An Act to provide financial assistance for and establishment of improved rail passenger service in the United States, to provide for the upgrading of rail roadbed and the modernization of rail passenger equipment, to encourage the development of new modes of high speed ground transportation, to authorize the prescribing of minimum standards for railroad passenger service, to amend section 13(a) of the Interstate Commerce Act, and for other purposes
PL 91-518 (H.R.17849), enacted 10/30/1970

84 STAT. ] 
PUBLIC LAW 91.518-OCT. 30, 1970 
1327 
a MAINTENANCE OF EFFORT 
"SEC. 127. Applications for grants under this part may be approved 
by the Secretary only if the application contains or is supported by 
reasonable assurances that the grants will not result in any decrease 
in the level of State, local, and other non-Federal funds for services 
for persons with developmental disabilities and training of persons to 
provide such services which would (except for such grant) be avail-
able to the applicant, but that such grants will be used to supplement, 
and, to the extent practicable, to increase the level of such funds." 
CONFORMING AMENDMENTS 
SEC. 207. (a) Section 100 of such title is amended to read as follows: 
^^ ^*°*' 282. 
^ ^ 
42 use 2661 
li 
note. 
SHORT TITLE 
"SEC. 100. This title may be cited as the 'Developmental Disabilities 
Services and Facilities Construction Act'." 
(b) The heading for part B of such title is amended to read as 
follows: 
"PART B—CONSTRUCTION, DEMONSTRATION, AND TRAINING GRANTS 
FOR 
UNIVERSITY-AFFILIATED 
FACILITIES 
FOR 
PERSONS 
W I T H 
DEVELOPMENTAL DISABILITIES". 
Approved October 30, 1970. 
Public Law 91-518 
AN ACT 
October 30, 1970 
To provide financial assistance for and establisliment of a national rail passen- 
[H. R. 17849] 
ger system, to provide for the modernization of railroad passenger eiiuipment, 
to authorize the prescribing of minimum standards for railroad passenger 
service, to amend section 13a of the Interstate Commerce Act, and for other 
purposes. 
Be it enacted hy the Senate and House of Representatives 
of the 
United States of America in Congress assembled^ That this Act may 
be cited as the "Kail Passenger Service Act of 1970". 
. T9V0. 
Rail Passeng;er 
Service Act of 
1328 
PUBLIC L
A
W 91-518-OCT. 30, 1970 
[84 STAT. 
TITLE I—FINDINGS, PURPOSES, AND DEFINITIONS 
SEC. 101. CONGRESSIONAL FINDINGS AND DECLARATION OF PURPOSE. 
The Congress finds that modern, efficient, intercity railroad pas-
senger service is a necessary part of a balanced transportation system; 
that the public convenience and necessity require the continuance and 
improvement of such service to provide fast and comfortable transpor-
tation between crowded urban areas and in other areas of the country; 
that rail passenger service can help to end the congestion on our high-
ways and the overcrowding of airways and airports; that the traveler 
in America should to the maximum extent feasible have freedom to 
choose the mode of travel most convenient to his needs; that to achieve-
these goals requires the designation of a basic national rail passenger 
system and the establishment of a rail passenger corporation for the 
purpose of providing modern, efficient, intercity rail passenger service; 
that Federal financial assistance as well as investment capital from 
the private sector of the economy is needed for this purpose; and that 
interim emergency Federal financial assistance to certain railroads 
may be necessary to permit the orderly transfer of railroad passenger 
service to a railroad passenger corporation. 
SEC. 102. DEFINITIONS. 
For the purposes of this Act— 
(1) "Railroad" means a common carrier by railroad, as defined in 
section 1(3) of part I of the Interstate Commerce Act, as amended 
41 Stat. 474; 
(49 U.S.C. 1(3)) other than the corporation created by title III of 
54 Stat. 899. 
fhisAot 
Post, 
p, 1330, 
llllb-tl.01. 
1 . 
1 
(2) "Secretary" means the Secretary of Transportation or his dele-
gate unless the context indicates otherwise. 
(3) "Commission" means the Interstate Commerce Commission. 
(4) "Basic system" means the system of intercity rail passenger 
service designated by the Secretary under title II and section 403(a) 
Post, pp. 1329, of this Act. 
^^^* 
(5) "Intercity rail passenger service" means all rail passenger serv-
ice other than (A) commuter and other short-haul service in metro-
politan and suburban areas, usually characterized by reduced fare, 
multiple-ride and commutation tickets, and by morning and evening 
peak period operations, and (B) auto-ferry service characterized by 
transportation of automobiles and their occupants where contracts 
for such service have been consummated prior to enactment of this 
Act. 
(6) "Avoidable loss" means the avoidable costs of providing pas-
senger service, less revenues attributable thereto, as determined by 
the Interstate Commerce Commission pursuant to the provisions of 
80 Stat. 383. 
gection 553 of title 5, United States Code. 
(7) "Corporation" means the National Railroad Passenger Corpo-
ration created under title III of this Act. 
84 STAT. ] 
PUBLIC LAW 91-518-OCT. 30, 1970 
1329 
(8) "Regional transportation agency" means an authority, corpo-
ration, or other entity established for the purpose of providing pas-
senger service within a region. 
TITLE II—BASIC NATIONAL RAIL PASSENGER SYSTEM 
SEC. 201. DESIGNATION OF SYSTEM. 
In carrying out the congressional findings and declaration of pur- o^t'^^^'J'c'^'Jnij*' 
pose set forth in title I of this Act, the Secretary, acting in cooperation congress, 
with other interested Federal agencies and departments, is authorized 
and directed to submit to the Commission and to the Congress within 
thirty days after the date of enactment of this Act his preliminary 
report and recommendations for the basic system. Such recommenda-
tions shall specify those points between which intercity passenger 
trains shall be operated, identify all routes over which service may be 
provided, and the trains presently operated over such routes, together 
with basic service characteristics of operations to be provided within 
the basic system, taking into account schedules, number of trains, con-
nections, through car service, and sleeping, parlor, dining, and lounge 
facilities. In recommending the basic system the Secretary shall take 
into account the need for expeditious intercity rail passenger service 
within and between all regions of the continental United States, and 
the Secretary shall consider the need for such service within the States 
of Alaska and Hawaii and the Commonwealth of Puerto Rico. In 
formulating such recommendations the Secretary shall consider 
opportunities for provision of faster service, more convenient service, 
service to more centers of population, and service at lower cost, by 
the joint operation, for passenger service, of facilities of two or more 
railroad companies; the importance of a given service to overall 
viability of the basic system; adequacy of other transportation facil-
ities serving the same points; unique characteristics and advantages 
of rail service as compared to other modes of transportation; the rela-
tionship of public benefits of given services to the costs of providing 
such services; and potential profitability of the service. The exclusion 
of a particular route, train, or service from the basic system shall not 
be deemed to create a presumption that the route, train, or service is 
not required by public convenience and necessity in any proceeding 
under section 13a of the Interstate Commerce Act (49 U.S.C. 13a). 
72 stat. 571. 
SEC. 202. REVIEW OF THE BASIC SYSTEM. 
The Commission, the State Commissions, the representatives of the 
railroads, and labor organizations duly authorized under the Railway 
Labor Act to represent railroad employees shall, within thirty days 4g^ltllTiigJ' 
after receipt of the j)reliminary report of the Secretary designating 
45 use 151*. 
the basic system, review such report consistent with the purposes of 
this Act and provide the Secretary with their comments and recom-
mendations in writing. The Secretary shall give due consideration to 
such comments and recommendations. The Secretary shall, within con^reir^"'* *° 
ninety days after the date of enactment of this Act, submit his final °"^''^^^* 
report designating the basic system to the Congress. Such final report 
shall include a summary of their recommendations together with his 
reasons for failing to adopt any such recommendation. The basic sys- 
Effective date. 
tem as desi^ated by the Secretary shall become effective for the pur-
poses of this Act upon the date that the final report of the Secretary 
IS submitted to Congress and shall not be reviewable in any court. 
1330 
PUBLIC LAW 91-518-OCT. 30, 1970 
[84 STAT. 
68 Stat. 177; 
77 Stat. 140. 
D.C. Code 29-
901. 
Incorporators, 
Presidential ap-
pointments. 
Board of direc-
tors. 
Conflict of in-
terest, prohibition. 
Compensation, 
travel expenses. 
TITLE III—CREATION OF A RAIL PASSENGER 
CORPORATION 
SEC. 301. CREATION OF THE CORPORATION. 
There is authorized to be created a National Railroad Passenger 
Corporation. The Corporation shall be a for profit corporation, the 
purpose of which shall be to provide intercity rail passenger service, 
employing innovative operating and marketing concepts so as to fully 
develop the potential of modern rail service in meeting the Nation's 
intercity passenger transportation requirements. The Corporation will 
not be an agency or establishment of the United States Government. 
It shall be subject to the provisions of this Act and, to the extent 
consistent with this Act, to the District of Columbia Business Corpora-
tion Act. The right to repeal, alter, or amend this Act at any time is 
expressly reserved. 
SEC. 302. PROCESS OF ORGANIZATION. 
The President of the United States shall appoint not few^er than 
three incorporators, by and wdth the advice and consent of the Senate, 
who shall also serve as the board of directors for one hundred and 
eighty days following the date of enactment of this Act. The incor-
porators shall take whatever actions are necessary to establish the 
Corporation, including the filing of articles of incorporation, as 
approved by the President. 
SEC. 303. DIRECTORS AND OFFICERS. 
(a) The Corporation shall have a board of fifteen directors consist-
ing of individuals who are citizens of the United States, of whom one 
shall be elected annually by the board to serve as chairman. Eight 
members of the board shall be appointed by the President of the 
Ignited States, by and with the advice and consent of the Senate, for 
terms of four years or until their successors have been appointed and 
qualified, except that the first three members of the board so appointed 
shall continue in office for terms of two years, and the next three 
members for terms of three years. Any member appointed to fill a 
vacancy may be appointed only for the unexpired term of the direc-
tor whom he succeeds. At all times the Secretary shall be one of the 
members of the board of directors appointed by the President and at 
all times at least one such member shall be a consumer representative. 
Three members of the board shall be elected annually by common 
stockholders, and four shall be elected annually by preferred stock-
holders of the Corporation. The members of the board appointed by 
the President and those elected by common stockholders shall take 
office on the one hundred and eighty-first day after the date of enact-
ment of this Act. Election of the remaining four members of the 
board shall take place as soon as practicable after the first issuance 
of preferred stock by the Corporation. Pending election of the remain-
ing four members, seven members shall constitute a quorum for the 
purpose of conducting the business of the board. No director appointed 
by the President may have any direct or indirect financial or employ-
ment relationship with any railroad during the time that he serves on 
the board. Each of the directors not employed by the Federal Govern-
ment shall receive compensation at the rate of $800 for each meeting 
of the board he attends. In addition, each director shall be reim-
burs-ed for necessary travel and subsistence expenses incurred in 
attending the meetings of the board. No director elected by railroads 
shall vote on any action of the board of directors relating to any con-
tract or operating relationship between the Corporation and a rail-
road, but he may be present at meetings of the board at which such 
matters are voted upon, and he may be included for purposes of 
84 STAT.] 
PUBLIC LAW 91-518-OCT. 30, 1970 
1331 
determining a quorum and may participate in discussions at any such 
meeting. 
(b) The board of directors is empowered to adopt and amend 
bylaws governing the operation of the Corporation. Such bylaws shall 
not be inconsistent with the provisions of this Act or of the articles 
of incorporation. 
(c) The articles of incorporation of the Corporation shall provide 
for cumulative voting for all stockholders and shall provide that, upon 
conversion of one-fourth of the outstanding shares of preferred stock, 
the common stockholders shall be entitled to elect four directors and 
the preferred stockholders shall be entitled to elect three directors: 
upon the conversion of one-half of the outstanding shares of preferred 
stock, the common stockholders shall be entitled to elect five directors 
and the preferred stockholders shall be entitled to elect two directors; 
upon the conversion of three-fourths of the outstanding shares of pre-
ferred stock, the common stockholders shall be entitled to elect six 
directors and the preferred stockholders shall be entitled to elect one 
director; and upon conversion of all outstanding shares of preferred 
stock, the common stockholders shall be entitled to elect seven directors. 
Any change of directors resulting from such stock conversion shall 
take effect at the next annual meeting of the Corporation following 
such stock conversion. 
(d) The Corporation shall have a president and such other officers 
as may be named and appointed by the board. The rates of compensa-
tion of all officers shall be fixed by the board. Officers shall serve at 
the pleasure of the board. No individual other than a citizen of the 
Ignited States may be an officer of the Corporation. No officer of the 
Corporation may have any direct or indirect employment or financial 
relationship with any railroad during the time of his employment by 
the Corporation. 
SEC. 304. FINANCING OF THE CORPORATION. 
(a) The Corporation is authorized to issue and have outstanding, 
in such amounts as it shall determine, two issues of capital stock, a 
common and a preferred, each of which shall carry voting rights and 
be eligible for dividends. Common stock may be initially issued only 
to a railroad. Preferred stock may be issued to and held only by any 
person other than (1) a railroad or (2) any person controlling one 
or more railroads, as defined in section 1(3) (b) of the Interstate 
Commerce Act. The articles of incorporation of the Corporation shall 
provide for the following respective rights of each issue of stock: 
(A) COMMON STOCK.—Common stock shall have a par value 
of $10 per share and shall be designated fully paid and non-
assessable. No dividends shall be paid on the common stock when-
ever dividends on the preferred stock are in arrears. 
(B) (i) PREFERRED STOCK.—Preferred stock shall have a par 
value of $100 per share and shall be designated fully paid and 
nonassessable. Dividends shall be fixed at a rate not less than 6 
per centum per annum, and shall be cumulative so that, if for any 
dividend period dividends at the rate fixed in the articles of 
incorporation shall not have been declared and paid or set aside 
for payment on the preferred shares, the deficiency shall be 
declared and paid or set apart for payment prior to the making of 
any dividend or other distribution on the common shares. 
(ii) Preferred stock shall be entitled to a liquidation preference 
over common stock, which shall entitle preferred stockholders to a 
liquidating payment not less than par value plus all accrued 
unpaid dividends prior to any payment on liquidation to common 
stockholders. 
Bylaws, 
Corporation, 
President and of-
ficers. 
Stock issues, 
restriction. 
54 Stat. 899. 
49 u s e 1. 
1332 
PUBLIC LAW 91-518--OCT. 30, 1970 
[84 STAT. 
Stock ownei" 
ship, limitation. 
54 Stat, 899. 
49 u s e 1. 
Bonds, securi* 
ties, etc., author> 
ization. 
Inspection rights 
requirements, ex-
ception* 
68 Stat* 197* 
68 Stat* 179; 
77 Stat. 140* 
D.C. Code 29-
901. 
41 Stat. 474; 
54 Stat. 899. 
49 u s e 1. 
(iii) Preferred stock shall be convertible into shares of com-
mon stock at such time and upon such terms as the articles of 
incorporation shall provide. 
(b) At no time after the initial issue is completed shall the aggre-
gate of the shares of common stock of the Corporation owned by a 
single railroad or by any person controlling one or more railroads, as 
defined in section 1(3) (b) of the Interstate Commerce Act, directly 
or indirectly through subsidiaries or affiliated companies, nominees, or 
any person subject to its direction or control, exceed 331/^ per centum 
of such shares issued and outstanding. 
(c) At no time may any stockholder, or any syndicate or affiliated 
group of such stockholders, own more than 10 per centum of the 
shares of preferred stock of the Corporation issued and outstanding. 
(d) The articles of incorporation shall provide that no shares of 
any issue of stock may be redeemed or repurchased for five years, 
following the date of enactment of this Act. 
(e) The Corporation is authorized to issue, in addition to the stock 
authorized by subsection (a) of this section, nonvoting securities, 
bonds, debentures, and other certificates of indebtedness as it may 
determine. 
(f) The requirement of section 45(b) of the District of Columbia 
Business Corporation Act (D.C. Code, sec. 29-920(b)) as to the per-
centage of stock which a stockholder must hold in order to have the 
rights of inspection and copying set forth in that subsection shall 
not be applicable in the case of holders of the stock of the Corpora-
tion, and they may exercise such rights without regard to the per-
centage of stock they hold. 
SEC. 
3
0
5
. 
GENERAL 
POWERS 
OF 
THE 
CORPORATION. 
The Corporation is authorized to own, manage, operate, or con-
tract for the operation of intercity trains operated for the purpose of 
providing modern, efficient, intercity transportation of passengers and 
to carry mail and express on such trains; to conduct research and 
development related to its mission; and to acquire by construction, 
purchase, or gift, or to contract for the use of, physical facilities, 
equipment, and devices necessary to rail passenger operations. The 
Corporation shall, consistent with prudent management of the affairs 
of the Corporation, rely upon railroads to provide the employees neces-
sary to the operation and maintenance of its passenger trains and to 
the performance of all services and work incidental thereto, to the 
extent the railroads are able to provide such employees and services 
in an economic and efficient manner. To carry out its functions and 
purposes, the Corporation shall have the usual powers conferred upon 
a stock corporation by the District of Columbia Business Corporation 
Act. 
SEC. 306. APPLICABILITY OF THE INTERSTATE COMMERCE ACT AND 
OTHER LAWS. 
(a) The Corporation shall be deemed a common carrier by railroad 
within the meaning of section 1(^3) of the Interstate Commerce Act 
and shall be subject to all provisions of the Interstate Commerce Act 
other than those pertaining to— 
(1) regulation of rates, fares, and charges; 
(2) abandonment or extension of lines of railroads utilized 
solely for passenger service, and the abandonment or extension of 
operations over such lines of railroads, whether by trackage rights 
or otherwise; 
(3) regulation of routes and service and, except as otherwise 
provided in this Act, the discontinuance or change of passenger 
train service operations. 
84 STAT. ] 
PUBLIC LAW 91-518-OCT. 30, 1970 
1333 
(b) The Corporation shall be subject to the same laws and regula-
tions with respect to safety and with respect to the representation of 
its employees for purposes of collective bargaining, the handling of 
disputes between carriers and their employees, employee retirement, 
annuity and unemployment systems, and other dealings with its 
employees as any other common carrier subject to part I of the Inter-
state Commerce Act. 
24 stat. 379; 
(c) The Corporation shall not be subject to any State or other law ^M^usc aVand 
pertaining to the transportation of passengers by railroad as it relates note. 
to rates, routes, or service. 
(d) Leases and contracts entered into by the Corporation, regard-
less of the place where the same may be executed, shall be governed by 
the laws of the District of Columbia. 
(e) Persons contracting with the Corporation for the joint use or 
operation of such facilities and equipment as may be necessary for the 
provision of efficient and expeditious passenger service shall be and 
are hereby relieved from all prohibitions of existing law, including 
the antitrust laws of the United States, with respect to such contracts, 
agreements, or leases insofar as may be necessary to enable them to 
enter into such contracts and to perform their obligations thereunder. 
SEC. 307. SANCTIONS. 
(a) If the Corporation or any railroad engages in or adheres to 
any action, practice, or policy inconsistent with the policies and pur-
poses of this Act, obstructs or interferes with any activities authorized 
by this Act, refuses, fails, or neglects to discharge its duties and respon-
sibilities under this Act, or threatens any such violation, obstruc-
tion, interference, refusal, failure, or neglect, the district court of the 
United States for any district in which the Corporation or other 
person resides or may be found shall have jurisdiction, except as other-
wise prohibited by law, upon petition of the Attorney General of the 
United States or, in a case involving a labor agreement, upon petition 
of any employee affected thereby, including duly authorized employee 
representatives, to grant such equitable relief as may be necessary or 
appropriate to prevent or terminate any violation, conduct, or threat. 
(b) Nothing contained in this section shall be construed as relieving 
any person of any punishment, liability, or sanction which may be 
imposed otherwise than under this Act. 
SEC. 308. REPORTS TO THE CONGRESS. 
(a) The Corporation shall transmit to the President and the Con-
gress, annually, commencing one year from the date of enactment of 
this Act, and at such other times as it deems desirable, a compre-
hensive and detailed report of its operations, activities, and accom-
plishments under this Act, including a statement of receipts and 
expenditures for the previous year. At the time of its annual report, 
the Corporation shall submit such legislative recommendations as it 
deems desirable, including the amount of financial assistance needed 
for operations and for capital improvements, the manner and form 
in which the amount of such assistance should be computed, and the 
sources from which such assistance should be derived. 
(b) The Secretary and the Commission shall transmit to the Presi-
dent and the Congress, one year following the date of enactment of 
this Act and biennially thereafter, reports on the state of rail passen-
ger service and the effectiveness of this Act in meeting the require-
ment for a balanced national transportation system, together with 
any legislative recommendations. 
Annual reports. 
Legislative 
re commendations . 
Biennial reports. 
1334 
PUBLIC LAW 91-518-OCT. 30, 1970 
[84 STAT. 
TITLE IV—PROVISION OF RAIL PASSENGER SERVICES 
SEC. 401. ASSUMPTION OF PASSENGER SERVICE BY THE CORPORA-
TION; COMMENCEMENT OF OPERATIONS. 
as^en^er^sTrv. 
(^) (^) ^ ^ ^^ before May 1, 1971, the Corporation is authorized 
ice, contracts. 
to coiitract and, upon written request therefor from a railroad, shall 
tender a contract to relieve the railroad, from and after May 1, 
1971, of its entire responsibility for the provision of intercity rail 
passenger service. On or after March 1, 1973, but before January 1, 
1975, the Corporation is authorized to contract, and upon written 
request therefor, shall tender a contract to relieve the railroad of its 
entire responsibility for the provision of intercity rail passenger serv-
ice and such relief shall become effective upon the date on which such 
contract is entered into. Contracts may be entered into on or before 
May 1, 19Y1, notwithstanding the fact that the decision of the Com-
Ante, p. 1328. 
missiou uuder section 102(f) of this Act with respect to avoidable loss 
has not become final. Any contract entered into before such decision 
of the Commission has become final shall be subject to adjustment to 
assure that the contract is consistent with such final decision of the 
Commission. The contract may be made upon such terms and condi-
tions as necessary to permit the Corporation to undertake passenger 
service on a timely basis. Upon its entering into a valid contract 
(including protective arrangements for employees), the railroad shall 
be relieved of all its responsibilities as a common carrier of passengers 
by rail in intercity rail passenger service under part I of the Interstate 
24 Stat. 379; 
Commercc Act or any State or other law relatmg to the provision of 
^^g^usc 27'and 
intercity passenger service: Provided, That any railroad discontinu-
note. 
ing a train hereunder must give notice in accordance with the notice 
procedures contained in section 13a (1) of the Interstate Commerce 
72 Stat. 571. 
^^ct. 
passenge/serv- 
(2) lu Consideration of being relieved of this responsibility by the 
ice deficit pay- 
Corporatlou, the railroad shall agree to pay to the Corporation each 
'"*"*^* 
year for three years an amount equal to one-third of 50 per centum 
of the fully distributed passenger service deficit of the railroad as 
reported to the Commission for the year ending December 31, 1969. 
The payment to the Corporation may be made in cash or, at the 
option of the Corporation, by the transfer of rail passenger equip-
ment or the provision of future service as requested by the Corpora-
tion. Unless the railroad waives all rights to receive stock in exchange 
for its payments, the railroad shall receive common stock from the 
Corporation in an amount equivalent in par value to each payment. 
(3) In agreeing to pay the amount specified in paragraph (2) of 
this subsection, a railroad may reserve the right to pay a lesser sum 
to be determined by calculating either of the following: 
(A) 100 per centum of the avoidable loss of all intercity rail 
passenger service operated by the railroad during the period 
January 1, 1969, through December 31, 1969; or 
(B) 200 per centum of the avoidable loss of the intercity rail 
passenger service operated by the railroad during the period 
January 1, 1969, through December 31, 1969, covering all inter-
city service over the routes between those points between which 
Ante. p. 1329. 
^^iQ Sccrctary, under sections 201 and 202 of title I I of this Act, 
has specified that intercity passenger trains shall be operated 
within the basic system. 
If the amount owed the Corporation under either of these alternatives 
is agreed by the parties to be less than the amount paid pursuant to 
paragraph (2), the Corporation shall pay the difference to the railroad 
and the railroad shall surrender to the Corporation an amount of 
stock, at par value, equivalent to such payment. If the railroad and the 
84 STAT. ] 
PUBLIC LAW 91-518-OCT. 30, 1970 
1335 
Corporation are unable to agree as to the amount owed, the matter 
shall be referred to the Interstate Commerce Commission for decision. 
The Commission, upon investigation, shall decide the issue within 
ninety days following the date of referral, or within such additional 
time as the Commission may order not to exceed an aggregate of one 
hundred and eightj days following such date of referral, and its 
decision shall be binding on both parties. 
(4) The payments to the Corporation shall be made in accordance 
with a schedule to be agreed upon between the parties. Unless the 
parties otherwise agree, the payments for each of the first twelve 
months following the date on which the Corporation assumes any of 
the operational responsibilities of the railroad shall be in cash and 
not less than one thirty-sixth of the amount owed. 
(b) On May 1, 1971, the Corporation shall begin the provision 
of intercity rail passenger service between points within the basic 
system unless such service is being provided (i) either by a railroad 
with which it has not entered into a contract under subsection (a) of 
this section or (ii) by a regional transportation agency, provided such 
agency gives satisfactory assurance to the Corporation of the agency's 
financial and operating capability to provide such service, and of its 
willingness to cooperate with the Corporation and with other regional 
transportation agencies on matters of through train service, through 
car service, and connecting train service. The Corporation may at any 
time subsequent to May 1, 1971, contract with a regional transporta-
tion agency to provide intercity rail passenger service between points 
within the basic system included within the service of such agency. 
(c) No railroad or any other person may, without the consent of the 
Corporation, conduct intercity rail passenger service over anv route 
over which the Corporation is performing scheduled intercity rail 
passenger service pursuant to a contract under this section. 
SEC. 402. FACILITY AND SERVICE AGREEMENTS. 
(a) The Corporation may contract with railroads or with regional 
transportation agencies for the use of tracks and other facilities and 
the provision of services on such terms and conditions as the parties 
may agree. In the event of a failure to agree, the Interstate Commerce 
Commission shall, if it finds that doing so is necessary to carry out the 
purposes of this Act, order the provision of services or the use of tracks 
or facilities of the railroad by the Corporation, on such terms and for 
such compensation as the Commission may fix as just and reasonable, 
and the rights of the Corporation to such services or to the use of tracks 
or facilities of the railroad or agency under such order or under an 
order issued under subsection (b) of this section shall be conditioned 
upon payment by the Corporation of the compensation fixed by the 
Commission. If the amount of compensation fixed is not duly and 
promptly paid, the railroad or agency entitled thereto may bring an 
action against the Corporation to recover the amount properly owed. 
(b) To facilitate the initiation of operations by the Corporation 
within the basic system, the Commission shall, upon application by the 
Corporation, require a railroad to make immediately available tracks 
and other facilities. The Commission shall thereafter promptly pro-
ceed to fix such terms and conditions as are just and reasonable. 
SEC. 403. NEW SERVICE. 
(a) The Corporation may provide intercity rail passenger service 
in excess of that prescribed "for the basic system, either within or out-
side the basic system, including the operation of special and extra 
passenger trains, if consistent with prudent management. Any inter-
city rail passenger service provided under this subsection for a con-
tinuous period of two years shall be designated by the Secretary as 
a part of the basic system. 
Payment sched-
ule. 
Operations, com-
mencement. 
Prohibition. 
Interstate Com-
merce Commission 
authority. 
47-348 O - 72 - 87 (Pt. 1) 
1336 
PUBLIC LAW 91-518~OCT. 30, 1970 
[84 STAT. 
Rail service 
beyond basic sys-
tem* 
Reimbursement 
costs* 
72 Stat. 571. 
49 u s e 13a. 
Change in serv-
ice, notice to 
Governors. 
(b) Any State, regional, or local agency may request of the Corpo-
ration rail passenger service beyond that included within the basic 
system. The Corporation shall institute such service if the State, 
regional, or local agency agrees to reimburse the Corporation for a 
reasonable portion of any losses associated with such services. 
(c) For purposes of this section the reasonable portion of such 
losses to be assumed by the State, regional, or local agency, shall be no 
less than 66% per centum of, nor more than, the solely related costs 
and associated capital costs, including interest on passenger equip-
ment, less revenues attributable to, such service. If the Corporation 
and the State, regional, or local agency are unable to agree upon a 
reasonable apportionment of such losses, the matter shall be referred 
to the Secretary for decision. In deciding this issue the Secretary shall 
take into account the intent of this Act, and the impact of requiring 
the Corporation to bear such losses upon its ability to provide 
improved service within the basic system. 
SEC. 404. DISCONTINUANCE OF SERVICE. 
(a) Unless it has entered into a contract with the Corporation pur-
suant to section 401(a) (1) of this Act, no railroad may discontmue 
any intercity passenger train whatsoever prior to January 1,1975, the 
provisions of any other Act, the laws or constitution of any State, or 
the decision or order of, or the pendency of any proceeding before, a 
Federal or State court, agency, or authority to the contrary notwith-
standing. On and after January 1,1975, passenger train service oper-
ated by such railroad may be discontinued under the provisions of 
section 13a of the Interstate Commerce Act. Upon filing of a notice 
of discontinuance by such railroad, the Corporation may undertake to 
initiate passenger train operations between the points served. 
(b) (1) The Corporation must provide the service included within 
the basic system until July 1,1973, to the extent it has assumed respon-
sibility for such service by contract with a railroad pursuant to section 
401 of this Act. 
(2) Except as provided in section 403 (a) of this Act, service beyond 
that prescribed for the basic system undertaken by the Corporation 
upon its own initiative may be discontinued at any time. 
(3) If at any time after July 1, 1973, the Corporation determines 
that any train or trains in the basic system in whole or in part are 
not required by public convenience and necessity, or will impair the 
ability of the Corporation to adequately provide other services, such 
train or trains may be discontinued under the procedures of section 
13a of the Interstate Commerce Act (49 U.S.C. 13a) : Provided, hoic-
ever. That at least thirty days prior to any change or discontinuance, 
in whole or in oart, of any service under this subsection, the Corpora-
tion shall mail to the Governor of each State in which the train in 
question is operated, and post in every station, depot, or other facility 
served thereby notice of the proposed change or discontinuance. The 
Corporation may not change or discontinue this service if prior to the 
end of the thirty-day notice period. State, regional, or local agencies 
request continuation of the service and within ninety days agree to re-
imburse the Corporation for a reasonable portion of any losses asso-
ciated with the continuation of service beyond the notice period. 
(4) For the purposes of paragraph (3) of this subsection, the 
reasonable portion of such losses to be assumed by the State, regional, 
or local agency shall be no less than 66% per centum of, nor more than, 
the solely related costs and associated capital costs, including interest 
on passenger equipment, less revenues attributable to, such service. If 
the Corporation and the State, regional, or local agencies are unable 
to agree upon a reasonable apportionment of such losses, the matter 
84 STAT. ] 
PUBLIC LAW 91-518-OCT. 30, 1970 
1337 
shall be referred to the Secretary for decision. In deciding this issue 
the Secretary shall take into account the purposes of this Act and the 
impact of requiring the Corporation to bear such losses upon its ability 
to provide improved service within the basic system. 
SEC. 405. PROTECTIVE ARRANGEMENTS FOR EMPLOYEES. 
(a) A railroad shall provide fair and equitable arrangements to 
protect the interests of employees affected by discontinuances of inter-
city rail passenger service whether occurring before, on, or after 
January 1,1975. 
(b) Such protective arrangements shall include, without being lim-
ited to, such provisions as may be necessary for (1) the preservation 
of rights, privileges, and benefits (including continuation of pension 
rights and benefits) to such employees under existing collective-bar-
f
aining agreements or otherwise; (2) the continuation of coUective-
ar^aining rights; (3) the protection of such individual employees 
against a worsening of their positions with respect to their employ-
ment; (4) assurances of priority of reemployment of employees 
terminated or laid off; and (5) paid training or retraining programs. 
Such arrangements shall include provisions protecting individual 
employees against a worsening of their positions with respect to their 
employment which shall in no event provide benefits less than those 
established pursuant to section 5(2) (f) of the Interstate Commerce 
Act. Any contract entered into pursuant to the provisions of this title 
54 stat. 905. 
shall specify the terms and conditions of such protective arrangements. 
'*^ ^^^ ^' 
No contract under section 401(a) (1) of this Act between a railroad 
and the Corporation may be made unless the Secretary of Labor has 
certified to the Corporation that the labor protective provisions of 
such contract afford affected employees fair and equitable protection 
by the railroad. 
(c) After commencement of operations in the basic system, the 
substantive requirements of subsection (b) of this section shall apply 
to the Corporation. The certification by the Secretary of Labor that 
employees affected have been provided fair and equitable protection 
as required by this section shall be a condition to the completion of 
any transaction requiring such protection. 
(d) The Corporation shall take such action as may be necessary 
to insure that all laborers and mechanics employed by contractors and 
subcontractors in the performance of construction work financed with 
the assistance of funds received under any contract or agreement 
entered into under this title shall be paid wages at rates not less than 
those prevailing on similar construction in the locality as determined 
by the Secretary of Labor in accordance with the Davis-Bacon Act. 78*1^1**238°^^' 
The Corporation shall not enter into any such contract or agreement 
40 use 276*. 
without first obtaining adequate assurance that required labor stand- 2760-5. 
ards will be maintained on the construction work. Health and safety 
standards promulgated by the Secretary of Labor pursuant to section 
107 of the Contract Work Hours and Safety Standards Act (40 
U.S.C. 333) shall be applicable to all construction work performed 
^^ ^*"** ^^* 
under such contracts or agreements, except any construction work 
performed by a railroad employee. Wage rates provided for in col-
lective barsraining agreements negotiated under and pursuant to the 
Railway Labor Act shall be considered as being in compliance with 
'*'* stat. 577; 
the Davis-Bacon Act. 
(e) The Corporation shall not contract out any work normally 
performed by employees in any bargaining unit covered by a contract 
between the Corporation or any railroad providing intercity rail pas-
senger service upon the date of enactment of this Act and any labor 
organization, if such contracting out shall result in the layoff of any 
employee or employees in such bargaining unit. 
49 Stat. 1189. 
45 u s e 151-188. 
1338 
PUBLIC LAW 91-518-OCT. 30, 1970 
[84 
STAT. 
Maturity date. 
Appropriation, 
TITLE V—ESTABLISHMENT OF A FINANCIAL 
INVESTMENT ADVISORY PANEL 
SEC. 501. APPOINTMENT OF ADVISORY PANEL. 
Within thirty days after enactment of this Act, the President shall 
appoint a fifteen-man financial advisory panel. Six members of the 
panel shall represent the business of investment banking, commercial 
banking, and rail transportation. Two members shall be representa-
tives of the Secretary of the Treasury and seven members shall repre-
sent the public in the various regions of the Nation. 
SEC. 502. PURPOSE OF ADVISORY PANEL. 
The advisory panel appointed by the President shall advise the 
directors of the Corporation on ways and means of increasing capi-
talization of the Corporation. 
SEC. 503. REPORT TO CONGRESS. 
On or before January 1, 1971, the panel shall submit a report to 
Congress evaluating the initial capitalization of the Corporation and 
the prospects for increasing its capitalization. 
TITLE VI—FEDERAL FINANCIAL ASSISTANCE 
SEC. 601. FEDERAL GRANTS. 
There is authorized to be appropriated to the Secretary in fiscal 
year 1971, $40,000,000 to remain available until expended, for pay-
ment to the Corporation for the purpose of assisting in— 
(1) the initial organization and operation of the Corporation; 
(2) the establishment of improved reservations systems and 
advertising; 
(3) servicing, maintenance, and repair of railroad passenger 
equipment; 
(4) the conduct of research and development and demonstra-
tion programs respecting new rail passenger services; 
(5) the development and demonstration of improved rolling 
stock; and 
(6) essential fixed facilities for the operation of passenger 
trains on lines and routes included in the basic system over which 
no through passenger trains are being operated at the time of 
enactment of this Act, including necessary track connections 
between lines of the same or different railroads. 
SEC. 602. GUARANTY OF LOANS. 
The Secretary is authorized, on such terms and conditions as he 
may prescribe, to guarantee any lender against loss of principal or 
interest on securities, obligations, or loans issued to finance the 
upgrading of roadbeds and the purchase by the Corporation or agency 
of new rolling stock, rehabilitation of existing rolling stock and for 
other corporate purposes. The maturity date of such securities, obli-
gations, or loans, including all extensions and renewals thereof, shall 
not be later than twenty years from their date of issuance, and the 
amount of guaranteed loans outstanding at any time may ^^ot exceed 
$100,000,000. The Secretary shall prescribe and collect 
" 
the '^-^ 
ing institution a reasonable annual guaranty fee. Thero 
t 
to be appropriated such amounts as necessary to carry out tiiis beet 
j 
not to exceed $100,000,000. 
84 STAT. ] 
PUBLIC LAW 91-518-OCT. 30, 1970 
1339 
TITLE VII—INTERIM EMERGENCY FEDERAL 
FINANCIAL ASSISTANCE 
Conditions, 
SEC. 701. INTERIM AUTHORITY TO PROVIDE EMERGENCY FINANCIAL 
ASSISTANCE 
FOR RAILROADS OPERATING 
PASSENGER 
SERVICE. 
(a) For the purpose of permitting a railroad to enter into or carry 
out a contract entered into under this Act, the Secretary is authorized, 
on such terms and conditions as he may prescribe, to (1) make loans 
to such railroad, or (2) guarantee any lender against loss of principal 
or interest on any loan to such railroad. 
(b) Before making a loan or a guarantee under this section, the 
Secretary must find, in writing, that— 
(1) the loan or guarantee is necessary to carry out the provi-
sions of this Act; 
(2) the proceeds of any loan made or guaranteed under this 
Act will be used solely to carry out contracts entered into under 
this Act; 
(3) the loan or guarantee is not otherwise available on reason-
able terms and conditions; and 
(4) there is reasonable assurance that the business affairs of 
the railroad will be conducted in a prudent manner. 
(c) (1) In any case in which there is a liquidation of the assets of 
any railroad which is the recipient of a loan made or guaranteed under 
this Act, the United States shall have the first right to redeem that 
portion of such assets consisting of those rights-of-way, tracks, and 
other facilities designated by the Secretary to be necessary for the 
purpose of providing intercity rail passenger service, including serv-
ices employing innovative technology, within the basic system. 
(2) It is the intent of the Congress that, in the case of a loan guar-
antee under this Act, the United States shall stand in the same position 
with respect to other creditors as in the case of a direct loan by the 
United States giving the United States priority over secured and 
unsecured creditors. 
(d) Interest on loans made under this section shall be at a rate not 
less than a rate determined by the Secretary of the Treasury, taking Trea'surTs 
into consideration the current average market yield on outstanding ^^'•y* 
marketable obligations of the United States with remaining periods 
to maturity comparable to the average maturity of such loans adjusted 
to the nearest one-eighth of one per centum. 
(e) The maturity date on any loan made or guaranteed under this 
section, including renewals and extensions thereof, shall not be later 
than five years from the date of issuance. 
(f) The aggregate amount of loans and loan guarantees made under 
this section shall not exceed $200,000,000. 
SEC. 702. AUTHORIZATION FOR APPROPRIATIONS. 
There are hereby authorized to be appropriated such amounts not 
to exceed $200,000,000 as may be necessary to carry out the purposes 
of this title. Any sums appropriated shall be available until expended. 
TITLE VIII—MISCELLANEOUS PROVISIONS 
Interest rate, 
determination by 
ecre-
SEC. SOL ADEQUACY OF SERVICE. 
The Commission is authorized to prescribe such regulations as it 
considers necessary to provide safe and adequate service, equipment, 
and facilities for intercity rail passenger service. Any person who 
violates a regulation issued under this section shall be subject to a 
civil penalty of not to exceed $500 for each violation. Each day a 
violation continues shall constitute a separate offense. 
Regulations, 
violation, penalty. 
1340 
PUBLIC LAW 91.518-OCT. 30, 1970 
[84 STAT. 
59 Stat. 600; 
70 Stat. 667. 
Annual audit by 
independent ac-
countants. 
Records, avail-
ability. 
Report to Con-
gress, contents. 
Ante, p. 1333. 
Audit by Comp-
troller General. 
Records, avail-
ability. 
Report to Con-
gress, contents. 
SEC. 8a2. EFFECT ON PENDING PROCEEDINGS. 
Upon enactment of this Act, no railroad may discontinue any inter-
city rail passenger service whatsoever other than in accordance with 
the provisions of this Act, notwithstanding the provisions of any other 
Act, the laws or constitution of any State, or the decision or order of, 
or the pendency of any proceeding before, any Federal or State court, 
agency, or authority. 
SEC. 803. SEPARABILITY. 
If any provision of this Act or the application thereof to any person 
or circumstance is held invalid, the remainder of the Act and the 
application of such provision to other persons or circumstances shall 
not be affected thereby 
SEC. 804. ACCOUNTABILITY. 
Section 201 of the Government Corporation Control Act (31 U.S.C. 
856) is amended by striking out "and" immediately preceding "(5)" 
and b}^ inserting immediately before the period at the end thereof the 
following: "and (6) the National Railroad Passenger Corporation". 
SEC. 805. RECORDS AND AUDIT OF THE CORPORATION. 
(1) (A) The accounts of the Corporation shall be audited annually 
in accordance with generally accepted auditing standards by inde-
pendent certified public accountants or independent licensed public 
accountants certified or licensed by a regulatory authority of a State or 
other political subdivision of the United States. The audit shall be 
conducted at the place or places where the accounts of the Corporation 
are normally kept. All books, accounts, financial records, reports, files, 
and other papers, things, or property belonging to or in use by the 
Corporation and necessary to facilitate the audit shall be made avail-
able to the person conducting the audit; and full facilities for verify-
ing transactions with the balances or securities held by depositories, 
fiscal agents, and custodians shall be afforded to such person. 
(B) The report of each such independent audit shall be included in 
the annual report required by section 308(a) of this Act. The audit 
report shall set forth the scope of the audit and include such state-
ments as are necessary to present fairly the Corporation's assets and 
liabilities, surplus or deficit, with an analysis of the changes therein 
during the year, supplemented in reasonable detail by a statement of 
the Corporation's income and expenses during the year, and a state-
ment of the sources and application of funds, together with the inde-
pendent auditor's opinion of those statements. 
(2) (A) The financial transactions of the Corporation for any fiscal 
year during which Federal funds are available to finance any portion 
of its operations' may be audited by the Comptroller General of the 
United States in accordance with the principles and procedures ap-
plicable to commercial corporate transactions and under such rules 
and regulations as may be prescribed by the Comptroller General. 
Any such audit shall be conducted at the place or places where 
accounts of the Corporation are normally kept. The representative of 
the Comptroller General shall have access to all books, accounts, 
records, reports, files, and other papers, things, or property belonging 
to or in use by the Corporation pertaining to its financial transactions 
and necessary to facilitate the audit, and they shall be afforded full 
facilities for verifying transactions with the balances or securities held 
by depositories, fiscal agents, and custodians. All such books, accounts, 
records, reports, files, papers, and property of the Corporation shall 
remain in possession and custody of the Corporation. 
(B) A report of each such audit shall be made by the Comptroller 
General to the Congress. The report to the Congress shall contain 
such comments and information as the Comptroller General may 
84 STAT. ] 
PUBLIC LAW 91-518-OCT. 30, 1970 
1341 
deem necessary to inform Congress of the financial operations and 
condition of the Corporation, together with such recommendations 
with respect thereto as he may deem advisable. The report shall also 
show specifically any program, expenditure, or other financial trans-
action or undertaking observed in the course of the audit, which, in 
the opinion of the Comptroller General, has been carried on or made 
without authority of law. A copy of each report shall be furnished 
copies, 
to the President, to the Secretary, and to the Corporation at the 
time submitted to the Congress. 
TITLE IX—TAX DEDUCTION FOR CERTAIN PAYMENTS 
TO T H E NATIONAL RAILROAD PASSENGER CORPO-
RATION 
SEC. 901. (a) Part V I I I of subchapter B of chapter 1 of the 
Internal Revenue Code of 1954 (relating to special deductions for 
esA stat. 72; 
corporations) is amended by adding at the end thereof the following ^\rusc 24'i-249. 
new section: 
"SEC. 250. CERTAIN PAYMENTS TO THE NATIONAL RAILROAD PASSEN-
<1ER CORPORATION. 
"(a) 
GENERAL RULE.—If— 
"(1) any corporation which is a common carrier by railroad 
(as defined in section 1(3) of the Interstate Commerce Act (49 
U.S.C. 1(3))) makes a payment in cash, rail passenger equip- 
'
*
^ stat. 474; 
ment, or services to the National Railroad Passenger Corporation ^'^ ^'°'* *^^* 
(hereinafter in this section referred to as the 'Passenger Corpo-
ration') pursuant to a contract entered into under section 401(a) 
of the Rail Passenger Service Act of 1970, and 
"(2) no stock in the Passenger Corporation is issued at any 
time to such corporation in connection with any contract entered 
into under such section 401(a), 
then the amount of such payment shall (subject to subsection (c)) 
be allowed as a deduction for the taxable year in which it is made. 
"(b) W H E N PAYMENT Is MADE.—Under regulations prescribed by 
the Secretary or his delegate, a payment in rail passenger equipment 
shall be treated as made when title to the equipment is transierred, 
and a payment in services shall be treated as made when the services 
are rendered. 
"(c) 
EFFECT OF CERTAIN SUBSEQUENT ACQUISITIONS OF STOCK.— 
" (1) DISALLOWANCE OF DEDUCTIONS.—If any deduction has been 
allowed under subsection (a) to a corporation and such corpora-
tion (or a successor corporation) acquires any stock in the Pas-
senger Corporation (other than m a transaction described in sec-
tion 374 or 381) before the close of the 36-month period which eg A
* lutV m.' 
begins with the day on which the last payment is made to the 
26 use 374i38i. 
Passenger Corporation pursuant to the contract entered into 
under such section 401 (a), then such deduction shall be disallowed 
(as of the close of the taxable year for which it was allowed under 
subsection (a)). 
"(2) COLLECTION or DEFICIENCY.—If any deduction is disal-
lowed by reason of paragraph (1), then the periods of limitation 
provided in sections 6501 and 6502 on the making of an assess- 
seljsc^esS^* 
ment and the collection by levy or a proceeding m court shall, 6502. 
with respect to any deficiency (including interest and additions 
to the tax) resulting from such a disallowance, include one year 
following the date on which the person acquiring the stock which 
results in the disallowance (in accordance with regulations pre-
scribed by the Secretary or his delegate) notifies the Secretary 
or his delegate of such acquisition; and such assessment and col-
1342 
PUBLIC LAW 91-519-NOV. 2, 1970 
[84 STAT. 
78 Stat. 120; 
83 Stat. 602. 
26 u s e 1563. 
Effective date. 
lection may be made notwithstanding any provision of law or 
rule of law which otherwise would prevent such assessment and 
collection. 
"(d) MEMBERS OF CONTROLLED (TROUP.—Under regulations pre-
scribed by the Secretary or his delegate, if a corporation is a member 
of a controlled group of corporations (within the meaning of section 
1563), subsections (a)(2) and (c) shall be applied by treating all 
members of such controlled group as one corporation.'' 
(b) The table of sections for such part VIII is amended by adding 
at the end thereof the following: 
"Sec. 250. Certain payments to the National Railroad Pas-
senger Corporation." 
(c) The amendments made by this section shall apply to taxable 
years ending after the date of the enactment of this Act. 
Approved October 30, 1970. 
November 2, 1970 
[S.3586] 
Public Law 91-519 
AN ACT 
To amend title VII of the Public Health Service Act to establish eligibility of 
new schools of medicine, dentistry, osteopathy, pharmacy, optometry, veter-
inary medicine, and podiatry for institutional grants under section 771 thereof, 
to extend and improve the program relating to training of personnel in the 
allied health professions, and for other purposes. 
Health Training 
Improvement Act 
of 1970. 
Be it enacted hy the Senate and House of Representatives 
of the 
United States of America in Congress 
assembled, 
SHORT TITLE 
SECTION 1. This Act may be cited as the "Health Training Improve-
ment Act of 1970". 
TITLE I—SCHOOLS OF MEDICINE, DENTISTEY, OSTE-
OPATHY, 
PHARMACY, 
OPTOMETRY, 
VETERINARY 
MEDICINE, AND PODIATRY