we are adopting it as established by the IFR.

I. Compliance and Enforcement (Sec.  172.820(i))

    In the IFR, we require carriers to revise their analyses or make 
changes to a route if the route selection documentation or underlying 
analyses is found to be deficient. In addition, if the carrier's chosen 
route is found not to be the safest and most secure practicable route 
available, the FRA Associate Administrator for Safety, in consultation 
with TSA, may require the use of an alternative route until such time 
as identified deficiencies are satisfactorily addressed. FRA and TSA 
will consult with the Surface Transportation Board regarding whether 
the contemplated alternative route(s) would be economically 
practicable.
    One commenter specifically addressed the requirements in this 
section. AAR asks if field inspectors will have the capability to 
perform route analyses. It suggests that the level of detail involved 
in the route analysis would make it difficult for inspectors to have 
the capability to perform route analyses during an inspection. AAR 
recommends that Federal agencies should designate the employees 
requiring access to route analyses and provide the railroads with a 
list of those employees to facilitate coordination between the 
railroads and Federal agencies.
    FRA will continue to coordinate closely with the railroads in its 
inspection and enforcement activities, including review of security 
plans and route analyses. We note concerning the AAR comments that 
FRA's enforcement role is to review the railroads' analyses, not to 
perform them. FRA employees will be capable of reviewing a rail 
carrier's route analyses and route selections to ensure compliance with 
the requirements of this final rule. Further, FRA and its employees 
will comply with the existing SSI regulations with regard to the 
handling of the route analyses and the underlying commodity data. Only 
FRA employees who are ``covered persons'' with a ``need to know'' under 
the SSI regulations at 49 CFR Parts 15 and 1520 will access the routing 
analyses and data. 9 CFR Part 1 outlines enforcement authority for the 
modal administrations within DOT. In the hazardous materials arena, 
modal administrations share broad authority over all modes regardless 
of agency. In accordance with a DOT-wide memorandum of understanding 
that delineates normal areas of activity for each modal administration, 
FRA expects to utilize inspectors from various disciplines as well as 
other modal partners when evaluating rail carrier compliance with these 
regulations.
    In addition, FRA plans to work closely with TSA to develop a 
coordinated enforcement strategy to include both FRA and TSA inspection 
personnel. We note in this regard that while TSA has broad 
responsibility and authority under the Aviation and Transportation 
Security Act for security in all modes of transportation, TSA does not 
have the authority to enforce safety or security requirements 
established in the HMR. If in the course of an inspection of a railroad 
carrier or a rail hazardous material shipper, TSA identifies evidence 
of non-compliance with a DOT security regulation, TSA will provide the 
information to FRA and PHMSA for appropriate action. TSA will not 
directly enforce DOT security rules and will not initiate safety 
inspections. In accordance with the PHMSA-TSA and FRA-TSA annexes to 
the DOT-DHS MOU, all the involved agencies will cooperate to ensure 
coordinated, consistent, and effective activities related to rail 
security issues.
    Another commenter, PPG, fully supports the intent of this 
rulemaking and believes it will aid in the safe and secure 
transportation of hazardous materials. However, PPG questions whether a 
risk assessment is necessary

[[Page 72190]]

before a rail carrier can accept a shipment for a new route The concern 
is that the rail carrier will have the right to refuse to accept a 
shipment until a risk assessment can be done. According to its 
comments, PPG does not believe this is the intent of the rule but wants 
some assurance that the rail carriers cannot refuse a shipment based on 
this rulemaking.
    We do not intend for the provisions of this rule to impede the 
everyday commerce of hazardous materials, or to change the common 
carrier obligation of the railroads to handle security-sensitive 
materials that shippers tender to them for shipment. In the event that 
a railroad accepts a new shipment with a new route, we would expect the 
railroad to document this new data in its annual data compilation, and 
to note any new routes, risk factors, and mitigation measures in its 
analysis. Since new routes are often discussed long before the initial 
shipment, if the carrier has knowledge of the expected shipments when 
it conducts its initial or subsequent reviews it should include this 
information as part of the decision-making process.

J. Federal Preemption (Sec.  172.822)

    We addressed the preemptive effect of the IFR by clarifying that 
state and local regulation of rail routes for shipments of hazardous 
materials is preempted under both the Federal Hazardous Materials 
Transportation Law (Federal Hazmat Law; 49 U.S.C. 5125) and the Federal 
Rail Safety Act (49 U.S.C. 20106). All comments that were addressed 
supported the proposed language; therefore, we are adopting it as 
established by the IFR.

K. Rail Risk Analysis Factors (Appendix D to Part 172)

    The IFR adopts minimum criteria in Appendix D to Part 172 to be 
used by rail carriers when performing the safety and security risk 
analyses required by Sec.  172.820. We listed 27 factors in this 
appendix for carriers to consider in the analyses. The IFR adopted the 
27 factors as proposed in the NPRM, with modifications for consistency 
with requirements of the 9/11 Commission Act. Specifically, the IFR 
added high consequence targets, as defined in Sec.  1551(h)(2), to the 
list of factors that must be considered.
    The comments submitted in response to this section reiterate 
comments made to the NPRM. BNSF expresses concern that the IFR does not 
provide any direction as to how the 27 factors are to be prioritized 
and requests that PHMSA provide guidance on the comparative weight or 
prioritization that it assigns to each factor. Theodore Glickman 
suggests that the 27 factors far exceed the number that should be 
included and recommends that emphasis should be placed on the 
identification of the most important factors and developing the 
database required to evaluate those factors. In its comments, Norfolk 
Southern expresses support for the factors and agrees with the agency's 
decision not to arbitrarily weight or rank the factors and recognize 
that weighting of the individual factors listed in Appendix D may vary 
upon the circumstances and/or the region in which the rail carrier 
operates.
    As we stated in the IFR, the weighting of the factors is an 
extremely important aspect of an overall safety and security risk 
assessment methodology. However, we do not believe that prioritizing or 
limiting the number of factors will allow rail carriers the flexibility 
necessary to account for unique track conditions and localized 
concerns. We expect carriers to make conscientious efforts to develop 
logical and defendable systems using these factors. Tools to assist 
rail carriers to use the factors to assess the safety and security 
vulnerabilities of specific routes, including how to weight the factors 
in performing the analysis, are available from a variety of sources. In 
addition, DOT and DHS are finalizing a route analysis tool under a 
grant from the Federal Emergency Management Agency (FEMA). This web-
based, interactive tool will assist rail carries to identify route 
characteristics using the 27 factors and to weigh safety and security 
impacts, thereby providing a standardized, consistent approach to the 
process of selecting safe and secure rail routes for high-risk 
hazardous materials. In addition, the tool provides a methodology for 
assessment of consequences for a specific commodity released at a 
specific point on a rail line; assessing natural hazard risks for a 
specific rail asset; and for corridor analysis entailing a review of 
all route or asset analysis results for a given rail corridor (i.e., 
geographic area). We expect this analysis tool to be available in 2008.
    We addressed similar comments regarding the rail risk analysis 
factors in the IFR. After thoroughly reviewing the comments submitted 
in response to the IFR, we are confident that the list of rail risk 
analysis factors is sufficient. The flexibility provided is necessary 
to allow rail carriers to fully assess the potential routes. Therefore, 
this final rule adopts Appendix D to Part 172 as established by the 
IFR.

L. Pre-Trip Security Inspections (Sec.  174.9)

    The IFR increases the scope of the currently required rail car 
safety inspection to include a security inspection of all rail cars 
carrying placarded loads of hazardous materials. The primary focus of 
the enhanced inspection is to recognize an IED, which is a device 
fabricated in an improvised manner incorporating explosives or 
destructive, lethal, noxious, pyrotechnic, or incendiary chemicals in 
its design, and generally including a power supply, a switch or timer, 
and a detonator or initiator. The IFR requires the rail carriers' pre-
trip inspections of placarded rail cars to include an inspection for 
signs of tampering with the rail car, including its seals and closures, 
and an inspection for any item that does not belong, is suspicious, or 
may be an IED. When an indication of tampering or a foreign object is 
found, the rail carrier must take appropriate actions before accepting 
the rail car for further movement; the carrier will verify that the 
rail car is secure and its contents have not been compromised. 
Instructional materials have been developed by TSA that may be used by 
rail carriers to train their employees on detection of tampering and 
identification of IEDs. The comments submitted in response to the IFR 
do not address the pre-trip security inspections. Therefore, we are 
adopting Sec.  174.9 as established by the IFR.

VII. Regulatory Analyses and Notices

A. Statutory/Legal Authority for This Rulemaking

    This final rule is published under authority of the Federal Hazmat 
Law. Section 5103(b) of Federal Hazmat Law authorizes the Secretary of 
Transportation to prescribe regulations for the safe transportation, 
including security, of hazardous materials in intrastate, interstate, 
and foreign commerce. In addition, this final rule is published under 
authority of the 9/11 Commission Act. Section 1551 of the 9/11 
Commission Act directs the Secretary of Transportation, in consultation 
with the Secretary of Homeland Security, to publish a final rule by May 
3, 2008, based on the NPRM published under this docket on December 21, 
2006. In accordance with Sec.  1551(e) of the Act, PHMSA's final rule 
must require rail carriers of ``security-sensitive materials'' to 
``select the safest and most secure route to be used in transporting'' 
those materials, based on the rail carrier's analysis of the safety and 
security risks on primary and alternate transportation routes over

[[Page 72191]]

which the carrier has authority to operate.

B. Executive Order 12866 and DOT Regulatory Policies and Procedures

    This final rule is a significant regulatory action under Sec.  3(f) 
Executive Order 12866 and, therefore, was reviewed by the Office of 
Management and Budget (OMB). The final rule is a significant rule under 
the Regulatory Policies and Procedures order issued by the DOT (44 FR 
11034). We completed a regulatory evaluation and placed it in the 
docket for this rulemaking.
    Generally, costs associated with the provisions of this final rule 
include the cost for collecting and retaining data and performing the 
mandated route safety and security analysis. We estimate total 20-year 
costs to gather the data and conduct the analyses established by this 
final rule to be about $20 million (discounted at 7%).
    In addition, rail carriers and shippers may incur costs associated 
with rerouting shipments or mitigating safety and security 
vulnerabilities identified as a result of their route analyses. Because 
the final rule builds on the current route evaluation and routing 
practices already in place for most, if not all, railroads that haul 
the types of hazardous materials covered, we do not expect rail 
carriers to incur significant costs associated with rerouting. The 
railroads already conduct route analyses and re-routing--in line with 
what this rule would require--in accordance with the AAR comments and 
AAR Circular OT-55-I. Moreover, the smaller carriers (regionals and 
short lines) are unlikely to have access to many alternative routes, 
and where an alternative does exist, it is not likely to be safer and 
more secure than the route they are currently using. If there is an 
alternative route the carrier determines to be safer and more secure 
than the one it is currently using, the carrier could well switch 
routes, even in the absence of a regulatory requirement, because it 
reduces the overall risk to its operations. Such reduction in risk 
offers a significant economic advantage in the long run.
    Identifying and mitigating security vulnerabilities along rail 
routes are currently being done by the railroads. We believe that 
readily available ``high-tech'' and ``low-tech'' measures are being 
quickly implemented. The development, procurement, and wide-spread 
installation of the more technology-driven alternatives could take 
several years. However, PHMSA's previous security rule requires the 
railroads to have a security plan that includes en route security. This 
existing regulatory requirement, coupled with industry efforts to 
address security vulnerabilities, has caused railroads to enhance their 
security posture. As with routing decisions, such reduction in risk 
offers a significant economic advantage in the long run. Therefore, we 
expect that the cost of mitigation attributed solely to this final rule 
will not be significant. We note in this regard that safety and 
security measures are intertwined and often complementary; therefore, 
separating security costs from safety costs is not feasible.
    We do not expect this final rule to result in a diversion from 
railroads to trucks. For the movements subject to this rule, 
transportation and distribution patterns, with associated 
infrastructure, tend to be well-established. For example, the vast 
majority of PIH offerors ship by rail; indeed, many do not have the 
infrastructure (loading racks, product transfer facilities) necessary 
to utilize trucks for such transportation. Moreover, the current fleet 
of cargo tank motor vehicles is insufficient to handle a significant 
shift of PIH cargoes from rail to highway--for example, there are only 
85 cargo tank motor vehicles used for the transportation of chlorine. 
Because it takes about four tank trucks to haul the amount of product 
that can be moved in a rail tank car, the industry would have to build 
many more trucks to accommodate a shift in transportation from rail to 
highway, necessitating a significant expansion in current tank truck 
manufacturing capacity. In addition, because it takes four trucks to 
transport the same amount of product as a single rail tank car, it 
generally is only cost-effective to utilize trucks for relatively 
limited distances. A farm cooperative or agricultural products 
distributor, for example, typically receives large quantities of 
anhydrous ammonia by rail car and offloads the material into storage 
tanks for subsequent truck movement to local customers.
    Changing these established transportation patterns would require 
substantial investment in new capacity and infrastructure, vastly 
exceeding the costs of complying with the final rule. Under these 
circumstances, we do not expect any shift in transportation mode as a 
result of implementation of this final rule. We note in this regard 
that no commenters raised this issue in their discussions of the 
potential impacts of the proposals in the NPRM. Overall transportation 
costs should not substantially increase because of this final rule.
    Estimating the security benefits of the new requirements is 
challenging. Accident causation probabilities can be estimated based on 
accident histories in a way that the probability of a criminal or 
terrorist act cannot. The threat of an attack is virtually impossible 
to assess from a quantitative standpoint. It is undeniable that 
hazardous materials in transportation are a possible target of 
terrorism or sabotage. The probability that hazardous materials will be 
targeted is, at best, a guess. Similarly, the projected outcome of a 
terrorist attack cannot be precisely estimated. It is assumed choices 
will be made to maximize consequences and damages. Scenarios can be 
envisioned in which hazardous materials could be used to inflict 
hundreds or even thousands of fatalities. To date, there have been no 
known or specific threats against freight railroads, rail cars, or tank 
cars, which makes all of these elements even more difficult to 
quantify. Security plans lower risk through the identification and 
mitigation of vulnerabilities. Therefore, rail carriers and the public 
benefit from the development and implementation of security plans. 
However, forecasting the benefits likely to result from plan 
implementation requires the exercise of judgment and necessarily 
includes subjective elements.
    The major benefits expected to result from this final rule relate 
to enhanced safety and security of rail shipments of hazardous 
materials. The requirements of the final rule are intended to reduce 
the safety and security risks associated with the transportation of the 
specified hazardous materials. Accidents that result in the release of 
hazardous materials can be very costly. Given the level of such costs, 
it is not unreasonable to assume that the benefits associated with 
assessing safety and security risks and identifying opportunities to 
reduce those risks will also be significant.

C. Executive Order 13132

    This final rule has been analyzed in accordance with the principles 
and criteria contained in Executive Orders 13132 (``Federalism'') and 
13175 (``Consultation and Coordination With Indian Tribal 
Governments''). This final rule would not have any direct effect on the 
states, their political subdivisions, or Indian tribes; it would not 
impose any compliance costs; and it would not affect the relationships 
between the national government and the states, political subdivisions, 
or Indian tribes, or the distribution of power and responsibilities 
among the various levels of government.
    Section VII.K of the IFR (73 FR 20766) includes a discussion of 
PHMSA's conclusion that the decision in the

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March 25, 2003, final rule in HM-232 to leave to rail carriers the 
specifics of routing rail shipments of hazardous materials preempts all 
states, their political subdivisions, and Indian tribes from 
prescribing or restricting routes for rail shipments of hazardous 
materials, under Federal Hazmat Law (49 U.S.C. 5125) and the Federal 
Rail Safety Act (49 U.S.C. 20106). In that section, we also discuss the 
comments on the proposed language in the NPRM concerning the preemptive 
effect of HM-232 and this final rule and explain the reasons for 
adopting revised language in 49 CFR 172.822.

D. Executive Order 13175

    We analyzed this final rule in accordance with the principles and 
criteria prescribed in Executive Order 13175 (``Consultation and 
Coordination With Indian Tribal Governments''). Because this final rule 
does not significantly or uniquely affect tribes, and does not impose 
substantial and direct compliance costs on Indian tribal governments, 
the funding and consultation requirements of Executive Order 13175 do 
not apply; thus, a tribal summary impact statement is not required.

E. Regulatory Flexibility Act, Executive Order 13272, and DOT 
Procedures and Policies

    In consideration of the potential impacts of rules on small 
entities, we developed this final rule in accordance with Executive 
Order 13272 (``Proper Consideration of Small Entities in Agency 
Rulemaking'') and DOT's procedures and policies to promote compliance 
with the Regulatory Flexibility Act (5 U.S.C. 601 et seq.).
    The Regulatory Flexibility Act requires an agency to review 
regulations to assess their impact on small entities. An agency must 
conduct a regulatory flexibility analysis unless it determines and 
certifies that a rule is not expected to have a significant impact on a 
substantial number of small entities.
    The Small Business Administration (SBA) permits agencies to alter 
the SBA definitions for small businesses upon consultation with SBA and 
in conjunction with public comment. Pursuant to this authority, FRA 
published a final rule (68 FR 24891; May 9, 2003) defining a ``small 
entity'' as a railroad meeting the line haulage revenue requirements of 
a Class III railroad. Currently, the revenue requirements are $20 
million or less in annual operating revenue. This is the definition 
used by PHMSA to determine the potential impact of this final rule on 
small entities.
    Not all small railroads will be required to comply with the 
provisions of this final rule. Most of the 510 small railroads 
transport no hazardous materials. PHMSA and FRA estimate there are 
about 100 small railroads--or 20% of all small railroads--that could 
potentially be affected by this final rule. Cost impacts for small 
railroads will result primarily from the costs for data collection and 
analysis. PHMSA estimates the cost to each small railroad to be 
$2,776.70 per year over 20 years, discounted at 7%. Based on small 
railroads' annual operating revenues, these costs are not significant. 
Small railroads' annual operating revenues range from $3 million to $20 
million. Thus, the costs imposed by the final rule amount to between 
0.01% and 0.09% of a small railroad's annual operating revenue.
    This final rule will not have a noticeable impact on the 
competitive position of the affected small railroads or on the small 
entity segment of the railroad industry as a whole. The small entity 
segment of the railroad industry faces little in the way of intramodal 
competition. Small railroads generally serve as ``feeders'' to the 
larger railroads, collecting carloads in smaller numbers and at lower 
densities than would be economical for the larger railroads. They 
transport those cars over relatively short distances and then turn them 
over to the larger systems, which transport them relatively long 
distances to their ultimate destination or for handoff back to a 
smaller railroad for final delivery. Although their relative interests 
do not always coincide, the relationship between the large and small 
entity segments of the railroad industry is more supportive and co-
dependent than competitive.
    It is also rare for small railroads to compete with each other. As 
mentioned above, small railroads generally serve smaller, lower density 
markets and customers. They tend to operate in markets where there is 
not enough traffic to attract or sustain rail competition, large or 
small. Given the significant capital investment required (to acquire 
right-of-way, build track, purchase fleet, etc.), new entry in the 
railroad industry is especially rare. Thus, even to the extent the 
final rule may have an economic impact, it should have no impact on the 
intramodal competitive position of small railroads.
    We did not receive any comments in opposition to our conclusion 
that this rulemaking will not have a significant impact on a 
substantial number of small entities. Based on the lack of opposing 
comments, the foregoing discussion, and more detailed analysis in the 
regulatory evaluation for this final rule, PHMSA certifies that the 
provisions of this final rule, if adopted, will not have a significant 
impact on a substantial number of small entities.

F. Paperwork Reduction Act

    This final rule may result in an increase in annual burden and 
costs under OMB Control Number 2137-0612. PHMSA currently has an 
approved information collection under OMB Control No. 2137-0612, 
``Hazardous Materials Security Plans'', expiring June 30, 2011.
    Under the Paperwork Reduction Act of 1995, no person is required to 
respond to an information collection unless it has been approved by OMB 
and displays a valid OMB control number. 5 CFR 1320.8(d) requires that 
PHMSA provide interested members of the public and affected agencies an 
opportunity to comment on information and recordkeeping requests.
    This identifies a revised information collection request that PHMSA 
submitted to OMB for approval based on the requirements in this rule. 
PHMSA has developed burden estimates to reflect changes in this 
proposed rule. We estimate that the total information collection and 
recordkeeping burden for the current requirements and as specified in 
this rule would be as follows:

OMB No. 2137-0612, ``Hazardous Materials Security Plans''

First Year Annual Burden
    Total Annual Number of Respondents: 139.
    Total Annual Responses: 139.
    Total Annual Burden Hours: 51,469.
    Total Annual Burden cost: $3,130,859.27.
Subsequent Year Burden
    Total Annual Number of Respondents: 139.
    Total Annual Responses: 139.
    Total Annual Burden Hours: 13,677.
    Total Annual Burden Cost: $831,971.91.
    Direct your requests for a copy of the information collection to 
Deborah Boothe or T. Glenn Foster, U.S. Department of Transportation, 
Pipeline & Hazardous Materials Safety Administration (PHMSA), East 
Building, Office of Hazardous Materials Standards (PHH-11), 1200 New 
Jersey Avenue, SE., Washington, DC 20590; telephone (202) 366-8553.

G. Regulation Identifier Number (RIN)

    A regulation identifier number (RIN) is assigned to each regulatory 
action listed in the Unified Agenda of Federal

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Regulations. The Regulatory Information Service Center publishes the 
Unified Agenda in April and October of each year. The RIN number 
contained in the heading of this document can be used to cross-
reference this action with the Unified Agenda.

H. Unfunded Mandates Reform Act

    This final rule does not impose unfunded mandates under the 
Unfunded Mandates Reform Act of 1995. It does not result in costs of 
$120.7 million or more to either state, local, or tribal governments, 
in the aggregate, or to the private sector, and is the least burdensome 
alternative to achieve the objective of the rule.

I. Environmental Assessment

    The National Environmental Policy Act, 42 U.S.C. 4321-4375, 
requires that Federal agencies analyze proposed actions to determine 
whether the action will have a significant impact on the human 
environment. The Council on Environmental Quality (CEQ) regulations 
order Federal agencies to conduct an environmental review considering: 
(1) The need for the proposed action; (2) alternatives to the proposed 
action; (3) probable environmental impacts of the proposed action and 
alternatives; and (4) the agencies and persons consulted during the 
consideration process. 40 CFR 1508.9(b).
    In accordance with the CEQ regulations, we completed an 
environmental assessment for this final rule that considers the 
potential environmental impacts of three alternatives--(1) do nothing; 
(2) impose enhanced safety and security requirements for a broad list 
of hazardous materials transported by rail; or (3) impose enhanced 
safety and security requirements for specified rail shipments of highly 
hazardous materials. The environmental assessment is available for 
review in the public docket for this rulemaking.
    The provisions of this final rule build on current regulatory 
requirements to enhance the transportation safety and security of 
shipments of hazardous materials transported by rail, thereby reducing 
the risks of an accidental or intentional release of hazardous 
materials and consequent environmental damage. The net environmental 
impact, therefore, will be moderately positive. There are no 
significant environmental impacts associated with this final rule.

J. Privacy Act

    Anyone is able to search the electronic form of any written 
communications and comments received into any of our dockets by the 
name of the individual submitting the document, or the name of the 
individual signing the document if submitted on behalf of an 
association, business, labor union, etc. You may review DOT's complete 
Privacy Act Statement in the Federal Register published on April 11, 
2000, (65 FR 19477) or you may visit http://www.regulations.gov.

List of Subjects

49 CFR Part 172

    Hazardous materials transportation, Hazardous waste, Labeling, 
Packaging and containers, Reporting and recordkeeping requirements.

49 CFR Part 174

    Hazardous materials transportation, Rail carriers, Reporting and 
recordkeeping requirements.

0
In consideration of the foregoing, the interim final rule published on 
April 16, 2008 (73 FR 20752), amending title 49 Chapter I, Subchapter 
C, Parts 172 and 174, is confirmed as final with the following changes:

PART 172--HAZARDOUS MATERIALS TABLE, SPECIAL PROVISIONS, HAZARDOUS 
MATERIALS COMMUNICATIONS, EMERGENCY RESPONSE INFORMATION, AND 
TRAINING REQUIREMENTS

0
1. The authority citation for part 172 continues to read as follows:

    Authority: 49 U.S.C. 5101-5128, 44701; 49 CFR 1.53.

0
2. In Sec.  172.820:
0
A. Revise paragraph (a)(2),
0
B. Redesignate paragraphs (g), (h), and (i) as paragraphs (h), (i), and 
(j), respectively,
0
C. Add new paragraph (g), and
0
D. Revise paragraphs (f) and newly designated paragraph (h)(1), to read 
as follows:

Sec.  172.820  Additional planning requirements for transportation by 
rail.

    (a) * * *
    (2) A quantity of a material poisonous by inhalation in a single 
bulk packaging; or
* * * * *
    (f) Completion of route analyses. (1) Rail carriers have the 
following options for completing the initial route analysis, 
alternative route analysis, and route selection process required under 
paragraphs (c), (d), and (e) of this section:
    (i) A rail carrier may complete the initial process by September 1, 
2009, using data for the six month period from July 1, 2008 to December 
31, 2008; or
    (ii) A rail carrier may complete the initial process by March 31, 
2010, using data for all of 2008, provided the rail carrier notifies 
the FRA Associate Administrator of Safety in writing by September 1, 
2009 that it has chosen this second option.
    (2) Beginning in 2010, the rail transportation route analysis, 
alternative route analysis, and route selection process required under 
paragraphs (c), (d), and (e) of this section must be completed no later 
than the end of the calendar year following the year to which the 
analyses apply.
    (3) The initial analysis and route selection determinations 
required under paragraphs (c), (d), and (e) of this section must 
include a comprehensive review of the entire system. Subsequent 
analyses and route selection determinations required under paragraphs 
(c), (d), and (e) of this section must include a comprehensive, system-
wide review of all operational changes, infrastructure modifications, 
traffic adjustments, changes in the nature of high-consequence targets 
located along, or in proximity to, the route, and any other changes 
affecting the safety or security of the movements of the materials 
specified in paragraph (a) of this section that were implemented during 
the calendar year.
    (4) A rail carrier need not perform a rail transportation route 
analysis, alternative route analysis, or route selection process for 
any hazardous material other than the materials specified in paragraph 
(a) of this section.
    (g) Rail carrier point of contact on routing issues. Each rail 
carrier must identify a point of contact (including the name, title, 
phone number and e-mail address) on routing issues involving the 
movement of materials covered by this section in its security plan and 
provide this information to:
    (1) State and/or regional Fusion Centers that have been established 
to coordinate with state, local and tribal officials on security issues 
and which are located within the area encompassed by the rail carrier's 
rail system; and
    (2) State, local, and tribal officials in jurisdictions that may be 
affected by a rail carrier's routing decisions and who directly contact 
the railroad to discuss routing decisions.
    (h) Storage, delays in transit, and notification. * * *
    (1) A procedure under which the rail carrier must consult with 
offerors and consignees in order to develop measures for minimizing, to 
the extent practicable, the duration of any storage

[[Page 72194]]

of the material incidental to movement (see Sec.  171.8 of this 
subchapter).
* * * * *

    Issued in Washington, DC, on November 18, 2008, under the 
authority delegated in 49 CFR Part 1.
Carl T. Johnson,
Administrator.
[FR Doc. E8-27826 Filed 11-25-08; 8:45 am]

BILLING CODE 4910-60-P