H. R. 2400—358
boundaries prior to submitting area designations respecting
the July 1997 ozone national ambient air quality standards;
(3) to ensure that the schedule for implementation of the
July 1997 revisions of the ambient air quality standards for
particulate matter and the schedule for the Environmental
Protection Agency’s visibility regulations related to regional
haze are consistent with the timetable for implementation of
such particulate matter standards as set forth in the President’s
Implementation Memorandum dated July 16, 1997.
SEC. 6102. PARTICULATE MATTER MONITORING PROGRAM.
(a) Through grants under section 103 of the Clean Air Act
the Administrator of the Environmental Protection Agency shall
use appropriated funds no later than fiscal year 2000 to fund
100 percent of the cost of the establishment, purchase, operation
and maintenance of a PM2.5 monitoring network necessary to imple-
ment the national ambient air quality standards for PM2.5 under
section 109 of the Clean Air Act. This implementation shall not
result in a diversion or reprogramming of funds from other Federal,
State or local Clean Air Act activities. Any funds previously diverted
or reprogrammed from section 105 Clean Air Act grants for PM2.5
monitors must be restored to State or local air programs in fiscal
year 1999.
(b) EPA and the States, consistent with their respective authori-
ties under the Clean Air Act, shall ensure that the national network
(designated in subsection (a)) which consists of the PM2.5 monitors
necessary to implement the national ambient air quality standards
is established by December 31, 1999.
(c)(1) The Governors shall be required to submit designations
referred to in section 107(d)(1) of the Clean Air Act for each area
following promulgation of the July 1997 PM2.5 national ambient
air quality standard within 1 year after receipt of 3 years of air
quality monitoring data performed in accordance with any
applicable Federal reference methods for the relevant areas. Only
data from the monitoring network designated in subsection (a)
and other Federal reference method PM2.5 monitors shall be consid-
ered for such designations. Nothing in the previous sentence shall
be construed as affecting the Governor’s authority to designate
an area initially as nonattainment, and the Administrator’s author-
ity to promulgate the designation of an area as nonattainment,
under section 107(d)(1) of the Clean Air Act, based on its contribu-
tion to ambient air quality in a nearby nonattainment area.
(2) For any area designated as nonattainment for the July
1997 PM2.5 national ambient air quality standard in accordance
with the schedule set forth in this section, notwithstanding the
time limit prescribed in paragraph (2) of section 169B(e) of the
Clean Air Act, the Administrator shall require State implementation
plan revisions referred to in such paragraph (2) to be submitted
at the same time as State implementation plan revisions referred
to in section 172 of the Clean Air Act implementing the revised
national ambient air quality standard for fine particulate matter
are required to be submitted. For any area designated as attainment
or unclassifiable for such standard, the Administrator shall require
the State implementation plan revisions referred to in such para-
graph (2) to be submitted 1 year after the area has been so des-
ignated. The preceding provisions of this paragraph shall not pre-
clude the implementation of the agreements and recommendations
H. R. 2400—359
set forth in the Grand Canyon Visibility Transport Commission
Report dated June 1996.
(d) The Administrator shall promulgate the designations
referred to in section 107(d)(1) of the Clean Air Act for each area
following promulgation of the July 1997 PM2.5 national ambient
air quality standard by the earlier of 1 year after the initial designa-
tions required under subsection (c)(1) are required to be submitted
or December 31, 2005.
(e) The Administrator shall conduct a field study of the ability
of the PM2.5 Federal Reference Method to differentiate those par-
ticles that are larger than 2.5 micrograms in diameter. This study
shall be completed and provided to the Committee on Commerce
of the House of Representatives and the Committee on Environment
and Public Works of the United States Senate no later than 2
years from the date of enactment of this Act.
SEC. 6103. OZONE DESIGNATION REQUIREMENTS.
(a) The Governors shall be required to submit the designations
referred to in section 107(d)(1) of the Clean Air Act within 2
years following the promulgation of the July 1997 ozone national
ambient air quality standards.
(b) The Administrator shall promulgate final designations no
later than 1 year after the designations required under subsection
(a) are required to be submitted.
SEC. 6104. ADDITIONAL PROVISIONS.
Nothing in sections 6101 through 6103 shall be construed by
the Administrator of Environmental Protection Agency or any court,
State, or person to affect any pending litigation or to be a ratification
of the ozone or PM2.5 standards.
TITLE VII—MISCELLANEOUS
Subtitle A—Automobile Safety and
Information
SEC 7101. SHORT TITLE.
This subtitle may be cited as the ‘‘National Highway Traffic
Safety Administration Reauthorization Act of 1998’’.
SEC. 7102. AUTHORIZATION OF APPROPRIATIONS.
(a) MOTOR VEHICLE SAFETY ACTIVITIES.—Section 30104 of title
49, United States Code, is amended to read as follows:
‘‘§ 30104. Authorization of appropriations
‘‘There is authorized to be appropriated to the Secretary
$81,200,000 for the National Highway Traffic Safety Administration
to carry out this part in each fiscal year beginning in fiscal year
1999 and ending in fiscal year 2001.’’.
(b) MOTOR VEHICLE INFORMATION ACTIVITIES.—Section 32102
of title 49, United States Code, is amended to read as follows:
‘‘§ 32102. Authorization of appropriations
‘‘There is authorized to be appropriated to the Secretary
$6,200,000 for the National Highway Traffic Safety Administration
H. R. 2400—360
to carry out this part in each fiscal year beginning in fiscal year
1999 and ending in fiscal year 2001.’’.
SEC. 7103. IMPROVING AIR BAG SAFETY.
(a) RULEMAKING TO IMPROVE AIR BAGS.—
(1) NOTICE
OF
PROPOSED
RULEMAKING.—Not later than
September 1, 1998, the Secretary of Transportation shall issue
a notice of proposed rulemaking to improve occupant protection
for occupants of different sizes, belted and unbelted, under
Federal Motor Vehicle Safety Standard No. 208, while minimiz-
ing the risk to infants, children, and other occupants from
injuries and deaths caused by air bags, by means that include
advanced air bags.
(2) FINAL RULE.—Notwithstanding any other provision of
law, the Secretary shall complete the rulemaking required by
this subsection by issuing, not later than September 1, 1999,
a final rule with any provision the Secretary deems appropriate,
consistent with paragraph (1) and the requirements of section
30111, title 49, United States Code. If the Secretary determines
that the final rule cannot be completed by that date to meet
the purposes of paragraph (1), the Secretary may extend the
date for issuing the final rule to not later than March 1,
2000.
(3) EFFECTIVE DATE.—The final rule issued under this sub-
section shall become effective in phases as rapidly as prac-
ticable, beginning not earlier than September 1, 2002, and
no sooner than 30 months after the date of the issuance of
the final rule, but not later than September 1, 2003. The
final rule shall become fully effective for all vehicles identified
in section 30127(b), title 49, United States Code, that are
manufactured on and after September 1, 2005. Should the
phase-in of the final rule required by this paragraph commence
on September 1, 2003, then in that event, and only in that
event, the Secretary is authorized to make the final rule fully
effective on September 1, 2006, for all vehicles that are manu-
factured on and after that date.
(4) COORDINATION OF EFFECTIVE DATES.—The requirements
of S13 of Standard No. 208 shall remain in effect unless and
until changed by the rule required by this subsection.
(5) CREDIT FOR EARLY COMPLIANCE.—To encourage early
compliance, the Secretary is directed to include in the notice
of proposed rulemaking required by paragraph (1) means by
which manufacturers may earn credits for future compliance.
Credits, on a one-vehicle for one-vehicle basis, may be earned
for vehicles certified as being in full compliance under section
30115 of title 49, United States Code, with the rule required
by paragraph (2) which are either—
(A) so certified in advance of the phase-in period; or
(B) in excess of the percentage requirements during
the phase-in period.
(b) ADVISORY COMMITTEES.—Any government advisory commit-
tee, task force, or other entity involving air bags shall include
representatives of consumer and safety organizations, insurers,
manufacturers, and suppliers.
SEC. 7104. RESTRICTIONS ON LOBBYING ACTIVITIES.
(a) AMENDMENT.—Subchapter I of chapter 301 of title 49,
United States Code, is amended by adding at the end the following:
H. R. 2400—361
‘‘§ 30105. Restriction on lobbying activities
‘‘(a) IN GENERAL.—No funds appropriated to the Secretary shall
be available for any activity specifically designed to urge a State
or local legislator to favor or oppose the adoption of any specific
legislative proposal pending before any State or local legislative
body.
‘‘(b) APPEARANCE
AS WITNESS NOT BARRED.—Subsection (a)
does not prohibit officers or employees of the United States from
testifying before any State or local legislative body in response
to the invitation of any member of that legislative body or a State
executive office.’’.
(b) CLERICAL AMENDMENT.—The table of contents in subchapter
I of chapter 301 of title 49, United States Code, is amended by
adding at the end the following:
‘‘30105.
Restriction on lobbying activities.’’.
SEC. 7105. ODOMETERS.
(a) TRANSFERS OF NEW MOTOR VEHICLES.—Section 32705(a)
of title 49, United States Code, is amended by adding at the end
the following:
‘‘(4)(A) This subsection shall apply to all transfers of motor
vehicles (unless otherwise exempted by the Secretary by regulation),
except in the case of transfers of new motor vehicles from a vehicle
manufacturer jointly to a dealer and a person engaged in the
business of renting or leasing vehicles for a period of 30 days
or less.
‘‘(B) For purposes of subparagraph (A), the term ‘new motor
vehicle’ means any motor vehicle driven with no more than the
limited use necessary in moving, transporting, or road testing such
vehicle prior to delivery from the vehicle manufacturer to a dealer,
but in no event shall the odometer reading of such vehicle exceed
300 miles.’’.
(b) EXEMPTED VEHICLES.—Section 32705(a) of title 49, United
States Code, as amended by subsection (a), is amended by adding
at the end the following new paragraph:
‘‘(5) The Secretary may exempt such classes or categories of
vehicles as the Secretary deems appropriate from these require-
ments. Until such time as the Secretary amends or modifies the
regulations set forth in 49 CFR 580.6, such regulations shall have
full force and effect.’’.
SEC. 7106. MISCELLANEOUS AMENDMENTS.
(a) REMEDIES
FOR DEFECTS
AND NONCOMPLIANCE.—Section
30120(i)(1) of title 49, United States Code, is amended by inserting
‘‘(including retailers of motor vehicle equipment)’’ after ‘‘dealer’’
the first time it appears.
(b) TIRES.—Section 30123 of title 49, United States Code, is
amended by striking subsections (a), (b), and (c) and by redesignat-
ing subsections (d), (e), and (f), as subsections (a), (b), and (c),
respectively.
(c) AUTOMATIC OCCUPANT CRASH PROTECTION AND SEAT BELT
USE.—Section 30127(g)(1) of title 49, United States Code, is amend-
ed by striking ‘‘every 6 months’’ and inserting ‘‘annually’’.
(d) MISCELLANEOUS.—
(1) DEFINITIONS.—
(A) COUNTRY OF ORIGIN.—Section 32304(a)(3)(B) of title
49, United States Code, is amended by inserting before
H. R. 2400—362
the period the following: ‘‘, plus the assembly and labor
costs incurred for the final assembly of such engines and
transmissions’’.
(B) FINAL
ASSEMBLY
PLACE.—Section 32304(a)(5) of
title 49, United States Code, is amended by adding at
the end the following: ‘‘Such term does not include facilities
for engine and transmission fabrication and assembly and
the facilities for fabrication of motor vehicle equipment
component parts which are produced at the same final
assembly place using forming processes such as stamping,
machining, or molding processes.’’.
(C) OUTSIDE SUPPLIER CONTENT REPORTING.—Section
32304(a)(9)(A) of title 49, United States Code, is amended
to read as follows:
‘‘(A) for an outside supplier—
‘‘(i) the full purchase price of passenger motor
vehicle equipment whose purchase price contains at
least 70 percent value added in the United States
and Canada; or
‘‘(ii) that portion of the purchase price of passenger
motor vehicle equipment containing less than 70 per-
cent value added in the United States and Canada
that is attributable to the percent value added in the
United States and Canada when such percent is
expressed to the nearest 5 percent; and’’.
(2) COUNTRY OF ASSEMBLY.—Section 32304(d) of title 49,
United States Code, is amended by adding at the end the
following: ‘‘A manufacturer may add to the label required under
subsection (b) a line stating the country in which vehicle assem-
bly was completed.’’.
(3) VEHICLE CONTENT PERCENTAGE BY ASSEMBLY PLANT.—
Section 32304 of title 49, United States Code, is amended
by redesignating subsections (c) through (f) as subsections (f)
through (i), respectively, and by adding after subsection (b)
the following:
‘‘(c) VEHICLE CONTENT PERCENTAGE
BY ASSEMBLY PLANT.—
A manufacturer may display separately on the label required by
subsection (b) the domestic content of a vehicle based on the assem-
bly plant. Such display shall occur after the matter required to
be in the label by subsection (b)(1)(A).’’.
(4) SUPPLIERS FAILING TO REPORT.—Section 32304 of title
49, United States Code, is amended by adding after subsection
(c), as added by paragraph (3), the following:
‘‘(d) VALUE ADDED DETERMINATION.—If a manufacturer or allied
supplier requests information in a timely manner from one or
more of its outside suppliers concerning the United States /Canadian
content of particular equipment, but does not receive that informa-
tion despite a good faith effort to obtain it, the manufacturer or
allied supplier may make its own good faith value added determina-
tions, subject to the following:
‘‘(1) The manufacturer or allied supplier shall make the
same value added determinations as would be made by the
outside supplier, that is, whether 70 percent or more of the
value of equipment is added in the United States and /or Can-
ada.
‘‘(2) The manufacturer or allied supplier shall consider
the amount of value added and the location in which the
H. R. 2400—363
value was added for all of the stages that the outside supplier
would be required to consider.
‘‘(3) The manufacturer or allied supplier may determine
that the value added in the United States and /or Canada
is 70 percent or more only if it has a good faith basis to
make that determination.
‘‘(4) A manufacturer and its allied suppliers may, on a
combined basis, make value added determinations for no more
than 10 percent, by value, of a carline’s total parts content
from outside suppliers.
‘‘(5) Value added determinations made by a manufacturer
or allied supplier under this paragraph shall have the same
effect as if they were made by the outside supplier.
‘‘(6) This provision does not affect the obligation of outside
suppliers to provide the requested information.’’.
(5) ACCOUNTING FOR THE VALUE OF SMALL PARTS.—Section
32304 of title 49, United States Code, is amended by adding
after subsection (d), as added by paragraph (4), the following:
‘‘(e) SMALL PARTS.—The country of origin of nuts, bolts, clips,
screws, pins, braces, gasoline, oil, blackout, phosphate rinse, wind-
shield washer fluid, fasteners, tire assembly fluid, rivets, adhesives,
and grommets, of any system, subassembly, or component installed
in a vehicle shall be considered to be the country in which such
parts were included in the final assembly of such vehicle.’’.
(e) STUDY.—The National Highway Traffic Safety Administra-
tion shall conduct a study of the benefits to motor vehicle drivers
of a regulation to require the installation in a motor vehicle of
an interior device to release the trunk lid. Not later than 18 months
after the date of the enactment of this Act, the Administration
shall submit a report on the results of the study to the Committee
on Commerce of the House of Representatives and the Committee
on Commerce, Science, and Transportation of the Senate.
SEC. 7107. IMPORTATION OF MOTOR VEHICLE FOR SHOW OR DISPLAY.
(a) IMPORTATION OF NONCOMPLYING MOTOR VEHICLES.—Section
30114 of title 49, United States Code, is amended by striking
‘‘or competitive racing events’’ and inserting ‘‘competitive racing
events, show, or display’’.
(b) TRANSITION RULE.—A person who is the owner of a motor
vehicle located in the United States on the date of enactment
of this Act may seek an exemption under section 30114 of title
49, United States Code, as amended by subsection (a) of this section,
for a period of 6 months after the date regulations of the Secretary
of Transportation promulgated in response to such amendment
take effect.
Subtitle B—Railroads
SEC. 7201. HIGH-SPEED RAIL.
(a) AUTHORIZATION OF APPROPRIATIONS.—Section 26104 of title
49, United States Code, is amended—
(1) by redesignating subsection (d) as subsection (h); and
(2) by inserting after subsection (c) the following new sub-
sections:
H. R. 2400—364
‘‘(d) FISCAL YEAR 1998.—(1) There are authorized to be appro-
priated to the Secretary $10,000,000 for fiscal year 1998, for carry-
ing out section 26101 (including payment of administrative expenses
related thereto).
‘‘(2) There are authorized to be appropriated to the Secretary
$25,000,000 for fiscal year 1998, for carrying out section 26102
(including payment of administrative expenses related thereto).
‘‘(e) FISCAL YEAR 1999.—(1) There are authorized to be appro-
priated to the Secretary $10,000,000 for fiscal year 1999, for carry-
ing out section 26101 (including payment of administrative expenses
related thereto).
‘‘(2) There are authorized to be appropriated to the Secretary
$25,000,000 for fiscal year 1999, for carrying out section 26102
(including payment of administrative expenses related thereto).
‘‘(f) FISCAL YEAR 2000.—(1) There are authorized to be appro-
priated to the Secretary $10,000,000 for fiscal year 2000, for carry-
ing out section 26101 (including payment of administrative expenses
related thereto).
‘‘(2) There are authorized to be appropriated to the Secretary
$25,000,000 for fiscal year 2000, for carrying out section 26102
(including payment of administrative expenses related thereto).
‘‘(g) FISCAL YEAR 2001.—(1) There are authorized to be appro-
priated to the Secretary $10,000,000 for fiscal year 2001, for carry-
ing out section 26101 (including payment of administrative expenses
related thereto).
‘‘(2) There are authorized to be appropriated to the Secretary
$25,000,000 for fiscal year 2001, for carrying out section 26102
(including payment of administrative expenses related thereto).’’.
(b) DEFINITION.—Section 26105(2) of title 49, United States
Code, is amended to read as follows:
‘‘(2) the term ‘high-speed rail’ means all forms of non-
highway ground transportation that run on rails or electro-
magnetic guideways providing transportation service which is—
‘‘(A) reasonably expected to reach sustained speeds
of more than 125 miles per hour; and
‘‘(B) made available to members of the general public
as passengers,
but does not include rapid transit operations within an urban
area that are not connected to the general rail system of
transportation;’’.
SEC. 7202. LIGHT DENSITY RAIL LINE PILOT PROJECTS.
(a) AMENDMENT.—Part B of subtitle V of title 49, United States
Code, is amended by adding at the end the following new chapter:
‘‘CHAPTER 223—LIGHT DENSITY RAIL LINE PILOT
PROJECTS
‘‘Sec.
‘‘22301. Light density rail line pilot projects.
‘‘§ 22301. Light density rail line pilot projects
‘‘(a) GRANTS.—The Secretary of Transportation may make
grants to States that have State rail plans described in section
22102 (1) and (2), to fund pilot projects that demonstrate the
relationship of light density railroad services to the statutory
responsibilities of the Secretary, including those under title 23.
H. R. 2400—365
‘‘(b) LIMITATIONS.—Grants under this section may be made
only for pilot projects for making capital improvements to, and
rehabilitating, publicly and privately owned rail line structures,
and may not be used for providing operating assistance.
‘‘(c) PRIVATE OWNER CONTRIBUTIONS.—Grants made under this
section for projects on privately owned rail line structures shall
include contributions by the owner of the rail line structures, based
on the benefit to those structures, as determined by the Secretary.
‘‘(d) STUDY.—The Secretary shall conduct a study of the pilot
projects carried out with grant assistance under this section to
determine the public interest benefits associated with the light
density railroad networks in the States and their contribution to
a multimodal transportation system. Not later than March 31,
2003, the Secretary shall report to Congress any recommendations
the Secretary considers appropriate regarding the eligibility of light
density rail networks for Federal infrastructure financing.
‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated to the Secretary to carry out this section
$17,500,000 for each of the fiscal years 1998, 1999, 2000, 2001,
2002, and 2003. Such funds shall remain available until expended.’’.
(b) TABLE
OF CHAPTERS.—The table of chapters of subtitle
V of title 49, United States Code, is amended by inserting after
the item relating to chapter 221 the following new item:
‘‘223. LIGHT DENSITY RAIL LINE PILOT PROJECTS ............................
22301’’.
SEC. 7203. RAILROAD REHABILITATION AND IMPROVEMENT FINANC-
ING.
(a) AMENDMENTS.—Title V of the Railroad Revitalization and
Regulatory Reform Act of 1976 is amended—
(1) by striking sections 501 through 504 and inserting
the following new sections:
‘‘SEC. 501. DEFINITIONS.
‘‘For purposes of this title:
‘‘(1)(A) The term ‘cost’ means the estimated long-term cost
to the Government of a direct loan or loan guarantee or modi-
fication thereof, calculated on a net present value basis, exclud-
ing administrative costs and any incidental effects on govern-
mental receipts or outlays.
‘‘(B) The cost of a direct loan shall be the net present
value, at the time when the direct loan is disbursed, of the
following estimated cash flows:
‘‘(i) Loan disbursements.
‘‘(ii) Repayments of principal.
‘‘(iii) Payments of interest and other payments by or
to the Government over the life of the loan after adjusting
for estimated defaults, prepayments, fees, penalties, and
other recoveries.
Calculation of the cost of a direct loan shall include the effects
of changes in loan terms resulting from the exercise by the
borrower of an option included in the loan contract.
‘‘(C) The cost of a loan guarantee shall be the net present
value, at the time when the guaranteed loan is disbursed,
of the following estimated cash flows:
‘‘(i) Payments by the Government to cover defaults
and delinquencies, interest subsidies, or other payments.
H. R. 2400—366
‘‘(ii) Payments to the Government, including origina-
tion and other fees, penalties, and recoveries.
Calculation of the cost of a loan guarantee shall include the
effects of changes in loan terms resulting from the exercise
by the guaranteed lender of an option included in the loan
guarantee contract, or by the borrower of an option included
in the guaranteed loan contract.
‘‘(D) The cost of a modification is the difference between
the current estimate of the net present value of the remaining
cash flows under the terms of a direct loan or loan guarantee
contract, and the current estimate of the net present value
of the remaining cash flows under the terms of the contract,
as modified.
‘‘(E) In estimating net present values, the discount rate
shall be the average interest rate on marketable Treasury
securities of similar maturity to the cash flows of the direct
loan or loan guarantee for which the estimate is being made.
‘‘(F) When funds are obligated for a direct loan or loan
guarantee, the estimated cost shall be based on the current
assumptions, adjusted to incorporate the terms of the loan
contract, for the fiscal year in which the funds are obligated.
‘‘(2) The term ‘current’ has the same meaning as in section
250(c)(9) of the Balanced Budget and Emergency Deficit Control
Act of 1985.
‘‘(3) The term ‘direct loan’ means a disbursement of funds
by the Government to a non-Federal borrower under a contract
that requires the repayment of such funds. The term includes
the purchase of, or participation in, a loan made by another
lender and financing arrangements that defer payment for more
than 90 days, including the sale of a Government asset on
credit terms. The term does not include the acquisition of
a federally guaranteed loan in satisfaction of default claims.
‘‘(4) The term ‘direct loan obligation’ means a binding agree-
ment by the Secretary to make a direct loan when specified
conditions are fulfilled by the borrower.
‘‘(5) The term ‘intermodal’ means of or relating to the
connection between rail service and other modes of transpor-
tation, including all parts of facilities at which such connection
is made.
‘‘(6) The term ‘loan guarantee’ means any guarantee, insur-
ance, or other pledge with respect to the payment of all or
a part of the principal or interest on any debt obligation of
a non-Federal borrower to a non-Federal lender, but does not
include the insurance of deposits, shares, or other withdrawable
accounts in financial institutions.
‘‘(7) The term ‘loan guarantee commitment’ means a bind-
ing agreement by the Secretary to make a loan guarantee
when specified conditions are fulfilled by the borrower, the
lender, or any other party to the guarantee agreement.
‘‘(8) The term ‘modification’ means any Government action
that alters the estimated cost of an outstanding direct loan
(or direct loan obligation) or an outstanding loan guarantee
(or loan guarantee commitment) from the current estimate
of cash flows. This includes the sale of loan assets, with or
without recourse, and the purchase of guaranteed loans. This
also includes any action resulting from new legislation, or from
the exercise of administrative discretion under existing law,
H. R. 2400—367
that directly or indirectly alters the estimated cost of outstand-
ing direct loans (or direct loan obligations) or loan guarantees
(or loan guarantee commitments) such as a change in collection
procedures.
‘‘SEC. 502. DIRECT LOANS AND LOAN GUARANTEES.
‘‘(a) GENERAL AUTHORITY.—The Secretary may provide direct
loans and loan guarantees to State and local governments, govern-
ment sponsored authorities and corporations, railroads, and joint
ventures that include at least 1 railroad.
‘‘(b) ELIGIBLE PURPOSES.—
‘‘(1) IN GENERAL.—Direct loans and loan guarantees under
this section shall be used to—
‘‘(A) acquire, improve, or rehabilitate intermodal or
rail equipment or facilities, including track, components
of track, bridges, yards, buildings, and shops;
‘‘(B) refinance outstanding debt incurred for the pur-
poses described in subparagraph (A); or
‘‘(C) develop or establish new intermodal or railroad
facilities.
‘‘(2) OPERATING EXPENSES NOT ELIGIBLE.—Direct loans and
loan guarantees under this section shall not be used for railroad
operating expenses.
‘‘(c) PRIORITY PROJECTS.—In granting applications for direct
loans or guaranteed loans under this section, the Secretary shall
give priority to projects that—
‘‘(1) enhance public safety;
‘‘(2) enhance the environment;
‘‘(3) promote economic development;
‘‘(4) enable United States companies to be more competitive
in international markets;
‘‘(5) are endorsed by the plans prepared under section
135 of title 23, United States Code, by the State or States
in which they are located; or
‘‘(6) preserve or enhance rail or intermodal service to small
communities or rural areas.
‘‘(d) EXTENT OF AUTHORITY.—The aggregate unpaid principal
amounts of obligations under direct loans and loan guarantees
made under this section shall not exceed $3,500,000,000 at any
one time. Of this amount, not less than $1,000,000,000 shall be
available solely for projects primarily benefiting freight railroads
other than Class I carriers.
‘‘(e) RATES OF INTEREST.—
‘‘(1) DIRECT LOANS.—The Secretary shall require interest
to be paid on a direct loan made under this section at a
rate not less than that necessary to recover the cost of making
the loan.
‘‘(2) LOAN GUARANTEES.—The Secretary shall not make a
loan guarantee under this section if the interest rate for the
loan exceeds that which the Secretary determines to be reason-
able, taking into consideration the prevailing interest rates
and customary fees incurred under similar obligations in the
private capital market.
‘‘(f) INFRASTRUCTURE PARTNERS.—
‘‘(1) AUTHORITY OF SECRETARY.—In lieu of or in combination
with appropriations of budget authority to cover the costs of
direct loans and loan guarantees as required under section
H. R. 2400—368
504(b)(1) of the Federal Credit Reform Act of 1990, the Sec-
retary may accept on behalf of an applicant for assistance
under this section a commitment from a non-Federal source
to fund in whole or in part credit risk premiums with respect
to the loan that is the subject of the application. In no event
shall the aggregate of appropriations of budget authority and
credit risk premiums described in this paragraph with respect
to a direct loan or loan guarantee be less than the cost of
that direct loan or loan guarantee.
‘‘(2) CREDIT RISK PREMIUM AMOUNT.—The Secretary shall
determine the amount required for credit risk premiums under
this subsection on the basis of—
‘‘(A) the circumstances of the applicant, including the
amount of collateral offered;
‘‘(B) the proposed schedule of loan disbursements;
‘‘(C) historical data on the repayment history of similar
borrowers;
‘‘(D) consultation with the Congressional Budget Office;
and
‘‘(E) any other factors the Secretary considers relevant.
‘‘(3) PAYMENT OF PREMIUMS.—Credit risk premiums under
this subsection shall be paid to the Secretary before the
disbursement of loan amounts.
‘‘(4) COHORTS OF LOANS.—In order to maintain sufficient
balances of credit risk premiums to adequately protect the
Federal Government from risk of default, while minimizing
the length of time the Government retains possession of those
balances, the Secretary shall establish cohorts of loans. When
all obligations attached to a cohort of loans have been satisfied,
credit risk premiums paid for the cohort, and interest accrued
thereon, which were not used to mitigate losses shall be
returned to the original source on a pro rata basis.
‘‘(g) PREREQUISITES FOR ASSISTANCE.—The Secretary shall not
make a direct loan or loan guarantee under this section unless
the Secretary has made a finding in writing that—
‘‘(1) repayment of the obligation is required to be made
within a term of not more than 25 years from the date of
its execution;
‘‘(2) the direct loan or loan guarantee is justified by the
present and probable future demand for rail services or inter-
modal facilities;
‘‘(3) the applicant has given reasonable assurances that
the facilities or equipment to be acquired, rehabilitated,
improved, developed, or established with the proceeds of the
obligation will be economically and efficiently utilized;
‘‘(4) the obligation can reasonably be repaid, using an
appropriate combination of credit risk premiums and collateral
offered by the applicant to protect the Federal Government;
and
‘‘(5) the purposes of the direct loan or loan guarantee
are consistent with subsection (b).
‘‘(h) CONDITIONS OF ASSISTANCE.—The Secretary shall, before
granting assistance under this section, require the applicant to
agree to such terms and conditions as are sufficient, in the judgment
of the Secretary, to ensure that, as long as any principal or interest
is due and payable on such obligation, the applicant, and any
H. R. 2400—369
railroad or railroad partner for whose benefit the assistance is
intended—
‘‘(1) will not use any funds or assets from railroad or
intermodal operations for purposes not related to such oper-
ations, if such use would impair the ability of the applicant,
railroad, or railroad partner to provide rail or intermodal serv-
ices in an efficient and economic manner, or would adversely
affect the ability of the applicant, railroad, or railroad partner
to perform any obligation entered into by the applicant under
this section;
‘‘(2) will, consistent with its capital resources, maintain
its capital program, equipment, facilities, and operations on
a continuing basis; and
‘‘(3) will not make any discretionary dividend payments
that unreasonably conflict with the purposes stated in sub-
section (b).
‘‘SEC. 503. ADMINISTRATION OF DIRECT LOANS AND LOAN GUARAN-
TEES.
‘‘(a) APPLICATIONS.—The Secretary shall prescribe the form and
contents required of applications for assistance under section 502,
to enable the Secretary to determine the eligibility of the applicant’s
proposal, and shall establish terms and conditions for direct loans
and loan guarantees made under that section.
‘‘(b) ASSIGNMENT OF LOAN GUARANTEES.—The holder of a loan
guarantee made under section 502 may assign the loan guarantee
in whole or in part, subject to such requirements as the Secretary
may prescribe.
‘‘(c) MODIFICATIONS.—The Secretary may approve the modifica-
tion of any term or condition of a direct loan, loan guarantee,
direct loan obligation, or loan guarantee commitment, including
the rate of interest, time of payment of interest or principal, or
security requirements, if the Secretary finds in writing that—
‘‘(1) the modification is equitable and is in the overall
best interests of the United States; and
‘‘(2) consent has been obtained from the applicant and,
in the case of a loan guarantee or loan guarantee commitment,
the holder of the obligation.
‘‘(d) COMPLIANCE.—The Secretary shall assure compliance, by
an applicant, any other party to the loan, and any railroad or
railroad partner for whose benefit assistance is intended, with
the provisions of this title, regulations issued hereunder, and the
terms and conditions of the direct loan or loan guarantee, including
through regular periodic inspections.
‘‘(e) COMMERCIAL VALIDITY.—For purposes of claims by any
party other than the Secretary, a loan guarantee or loan guarantee
commitment shall be conclusive evidence that the underlying obliga-
tion is in compliance with the provisions of this title, and that
such obligation has been approved and is legal as to principal,
interest, and other terms. Such a guarantee or commitment shall
be valid and incontestable in the hands of a holder thereof, including
the original lender or any other holder, as of the date when the
Secretary granted the application therefor, except as to fraud or
material misrepresentation by such holder.
‘‘(f) DEFAULT.—The Secretary shall prescribe regulations setting
forth procedures in the event of default on a loan made or guaran-
teed under section 502. The Secretary shall ensure that each loan
H. R. 2400—370
guarantee made under that section contains terms and conditions
that provide that—
‘‘(1) if a payment of principal or interest under the loan
is in default for more than 30 days, the Secretary shall pay
to the holder of the obligation, or the holder’s agent, the amount
of unpaid guaranteed interest;
‘‘(2) if the default has continued for more than 90 days,
the Secretary shall pay to the holder of the obligation, or
the holder’s agent, 90 percent of the unpaid guaranteed prin-
cipal;
‘‘(3) after final resolution of the default, through liquidation
or otherwise, the Secretary shall pay to the holder of the
obligation, or the holder’s agent, any remaining amounts
guaranteed but which were not recovered through the default’s
resolution;
‘‘(4) the Secretary shall not be required to make any pay-
ment under paragraphs (1) through (3) if the Secretary finds,
before the expiration of the periods described in such para-
graphs, that the default has been remedied; and
‘‘(5) the holder of the obligation shall not receive payment
or be entitled to retain payment in a total amount which,
together with all other recoveries (including any recovery based
upon a security interest in equipment or facilities) exceeds
the actual loss of such holder.
‘‘(g) RIGHTS OF THE SECRETARY.—
‘‘(1) SUBROGATION.—If the Secretary makes payment to
a holder, or a holder’s agent, under subsection (g) in connection
with a loan guarantee made under section 502, the Secretary
shall be subrogated to all of the rights of the holder with
respect to the obligor under the loan.
‘‘(2) DISPOSITION OF PROPERTY.—The Secretary may com-
plete, recondition, reconstruct, renovate, repair, maintain, oper-
ate, charter, rent, sell, or otherwise dispose of any property
or other interests obtained pursuant to this section. The Sec-
retary shall not be subject to any Federal or State regulatory
requirements when carrying out this paragraph.
‘‘(h) ACTION AGAINST OBLIGOR.—The Secretary may bring a
civil action in an appropriate Federal court in the name of the
United States in the event of a default on a direct loan made
under section 502, or in the name of the United States or of
the holder of the obligation in the event of a default on a loan
guaranteed under section 502. The holder of a guarantee shall
make available to the Secretary all records and evidence necessary
to prosecute the civil action. The Secretary may accept property
in full or partial satisfaction of any sums owed as a result of
a default. If the Secretary receives, through the sale or other
disposition of such property, an amount greater than the aggregate
of—
‘‘(1) the amount paid to the holder of a guarantee under
subsection (g) of this section; and
‘‘(2) any other cost to the United States of remedying the
default,
the Secretary shall pay such excess to the obligor.
‘‘(i) BREACH OF CONDITIONS.—The Attorney General shall com-
mence a civil action in an appropriate Federal court to enjoin
any activity which the Secretary finds is in violation of this title,
H. R. 2400—371
regulations issued hereunder, or any conditions which were duly
agreed to, and to secure any other appropriate relief.
‘‘(j) ATTACHMENT.—No attachment or execution may be issued
against the Secretary, or any property in the control of the Sec-
retary, prior to the entry of final judgment to such effect in any
State, Federal, or other court.
‘‘(k) INVESTIGATION CHARGE.—The Secretary may charge and
collect from each applicant a reasonable charge for appraisal of
the value of the equipment or facilities for which the direct loan
or loan guarantee is sought, and for making necessary determina-
tions and findings. Such charge shall not aggregate more than
one-half of 1 percent of the principal amount of the obligation.’’;
(2) by striking sections 505 through 515 (other than 511(c)),
517, and 518;
(3) in section 511(c) by striking ‘‘this section’’ and inserting
‘‘section 502’’;
(4) by moving subsection (c) of section 511 (as amended
by paragraph (3) of this section) from section 511 to section
503 (as inserted by paragraph (1) of this section), inserting
it after subsection (a), and redesignating it as subsection (b);
and
(5) by redesignating section 516 as section 504.
(b) TECHNICAL AND CONFORMING PROVISIONS.—
(1) TABLE
OF
CONTENTS.—The table of contents of title
V of the Railroad Revitalization and Regulatory Reform Act
of 1976 is amended by striking the items relating to sections
502 through 518 and inserting the following:
‘‘Sec. 502. Direct loans and loan guarantees.
‘‘Sec. 503. Administration of direct loans and loan guarantees.
‘‘Sec. 504. Employee protection.’’.
(2) SAVINGS PROVISION.—A transaction entered into under
the authority of title V of the Railroad Revitalization and
Regulatory Reform Act of 1976 (45 U.S.C. 821 et seq.) before
the date of enactment of this Act shall be administered until
completion under its terms as if this Act were not enacted.
(3) REPEAL.—Section 211(i) of the Regional Rail Reorga-
nization Act of 1973 (45 U.S.C. 721(i)) is repealed.
SEC. 7204. ALASKA RAILROAD.
(a) GRANTS.—The Secretary may make grants to the Alaska
Railroad for capital rehabilitation of and improvements to its pas-
senger services.
(b) AUTHORIZATION OF APPROPRIATIONS.—There is authorized
to be appropriated to carry out this section $5,250,000 for each
of fiscal years 1998 through 2003.
Subtitle C—Comprehensive One-Call
Notification
SEC. 7301. FINDINGS.
Congress finds that—
(1) unintentional damage to underground facilities during
excavation is a significant cause of disruptions in telecommuni-
cations, water supply, electric power, and other vital public
services, such as hospital and air traffic control operations,