An Act to improve the quality of rail services in the United States through regulatory reform, coordination of rail services and facilities, and rehabilitation and improvement financing, and for other purposes.
PL 94-210 (S.2718), enacted 02/05/1976

PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 31 
Public Law 94-210 
94th Congress 
An Act 
To improve the quality of rail services in the United States through regulatory 
—feb. 5, 197o 
reform, coordination of rail services and facilities, and rehabilitation and 
[S. 2718] 
improvement financing, and for other purposes. 
Railroad 
Be it enacted hy the Senate and House of Representatives of the 
United States of America in Congress assembled, That this Act, 
divided into titles and sections according to the following table of Revitelization 
contents, may be cited as tb.e "Railroad Revitalization and Regulatory- ^nd Regulatoi7 
Reform Act of 1976": 
f^^^™ 
TABLE OF CONTENTS 
45 u s e 801 note. 
TITLE I—GENERAL PROVISIONS 
Sec. 101. Declaration of policy. 
Sec. 102. Definitions. 
TITLE II—RAILROAD RATES 
Sec. 201. Expeditious divisions of revenues. 
Sec. 202. Railroad ratemaking. 
Sec. 203. Tariff modifications. 
Sec. 204. Investigation of discriminatory freight rates for the transportation of 
recyclable or recycled materials. 
Sec. 205. Adequate revenue levels. 
Sec. 206. Rate incentives for capital investment. 
Sec. 207. Exemptions from Interstate Commerce Act. 
Sec. 208. Rate bureaus. 
Sec. 209. Filing procedures. 
Sec. 210. Intrastate railroad rate proceedings. 
See. 211. Demurrage charges. 
Sec. 212. Car service compensation and practices. 
TITLE III—REFORM OF THE INTERSTATE COMMERCE 
COMMISSION 
Sec. 301. Access to information by congressional committees. 
Sec. 302. Effective date of orders of the Commission. 
Sec. 303. Commission hearing and appellate procedure. 
Sec. 304. Office of Rail Public Counsel. 
Sec. 305. Reform of rules of practice before the Commission. 
Sec. 306. Prohibiting discriminatory tax treatment of transportation property. 
Sec. 307. Uniform cost and revenue accounting system. 
Sec. 308. Securities. 
Sec. 309. Rail Services Planning Office. 
Sec. 310. Equitable distribution of cars for unit train service. 
Sec. 311. Appropriations request. 
Sec. 312. Law revision. 
TITLE IV—MERGERS AND CONSOLIDATIONS 
Sec. 401. Responsibilities of the Secretary. 
Sec. 402. Merger procedure. 
Sec. 403. Expedited railroad merger procedure. 
TITLE V—RAILROAD REHABILITATION AND IMPROVEMENT 
FINANCING 
Sec. 501. Definitions. 
Sec. 502. The Rail Fund. 
Sec. 503. Classification and designation of rail lines. 
Sec. 504. Capital needs study. 
Sec. 505. Rehabilitation and improvement financing. 
89-194 O—78—pt. 1 
6 
90 STAT. 32 
PUBLIC LAW 94-210—FEB. 5, 1976 
TABLE OF CONTENTS—Continued 
TITLE V—RAILROAD REHABILITATION AND IMPROVEMENT 
FINANCING—Continued 
Sec. 506. Redeemable preference shares. 
Sec. 507. Fund anticipation notes. 
Sec. 608. Fund bonds. 
Sec. 509. Authorizations. 
Sec. 510. Exemption. 
Sec. 511. Guarantee of obligations. 
Sec. 512. Issuance of notes or obligations. 
Sec. 513. Default on guaranteed obligations. 
Sec. 514. Audit of transactions. 
Sec. 515. Annual report. 
Sec. 516. Employee protection. 
Sec. 517. Intercity rail passenger service. 
y : . 
TITLE VI—IMPLEMENTATION OF THE FINAL SYSTEM PLAN 
' 
' 
Sec. 601. General. 
Sec. 602. Special court. 
Sec. 603. Finance Committee. 
Sec. 604. Obligations of the Association. 
Sec. 605. Debentures and series A preferred stock. 
Sec. 606. Loans. 
Sec. 607. Miscellaneous amendments to title II. 
Sec. 608. Capitalization of the Corporation. 
Sec. 609. Protection of Federal funds. 
Sec. 610. Continuing reorganization; supplemental transactions. 
Sec. 611. Officers and directors of the Corporation, 
Sec. 612. Miscellaneous amendments to title III. 
Sec. 613. Definitions. 
. 
, 
Sec. 614. Employment offers. 
Sec. 615. Collective bargaining agreements. 
Sec. 616. Employee protection. 
Sec. 617. Duties of acquiring and selling railroads. 
Sec. 618. Exemptions. 
Sec. 619. Application of the National Environmental Policy Act. 
TITLE VII—NORTHEAST CORRIDOR PROJECT IMPLEMENTATION 
Sec. 701. National Railroad Passenger Corporation. 
Sec. 702. Operations Review Panel. 
Sec. 703. Required goals. 
Sec. 704. Funding. 
Sec. 705. Conforming amendments. 
Sec. 706. Facilities with historical or architectural significance. 
TITLE VIII—LOCAL RAIL SERVICE CONTINUATION 
Sec. 801. Extension of service. 
«'. 
Sec. 802. Discontinuance or abandonment. 
Sec. 803. Local rail service assistance. 
Sec. 804. Termination and continuation of rail services. 
Sec. 805. Continuation assistance. 
See. 806. Repeal. 
, 
. 
r^ 
Sec. 807. Rail passenger service. 
Sec. 808. Emergency operating assistance. 
Sec. 809. Conversion of abandoned railroad rights-of-way. 
Sec. 810. Rail bank. 
TITLE IX—MISCELLANEOUS PROVISIONS 
Sec. 901. Comprehensive study of rail system. 
Sec. 902. Study of aid to rail transportation. 
Sec. 903. Study of conglomerates. 
" 
Sec. 904. Rail abandonment report. 
Sec. 905. Nondiscrimination. 
Sec. 906, Minority Resource Center. 
;, ''jt-* 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 33 
TITLE I—GENERAL PROVISIONS 
DECLARATION o r POLICY 
SEC. 101. (a) PURPOSE.—It is the purpose of the Congress in this Act 45 USC 801. 
to provide the means to rehabilitate and maintain the physical facili-
ties, improve the operations and structure, and restore the financial 
stability of the railway system of the United States, and to promote 
the revitalization of such railway system, so that this mode of trans-
portation will remain viable in the private sector of the economy and 
will be able to provide energy-efficient, ecologically compatible trans-
portation services with greater efficiency, effectiveness, and economy, 
through— 
(1) ratemaking and regulatory reform; 
(2) the encouragement of efforts to restructure the system on a 
more economically justified basis, including planning authority 
in the Secretary of Transportation, an expedited procedure for 
determining whether merger and consolidation applications are 
in the public interest, and continuing reorganization authority; 
(3) financing mechanisms that will assure adequate rehabilita-
tion and improvement of facilities and equipment, implementa-
tion of the final system plan, and implementation of the Northeast 
G)rridor project; 
(4) transitional continuation of service on light-density rail 
lines that are necessary to continued employment and community 
well-being throughout the United States; 
(5) auditing, accounting, reporting, and other requirements to 
protect Federal funds and to assure repayment of loans and finan-
cial responsibility; and 
(6) necessary studies. 
(b) POLICY.—It is declared to be the policy of the Congress in this 
Act to— 
(1) balance the needs of carriers, shippers, and the public; 
(2) foster competition among all carriers by railroad and other 
modes of transportation, to promote more adequate and efficient 
transportation services, and to increase the attractiveness of 
investing in railroads and rail-service-related enterprises; 
(3) permit railroads greater freedom to raise or lower rates for 
rail services in competitive markets; 
(4) promote the establishment of railroad rate structures which 
are more sensitive to changes in the level of seasonal, regional, 
and shipper demand; 
(5) promote separate pricing of distinct rail and rail-related 
services; 
(6) formulate standards and guidelines for determining ade-
quate revenue levels for railroads; and 
(7) modernize and clarify the functions of railroad rate bureaus. 
DEFINITIONS 
SEC. 102. As used in this Act, unless the context otherwise indicates, 45 USC 802. 
the term— 
(1) "Association" means the United States Railway Associa-
tion; 
(2) "Commission" means the Interstate Commerce Commission; 
(3) "Corporation" means the Consolidated Rail Corporation; 
90 STAT. 34 
PUBLIC LAW 94-210—FEB. 5, 1976 
(4) "final system plan" means the final system plan and any 
additions thereto adopted by the Association pursuant to the 
Regional Rail Reorganization Act of 1973 (45 U.S.C. 701 et seq.); 
(5) "includes" and variants thereof should be read as if the 
' '' •" 
phrase "but is not limited to" were also set forth; 
(6) "Office" means the Rail Services Planning Office of the 
Commission; 
(7) "railroad" means a common carrier by railroad or express, 
as defined in section 1(3) of the Interstate Commerce Act (49 
U.S.C. 1(3)), and includes the National Railroad Passenger Cor-
poration and the Alaska Railroad; and 
(8) "Secretary" means the Secretary of Transportation or his 
designated representative. 
TITLE II-|^AILROAD RATES 
EXPEDITIOUS DIVISIONS OE REVENUES 
SEC. 201. Section 15(6) of the Interstate Commerce Act (49 U.S.C. 
15(6)) is amended by (1) inserting "(a)" immediately after "(6)", 
and (2) adding at the end thereof the following three new subdivisions : 
"(b) Notwithstanding any other provision of law, the Commission 
shall, within 180 days after the date of enactment of this subdivision, 
establish, by rule, standards and procedures for the conduct of proceed-
ings for the adjustment of divisions of joint rates or fares (whether 
prescribed b}^ the Commission or otherwise) in accordance with the 
provisions of this paragraph. The Commission shall issue a final order 
in all such proceedings within 270 days after the submission to the 
Report to 
Commission of a case. If the Commission is unable to issue such a final 
Congress. 
order within such time, it shall issue a report to the Congress setting 
forth the reasons for such inability. 
"(c) All evidentiary proceedings conducted pursuant to this para-
graph shall be completed, in a case brought upon a complaint, within 
1 year following the filing of the complaint, or, in a case brought upon 
the Commission's initiative, within 2 years following the commence-
ment of such proceeding, unless the Commission finds that such a 
proceeding must be extended to permit a fair and expeditious corn-
Report to 
pletion of the proceeding. If the Commission is unable to meet any 
Congress. 
such time requirement, it shall issue a report to the Congress setting 
forth the reasons for such inability. 
"(d) Whenever a proceeding for the adjustment of divisions of 
joint rates or fares (whether prescribed by the Commission or other-
wise established) is commenced by the filing of a complaint with the 
Commission, the complaining carrier or carriers shall (i) attach 
thereto all of the evidence in support of their position, and (ii) 
during the course of such proceeding, file only rebuttal or reply evi-
dence unless otherwise directed by order of the Commission. Upon 
receipt of a notice of intent to file a complaint pursuant to this para-
graph, the Commission shall accord, to the party filing such notice, the 
same right to discovery that would be accorded to a party filing a 
complaint pursuant to this paragraph.". 
RAILROAD RATEMAKING 
SEC. 202. (a) Section 1(5) of the Interstate Commerce Act (49 
U.S.C. 1(5)) is amended by inserting "(a)" immediately after "(5)" 
and by adding at the end thereof the following new sentence: "The 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 35 
provisions of this subdivision shall not apply to common carriers by 
railroad subject to this part.". 
(b) Section 1(5) of the Interstate Commerce Act (49 U.S.C. 1(5)), 
as amended by subsection (a) of this section, is further amended by 
adding at the end thereof the following new subdivisions: 
"(b) Each rate for any service rendered or to be rendered in the 
transportation of persons or property by any common carrier by rail-
road subject to this part shall be just and reasonable. A rate that is 
unjust or unreasonable is prohibited and unlawful. No rate which con-
tributes or w^hich would contribute to the going concern value of such 
a carrier shall be found to be unjust or unreasonable, or not shown to 
be just and reasonable, on the ground that such rate is below a just or 
reasonable minimum for the service rendered or to be rendered. A rate 
which equals or exceeds the variable costs (as determined through for-
mulas prescribed by the Commission) of providing a service s^^all be 
presumed, unless such presumption is rebutted by clear and convincing 
evidence, to contribute to the going concern value of the carrier or 
carriers proposing such rate (hereafter in this paragraph referred 
to as the 'proponent carrier'), In determining variable costs, the Com-
mission shall, at the request of the carrier proposing the rate, determine 
only those costs of the carrier proposing the rate and only those costs 
of the specific service in question, except where such specific data and 
cost information is not available. The Commission shall not include 
in variable cost any expenses which do not vary directlv with the 
level of service provided under the rate in question. Notwithstanding 
any other provision of this part, no rate shall be found to be unjust 
or unreasonable, or not shown to be just and reasonable, on the ground 
that such rate exceeds a just or reasonable maximum for the service 
rendered or to be rendered, unless the Commission has first found that 
the proponent carrier has market dominance over such service. A 
finding that a carrier has market dominance over a service shall not 
create a presumption that the rate or rates for such service exceed a 
just and reasonable maximum. Nothing in this paragraph shall pro-
hibit a rate increase from a level which reduces the going concern 
value of the proponent carrier to a level which contributes to such 
going concern value and is otherwise just and reasonable. For the 
purposes of the preceding sentence, a rate increase which does not 
raise a rate above the incremental costs (as determined through 
formulas prescribed by the Commission) of rendering the service to 
which such rate applies shall be presumed to be just and reasonable. 
" (c) As used in this part, the terms— 
"(i) 'market dominance' refers to an absence of effective com-
petition from other carriers or modes of transportation, for the 
traffic or movement to which a rate applies; and 
"(ii) 'rate' means any rate or charge for the transportation of 
persons or property. 
"(d) Within 240 days after the date of enactment of this subdivi-
sion, the Commission shall establish, by rule, standards and procedures 
for determining, in accordance with section 15 (9) of this part, whether 
and when a carrier possesses market dominance over a service rendered 
or to be rendered at a particular rate or rates. Such rules shall be 
designed to provide for a practical determination without administra-
tive delay. The Commission shall solicit and consider the recommenda-
tions of the Attorney General and of the Federal Trade Commission 
in the course of establishing such rules.". 
(c) Section 15 of the Interstate Commerce Act (49 U.S.C. 15) is 
amended by redesignating paragraphs (8) through (14) thereof as 
"Market 
dominance." 
"Rate." 
Standards and 
procedures. 
49 use 15. 
90 STAT. 36 
PUBLIC LAW 94-210—FEB. 5, 1976 
Annual report to 
Congress. 
•JA 
paragraphs (10) through (16) thereof, respectively, and by inserting 
therein a new paragraph (9) as follows: 
" (9) Following promulgation of standards under section 1 (5) (d) of 
this part, whenever a rate of a common carrier by railroad subject to 
this part is challenged as being unreasonably high, the Commission 
shall, upon complaint or upon its own initiative and within 90 days 
after the commencement of a proceeding to investigate the lawfulness 
of such rate, determine whether the carrier proposing such rate lias 
market dominance, within the meaning of section 1(5) (c) (i) of this 
part, over the service to which such rate applies. If the Commission 
finds that such a carrier does not have such market dominance, such 
finding shall be determinative in all additional or other proceedings 
under this Act concerning such rate or service, unless (a) such finding 
is modified or set aside by the Commission, or (b) such finding is set 
aside by a court of competent jurisdiction. Nothing in tliis paragraph 
shall limit the Commission's power to suspend a rate pursuant to this 
section, except that if the Commission has found that a carrier does not 
have such market dominance over the service to which a rate applies, 
the Commission may not suspend any increase in such rate on the 
ground that such rate as increased exceeds a just or reasonable maxi-
mum for such service, unless the Commission specifically modifies or 
sets aside its prior determination concerning market dominance over 
the service to which such rate applies.". 
(d) Section 15 of the Interstate Commerce Act (49 U.S.C. 15) is 
amended by adding at the end thereof the following two new 
paragraphs: 
"(17) Within 1 year after the date of enactment of this paragraph, 
the Commission shall establish, by rule, standards and expeditious 
procedures for the establishment of railroad rates based on seasonal, 
regional, or peak-period demand for rail services. Such standards and 
procedures shall be designed to (a) provide sufficient incentive to 
shippers to reduce peak-period shipments, through rescheduling and 
advance planning; (b) generate additional revenues for the railroads; 
and (c) improve (i) the utilization of the national supply of freight 
cars, (ii) the movement of goods by rail, (iii) levels of employment 
by railroads, and (iv) the financial stability of markets served by rail-
roads. Following the establishment of such standards and procedures, 
the Commission shall prepare and submit to the Congress annual 
reports on the implementation of such rates, including recommenda-
tions with respect to the need, if any, for additional legislation to 
facilitate the establishment of such demand-sensitive rates. 
"(18) In order to encourage competition, to promote increased rein-
vestment by railroads, and to encourage and facilitate increased non-
railroad investment in the production of rail services, a carrier by 
railroad subject to this part may, upon its own initiative or upon the 
request of any shipper or receiver of freight, file separate rates for 
distinct rail services. Within 1 year after the date of enactment of this 
paragraph, the Commission shall establish, by rule, expeditious proce-
dures for permitting publication of separate rates tor distinct rail 
services in order to (a) encourage the pricing of such services in 
accordance with the carrier's cash-outlays for such services and the 
demand therefor, and (b) enable shippers and receivers to evaluate all 
transportation and related charges and alternatives.". 
(e) Section 15 of the Interstate Commerce Act (49 U.S.C. 15), as 
amended by this Act, is further amended— 
(1) by adding at the end of paragraph (7) thereof the follow^-
ing new sentence: "This paragraph shall not apply to common 
carriers by railroad subject to this part."; and 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 37 
(2) by inserting a new paragraph (8) as follows: 
"(8) (a) Whenever a schedule is filed with the Commission by a 
common carrier by railroad stating a new individual or joint rate, fare, 
or charge, or a new individual or joint classification, regulation, or 
practice affecting a rate, fare, or charge, the Commission may, upon 
the complaint of an interested party or upon its own initiative, order 
a hearing concerning the lawfulness of such rate, fare, charge,-classifi-
cation, regulation, or practice. The hearing may be conducted without 
answer or other formal pleading, but reasonable notice shall be pro-
vided to interested parties. Such hearing shall be completed and a final 
decision rendered by the Commission not later than 7 months after 
such rate, fare, charge, classification, regulation, or practice was sched-
uled to become effective, unless, prior to the expiration of such 7-montli 
period, the Commission reports in writing to the Congress that it is 
unable to render a decision within such period, together with a full 
explanation of the reason for the delay. If such a report is made to the 
Congress, the final decision shall be made not later than 10 months 
after the date of the filing of such schedule. If the final decision of the 
Commission is not made within the applicable time period, the rate, 
fare, charge, classification, regulation, or practice shall go into effect 
immediately at the expiration of such time period, or shall remain in 
effect if it has already become effective. Such rate, fare, charge, classifi-
cation, regulation, or practice may be set aside thereafter by the Com-
mission if, upon complaint of an interested party, the Commission finds 
it to be unlawful. 
"(b) Pending a hearing pursuant to subdivision (a), the schedule 
may be suspended, pursuant to subdivision (d), for 7 months beyond 
the time when it would otherwise go into effect, or for 10 months if the 
Commission makes a report to the Congress pursuant to subdivision 
(a), except under the following conditions: 
"(i) in the case of a rate increase, a rate may not be suspended 
on the ground that it exceeds a just and reasonable level if the 
rate is within a limit specified in subdivision (c), except that such 
a rate change may be suspended under any provision of section 
2, 3, or 4 of this part or, following promulgation of standards and 
procedures under section 1(5) (d) of this part, if the carrier is 
found to have market dominance, within the meaning of section 
l(6)(c)(i) of this part, over the service to which such rate 
increase applies; or 
"(ii) in the case of a rate decrease, a rate may not be suspended 
on the ground that it is below a just and reasonable level if the 
rate is within a limit specified in subdivision (c), except that such 
a rate change may be suspended under any provision of section 
2, 3, or 4 of this part, or for the purposes of investigating such 
rate change upon a complaint that such rate change constitutes a 
competitive practice which is unfair, destructive, predatory or 
otherwise undermines competition which is necessary in the pub-
lic interest. 
"(c) The limitations upon the Commission's power to suspend rate 
changes set forth in subdivisions (b) (i) and (ii) apply only to rate 
changes which are not of general applicability to all or substantially 
all classes of traffic and only if— 
"(i) the rate increase or decrease is filed within 2 years after 
the date of the enactment of this subdivision; 
"(ii) the common carrier by railroad notifies the Commission 
that it wishes to have the rate considered pursuant to this sub-
division ; 
Hearing and 
notice. 
Schedule 
suspension. 
90 STAT. 38 
PUBLIC LAW 94-210—FEB. 5, 1976 
"(iii) the aggregate of increases or decreases in any rate filed 
pursuant to clauses (i) and (ii) of this subdivision within the 
first 365 days following such date of enactment is not more than 
7 per centum of the rate in effect on January 1,1976; and 
"(iv) the aggregate of the increases or decreases for any rate 
filed pursuant to clauses (i) and (ii) of this subdivision within 
the second 365 day-period following such date of enactment is 
; .r, 
not more than 7 per centum of the rate in effect on January 1,1977. 
"(d) The Commission may not suspend a rate under this paragraph 
unless it appears from specific facts shown by the verified complaint 
of any person that— 
" (i) without suspension the proposed rate change will cause sub-
stantial injury to the complainant or the party represented by 
such complainant; and 
"(ii) it is likely that such complainant will prevail on the 
merits. 
The burden of proof shall be upon the complainant to establish the 
matters set forth in clauses (i) and (ii) of this subdivision. Nothing 
in this paragraph shall be construed as establishing a presumption 
that any rate increase or decrease in excess of the limits set forth in 
clauses (iii) or (iv) of subdivision (c) is unlawful or should be 
suspended. 
"(e) If a hearing is initiated under this paragraph with respect to 
a proposed increased rate, fare, or charge, and if the schedule is not 
suspended pending such hearing and the decision thereon, the Com-
mission shall require the railroads involved to keep an account of all 
amounts received because of such increase from the date such rate, 
fare, or charge became effective until the Commission issues an 
order or until 7 months after such date, whichever first occurs, or, 
if the hearings are extended pursuant to subdivision (a), until an 
order issues or until 10 months elapse, whichever first occurs. The 
account shall specify by whom and on whose behalf the amounts are 
paid. In its final order, the Commission shall require the common 
carrier by railroad to refund to the person on w^hose behalf the amounts 
were paid that portion of such increased rate, fare, or charge found 
, 
to be not justified, plus interest at a rate which is equal to the average 
yield (on the date such schedule is filed) of marketable securities of 
the United States which have a duration of 90 days. With respect to 
any proposed decreased rate, fare, or charge which is suspended, if 
the decrease or any part thereof is ultimately found to be lawful, the 
common carrier by railroad may refund any part of the portion of such 
decreased rate, fare, or charge found justified if such carrier makes 
such a refund available on an equal basis to all shippers who 
participated in such rate, fare, or charge according to the relative 
amounts of traffic shipped at such rate, fare, or charge. 
"(f) In any hearing under this section, the burden of proof is on 
the common carrier by railroad to show that the proposed changed rate, 
fare, charge, classification, rule, regulation, or practice is just and rea-
sonable. The Commission shall specifically consider, in any such hear-
ing, proof that such proposed changed rate, fare, charge, classification, 
rule, regulation, or practice will have a significantly adverse effect 
(in violation of section 2 or 3 of this part) on the competitive posture 
of shippers or consignees affected thereby. The Commission shall give 
such hearing and decision preference over all other matters relating 
to railroads pending before the Commission and shall make its decision 
at the earliest practicable time.". 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 39 
(f) Nothing in the amendments made by this section shall be con- 49 USC 1 note. 
strued— 
(1) to modify the application of section 2, 3, or 4 of the Inter- 
. . 
state Commerce Act (49 U.S.C. 2, 3, or 4) in determining the 
lawfulness of any rate or practice; 
(2) to make lawful any competitive practice which is unfair, 
destructive, predatory, or otherwise undermines competition which 
is necessary in the public interest; 
(3) to affect the existing law or the authority of the Commis-
sion with respect to rate relationships between ports; or 
(4) to affect the authority and responsibility of the Commis-
sion to guarantee the equalization of rates Avithin the same port. 
(g) The Secretary and the Commission shall separately study the 
effect of the amendments made by this section on the development of 
an efficient and financially stable railway system in the United States. 
Such studies shall include (1) an analysis of the effect of such provi-
sions upon shippers and upon carriers in all modes of transportation, 
and (2) proposals for further regulatory and legislative changes, if 
necessary. The Commission shall gather all data relating to such 
studies as requested by the Secretary, and shall make such data avail-
able to the Secretary. The Secretary and the Commission shall trans- Transmittal to 
mit the results of their respective studies to each House of Congress Congress, 
within 20 months after the date of the enactment of this Act. 
Study. 
49 USC 1 note. 
TARIFF MODIFICATIONS 
SEO. 203. (a) Section 15(3) of the Interstate Commerce Act (49 
U.S.C. 15(3)) is amended by adding at the end thereof the following 
new sentence: "With respect to carriers by railroad, in determining 
whether any such cancellation or proposed cancellation involving any 
common carrier by railroad is consistent with the public interest, the 
Commission shall, to the extent applicable, (a) compare the distance 
traversed and the average transportation time and expense required 
using the through route, and the distance traversed and the average 
transportation time and expense required using alternative routes, 
between the points served by such through route, (b) consider any 
reduction in energy consumption which may result from such cancel-
lation, and (c) take into account the overall impact of such cancella-
tion on the shippers and carriers who are affected thereby.". 
(b) Section 15a of the Interstate Commerce Act (49 U.S.C. 15a) is 
amended by adding at the end thereof the following new paragraph: 
"(5) The Commission shall, in any proceeding which involves a 
proposed increase or decrease in railroad rates, specifically consider 
allegations that such increase or decrease would change the rate rela-
tionships between commodities, ports, points, regions, territories, or 
other particular descriptions of traffic (whether or not such relation-
ships were previously considered or approved by the Commission) and 
allegations that such increase or decrease would have a significantly 
adverse effect on the competitive position of shippers or consignees 
served by the railroad proposing such increase or decrease. If the Com-
mission finds that such allegations as to change or effect are substan-
tially supported on the record, it shall take such steps as are necessary, 
either before or after such proposed increase or decrease becomes effec-
tive and either within or outside such proceeding, to investigate the 
lawfulness of such change or effect.". 
90 STAT. 40 
PUBLIC LAW 94-210—FEB. 5, 1976 
45 use 793 note. 
49 use 1. 
Public hearing. 
Report to 
President and 
Congress. 
INVESTIGATION OF DISCRIMINATORY FREIGHT RATES FOR THE TRANSPORTA-
TION OF RECYCLABLE OR RECYCLED MATERIALS 
SEC. 204. (a) INVESTIGATION.—The Commission, within 12 months 
after the date of enactment of this Act, and thereafter as appropriate, 
shall— 
(1) conduct an investigation of (A) the rate structure for the 
transportation, by common carriers by railroad subject to part I 
of the Interstate Commerce Act, of recyclable or recycled mate-
rials and competing virgin natural resource materials, and (B) 
the manner in which such rate structure has been affected by suc-
cessive general rate increases approved by the Commission for 
such common carriers by railroad; 
(2) determine, after a public hearing during which the burden 
of proof shall be upon such common carriers by railroad to show 
that such rate structure, as affected by rate increases applicable 
to the transportation of such competing materials, is just, rea-
sonable, and nondiscriminatory, whether such rate structure is, 
in whole or in part, unjustly discriminatory or unreasonable; 
(3) issue, in all cases in which such transportation rate struc-
ture is determined to be, in whole or in part, unjustly discrimina-
tory or unreasonable, orders requiring the removal from such rate 
structure of such unreasonableness or unjust discrimination; and 
(4) report to the President and the Congress, in the annual 
report of the Commission for each of the 3 years following the 
date of enactment of this Act, and in such other reports as may be 
appropriate, all actions commenced or completed under this sec-
tion to eliminate unreasonable and unjustly discriminatory rates 
for the transportation of recyclable or recycled materials. 
(b) PARTICIPATION.—The Administrator of the Environmental Pro-
tection Agency shall take such steps as are necessary to assure that the 
Commission carries out the requirements set forth in subsection (a) 
of this section as expeditiously as possible. Such Administrator is 
authorized to participate as a party in the investigation to be com-
menced by the Commission under such subsection (a). 
(c) RESEARCH, DEVELOPMENT, AND DEMONSTRATION.—The Secretary, 
in cooperation with the Commission, shall establish a research, devel-
opment, and demonstration program to develop and improve transport 
terminal operations, transport service characteristics, transport equip-
ment, and collection and processing methods for the purpose of facili-
tating the competitive and efficient transportation of recyclable or 
recycled materials by common carriers by railroad subject to part I 
of the Interstate Commerce Act. 
(d) REVIEW.—Orders issued by the Commission pursuant to this 
section shall be subject to judicial review or enforcement in the same 
manner as other orders issued by the Commission under the Interstate 
Commerce Act. In all proceedings under this section, the Commission 
shall comply fully with the requirements of the National Environ-
mental Policy Act of 1969 (42 U.S.C. 4321 et seq.). 
(e) DEFINITIONS.—As used in this section, the term— 
(1) "recyclable material" means any material which has been 
collected or recovered from waste for a commercial or industrial 
use, whether or not such collection or recovery follows end usage 
as a product; and 
I 
(2) "virgin natural resource material" and "virgin material" 
mean any raw material, including previously unused metal or 
metal ore, woodpulp or pulpwood, textile fiber or material, or 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 41 
other resource which is, or which will become (through the appli-
cation of technology), a source of raw material for commercial or 
industrial use. 
ADEQUATE REVENUE LEVELS 
SEC. 205. Section 15a of the Interstate Commerce Act (49 U.S.C. 
15a) is amended— 
(1) by adding at the end of paragraph (2) and at the end of 
paragraph (3) the following new sentence: "This paragraph shall 
not apply to common carriers by railroad subject to this part."; 
and 
(2) by redesignating paragraph (4) as paragraph (6), and 
by inserting immediately after paragraph (3) the following new 
paragraph: 
"(4) With respect to common carriers by railroad, the Commission 
shall, within 24 months after the date of enactment of this paragraph, 
after notice and an opportunity for a hearing, develop and promul-
gate (and thereafter revise and maintain) reasonable standards and 
procedures for the establishment of revenue levels adequate under 
honest, economical, and efficient management to cover total operating 
expenses, including depreciation and obsolescence, plus a fair, rea-
sonable, and economic profit or return (or both) on capital employed 
in the business. Such revenue levels should (a) provide a flow of net 
income plus depreciation adequate to support prudent capital out-
lays, assure the repayment of a reasonable level of debt, permit the 
raising of needed equity capital, and cover the effects of inflation 
and (b) insure retention and attraction of capital in amounts adequate 
to provide a sound transportation system in the United States. The 
Commission shall make an adequate and continuing effort to assist 
such carriers in attaining such revenue levels. No rate of a common car-
rier by railroad shall be held up to a particular level to protect the 
traffic of any other carrier or mode of transportation, unless the Com-
mission finds that such rate reduces or would reduce the going concern 
value of the carrier charging the rate.". 
Notice and 
hearing. 
Standards and 
procedures. 
RATE INCENTIVES FOR CAPITAL INVESTMENT 
SEC. 206. Section 15 of the Interstate Commerce Act (49 U.S.C. 15), 
as amended by section 202 of this Act, is amended by adding at the 
end thereof the following new paragraph: 
"(19) Notwithstanding any other provision of law, a common car- Notice, 
rier by railroad subject to this part may file with the Commission a 
notice of intention to file a schedule stating a new rate, fare, charge, 
classification, regulation, or practice whenever the implementation of 
the proposed schedule would require a total capital investment of 
$1,000,000 or more, individually or collectively, by such carrier, or by 
a shipper, receiver, or agent thereof, or an interested third party. The 
filing shall be accompanied by a sworn affidavit setting forth in detail 
the anticipated capital investment upon which such filing is based. Any Hearing, 
interested person may request the Commission to investigate the sched-
ule proposed to be filed, and upon such request the Commission shall 
hold a hearing with respect to such schedule. Such hearing may be Notice, 
conducted without answer or other formal pleading, but reasonable 
notice shall be provided to interested parties. Unless, prior to the 
180-day period following the filing of such notice of intention, the 
Commission determines, after a hearing, that the proposed schedule, or 
any part thereof, would be unlawful, such carrier may file the schedule 
at any time within 180 days thereafter to become effective after 30 
90 STAT. 42 
PUBLIC LAW 94-210—FEB. 5, 1976 
days' notice. Such a schedule may not, for a period of 5 years after its 
effective date, be suspended or set aside as unlawful under section 2, 
3, or 4 of this part, except that the Commission may at any time order 
such schedule to be revised to a level equaling the variable costs of pro-
viding the service, if the rate stated therein is found to reduce the 
going concern value of the carrier.". 
Notice and 
hearing. 
49 use 1, 301, 
901. 
EXEMPTIONS FROM INTERSTATE COMMERCE ACT 
SEC. 207. Paragraph (1) of section 12 of the Interstate Commerce 
Act (49 U.S.C. 12(1)) is amended by inserting " ( a ) " immediately 
before "The Commission" and by adding at the end thereof the fol-
lowing new subdivision: 
"(b) Whenever the Commission determines, upon petition by the 
Secretary or an interested party or upon its own initiative, in matters 
relating to a common carrier by railroad subject to this part, after 
notice and reasonable opportunity for a hearing, that the application 
of the provisions of this part (i) to any person or class of persons, or 
(ii) to any services or transactions by reason of the limited scope of 
such services or transactions, is not necessary to effectuate the national 
transportation policy declared in this Act, would be an undue burden 
on such person or class of persons or on interstate and foreign com-
merce, and would serve little or no useful public purpose, it shall, by 
order, exempt such persons, class of persons, services, or transactions 
from such provisions to the extent and for such period of time as may 
be specified in such order. The Commission may, by order, revoke any 
such exemption whenever it finds, after notice and reasonable oppor-
tunity for a hearing, that the application of the provisions of this part 
to the exempted person, class of persons, services, or transactions, 
to the extent specified in such order, is necessary to effectuate the 
national transportation policy declared in this Act and to achieve 
effective regulation by the Commission, and would serve a useful 
public purpose.". 
RATE BUREAUS 
SEC. 208. (a) Effective 270 days after the date of enactment of this 
Act, section 5a of the Interstate Commerce Act (49 IJ.S.C. 5b) is 
amended in paragraph (1) (A) thereof by striking out "part I, 
I I , or I I I " and inserting in lieu thereof "part I (other than a common 
carrier by railroad), part I I , or part I I I " . 
(b) Part I of the Interstate Commerce Act is amended by inserting 
after section 5a thereof a new section 5b as follows: 
a 
Definitions. 
49 use 5c. 
AGREEMENTS BETWEEN CARRIERS SUBJECT TO PART I 
"SEC. 5b. (1) As used in this section, the term— 
"(a) 'affiliate' means any person directly or indirectly con-
trolling, controlled by, or under common control or ownership 
with, any other person, and as used in this subdivision, the term 
(i) 'control' has the same meaning as in section 1(3) (b) of this 
part; and (ii) 'ownership' refers to equity holdings of 5 per 
centum or more in any business entity; 
"(b) 'antitrust laws' means the Act of July 2,1890, as amended 
(15 U.S.C. 1, et seq.), the Act of October 15, 1914, as amended 
(15 U.S.C. 12, et seq.), the Federal Trade Commission Act (15 
IJ.S.C. 41, et seq.), sections 73 and 74 of the Act of August 27, 
1894, as amended (15 U.S.C. 8 and 9), and chapter 592 of the Act 
of June 19, 1936, as amended (15 U.S.C. 13, 13a, 13b, 21a); and 
"(c) 'carrier' means any common carrier by railroad subject to 
part I of this Act. 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 43 
"(2) Any carrier which is a party to an agreement, between or 
among two or more carriers, relating to rates, fares, classification, divi-
sions, allowances, or charges (including charges between carriers and 
compensation paid or received for the use of facilities and equipment), 
or rules and regulations pertaining thereto, or procedures for the joint 
consideration, initiation, or establishment thereof, shall, under such 
rules and regulations as the Commission shall prescribe, apply to the 
Commission for approval of such agreement. The Commission shall, 
by order, approve any such agreement if approval thereof is not pro-
hibited by paragraph (4) or (5) and if it finds that, by reason of 
furtherance of the national transportation policy declared in this Act, 
the relief provided in paragraph (8) should apply with respect to the 
making and carrying out of such agreement; otherwise the application 
shall be denied. No such approval shall be granted or continued (a) if 
any of the terms and conditions which are prescribed under the last 
sentence of this paragraph are violated or not complied with, or 
(b) unless the Commission receives a verified written statement (and 
any written supplement or addendum thereto requested by the Com-
mission) setting forth, with respect to each carrier which is a party to 
such agreement (i) its name, (ii) the mailing address and telephone 
number of its headquaiter's office, (iii) the names of each of its affili-
ates, (iv) the names, addresses, and affiliations of each of its officers 
and directors and of each person who, together with any affiliate, 
owns or controls any debt, equity, or security interest in it having 
a value of $1,000,000 or more, and (v) such other information as 
the Commission directs to be included. The approval of the Commis-
sion shall be granted only upon such terms and conditions as the 
Commission determines are necessary to enable its approval to be 
granted in accordance with the standard set forth in this paragraph. 
"(3) Each conference, bureau, committee, or other organization Recordkeeping. 
established or continued pursuant to any agreement approved by the 
Commission under the provisions of this section shall maintain such 
accounts, records, files, and memoranda and shall submit to the Com-
mission such reports, as may be prescribed by the Commission. All 
such accounts, records, files, and memoranda shall be subject to inspec-
tion by the Commission or its duly authorized representatives. The 
Commission may conduct investigations, make reports, issue sub-
poenas, conduct hearings, require the production of relevant docu-
ments, records, and property, copy and verify the correctness of 
? 
, -
information subject to inspection, and take depositions (a) to deter-
mine whether any such conference, bureau, committee, or other orga-
nization, or any carrier which is a party to any such agreement, has 
acted or is acting in compliance with the provisions of this section, 
regulations issued under this section, and the public interest, (b) to 
determine whether any such organization or carrier is inhibiting an 
efficient utilization of transportation resources or has established prac-
tices which are inconsistent with efficient, flexible, and economic oper-
ation, and (c) for such other purposes as the Commission considers 
appropriate. 
"(4) The Commission shall not approve under this section any 
agreement which it finds is an agreement with respect to a pooling, 
division, or other matter or transaction to which section 5 of this part 
49 USC 5. 
is applicable. 
"(5) (a) The Commission shall not approve under this section any 
agreement which establishes a procedure for the determination of any 
matter through joint consideration, unless it finds that under the 
agreement there is accorded to each party the free and unrestrained 
right to take independent action, without fear of any sanction or retal-
90 STAT. 44 
PUBLIC LAW 94-210—FEB. 5, 1976 
iatory action, at any time before or after any determination arrived at 
through such procedure. In no event shall any conference, bureau, 
committee, or other organization established or continued pursuant to 
any agreement approved by the Commission under the provisions of 
this section— 
"(i) permit participation in agreements with respect to, or any 
voting on, single-line rates, allowances, or charges established by 
any carrier; 
"(ii) permit any carrier to participate in agreements with 
respect to, or to vote on, rates, allowances, or charges relating to 
any particular interline movem^ent, unless such carrier can prac-
ticably participate in such movement; or 
"(iii) permit, provide for, or establish any procedure for joint 
consideration or any joint action to protest or otherwise seek the 
suspension of any rate or classification filed by a carrier of the 
49 use 15. 
same mode pursuant to section 15(7) of this part where such rate 
or classification is established by independent action. 
As used in clause (i) of this subdivision, a single-line rate, allowance, 
or charge is one that is proposed by a single carrier applicable only 
over its own line and as to which the service (exclusive of terminal 
services provided by switching, drayage, or other terminal carriers or 
agencies) can be performed by such carrier. 
"(b) The limitations set forth in subdivision (a) shall not be appli-
cable to— 
" (i) general rate increases or decreases, if the agreements accord 
the shipping public, under specified procedures, adequate notice 
of at least 15 days of such proposals and an opportunity to present 
comments thereon, in writing or otherwise, prior to the filing with 
the Commission of the tariffs containing such increases or 
decreases, or 
"(ii) broad tariff changes if such changes are of general appli-
cation or substantially general application throughout a territory 
or territories within which such changes are to be applicable. 
In any proceeding in which it is alleged that a carrier voted or agreed 
upon a rate, allowance, or charge, in violation of the provisions of 
this section, the party alleging such violation shall have the burden 
of showing that such vote or agreement occurred. A showing of par-
allel behavior is not, by itself, sufficient to satisfy such burden. 
Investigation. 
"(6) (a) The Commission is authorized, upon complaint or upon 
its own initiative without complaint, to investigate and determine 
whether any agreement previously approved by it under this section, 
or terms and conditions upon which such approval was granted, is 
not or are not in conformity with the standards set forth in paragraph 
(2) and with the public interest, and whether any such terms and 
conditions are not necessary or whether any additional or modified 
terms and conditions are necessary for purposes of conformity with 
such standard. After any such investigation the Commission shall, 
by order, terminate or modify its approval of such an agreement if 
it finds such action necessary to insure conformity with such stand-
ard, and shall modify the terms and conditions upon which such 
approval was granted to the extent it finds necessary to insure con-
y ; 
formity with such standard or to the extent to which it finds such 
terms and conditions not necessary to insure such conformity. The 
effective date of any order terminating or modifying approval, or 
modifying terms and conditions, shall be postponed for such period 
as the Commission determines to be reasonably necessary to avoid 
undue hardship. 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 45 
Report to 
President and 
Congress. 
49 use 21. 
"(b) The Commission shall periodically, but not less than once Review, 
every 3 years, review each agreement which the Commission has by 
order approved under this section to determine whether such agree-
ment, or any conference, bureau, committee, or other organization 
established or continued pursuant to such agreement, still conforms 
with the standard set forth in paragraph (2) and the public interest, 
and to evaluate the success and effect upon the consuming public and 
the national rail freight transportation system of such agreement and 
organization. The Commission shall report to the President and to 
the Congress on the results of such reviews, as part of its annual 
report pursuant to section 21. If the Commission makes a determina-
tion that any such agreement or organization is no longer in con-
formity with such standard, the Commission shall by order terminate 
or suspend its approval thereof. 
"(7) No order shall be entered under this section except after Hearing, 
interested parties have been afforded a reasonable opportunity for a 
hearing. 
"(8) Parties to any agreement approved by the Commission under 
this section and other persons are, if the approval of such agreement 
is no prohibited by paragraph (4) or (5), hereby relieved from the 
operation of the antitrust laws with respect to the making of such 
agreement, and with respect to the carrying out of such agreement in 
conformity with its provisions and in conformity with the terms and 
conditions prescribed by the Commission. 
"(9) Any action of the Commission under this section (a) in 
approving an agreement, (b) in denying an application for such 
approval, (c) in terminating or modifying such approval, (d) in 
prescribing the terms and conditions upon which such approval is to 
be granted, or (e) in modifying such terms and conditions, shall be 
construed as having effect solely with reference to the applicability of 
the relief provisions of paragraph (8). 
"(10) The Federal Trade Commission, in consultation with the 
Antitrust Division of the Department of Justice, shall periodically 
prepare an assessment of, and shall report to the Commission on (a) 
any possible anticompetitive features of (i) any agreements approved 
or submitted for approval under this section, and (ii) any conferences, 
v 
bureaus, committees, or other organizations operating under such 
agreements, and (b) possible ways to eliminate or alleviate any such 
anticompetitive features, effects, or aspects in a manner that will fur-
ther the goals of the national transportation policy and this Act. The 
Commission shall make such reports available to the public. 
"(11) Any conference, bureau, committee, or other organization Final disposition, 
established or continued pursuant to any agreement approved by the 
Commission under this section shall make a final disposition with 
respect to any rule, rate, or charge docketed with such organization 
within 120 days after such proposal is docketed.". 
Report to 
Interstate 
Commerce 
Commission. 
FILING PROCEDURES 
SEC. 209. Section 6(6) of the Interstate Commerce Act (49 U.S.C. 
6(6)) is amended by striking out "shall prescribe; and the" and insert-
ing in lieu thereof the following: "shall prescribe. The Commission 
shall, beginning 2 years after the date of enactment of this sentence, 
require (a) that all rates shall be incorporated into the individual 
tariffs of each common carrier by railroad subject to this part or rail 
ratemaking association within 2 years after the initial publication of 
the rate, or within 2 years after a change in any rate is approved by 
the Commission, whichever is later, and (b) that any rate shall be 
null and void with respect to any such carrier or association which 
90 STAT. 46 
PUBLIC LAW 94-210—FEB. 5, 1976 
does not so incorporate such rate into its individual tariff. The Com-
mission may, upon good cause shown, extend such period of time. 
Notice of any such extension and a statement of the reasons therefor 
shall be promptly transmitted to the Congress. The". 
Application. 
Rules and 
regulations. 
INTRASTATE RAILROAD RATE PROCEEDINGS 
SEC. 210. Section 13 of the Interstate Commerce Act (49 U.S.C. 13) 
is amended by striking out " : Provided^ That" and all that follows 
through "hearing and decision therein" in paragraph (4) thereof, 
and by adding at the end thereof the following new paragraph: 
"(5) The Commission shall have exclusive authority, upon applica-
tion to it, to determine and prescribe intrastate rates if— 
"(a) a carrier by railroad has filed wath an appropriate admin-
istrative or regulatory body of a State, a change in an intrastate 
rate, fare, or charge, or a change in a classification, regulation, or 
practice that has the effect of changing such a rate, fare, or 
charge, for the purpose of adjusting such rate, fare, or charge 
to the rate charged on similar traffic moving in interstate or for-
eign commerce; and 
"(b) the State administrative or regulatory body has not, 
within 120 days after the date of such filing, acted finally on 
such change. 
Notice of the application to the Commission shall be served on the 
appropriate State administrative or regulatory body. Upon the filing 
of such an application, the Commission shall determine and prescribe, 
according to the standards set forth in paragraph (4) of this section, 
the rate thereafter to be charged. The provisions of this paragraph 
shall apply notwithstanding the laws or constitution of any State, or 
the pendency of any proceeding before any State court or other State 
authority.". 
DEMURRAGE CHARGES 
SEC. 211. Section 1(6) 
of the Interstate Commerce Act 
(49 
U.S.C. 1(6)) is amended by inserting at the end thereof the following 
new sentence: "Demurrage charges shall be computed, and rules and 
regulations relating to such charges shall be established, in such a 
manner as to fulfill the national needs with respect to (a) freight car 
utilization and distribution, and (b) maintenance of an adequate 
freight car supply available for transportation of property.". 
Notice and 
hearing. 
Rules and 
regulations. 
CAR SERVICE COMPENSATION AND PRACTICES 
SEC. 212. (a) Section 1(14) (a) of the Interstate Commerce Act 
(49 U.S.C. 1(14) (a)) is amended to read as follows: 
"(14) (a) I t is the intent of the Congress to encourage the purchase, 
acquisition, and efficient utilization of freight cars. In order to carry 
out such intent, the Commission may, upon complaint of an interested 
party or upon its own initiative without complaint, and after notice 
and an opportunity for a hearing, establish reasonable rules, regula-
tions, and practices with respect to car service by common carriers by 
railroad subject to this part, including (i) the compensation to be paid 
for the use of any locomotive, freight car, or other vehicle, (ii) the 
other terms of any contract, agreement, or arrangement for the use of 
any locomotive or other vehicle not owned by the carrier by which it is 
used (and whether or not owned by another carrier, shipper, or third 
party), and (iii) the penalties or other sanctions for nonobservance of 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 47 
Rules and 
regulations, 
revision. 
49 u s e 1 note. 
such rules, regulations, or practices. In determining the rates of com-
pensation to be paid for each type of freight car, the Commission shall 
give consideration to the transportation use of each type of freight 
car, to the national level of ownership of each such type of freight 
car, and to other factors affecting the adequacy of the national freight 
car supply. Such compensation shall be fixed on the basis of the ele-
ments of ownership expense involved in owning and maintaining each 
such type of freight car, including a fair return on the cost of such 
type of freight car (giving due consideration to current costs of capi-
tal, repairs, materials, parts, and labor). Such compensation may be 
increased by any incentive element which will, in the judgment of the 
Commission, provide just and reasonable compensation to freight car 
owners, contribute to sound car service practices (including efficient 
utilization and distribution of cars), and encourage the acquisition 
and maintenance of a car supply adequate to meet the needs of com-
merce and the national defense. The Commission shall not make any 
incentive element applicable to any type of freight car if the Com-
mission finds that the supply of such type of freight car is adequate. 
The Commission may exempt such incentive element from the compen-
sation to be paid by any carrier or group of carriers if the Commission 
finds that such an exemption is in the national interest.". 
(b) The Commission shall, within 18 months after the date of 
enactment of this Act, revise its rules, regulations, and practices with 
respect to car service, in accordance with the amendment made by 
subsection (a) of this section. 
TITLE III—REFORM OF THE INTERSTATE COMMERCE 
COMMISSION 
ACCESS TO INFORMATION BY CONGRESSIONAL COMMITTEES 
SEC. 301. Section 17 of the Interstate Commerce Act (49 U.S.C. 17), 
as amended by section 303 of this Act, is further amended by insert-
ing therein a new paragraph (15) as follows: 
"(15) Whenever the Committee on Interstate and Foreign Com-
merce of the House of Representatives or the Committee on Commerce 
of the Senate makes a written request for documents which are in 
the possession or under the control of the Commission and which 
relate to any matter involving a common carrier by railroad subject 
to this part, the Commission shall, within 10 days after the date of 
receipt of such request, submit such documents (or copies thereof) 
to such committee, or submit a report in writing to such committee 
stating the reason why such documents have not been so submitted, 
and the anticipated date on which they will be submitted. If the 
Commission transfers any document in its possession or under its 
control to any other agency or to any person, it shall condition such 
transfer on the ^aranteed return by the transferee of such document 
to the Commission for purposes of complying with the preceding 
sentence. This paragraph shall not apply to documents which have 
been obtained hj the Commission from persons subject to regulation 
by the Commission, and which contain trade secrets or commercial 
or financial information of a privileged or confidential nature. This 
paragraph shall not be deemed to restrict any other authority of either 
House of Congress, or any committee or subcommittee thereof, to 
obtain documents. For purposes of this paragraph, the term 'docu- "Document, 
ment' means any book, paper, correspondence, memorandum, or other 
' 
record, or any copy thereof.". 
90 STAT. 48 
PUBLIC LAW 94-210—FEB. 5, 1976 
EFFECTIVE DATE OF ORDERS OF THE COMMISSION 
f 
SEC. 302. Section 15(2) of the Interstate Commerce Act (49 U.S.C. 
15(2)), is amended by striking out ", not less than thirty days, and 
shall", and inserting in lieu thereof "as the Commission may prescribe. 
Such orders shall". 
'Hearing.' 
Review. 
COMMISSION HEARING AND APPELLATE PROCEDURE 
SEC. 303. (a) Section 17 of the Interstate Commerce Act (49 U.S.C. 
17) is amended by redesignating paragraphs (9) through (12) thereof 
as paragraphs (10) through (13) thereof, respectively, and by insert-
ing therein the following new paragraph (9) : 
"(9) (a) Whenever the term 'hearing' is used in this part, such term 
shall be construed to include an opportunity for the suomission of all 
evidence in written form, followed by an opportunity for briefs, writ-
ten statements, or conferences of the parties, such conferences to be 
chaired by a division, an individual Commissioner, an administrative 
law judge, an employee board, or any other designated employee of 
the Commission. 
"(b) With respect to any matter involving a common carrier by 
railroad subject to this part, whenever the Commission assigns the 
initial disposition to any of such matter before the Commission to an 
administrative law judge, individual Commissioner, employee board, 
or division or panel of the Commission, such judge, Coinmissiouer, 
board, division, or panel shall— 
"(i) complete all evidentiary proceedings with respect to such 
matter within 180 days after its assignment; and 
' 
"(ii) with respect to any matter so assigned which involves 
written submissions or the taking of testimony at a public hearing, 
submit in writing to the Commission, within 120 days after the 
completion of all evidentiary proceedings, an initial decision, 
report, or order containing— 
" (A) specific findings of fact; 
"(B) specific and separate conclusions of law; 
" (C) a recommended order; and 
"(D) any justification in support of such findings of fact, 
conclusions of law, and order. 
The Commission, or a duly designated division thereof, may, in its 
discretion, void any requirement for an initial decision, report, or 
order, and, in appropriate cases, may direct that any matter shall be 
considered forthwith by the Commission or such division, if it con-
cludes that the matter involves a question of agency policy, a new 
or novel issue of law, or an issue of general transportation importance, 
or if the due and timely execution of its functions so requires. When-
ever an initial decision, report, or order is submitted, copies thereof 
shall be served upon interested parties. Any such party may file an 
appeal with the Commission, with respect to such initial decision or 
report. If no such appeal is filed within 20 days after such service, or 
within such further period (not to exceed 20 days) as the Commission, 
or a duly designated division thereof, may authorize, the order set 
forth in such initial decision or report shall become the order of the 
Commission and shall become effective u,nless, within such period, the 
order shall have been stayed or postponed by the Commission pursu-
ant to subdivision (d) or (e). 
" (c) The Commission, or a duly designated division thereof, may, 
upon its own initiative, and shall, in any case in which an appeal is 
filed under subdivision (b), review the matter upon the same record or 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 49 
upon the basis of a further hearing. Any such appeal shall be con-
sidered and acted upon by the Commission, or a duly designated divi-
sion thereof, within 180 days after the date on which such appeal is 
filed. Any such decision, report, or order shall be stayed pending the 
determination of such appeal. Such a review shall be conducted in 
accordance with section 557 of title 5, United States Code, and such 
rules (limiting and defining the issues and pleadings upon review) as 
the Commission may adopt in conformance with section 557 (b) of such 
title 5. The Commission may, in its discretion and on such terms and 
conditions as it may prescribe, authorize duly designated employee 
boards to perform functions under this paragraph of the same char-
acter as those which may be performed by a duly designated division 
of the Commission (other than the decision of any appeal under this 
paragraph which may be further appealed to the Commission). 
"(d) Any decision, order, or requirement of the Commission, or 
of a duly designated division thereof, shall become effective 30 days 
after it is served on the parties thereto, unless the Commission pro-
vides for such decision, order, or requirement, or any applicable rule, 
to become effective at an earlier date. Any interested party to a deci-
sion, order or requirement of a duly designated division of the Com-
mission may petition the Commission for rehearing, reargument, or 
other reconsideration, subject to such rules and limitations as the 
Commission may establish. If the Commission finds that a decision, 
order, or requirement presents a matter of general transportation 
importance, or if it finds that clear and convincing new evidence has 
been presented or that changed circumstances exist which would 
materially affect such decision, order, or requirement, the Commission 
may reconsider such decision, order, or requirement, and it may, in its 
discretion, stay the effective date of such decision, order, or require-
ment. If the Commission reconsiders a decision, order, or requirement, 
it must complete the process and issue its final order not more than 120 
days after the date on which it grants the application for reconsidera-
tion. 
" (e) The Commission may, in its discretion, extend any time period 
set forth in this section for a period of not more than 90 days, if a 
majority of the Commissioners, by public vote, agree to such extension. 
The Commission shall submit an annual report in writing to each Report to 
House of Congress setting forth each extension granted pursuant to Congress, 
this subdivision (classified by the type of proceeding involved), and 
stating the reasons for each such extension and the duration thereof. 
"(f) In extraordinary situations in which an extension granted pur-
suant to subdivision (e) is not sufficient to allow for completion of 
necessary proceedings, the Commission may, in its discretion, grant 
a further extension if— 
"(i) not less than 7 of the Commissioners, by public vote, agree 
to such further extension; and 
"(ii) not less than 15 days prior to expiration of the extension 
' ' ^ 
granted pursuant to subdivision (e), the Commission reports in 
writing to the Congress that such further extension has been 
granted, together with— 
"(A) a full explanation of the reasons for such further 
extension; 
"^B) the anticipated duration of such further extension; 
"(C) the issues involved in the matter before the Commis-
sion; and 
"(D) the names of personnel of the Commission working 
on such matter. 
90 STAT. 50 
PUBLIC LAW 94-210—FEB. 5, 1976 
Rules. 
Written 
statement, 
availability to 
public. 
49 use 17. 
"(g) The Commission may, at any time upon its own initiative, on 
grounds of material error, new evidence, or substantially changed 
circumstances— 
" (i) reopen any proceeding; 
"(ii) grant rehearing, reargument, or reconsideration with 
•'•• respect to any decision, order, or requirement; and 
"(iii) 
reverse, modify, or change any decision, order, or 
requirement. 
The Commission may establish rules allowing interested parties to 
petition for leave to request reopening and reconsideration based upon 
material error, new evidence, or substantially changed circumstances. 
"(h) Notwithstanding any other provision of this Act, any decision, 
order, or requirement of the Commission, or of a duly designated 
division thereof, shall be final on the date on which it is served. A 
civil action to enforce, enjoin, suspend, or set aside such a decision, 
order, or requirement, in whole or in part, may be brought after such 
date in a court of the United States pursuant to the provisions of law 
which are applicable to suits to enforce, enjoin, suspend, or set aside 
orders of the Commission. 
"(i) Notwithstanding the provisions of paragraphs (5), (6), (7), 
and (8), the provisions of this paragraph shall govern the disposition 
of, and shall apply only to, any matter before the Commission which 
involves a common carrier by railroad subject to this part, except that 
the provisions of other sections of this part pertaining to deadlines 
in Commission proceedings shall govern to the extent that they are 
inconsistent with the provisions pertaining to deadlines contained in 
this paragraph. 
"(j) Reports in writing and other written statement (including, 
but not limited to, any report, order, decision and order, vote, notice, 
letter, policy statement, rule, or regulation) of any official action of 
the Commission (whether such action is taken by the Commission, a 
division thereof, any other group of Commissioners, a single Commis-
sioner, an employee board, an administrative law judge, or any other 
individual or group of individuals who are authorized to take any 
official action on behalf of the Commission) shall indicate (i) the 
official designation of the individual or group taking such action (ii) 
the name of each individual taking, or participating in taking, such 
action, and (iii) the vote or position of each such participating indi-
vidual. If any individual who is officially designated as a member of a 
group which takes any such action does not participate in such action, 
the written statement of such action shall indicate that such individual 
did not participate. Each individual who participates in taking any 
such action shall have the right to express his individual views as part 
of the written statement of such action. The written statement of any 
such action shall be made available to the public in accordance with 
Federal law.". 
(b) Section 17 of the Interstate Commerce Act is amended by insert-
ing therein a new paragraph (14) as follows: 
"(14) (a) Any formal investigative proceeding with respect to a 
common carrier by railroad which is instituted by the Commission 
after the date of enactment of this subdivision shall be concluded by 
the Commission with administrative finality within 3 years after the 
date on which such proceeding is instituted. Any such proceeding 
which is not so concluded by such date shall automatically be dismissed. 
"(b) Within 1 vear after the date of enactment of this subdivision, 
the Commission shall conclude or terminate, with administrative final-
ity, any formal investigative proceeding with respect to a common 
carrier by railroad which was instituted by the Commission on its own 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 51 
initiative and which has been pending before the Commission for a 
period of 3 or more years following the date of the order which 
instituted such proceeding.". 
OFFICE OF RAIL PUBLIC COUNSEL 
SEC. 304. (a) Part I of the Interstate Commerce Act is amended by 
redesignating section 27 thereof as section 29 thereof and by inserting 
after section 26 thereof a new section 27, as follows: 
u 
OFFICE OF RAIL PUBLIC COUNSEL 
"SEC. 27. (1) There shall be established, within 60 days after the 
date of enactment of this section, a new independent office affiliated 
with the Commission to be known as the Office of Rail Public Counsel. 
The Office of Rail Public Counsel shall function continuously pursu-
ant to this section and other applicable Federal laws. 
"(2) (a) The Office of Rail Public Counsel shall be administered by 
a Director. The Director shall be appointed by the President, by and 
with the advice and consent of the Senate. 
"(b) The term of office of the Director shall be 4 years. He shall be 
responsible for the discharge of the functions and duties of the Office 
of Rail Public Counsel. He shall be appointed and compensated, with-
out regard to the provisions of title 5, United States Code, governing 
appointments in the competitive service, classification, and General 
Schedule pay rates, at a rate not in excess of the maximum rate for 
GS-18 of the General Schedule under section 5332 of such title. 
"(3) The Director is authorized to appoint, fix the compensation, 
and assign the duties of employees of such Office and to procure tem-
porary and intei-mittent services to the same extent as is authorized 
under section 3109 of title 5, United States Code. Each bureau, office, 
or other entity of the Commission and each department, agency, and 
instrumentality of the executive branch of the Federal Government 
and each independent regulatory agency of the United States is author-
ized to provide the Office of Rail Public Counsel with such informa-
tion and data as it requests. The Director is authorized to enter into, 
without regard to section 3709 of the Revised Statutes of the United 
States (41 U.S.C. 5), such contracts, leases, cooperative agreements, 
or other transactions as may be necessary in the conduct of his func-
tions and duties. The Director shall submit a monthly report on the 
activities of the Office of Rail Public Counsel to the Chairman of the 
Commission, and the Commission, in its annual report to the Congress, 
shall evaluate and make recommendations with respect to such Office 
and its activities, accomplishments, and shortcomings. 
" (4) In addition to any other duties and responsibilities prescribed 
by law, the Office of Rail Public Counsel— 
"(a) shall have standing to become a party to any proceeding, 
formal or informal, which is pending or initiated before the Com-
mission and which involves a common carrier by railroad subject 
to this part; 
"(b) may petition the Commission for the initiation of pro-
ceeding on any matter within the jurisdiction of the Commission 
which involves a common carrier by railroad subject to this part; 
"(c) may seek judicial review of any Commission action on 
any matter involving a common carrier by railroad subject to this 
part, to the extent such review is authorized by law for any person 
and on the same basis; 
49 use 27. 
Establishment. 
49 use 26b. 
Director. 
Term. 
5 use 5332 note. 
Report to 
eommission and 
eongress. 
90 STAT. 52 
PUBLIC LAW 94-210—FEB. 5, 1976 
Budget request 
and estimates, 
submittal to 
Congress and 
President. 
Appropriation 
authorization. 
Ante, p. 46. 
Publication in 
Federal Register. 
Civil action. 
^ 
"(d) shall solicit, study, evaluate, and present before the Com-
d 
mission, in any proceeding, formal or informal, the views of those 
communities and users of rail service affected by proceedings 
initiated by or pending before the Commission, whenever the 
Director determines, for whatever reason (such as size or loca-
tion) , that such community or user of rail service might not other-
' 
wise be adequately represented before the Commission in the 
course of such proceedings; and 
"(e) shall evaluate and represent, before the Commission and 
before other Federal agencies wlien their policies and activities 
significantly affect rail transportation matters subject to the juris-
diction of the Commission, and shall by other means assist the 
constructive representation of, the public interest in safe, efficient, 
reliable, and economical rail transportation services. 
In the performance of its duties under this paragraph, the Office of 
Rail Public Counsel shall assist the Commission in the development 
of a public interest record in proceedings before the Commission. 
"(5) The budget requests and budget estimates of the Office of Rail 
Public Counsel shall be submitted concurrently to the Congress and 
to the President. 
"(6) There are authorized to be appropriated to the Office of Rail 
Public Counsel for the purpose of carrying out the provisions of this 
section not to exceed $500,000 for the fiscal year ending June 30, 1976, 
not to exceed $500,000 for the fiscal year transition period ending 
September 30, 1976, and not to exceed $2,000,000 for the fiscal year 
ending September 30,1977.". 
(b) Section 13 of the Interstate Commerce Act (49 U.S.C. 13), as 
amended by this Act, is further amended by adding at the end thereof 
the following new paragraph: 
"(6) (a) Whenever, pursuant to section 553(e) of title 5, United 
States Code, an interested person (including a government entity) 
petitions the Commission for the commencement of a proceeding for 
the issuance, amendment, or repeal of an order, rule, or regulation 
relating to common carriers by railroads under this Act, the Commis-
sion shall grant or deny such petition within 120 days after the date 
of receipt of such petition. If the Commission grants such a petition, 
it shall commence an appropriate proceeding as soon thereafter as 
practicable. If the Commission denies such a petition, it shall set forth, 
and publish in the Federal Register, its reasons for such denial. 
"(b) If the Commission denies a petition under subdivision (a) (or 
if it fails to act thereon within the 120-day period established by such 
subdivision), the petitioner may commence a civil action in an appro-
priate court of appeals of the United States for an order directing the 
Commission to initiate a proceeding to take the action requested in such 
petition. Such an action shall be commenced within 60 days after the 
date of such denial or, where appropriate, within 60 days after the 
date of expiration of such 120-day period. 
"(c) If the petitioner, in an action commenced under subdivision 
(b), demonstrates to the satisfaction of the court, by a preponderance 
of the evidence in the record before the Commission or, in an action 
based on a petition on which the Commission failed to act, in a new 
proceeding before such court, that the action requested in such petition 
to the Commission is necessary and that the failure of the Commission 
to take such action will result in the continuation of practices which 
•are not consistent with the public interest or in accordance with this 
Act, such court shall order the Commission to initiate such action. 
"(d) In any action under this paragraph, a court shall have no 
authority to compel the Commission to take any action other than the 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 53 
initiation of a proceeding for the issuance, amendment, or repeal of an 
order, rule, or regulation under this Act. 
"(e) As used in this paragraph, the term 'Commission' includes 
any division, individual Commissioner, administrative law judge, 
employee board, or any other person authorized to act on behalf of 
the Commission in any part of the proceeding for the issuance, amend-
ment, or repeal of any order, rule, or regulation under this Act relat-
ing to common carriers by railroad.". 
'Commission.' 
REFORM o r RULES OF PRACTICE BEFORE THE COMMISSION 
SEC. 305. (a) Within 360 days after the date of enactment of this 
Act, the Commission shall study, develop, and submit to the Congress 
an initial proposal setting forth rules of practice under which the 
Commission proposes to conduct all adjudicatory and rulemaking 
proceedings with respect to any matter involving a common carrier 
by railroad subject to this part. Such rules of practice before the 
Commission shall be consistent with existing law, shall take into con-
sideration the varying nature of proceedings before the Commission, 
and shall include— 
(1) specific time limits upon the filing and disposition of all 
complaints, applications, petitions, pleadings, motions, appeals, 
and rulemaking proceedings before an administrative law judge, 
individual Commissioner, review board, division, or panel of the 
Commission, or the full Commission; 
(2) specific methods of taking testimony, receiving evidence, 
hearing cross-examination, and the modification of such proce-
dures so as to facilitate the timely execution of the functions of 
the Commission; 
(3) utilization of additional administrative law judges or the 
assignment of employees of the Office, in complex adjudicatory or 
rulemaking proceedings, so as to facilitate proper focus and 
timely resolution of the issues within the required time limits; and 
(4) specific remedies in any case of failure to observe required 
time limits. 
(b) Within 420 days after the date of enactment of this Act, the 
Administrative Conference of the United States shall submit to the 
Congress and to the Commission its comments on the rules of practice 
before the Commission proposed pursuant to subsection (a) of this 
section, together 
with such recommendations as it considers 
appropriate. 
(c) Within 30 days after the receipt of comments submitted pur-
suant to subsection (b) of this section, the Commission shall consider 
such comments and shall submit to the Congress a final proposal 
setting forth the rules of practice before the Commission with respect 
to matters involving common carriers by railroad. Such rules of 
practice shall take effect at the end of the first period of 60 calendar 
days of continuous session of the Congress after the date of submis-
sion of such final proposal, unless either the Senate or the House of 
Representatives adopts a resolution during such period stating that it 
does not approve such final proposal. If no resolution is adopted as 
provided in the preceding sentence, the Commission shall adopt such 
proposed rules of practice. For purposes of this subsection, continuity 
of session of the Congress is broken only by an adjournment sine die, 
and the days on which either House is not in session because of an 
adjournment of more than 3 days to a day certain are excluded from 
the computation of the 60-day period. 
Submittal to 
congressional 
committees. 
49 u s e 17 note. 
Final proposal, 
submittal to 
Congress. 
90 STAT. 54 
PUBLIC LAW 94-210—FEB. 5, 1976 
Review. 
(d) If either the Senate or the House of Representatives passes a 
resolution of disapproval under subsection (c) of this section, the Com-
mission shall develop a revised proposal setting forth the rules of prac-
tice before the Commission pursuant to this section. Within 60 days 
after the date of such disapproval, each such revised proposal shall be 
submitted to the Congress by the Commission for review pursuant tx) 
such subsection (c). 
(e) The Commission shall periodically, but not less than once every 
3 years, review the rules of practice adopted pursuant to subsection (c) 
of this section, and shall revise such rules as it considers necessary. 
PROHIBITING DISCRIMIiSrATORY TAX TREATMENT OF TRANSPORTATION 
PROPERTY 
SEC. 306. Part I of the Interstate Commerce Act (49 IJ.S.C. 1 et seq.), 
as amended by this Act, is further amended by inserting therein a new 
section 28, as follows: 
49 use 26c. 
"SEC. 28. (1) Notwithstanding the provisions of section 202(b), any 
action described in this subsection is declared to constitute an unrea-
sonable and unjust discrimination against, and an undue burden on, 
interstate commerce. It is unlawful for a State, a political subdivision 
' 
of a State, or a governmental entity or person acting on behalf of such 
State or subdivision to commit any of the following prohibited acts: 
"(a) The assessment (but only to the extent of any portion 
based on excessive values as hereinafter described), for purposes 
of a property tax levied by any taxing district, of transportation 
property at a value which bears a higher ratio to the true market 
value of such transportation property than the ratio which the 
assessed value of all other commercial and industrial property in 
the same assessment jurisdiction bears to the true market value 
of all such other commercial and industrial property. 
"(b) The levy or collection of any tax on an assessment which 
is unlawful under subdivision (a). 
"(c) The levy or collection of any ad valorem property tax on 
transportation property at a tax rate higher than the tax rate 
generally applicable to commercial and industrial property in the 
same assessment jurisdiction. 
"(d) The imposition of any other tax which results in discrim-
inatory treatment of a common carrier by railroad subject to this 
part. 
District courts, 
"(2) Notwithstanding any provision of section 1341 of title 28, 
jurisdiction. 
United States Code, or of the constitution or laws of any State, the 
district courts of the United States shall have jurisdiction, without 
regard to amount in controversy or citizenship of the parties, to grant 
such mandatory or prohibitive injunctive relief, interim equitable 
relief, and declaratory judgments as may be necessary to prevent, 
restrain, or terminate any acts in violation of this section, except that— 
"(a) such jurisdiction shall not be exclusive of the jurisdiction 
which any Federal or State court may have in the absence of this 
subsection; 
"(b) the provisions of this section shall not become effective 
until 3 years after the date of enactment of this section; 
" (c) no relief may be granted under this section unless the ratio 
of assessed value to true market value, with respect to transporta-
tion property, exceeds by at least 5 per centum the ratio of assessed 
• 
value to true market value, with respect to all other commercial 
and industrial property in the same assessment jurisdiction; 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 55 
"(d) the burden of proof with respect to the determination of 
assessed value and true market vahie shall be that declared by the 
applicable State law; and 
"(e) in the event that the ratio of the assessed value of all other 
commercial and industrial property in the assessment jurisdiction 
to the true market value of all such other commercial and indus-
trial property cannot be established through the random-sampling 
method known as a sales assessment ratio study (conducted in 
accordance with statistical principles applicable to such studies) to 
the satisfaction of the court hearing the complaint that transpor-
tation property has been or is being assessed or taxed in contraven-
tion of the provisions of this section, then the court shall hold 
unlawful an assessment of such transportation property at a value 
which bears a higher ratio to the true market value of such trans-
portation property than the assessed value of all other property 
in the assessment jurisdiction in which is included such taxing dis-
trict and subject to a property tax levy bears to the true market 
value of all such other property, and the collection of any ad 
valorem property tax on such transportation property at a tax rate 
higher than the tax rate generally applicable to taxable property 
in the taxing district. 
" (3) As used in this section, the term— 
Definitions. 
"(a) 'assessment' means valuation for purposes of a property 
tax levied by any taxing district; 
"(b) 'assessment jurisdiction' means a geographical area, such 
as a State or a county, city, township, or special purpose district 
within such State which is a unit for purposes of determining the 
assessed value of property for ad valorem taxation; 
" (c) 'commercial and industrial property' or 'all other commer-
cial and industrial property' means all property, real or personal, 
other than transportation property and land used primarily for 
agricultural purposes or primarily for the purpose of growing 
timber, which is devoted to a commercial or industrial use and 
which is subject to a property tax levy; and 
"(d) 'transportation property' means transportation property, 
as defined in regulations of the Commission, which is owned or 
used by a common carrier by railroad subject to this part or 
which is owned by the National Railroad Passenger Corporation.". 
UNIFORM COST AND REVENUE ACCOUNTING SYSTEM 
SEC. 307. Paragraph (3) of section 20 of the Interstate. Commerce 
Act (49 U.S.C. 20 (3)) is amended to read as follows: 
"(3) (a) The Commission shall, not later than June 30, 1977, issue Regulations, 
regulations and procedures prescribing a uniform cost and revenue 
accounting and reporting system for all common carriers by railroad 
subject to this part. Such regulations and procedures shall become 
effective not later than January 1, 1978. Before promulgating such 
regulations and procedures, the Commission shall consult with and 
solicit the views of other agencies and departments of the Federal 
Government, 
representatives 
of 
carriers, 
shippers, 
and 
their 
employees, and the general public. 
"(b) In order to assure that the most accurate cost and revenue 
data can be obtained with respect to light density lines, main line 
operations, factors relevant in establishing fair and reasonable rates, 
and other regulatory areas of responsibility, the Commission shall 
90 STAT. 56 
PUBLIC LAW 94-210—FEB. 5, 1976 
Review. 
Appropriation 
authorization. 
identify and define the following items as they pertain to each facet 
of rail operations: 
"(i) operating and nonoperating revenue accounts; 
" (ii) direct cost accounts for determining fixed and variable cost 
for materials, labor, and overhead components of operating 
expenses and the assignment of such costs to various functions, 
services, or activities, including maintenance-of-way, mainte-
nance of equipment (locomotive and car), transportation (train, 
yard and station, and accessorial services), and general and 
administrative expenses; and 
"(iii) indirect cost accounts for determining fixed, common, 
joint, and constant costs, including the cost of capital, and the 
method for the assignment of such costs to various functions, 
services, or activities. 
" (c) The accounting system established pursuant to this paragraph 
shall be, in accordance with generally accepted accounting principles 
uniformly applied to all common carriers by railroad subject to this 
part, and all reports shall include any disclosure considered appropri-
ate under generally accepted accounting principles or the requirements 
of the Commission or of the Securities and Exchange Commission. 
The Commission shall, notwithstanding any other provision of this 
section, to the extent possible, devise the system of accounts to be cost 
effective, nonduplicative, and compatible with the present and desired 
managerial and responsibility accounting requirements of the carriers, 
and to give due consideration to appropriate economic principles. The 
Commission should attempt, to the extent possible, to require that such 
data be reported or otherwise disclosed only for essential regulatory 
purposes, including rate change requests, abandonment of facilities 
requests, responsibility for peaks in demand, cost of service, and issu-
ance of securities. 
"(d) In order that the accounting system established pursuant to 
this paragraph continue to conform to generally accepted accounting 
principles, compatible with the managerial responsibility accounting 
requirements of carriers, and in compliance with other objectives set 
forth in this section, the Commission shall periodically, but not less 
than once every 5 years, review such accounting system and revise 
it as necessary. 
"(e) There are authorized to be appropriated to the Commission 
for purposes of carrying out the provisions of this paragraph such 
sums as may be necessary, not to exceed $1,000,000, to be available 
for— 
"(i) procuring temporary and intermittent services as author-
ized by section 3109(b) of title 5, United States Code, but at rates 
for individuals not to exceed $250 per day plus expenses; and 
"(ii) entering into contracts or cooperative agreements with 
any public agency or instrumentality or with any person, firm, 
association, corporation, or institution, without regard to section 
3709 of the Revised Statutes of the United States (41 U.S.C. 5).". 
"Interest in a 
railroad 
equipment trust. 
SECURITIES 
SEC. 308. (a) (1) Paragraph (6) of section 3(a) of the Securities 
Act of 1933 (15 U.S.C. 77c(a) (6)) is amended to read as follows: 
"(6) Any security issued by a motor carrier the issuance of which 
is subject to the provisions of section 214 of the Interstate Commerce 
Act, or any interest in a railroad equipment trust. For purposes of 
this paragraph 'interest in a railroad equipment trust' means any 
interest in an equipment trust, lease, conditional sales contract, or other 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 57 
15 use 77c. 
similar arrangement entered into, issued, assumed, guaranteed by, or 
for the benefit of, a common carrier to finance the acquisition of rolling 
stock, including motive power;". 
(2) The second sentence of section 19(a) of such Act (15 U.S.C. 
7Ts(a)) is amended by striking out "j but insofar as they relate to 
any common carrier subject to the provisions of section 20 of the Inter-
state Commerce Act, as amended, the rules and regulations of the Com- 49 USC 20 
mission with respect to accounts shall not be inconsistent with the 
requirements imposed by the Interstate Commerce Commission under 
authority of such section 20". 
(3) Section 214 of the Interstate Commerce Act (49 U.S.C. 314) 
is amended by striking out "That the exemption" and all that follows 
through ^'And provided further,''\ 
(b) Section 13(b) of the Securities Exchange Act of 1934 (15 
U.S.C. 78m(b)) is amended by striking out ", and, in the case of 
carriers subject to the provisions of section 20 of the Interstate Com-
merce Act" and all that follows in such subsection, and inserting in 
lieu thereof "(except that such rules and regulations of the Commis-
sion may be inconsistent with such requirements to the extent that the 
Commission determines that the public interest or the protection of 
investors so requires).". 
(c) Paragraph (7) of section 3(c) of the Investment Company Act 
of 1940 (15 U.S.C. 80a-3(c) (7)) is amended to read as follows: 
"(7) Any company (A) which is subject to regulation under section 
214 of the Interstate Commerce Act, except that this exception shall 
not apply to a company which the Commission finds and by order 
declares to be primarily engaged, directly or indirectly, in the business 
of investing, reinvesting, owning, holding, or trading in securities, 
or (B) whose entire outstanding stock is owned or controlled by a 
company excepted under clause (A) hereof, if the assets of the con-
trolled company consist substantially of securities issued by companies 
which are sub3ect to regulation under section 214 of the Interstate 
Commerce Act,". 
(d)(1) The amendments made by subsection (a) of this section shall 
take effect on the 60th day after the date of enactment of this Act, but 
shall not apply to any bona fide offering of a security made by the 
issuer, or by or through an underwriter, before such 60th day. 
(2) The amendment made by subsection (c) of this section shall not 
apply to any report by any person with respect to a fiscal year of such 
person which began before the date of enactment of this Act. 
(3) The amendment made by subsection (c) of this section shall 
take effect on the 60th day after the date of enactment of this Act. 
Effective date. 
15 USC 77c note. 
15 USC 80a-3 
note. 
Effective date. 
15 USC 80a-3 
note. 
RAIL SERVICES PLANNING OFFICE 
SEC. 309. Section 205 of the Regional Rail Reorganization Act of 
1973 (45 U.S.C. 715) is amended to read as follows: 
"RAIL SERVICES PLANNING OFFICE 
"SEC. 205. (a) ESTABLISHMENT.—The Rail Services Planning Office 
is established as an office in the Commission. The Office shall function 
continuously pursuant to the provisions of this Act, and shall be 
administered by a director. 
"(b) DIRECTOR.—The Director of the Office shall be appointed for 
a term of 6 years by the Chairman of the Commission with the con-
currence of 5 members of the Commission. He shall be appointed and 
compensated, without regard to the provisions of title 5, United States 
90 STAT. 58 
PUBLIC LAW 94-210—FEB. 5, 1976 
Code, governing appointments in the competitive sei-vice, classifica-
tion, and General Schedule pay rates, at a rate not in excess of the 
maximum rate for GS-18 of the General Schedule under section 5332 
of such title. The Director of the Office shall administer and be respon-
sible for the discharge of the functions and duties of the Office from 
the date he takes office unless removed for cause by the Commission. 
' • 
"(c) POWERS.—The Director of the Office is subject to the direction 
of, and shall report to, such member of the Commission as the Chair-
man thereof shall designate. The Chairman may designate himself as 
that member. Such Director is authorized, with the concurrence of such 
member or (in case of disagreement) the Chairman of the Commission, 
to enter into, without regard to section 3709 of the Revised Statutes of 
the United States (41 U.S.C. 5) such contracts, leases, cooperative 
agreements, or other transactions as may be necessary in the conduct 
of the functions and duties of the Office with any person (including a 
government entity). Each department, agency, and instrumentality of 
the executive branch of the Federal Government and each independent 
^ 
' 
regulatory agency of the United States is authorized, and shall give 
careful consideration to a request, to furnish to the Director of the 
Office, upon written request, on a reimbursable basis or otherwise, such 
assistance as the Director deems necessary to carry out the functions 
and duties of the Office. Such assistance includes transfer of personnel 
^ 
with their consent and without prejudice to their position and rating. 
"(d) DUTIES.—In addition to its duties and responsibilities under 
other provisions of this Act and under the Railroad Revitalization 
Ante, p. 31. 
and Regulatory Reform Act of 1976, the Office shall— 
"(1) assist the Commission in studying and evaluating any 
proposal, submitted to the Commission pursuant to section 5(2) 
or (3) of the Interstate Commerce Act (49 U.S.C. 5 (2) or (3)), 
for a merger, consolidation, unification or coordination project, 
joint use of tracks or other facilities, or acquisition or sale of assets, 
' 
which involves any common carrier by railroad subject to part I 
of such Act; 
"(2) assist the Commission in developing, with respect to eco-
' 
nomic regulation of transportation, policies which are likely to 
result in a more competitive, energy-efficient, and coordinated 
transportation system which utilizes each mode of transportation 
to its maximum advantage to meet the transportation service 
needs of the Nation; 
"(3) assist States and local and regional transportation agen-
cies in making determinations whether to provide rail service 
continuation subsidies to maintain in operation particular rail 
properties, by establishing criteria for determining whether par-
ticular rail properties are suitable for rail service continuation 
subsidies, with such criteria to include the following considera-
tions : rail properties are suitable if the cost of the required sub-
sidy for such properties per year to the taxpayers is less than (A) 
the cost of termination of rail service over such properties meas-
ured by increased fuel consumption and operational costs for 
alternative modes of transportation, (B) the cost to the gross 
national product in terms of reduced output of goods and services, 
(C) the cost of relocating or assisting through unemployment, 
retraining, and welfare benefits to individuals and firms adversely 
affected thereby, and (D) the cost to the environment measured 
by damage caused by increased pollution; 
"(4) conduct an ongoing analysis of the national rail transpor-
tation needs, evaluate the policies, plans, and programs of the 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 59 
Commission on the basis of such analysis, and advise the Com-
mission of the results of such evaluation; 
"(5) within 180 days after the date of enactment of the Rail- Regulations, 
road Revitalization and Regulatory Reform Act of 1976, issue ^i^e. P- 31. 
additional regulations, after conducting a proceeding in accord-
ance with the provisions of section 553 of title 5, United States 
Code, which contain— 
" ( A ) standards for the computation of subsidies for rail 
passenger service (except passenger service compensation 
disputes subject to the jurisdiction of the Commission under 
section 402(a) of the Rail Passenger Service Act (45 U.S.C. 
562(a))), which are consistent with the compensation prin-
ciples described in the final system plan and which avoid cross 
subsidization among commuter, intercity, and freight lail 
services; and 
.. 
"(B) standards for the determination of emergency com- 
' 
muter rail passenger service operating payments pursuant to 
-
section 17 of the Urban Mass Transportation Act of 1964; 
Post, p. 143. 
"(6) determine and publish, and from time to time revise and 
reissue, standards for determining (A) the 'revenue attributable 
to the rail properties', (B) the 'avoidable costs of providing serv-
ice', (C) a'reasonable return on the value,'and (D) a'reasonable 
management fee', as those phrases are used in section 304 of this 
Act, after a proceeding in accordance with the provisions of sec-
tion 553 of title 5, United States Code; and 
" (7) employ and utilize the services of attorneys and such other 
personnel as may be required in order properly to protect the 
interests of those communities and users of rail service which, for 
whatever reason (such as their size or location) might not other-
wise be adequately represented in the course of the reorganization 
process under this Act, until the assumption of such duties by the 
Office of Rail Public Counsel pursuant to section 27(4) (d) of the 
Interstate Commerce Act (49 U.S.C. 27 (4) ( d ) ) . 
"(e) ADDITIONAL DUTIES.— (1) Within 270 days after the date of Regulations, 
enactment of the Railroad Revitalization and Regulatory Reform 
Act of 1976, the Office shall issue additional regulations, after conduct-
ing a proceeding in accordance with section 553 of title 5, United 
States Code. Such regulations shall (A) develop an accounting system 
which will permit the collection and publication by the Corporation or 
by profitable railroads providing service over lines scheduled for 
abandonment, of information necessary for an accurate determination 
of the attributable revenues, avoidable costs, and operations of light 
density lines as operating and economic units, and (B) determine the 
'avoidable costs of providing rail freight service', as that phrase is used 
in section la (6) (a) (ii) (A) of the Interstate Commerce Act. The Office 
Post, p. 127. 
may, at any time, revise and republish the standards and regulations 
required by this section to incorporate changes made necessary by the 
accounting system developed pursuant to this subsection. 
"(2) Upon the request of a State in the region, within 90 days after 
Evaluation, 
the date of enactment of the Railroad Revitalization and Regulatory 
Reform Act of 1976, the Office shall prepare and publish an evalua-
tion of the economic viability of any or all light density lines within 
such State which are not designated for inclusion in the final system 
plan. Such an evaluation shall include an analysis of the actions which 
may be necessary to make the operation of rail services over any such 
line economical. The results of each such evaluation shall be trans- 
Publication in 
Federal Register. 
90 STAT. 60 
PUBLIC LAW 94-210—FEB. 5, 1976 
mitted to the requesting State and published in the Federal Register, 
not later than 1 year after the date such request is received by the 
Office.". 
"Unit-train 
service." 
EQUITABLE DISTRIBUTION OF CARS FOR UNIT TRAIN SERVICE 
SEC. 310. Section 1(12) of the Interstate Commerce Act (49 U.S.C. 
1(12)), is amended by adding at the end thereof: "In applying the 
provisions of this paragraph, unit-train service and non-unit-train 
service shall be considered separate and distinct classes of service, and 
a distinction shall be made between these two classes of service and 
between the cars used in each class of service; questions of the justness 
and reasonableness of, or discrimination or preference or prejudice or 
advantage or disadvantage in, the distribution of cars shall be deter-
mined within each such class and not between them, notwithstanding 
any other provision of section 1, 2, or 3 of this Act (49 U.S.C. 1, 2, 
or 3), and of section 1, 2, or 3 of the Elkins Act (49 U.S.C. 41, 42, 
or 43). Coal cars supplied by shippers or receivers shall not be con-
sidered a part of such carrier's fleet or otherwise counted in determin-
ing questions of distribution or car count under this paragraph or 
any provision of law referred to in this section. As used in this para-
graph, the term 'unit-train service', means the movement of a single 
shipment of coal of not less than 4,500 tons, tendered to one carrier, on 
one bill of lading, at one origin, on one day, and destined to one con-
signee, at one plant, at one destination, via one route.". 
Transmittal to 
Congress. 
49 use 1 note. 
49 use prec. 
note. 
Final draft, 
submittal to 
Congress. 
APPROPRIATIONS REQUEST 
SEC. 311. Section 201 of the Budget and Accounting Act, 1921 (31 
U.S.C. 11) is amended by adding at the end thereof the following new 
subsection: 
"(j) Whenever the Interstate Commerce Commission submits any 
budget estimate or request, other budget information (including man-
power needs), legislative recommendations prepared testimony for 
congressional hearings, or comments on legislation, to the President or 
to the Office of Management and Budget, it shall concurrently transmit 
a copy of such estimate or request to the Congress. No officer or agency 
of the United States shall have any authority to prohibit, impose con-
ditions on, or in any Avay impair the free communication by such Com-
mission with the Congress, its committees, or any of the Members of 
the Congress with respect to any budget estimate or request of the 
Commission.". 
LAW REVISION 
SEC. 312. The Commission shall prepare, or shall cause to be pre-
pared, in whole or in part by consultants, a proposed modernization 
and revision of the Interstate Commerce Act, and a proposed codifica-
tion of all Acts supplementary to the Interstate Commerce Act. The 
Commission shall submit the final draft thereof to the Congress within 
2 years after the date of enactment of this Act. The final draft shall 
include comments on each proposed provision, significant alternative 
provisions considered but not recommended, and such other informa-
tion as may be useful to the Congress. The final draft shall be designed 
to simplify the present law and to harmonize regulation among the 
several modes of transportation subject to regulation under the Inter-
state Commerce Act. 
PUBLIC LAW 94-210—FEB. 5, 1976 
TITLE IV—MERGERS AND CONSOLIDATIONS 
RESPONSIBILITIES OF THE SECRETARY 
SEC. 401. The Department of Transportation Act (49 U.S.C. 1651 
et seq.) is amended by inserting after section 4 thereof the following 
new section 5: 
90 STAT. 61 
a 
RAIL SERVICES 
"SEC. 5. (a) The Secretary may develop and make available to inter- 
49 USC 1654. 
ested persons feasible plans, proposals, and recommendations for 
mergers, consolidations, reorganizations, and other unification or 
coordination projects for rail services (including, but not limited to, 
arrangements for joint use of tracks or other facilities and any acquisi-
tion or sale of assets) which the Secretary believes would result in 
a rail system which is more efficient, consistent with the public interest. 
"(b) In order to achieve a more efficient, economical, and viable 
rail system in the private sector, the Secretary may, upon the request 
of any railroad and in accordance with subsections (a) through (e) of 
this section, assist in planning, negotiating, and effecting a unification 
or coordination of operations and facilities with respect to two or more 
railroads. 
"(c) The Secretary may conduct such studies as are deemed advis- Studies, 
able to determine tiie potential cost savings and possible improve-
ments in the quality of rail services which are likely to result from 
unification or coordination with respect to two or more railroads, 
through the elimination of duplicative or overlapping opei-ations and 
facilities; the reduction of switching operations; utilization of the 
shortest, or the most efficient, and economical routes; the exchange of 
trackage rights; the combining of trackage and of terminal or other 
facilities; the upgrading of tracks and other facilities used by two or 
more railroads; reduction of administrative and other expenses; and 
any other measures likely to reduce costs and improve rail service. For 
purposes of studies conducted under this section and the study 
described in section 901 of the Railroad Re 
vital ization and Regulatory 
Reform Act of 1976, each railroad shall provide such information as Post, p. 147. 
may be requested by the Secretary in connection with the performance 
of functions under this section and such section 901. In furtherance of 
any of the functions or responsibilities of the Secretary under this 
section or such section 901, any officer or employee duly designated by 
the Secretary may obtain, from any railroad, information regarding 
the nature, kind, quality, origin, destination, consignor, consignee, 
and routing of property, without the consent of the consignor or con-
signee involved, notwithstanding the provisions of section 15(13) of 
the Interstate Commerce Act (49 U.S.C. 15(13)) and may, to the extent 
necessary or appropriate, exercise, with respect to any railroad, any 
of the powers described in section 203 (c) of the Regional Rail Reorga-
nization Act of 1973 (45 U.S.C. 713(c)), as provided therein, except Subpoenas, 
that subpoenas shall be issued under the signature of the Secretary. 
"(d) When requested by one or more railroads, the Secretary may 
Conferences, 
also hold conferences with respect to any proposed unification or coor-
dination project. The Secretary may invite officers and directors of 
all affected railroads; representatives of employees of such railroads 
who may be affected; the Interstate Commerce Commission; appro-
priate State and local government officials, shippers, and consumer 
representatives; and representatives of the Federal Trade Commission 
and of the Attorney General to one or more such conferences with 
respect to such a proposal. The Secretary may mediate any dispute 
90 STAT. 62 
PUBLIC LAW 94-210—FEB. 5, 1976 
which may arise in connection with any proposed unification or 
coordination project. Persons attending or represented at any such 
conference shall not be liable under the antitrust laws of the United 
States with respect to any discussion at such conference and as to any 
agreements reached at such conference, which are entered into with the 
approval of the Secretary in order to achieve or determine a plan of 
action to implement any such unification or coordination project. 
"(e) Whenever any railroad submits a proposal for a merger or 
other action the approval of which is subject to the jurisdiction of 
the Interstate Commerce Commission under section 5(2) of the Inter-
state Commerce Act (49 U.S.C. 5(2)), the Secretary may, if he has 
not already done so, conduct a study of such proposal in order to 
determine whether or not, in his judgment, such proposal is in accord-
ance with the standards set forth in section 5(2) (c) of such Act (49 
U.S.C. 5 (2) (c)). Whenever such proposal is the subject of an applica-
tion and a proceeding before such Commission, the Secretary is author-
ized to appear before the Commission in any proceeding held with 
respect to such application.". 
Application. 
Publication in 
Federal Register. 
49 use 17. 
Publication in 
Federal Register. 
MERGER PROCEDURE 
SEC. 402. (a) Section 5(2) (f) of the Interstate Commerce Act (49 
U.S.C. 5(2) (f)) is amended by inserting a new sentence immediately 
preceding the last sentence thereof as follows: "Such arrangement 
shall contain provisions no less protective of the interests of employees 
than those heretofore imposed pursuant to this subdivision and those 
established pursuant to section 405 of the Rail Passenger Service Act 
(45U.S.a565).". 
(b) Section 5(2) of the Interstate Commerce Act (49 U.S.C. 5(2)) 
is amended by adding at the end thereof the following two new 
subdivisions: 
"(g) In any case arising under this paragraph which involves a 
common carrier by railroad, the Commission shall— 
"(i) within 30 days after the date on which an application is 
filed with the Commission and after a certified copy of such appli-
cation is furnished to the Secretary of Tranportation, (A) publish 
notice thereof in the Federal Register, or (B) if such application 
is incomplete, reject such application by order, which order shall 
be deemed to be final under the provisions of section 17; 
"(ii) provide that written comments on an application, as to 
which such notice is published, may be filed within 45 days after 
the publication of such notice in the Federal Register; 
"(iii) require that copies of any such comments shall be served 
upon the Secretary of Transportation and the Attorney General, 
each of whom shall be afforded 15 days following the date of 
receipt thereof to inform the Commission whether he will inter-
vene as a party to th« proceeding, and if so, to submit preliminary 
views on such application; 
" (iv) require that all other applications, which are inconsistent, 
in whole or in part, with such applications, and all petitions for 
inclusion in the transaction, shall be filed with the Commission 
and furnished to the Secretary of Transportation, within 90 days 
after the publication of notice of the application in the Federal 
Register; 
"(v) conclude any evidentiary proceedings within 240 days 
following the date of such publication of notice, except that in 
the case of an application involving the merger or control of two 
or more class I railroads, as defined by the Commission, the Com-
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 63 
mission shall conclude any evidentiary proceedings not more than 
24 months following the date upon which notice of the applica-
tion was published in the Federal Kegister; and 
"(vi) issue a final decision within 180 days following the date 
upon which the evidentiary proceeding is concluded. 
If the Commission fails to issiie a decision which is final within the 
meaning of section 17 within such 180-day period, it shall notify 
the Congress in w^riting of such failure and the reasons therefor. 
If the Commission determines that the due and timely execution of its 
functions under this paragraph so requires, or that an application 
brought under this paragraph is of major transportation importance, 
it may order that the case be referred directly (without an initial deci-
sion by a division, individiuil Commissioner, board, or administrative 
law judge) to the full Commission for a decision which is final within 
the meaning of section 17. 
"(h) The Secretary of Transportation may propose any modifica-
tion of any transaction governed by this paragraph which involves a 
carrier by railroad. The Secretary shall have standing to appear before 
the Comipission in support of any such proposed modification.". 
Congressional 
notification. 
EXPEDITED RAIUIOAD MERGER PROCEDURE 
SEC. 403. (a) Section 5 of the Interstate Commerce Act (49 U.S.C. 5) 
is amended by redesignating paragraphs (3) through (16) thereof 
as paragraphs (4) through (17) thereof, respectively, and by insert-
ing therein a new^ paragraph (3), as follow^s: 
"(3)(a) If a merger, consolidation, unification or coordination proj-
ect (as described in section 5(c) of the Department of Transportation 
Act), joint use of tracks or other facilities, or acquisition or sale 
of assets, which involves any common carrier by railroad subject to 
this part, is proposed by an eligible party in accordance with sub-
division (b) during the period beginning on the date of enactment 
of this paragraph and ending on December 31,1981, the party seeking 
authority for the execution or implementation of such transaction may 
utilize the procedure set forth in this paragraph or in paragraph (2). 
"(b) Any transaction described in subdivision (a) may be proposed 
to the Commission by— 
"(i) the Secretary of Transportation (hereafter in this para-
graph referred to as the 'Secretary'), with the consent of the 
common carriers by railroad subject to this part which are parties 
to such transaction; or 
"(ii) any such carrier which, not less than 6 months prior to 
such submission to the Commission, submitted such proposed 
transaction to the Secretary for evaluation pursuant to subdivi-
sion (f). 
"(c) Whenever a transaction described in subdivision (a) is pro- Application, 
posed under this paragraph, the proposing party shall submit an 
application for approval thereof to the Commission, in accordance 
with such requirements as to form, content, and documentation as the 
Commission may prescribe. Within 10 days after the date of receipt Notice. 
of such an application, the Commission shall send a notice of such 
proposed transaction to— 
" (i) the Governor of each State which may be affected, directly 
or indirectly, by such transaction if it is executed or implemented; 
" (ii) the Attorney General; 
" (iii) the Secretary of Labor; and 
"(iv) the Secretary (except where the Secretary is the propos-
ing party). 
90 STAT. 64 
PUBLIC LAW 94-210—FEB. 5, 1976 
Hearing. 
Proposed 
transaction. 
Publication in 
Federal Register. 
Notice. 
The Commission shall accompany its notice to the Secretary with a 
request for the report of the Secretary pursuant to clause (v) of sub-
division (f). Each such notice shall include a copy of such application; 
a summary of the proposed transaction involved, and the proposing 
party's reasons and public interest justifications therefor. 
"(d) The Commission shall hold a public hearing on each applica-
tion submitted to it pursuant to subdivision (c), within 90 days after 
the date of receipt of such application. Such public hearing shall be 
held before a panel of the Commission duly designated for such 
purpose by the Commission. Such panel may utilize administrative 
law judges and the Rail Services Planning Office in such manner as 
it considers appropriate for the conduct of the hearing, the evalua-
tion of such application and comments thereon, and the timely and 
reasonable determination of whether it is in the public interest to 
grant such application and to approve such proposed transaction pur-
suant to subdivision (g). Such panel shall complete such hearing 
within 180 days after the date of referral of such application to such 
panel, and it may, in order to meet such requirement, prescribe such 
rules and make such rulings as may tend to avoid unnecessary costs or 
delay. Such panel shall recommend a decision and certify the record 
to the full Commission for final decision, within 90 days after the 
termination of such hearing. The full Commission shall hear oral 
argument on the matter so certified, and it shall render a final decision 
within 120 days after receipt of the certified record and recommended 
decision of such panel. The Commission may, in its discretion, extend 
any time period set forth in this subdivision, except that the final 
decision of the Commission shall be rendered not later than the second 
anniversary of the date of receipt of such an application by the Com-
mission. 
"(e) In making its recommended decision with respect to anv trans-
action proposed under this paragraph, the duly designated panel of 
the Commission shall— 
"(i) request the views of the Secretary, with respect to the effect 
of such proposed transaction on the national transportation pol-
icy, as stated by the Secretary, and consider the matter submitted 
under subdivision (f); 
"(ii) request the views of the Attorney General, witli respect 
r; to any competitive or anticompetitive effects of such proposed 
transaction; and 
"(iii) request the views of the Secretary of Labor, with respect 
to the effect of such proposed transaction on railroad employees, 
^ particularly as to whether such proposal contains adequate 
employee protection provisions. 
Such views shall be submitted in writing and shall be available to the 
public upon request. 
"(f) Whenever a proposed transaction is submitted to the Secre-
tary by a common carrier by railroad pursuant to clause (ii) of sub-
division (b), and whenever the Secretary develops a proposed 
transaction for submission to the Commission pursuant to subdivision 
(c), the Secretary shall— 
"(i) publish a summary and a detailed account of the contents 
of such proposed transaction in the Federal Register, in order to 
provide reasonable notice to interested parties and the public of 
such proposed transaction; 
"(ii) give notice of such proposed transaction to the Attorney 
General and to the Governor of each State in which any part of 
the properties of the common carriers by railroad involved in 
such proposed transaction are situated; 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 65 
' 
"(iii) conduct an informal public hearing with respect to such Hearing, 
proposed transaction and provide an opportunity for all inter-
ested parties to submit written comments; 
"(iv) study each such proposed transaction with respect to— 
< i 
" (A) the needs of rail transportation in the geographical 
area affected; 
"(B) the effect of such proposed transaction on the reten-
tion and promotion of competition in the provision of rail 
and other transportation services in the geographical area 
affected; 
"(C) the environmental impact of such proposed trans-
action and of alternative choices of action; 
"(D) the effect of such proposed transaction on employ-
ment; 
"(E) the cost of rehabilitation and modernization of track, 
equipment, and other facilities, with a comparison of the 
potential savings or losses from other possible choices of 
action; 
"(F) the rationalization of the rail system; 
"(G) the impact of such proposed transaction on shippers, 
consumers, and railroad employees; 
; i 
"(H) the effect of such proposed transaction on the com-
munities in the geographical areas affected and on the geo-
graphical areas contiguous to such areas; and 
"(I) whether such proposed tranf>action will improve rail 
service; and 
" (v) submit a report to the Commission setting forth the results Report to 
of each study conducted pursuant to clause (iv), within 10 Commission, 
days after an application is submitted to the Commission pursu-
ant to subdivision (c), with respect to the proposed transaction 
which is the subject of such study. The Commission shall g.ve due 
weight and consideration to such report in making its determina-
tions under this paragraph. 
"(g) The Commission may— 
"(i) approve a transaction proposed under this paragraph, if 
the Commission determines that such proposed transaction is in 
the public interest; and 
"(ii) condition its approval of any such proposed transaction 
on any terms, conditions, and modifications which the Commis-
sion determines are in the public interest; or 
"(iii) disapprove any such proposed transaction, if the Com-
mission determines that such proposed transaction is not in the 
public interest. 
In each such case, the decision of the Commission shall be accom-
panied by a written opinion setting forth the reasons for its action.", 
(b) Section 5 of the Interstate Commerce Act (49 U.S.C. 5) is 
further amended— 
(1) in paragraph (2) (a) thereof by inserting "or paragraph 
(3)" immediately after "subdivision (b)"; 
(2) in paragraph (2) (f) thereof, by inserting immediately 
after "(2)" the following: "or paragraph (3)"; 
(3) in paragraph (5) thereof, as redesignated by this Act, by 
striking out "paragraph (2)" and inserting in lieu thereof "para-
graphs (2) and (3)", and by striking out "paragraph (5)" and 
inserting in lieu thereof "paragraph (6)"; 
(4) in paragraph (8) thereof, as redesignated by this Act, 
by striking out "paragraph (4)" and inserting in lieu thereof 
90 STAT. 66 
PUBLIC LAW 94-210—FEB. 5, 1976 
"paragraph (5)", and by striking out "(12)" and inserting in 
lieu thereof "(13)"; 
(5) in paragraph (10) thereof, as redesignated by this Act, 
by striking out "(7)" and inserting in lieu thereof "(8)"; 
(6) in paragrai^h (14) thereof, as redesignated by this Act, by 
striking out "(12)" and inserting in lieu thereof "(13)"; 
(7) in paragraph (16), as redesignated by this Act, by striking 
out "paragraph (14)" and inserting in lieu thereof "paragraph 
(15)"; 
(8) in paragraph (17), as redesignated by this Act, by strik-
ing out "paragraph (14)" and inserting in lieu thereof "para-
graph (15)"; and 
(9) by striking out "subparagraph" each place it appears and 
inserting in lieu thereof "subdivision". 
TITLE V—RAILROAD REHABILITATION AND 
IMPROVEMENT FINANCING 
DEFINITIONS 
45 use 821. 
SEC. 50L As used in this title, the term— 
(1) "applicant" means any railroad, or other person (includ-
ing a governmental entity) which submits an application to the 
Secretary for the guarantee of an obligation under which it is 
an obligor or for a commitment to guarantee such an obligation; 
(2) 'Equipment" includes any type of new or rebuilt standard 
gauge locomotive, caboose, or general service railroad freight car 
the use of which is not limited to any specialized purpose by 
particular equipment, design, or other features. General service 
railroad freight car includes a boxcar, gondola, open-top or 
covered hopper car, and flatcar. The Secretary may designate 
other types of cars as equipment upon a written finding, with 
reasons therefor, that such designation is consistent with the 
purposes of this Act; 
(3) "facilities" means— 
(A) track, roadbed, and related structures, including rail, 
ties, ballast, other track materials, grading, tunnels, bridges, 
trestles, culverts, elevated structures, stations, office buildings 
used for operating purposes only, repair shops, enginehouses, 
and public improvements used or useable for rail service 
t;: 
operations; 
(B) communication and power transmission svstems, 
including electronic, microwave, wireless, communication, 
and automatic data processing systems, electrical transmis-
sion systems, powerplants, power transmission systems, 
: - 
powerplant machinery and equipment, structures, and facili-
ties for the transmission of electricity for use by railroads; 
J -J 
(C) signals, including signals and interlockers; 
(D) terminal or yard facilities, including trailer-on-flat-
car and container-on-flat-car terminals, express or railroad 
terminal and switching facilities, and services to express 
companies and railroads and their shippers, including ferries, 
tugs, carfloats, and related shoreside facilities designed for 
the transportation of equipment by water; or 
(E) shop or repair facilities or any other property used or 
capable of being used in rail freight transportation services 
or in connection with such services or for originating, termi-
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 67 
nating, improving, and expediting the movement of equip-
ment; 
(4) "Fund" means the Kailroad Eehabilitation and Improve-
ment Fund established under section 502 of this title; 
(5) "holder" means the obligee or creditor under an obligation, 
except that when a bank or trust company is acting as agent or 
trustee for such an obligee or creditor, the term refers to such 
bank or trust company; 
(6) "obligation" means a bond, note, conditional sale agree-
ment, equipment trust certificate, security agreement, or other 
obligation issued or granted to finance or refinance equipment or 
facilities acquisition, construction, rehabilitation, or improve-
ment ; and 
(7) "obligor" means the debtor under an obligation, including 
the original obligor and any successor or assignee of such obligor 
who is approved by the Secretary. 
THE RAIL FUND 
SEC. 502. (a) ESTABLISHMENT.—There is hereby established in the 
Treasury of the United States the Railroad Rehabilitation and 
Improvement Fund. The Fund shall be administered by the Secretary, 
without the requirement of annual authorizations, in order (1) to 
secure the payment, when due, of the principal of, any redemption 
premium on, and any interest on, all Fund anticipation notes and Fund 
bonds, by a first pledge of and a lien on all revenues payable to and 
assets held in the Fund, and (2) to carry out the purposes, functions, 
and powers authorized in this title. 
(b) PURPOSE.—The purpose of the Fund is to provide capital which 
is necessary to furnish financial assistance to railroads, to the extend 
of appropriated funds, for facilities maintenance, rehabilitation, 
improvements, and acquisitions, and such other financial needs as the 
Secretary approves, in accordance with this title. 
(c) GENERAL POWERS.—In order to achieve the objectives and to 
carry out the purposes of this title, the Secretary may— 
(1) issue and sell securities, including Fund anticipation notes 
and Fund bonds, as provided for in sections 507 and 508 of this 
title; 
(2) make and enforce such rules and regulations, and make and 
perform such contracts, agreements, and commitments, as may 
be necessary to appropriate to carry out the purposes or provi-
sions of this title; 
(3) prescribe and impose fees and charges for services by the 
Secretary, pursuant to this title; 
_ (4) settle, adjust, and compromise, and, with or without con-
sideration or benefit to the Fund, release or waive, in whole or in 
part, in advance or otherwise, any claim, demand, or right of, by, 
or against the Secretary or the Fund; 
(5) sue and be sued, complain, and defend, in any State, Fed-
eral, or other court; 
(6) acquire, take, hold, own, deal with, and dispose of, any 
property, including carrier redeemable preference shares as pro-
vided for in section 505(d) of this title; and 
(7) determine, in accordance with appropriations, the amounts 
to be withdrawn from the Fund and the manner in which such 
withdrawals shall be effected. 
(d) ASSISTANCE FROM OTHER AGENCIES.—The Secretary, with the 
consent of any department, establishment, or corporate or other instru-
Railroad 
Rehabilitation 
and Improvement 
Fund. 
45 u s e 822. 
Rules and 
regulations. 
90 STAT. 68 
PUBLIC LAW 94-210—FEB. 5, 1976 
mentality of the Federal Government, may utilize and act through any 
such department, establishment, or instrumentality. The Secretary 
may, with such consent, utilize the information, services, facili-
ties, and personnel of any such department, establishment, or instru-
mentality, on a reimbursable basis. Each such department, establish-
ment, and instrumentality is authorized to furnish any such assistance 
to the Secretary upon written request from the Secretary. 
(e) JURISDICTION,—A¥henever the Secretary or the Fund is a party 
to any civil action under this title, such action shall be deemed to arise 
under the laAvs of the United States, The district courts of the United 
States shall have original and removal jurisdiction of any action in 
which the Secretary or the Fund is a party, without regard to the 
amount in controversy. No attachment or execution may be issued 
against the Secretary, the Fund, or any property thereof prior to the 
entry of final judgment to such effect in any State, Federal, or other 
court. 
(f) 
CONTENTS OF FUND,—There shall be deposited in the Fund, 
subject to utilization pursuant to subsection (i) of this section— 
(1) funds received by the Secretary for deposit in the Fund, 
representing the proceeds from the issuance and sale by the Secre-
tary to the Secretary of the Treasury of Fund anticipation notes, 
as provided in section 507 of this title ; 
.-^;, ; 
(2) funds as may be hei-eafter appropriated to the Fund, follow-
ing the submission to the Congress of the Secretary's report, under 
section 504 of this title, with respect to the perceived needs of the 
rail industry for facilities rehabilitation and improvement, pro-
jected cash shortfalls within the rail industry, and the scope and 
sources of long-term public sector funding for the Fund; 
(3) funds received by the Secretary for deposit in the Fund, 
representing the proceeds from the issuance and sale of Fund 
bonds, as provided in section 508 of this title; 
(4) redeemable preference shares issued by a railroad and pur-
chased by the Secretary on behalf of the Fund and funds received 
by the Fund representing dividends and redemption payments on 
such shares, as provided in sections 505(d) and 506 (a) and (b) of 
this title; 
(5) income and gains realized by the Fund from any investment 
, 
of excess funds, pursuant to subsection (g) of this section, and the 
• 
obligations or securities comprising such investments; and 
(6) any other receipts of the Fund, 
(g) EXCESS FUNDS INVESTMENT,—If the Secretary determines that 
the amount of money in the Fund exceeds the amount required for 
current needs, the Secretary may, subject to sections 508 (g) and (h) 
of this title, direct the Secretary of the Treasury to invest such amounts 
as the Secretary deems advisable, for such periods as the Secretary 
directs, in obligations of. or obligations guaranteed by, the Government 
of the United States, or in sucli other governmental or agency obliga-
tions or other securities of the United States as the Secretary of the 
Treasury deems appropriate, 
" 
(h) DEPOSITORY.—The Secretary may deposit moneys of the Fund 
with any Federal Reserve bank, any depository for public funds, or 
in such other places and in such manner as the Secretary of the Treas-
ury deems appropriate, 
(i) USES.—Moneys in the Fund shall be utilized— 
(1) to provide financial assistance to railroads for facilities 
maintenance, rehabilitation, improvement, and acquisition proj-
•: 
ects, and for such other financial needs as may be approved by the 
" Secretary pursuant to section 505 of this title. 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 69 
(2) to effect the payment, when due, of the principal of, and any 
interest on. Fund anticipation notes and Fund bonds issued by the 
Secretary pursuant to sections 507 and 508 of this title, 
(3) to redeem, as contemplated by section 507(c) and section 
508(g) of this title. Fund anticipation notes and Fund bonds, 
(4) in such amounts as are provided in appropriation acts, to 
make payment of all expenses incurred by the Secretary in carry-
ing out his duties with respect to the Fund, and 
(5) to make transfers to the general fund of the Treasury. 
Transportation. 
45 use 823. 
45 use 701 note. 
CLASSIFICATION AND DESIGNATION OF RAIL LINES 
SEC. 503. (a) TRAFFIC DENSITY ANALYSIS.—^Within 90 days after Submittal to 
the date of enactment of this Act, each railroad designated by the ^®^^®^^^f^^ 
Commission as a class I railroad shall prepare and submit to the 
Secretary a full and complete analysis of the rail system operated by 
it. Such analysis shall indicate the traffic density for the preceding 5 
calendar years on each of the main and branch rail lines of the rail-
road submitting such analysis. The requirements of the two preceding 
sentences shall not apply to any railroad subject to reoiganization 
pursuant to the Regional Rail Reorganization Act of 1973. 
(b) PRELIMINARY STANDARDS AND DESIGNATIONS.—Within 180 days 
after the date of enactment of this Act, the Secretary shall develop 
and publish— 
(1) the preliminary standards for classification, in at least 3 
categories, of main and branch rail lines according to the degree 
to which they are essential to the rail transportation system; and 
(2) the preliminary designations with respect to each main 
and branch rail line, in accordance with such standards for 
classification. 
The classification of rail lines for purposes of this subsection shall be 
based on the level of usage measured in gross-ton-miles, the contribu-
tion to the economic viability of the railroad which controls sucli lines, 
and the contribution of such lines to the probable economic viability 
of any other railroads which participate in the traffic originating on 
such lines. In determining "level of usage" and "probable economic 
viability", for purposes of such classification, the Secretary shall take 
into account operational service and other appropriate factors, and 1 e 
may make reasonable allowance for differences in operation among 
individual railroads or groups of railroads. 
(c) PUBLIC HEARINGS.—Commencing 30 days after the date of pub-
lication of the standards and designations required under subsection 
(b) of this section, the Office shall conduct public hearings, at repre-
sentative locations, to solicit comments and receive views on the prelim-
inary standards for classification and on the preliminary designations. 
The Office shall give notice of the date, time, and place of each such 
hearing, and such notices shall be designed and placed in such manner 
that all interested parties will have a full and fair opportunity to be 
heard. 
(d) REPORT BY OFFICE.—^Within 120 days after the date of publica-
tion of the standards and designations required under subsection (b) 
of this section, the Office shall submit a report to the Secretary contain-
ing its conclusions and recommendations with respect to such prelimi-
nary standards for classification and such preliminary designations. 
This report shall be based on the record which was developed by the 
Office during the hearings under subsection (c) of this section, as sup-
plemented by such studies as may be undertaken by the Office. 
Notice. 
90 STAT. 70 
PUBLIC LAW 94-210—FEB. 5, 1976 
' 
(e) F I N A L STANDARDS AND DESIGNATIONS.—Within 60 days after the 
date of receipt of the report required under subsection (d) of this sec-
tion, the Secretary, with the cooperation and assistance of the Office, 
shall, after giving due consideration to such report, prepare and 
publish— 
(1) the final standards for classification of main and branch 
rail lines; and 
(2) the final designations with respect to each main and branch 
rail line, in accordance with such standards for classification, 
including findings to support any material change which is made 
in a final designation from the corresponding 
preliminary 
designation. 
CAPITAL N E E D S STUDY 
^ 
45 use 824. 
SEC. 504. (a) 
DEFERRED MAINTENANCE STATEMENT.—Within 180 
days after the date of enactment of this Act, each railroad designated 
by the Commission as a class I railroad (other than a railroad subject 
to reorganization pursuant to the Regional Rail Reorganization Act 
45 use 701 note, of 1973) shall prepare and submit to the Secretary a full and complete 
statement (1) of such railroad's deferred maintenance and delayed 
.;;. : 
capital expenditures, as of December 31.1975, and (2) of the projected 
amounts of appropriate maintenance to be performed and capital 
expenditures to be made for such railroad's facilities, during each of 
the years from 1976 through 1985. Each railroad shall submit such 
additional information as may be required from it by the Secretary, 
in connection with his duties under section 503 of this title or under 
this section, prior to July 1, 1977, including the projected sources of 
and uses for the funds required by such railroad for such projected 
program. 
(b) PRELIMINARY FINANCING RECOMMENDATIONS.—^Within 360 days 
after the date of enactment of this Act, the Secretary, after giving 
due consideration to (1) the final designations under section 503(e) 
of this title, (2) the information furnished under subsection (a) of 
this section, and (3) any other relevant information, shall develop, 
publish, and transmit— 
(A) to the Congress, preliminary recommendations as to the 
amount and type of carrier equity and other financing to be 
effected through the Fund, or through any other funding mecha-
nism, recommended by the Secretary, based upon his view of the 
rail industry's facilities rehabilitation and improvement needs, 
as projected through Decembor 31.1985; and 
(B) to the Congress and to the Secretary of the Treasury, 
preliminary recommendations as to the means by which the Fed-
eral share, if any, of such equity and other financing should be 
provided. 
In preparing such recommendations, the Secretary shall specifically 
consider and evaluate the public benefits and costs which would result 
from public ownership of railroad rights-of-way. 
(c) EVALUATION.—j-Within 90 days after the date of publication of 
the Secretary's preliminary recommendations under subsection (b) 
of this section, the Secretary of the Treasury shall publish and trans-
mit to the Secretary and to the Congress his evaluation thereof and 
any recommendations with respect to the matters referred to in sub-
section (b) (3) (B) of this section. 
(d) F I N A L RECOMMENDATIONS.—Within 90 days after the date of 
receipt of the evaluation, transmitted under subsection (c) of this 
Transmittal to 
Secretary and 
Congress. 
Transmittal to 
Congress. 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 71 
section, the Secretary shall, after giving due consideration to such 
recommendations, prepare and transmit to the Congress his final rec-
ommendations with respect to the matters referred to in subsection (b) 
of this section. 
REHABILITATION AND IMPROVEMENT riNANCING 
SEC. 505. (a) TIMING.—Any railroad may apply to the Secretary 
45 USC 825. 
following the date of enactment of this Act, in accordance with 
regulations promulgated by the Secretary— 
(1) for such financial assistance as may be approved by the 
Secretary; and 
(2) for financial assistance for facilities rehabilitation and im-
provement financing, except that the Secretary shall not act 
finally on any such application until the date of publication of 
the final standards and designations under section 503(e) of 
this title. 
(b) APPLICATION AND DETERMINATION.— (1) Each application for 
facilities rehabilitation and improvement financing shall set forth—• 
(A) a description of the proposed facilities rehabilitation and 
improvement project for which such railroad is seeking financial 
assistance, and of the current physical condition of such facilities; 
(B) the classification of each main and branch rail line included 
in such project, as determined in accordance with the final stand-
ards and designations under section 503 (e) of this title; 
(C) the track standard under which each such line has been and 
is being operated and the leasons therefor, and the safety stand-
ards and signal requirements necessary under such standard to 
prevent loss of life and serious accident or injury at grade 
crossings; 
(D) the track standard necessary, in the judgment of such 
railroad, to provide reliable and comjietitive freight service (and 
passenger service, where applicable) over each such line, together 
with such railroad's recommendations as to (i) the most economi-
cal method of improving the physical condition of each such line 
to meet such track standard, (ii) the cost of providing adequate 
safety standards and signals, and (iii) an economic analysis of the 
cost of such improvements in condition and in safety standards 
and signals; 
(E) such railroad's estimate as to the cost of labor and mate-
rials, and the date of completion, and its opinion as to the priority 
to be accorded such portions of the proposed project as are rea-
sonably divisible; 
(F) the amount and kind of Federal financial assistance 
required by such railroad in order to complete the proposed 
project; and 
(G) such other information as the Secretary shall by regulation 
require to assist him in evaluating such application in accordance 
with this section or for carrying out the purposes of this title. 
(2) The Secretary shall act upon each such application within 6 
months after the date on which all required information is received, 
except as otherwise provided in subsection (a) (2) of this section. 
The Secretary may approve any such application if he determines that 
providing the requested financial assistance is in the public interest. 
When making such a determination, the Secretary shall consider (A) 
the availability of funds from other sources at a cost which is reason-
able under principles of prudent railroad financial management in 
light of the railroad's projected rate of return for the project to be 
financed, (B) the interest of the public in supplementing such other 
90 STAT. 72 
PUBLIC LAW 94-210—FEB. 5, 1976 
funds as may be available in order to increase the total amount of 
funds available for railroad financing, and (C) the public benefits 
to be realized from the project to be fmanced in relation to the public 
costs of such financing and whether the proposed project will return 
public benefits sufficient to justify such public costs. The Secretary, in 
granting financial assistance to any applicant, shall assign the highest 
priority, among applications for assistance which would return equal 
•' 
public benefits, to applications for assistance for providing safety 
improvements and signals, including underpasses or overpasses at rail-
road crossings at which injury or loss of life has frequently occurred 
or is likely to occur. 
(c) FINANCING AGREEMENT.—Upon the approval of an application 
for financial assistance under this section, the Secretary shall promptly 
enter into an agreement with such railroad to provide financing in 
such amounts and at such times as is sufficient, in the judgment 
of the Secretary, to meet the reasonable cost, in whole or in part, of 
the facilities rehabilitation and improvement project which has been 
approved, in whole or in part. Each such agreement shall include such 
teims and conditions as are necessary or appropriate, in the judgment 
of the Secretary, to assure that the financing will be used only in 
the manner, and for the purposes, approved by the Secretary. 
(d) AUTHORIZATION.— (1) In the case of a railroad other than a rail-
11 use 205. 
road in reorganization under section 77 of the Bankruptcy Act, financ-
ing pursuant to this section shall be in the form of purchase by the 
Secretary of redeemable preference shares at par. Such shares shall be 
specifically issued for such purpose in accordance with the terms and 
conditions set forth in section 506 of this title. 
(2) (A) In the case of a railroad in reorganization under section 77 
of tlie Bankruptcy Act, the Secretary, in order to provide financing 
pursuant to this section, may agree to purchase redeemable preference 
shares of such railroad at par as part of a plan of reorganization of 
' 
such railroad approved by the court having jurisdiction over the reor-
ganization of such railroad. Such shares shall be specifically issued in 
accordance with the terms and conditions set forth in section 506 of 
this title. 
(B) The Secretary, in order to provide financing pursuant to this 
section, may also purchase certificates issued under section 77(c) (3) of 
the Bankruptcy Act by a trustee of a railroad in reorganization and 
approved by the reorganization court, under such terms and conditions 
as may be approved by the Secretary and the reorganization court. In 
purchasing such trustee certificates or at any time thereafter, the 
Secretary may agree with the trustee of such railroad in reorganiza-
tion, subject to the approval of the reorganization court, to exchange 
such certificates for redeemable preference shares issued, in accordance 
with the terms and conditions set forth in section 506 of this title, in 
connection with a plan of reorganization approved by the reorganiza-
tion court. No certificate shall be purchased under this section unless 
and until the Secretary makes a finding in writing that— 
(i) such certificates cannot otherwise be sold at a reasonable 
rate of interest; 
(ii) the project to be financed can reasonably be expected to 
be maintained as part of a financially self-sustaining railroad 
, 
system; and 
(iii) the probable value of the assets of the railroad in the event 
of liquidation provides reasonable protection to the United States. 
(3) The total par value of the redeemable preference shares and the 
amount of trustee certificates which the Secretary may purchase from 
the proceeds received from the issuance and sale of Fund anticipation 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 73 
notes shall not exceed $600,000,000. Not more than $100,000,000 of 
, 
such proceeds may be used to purchase trustee certificates. 
(e) FUTURE PURCHASES OF REDEEMABLE PREFERENCE SHARES.—The 
total par value of the redeemable preference shares which the Secre-
tary may purchase under this title after September 30, 1978, shall be 
determined by the Congress following the receipt by the Congress of 
the Secretary's recommendations as to the scope and sources of fund-
ing of the Fund or any recommended alternative financing mecha-
nism, as submitted pursuant to section 504 of this title, except that— 
(1) the amount of the Secretary's investment in redeemable 
preference shares in any fiscal year (out of proceeds other than 
those derived through the issuance and sale of Fund anticipation 
notes) shall not, when added to the amount of his prior invest-
ment in such shares, exceed 200 percent of the aggregate principal 
amount of the Fund bonds which (A) have been issued by the 
. ,,.... , 
Secretary prior to such fiscal year, and (B) are projected to be 
issued by the Secretary through the end of such fiscal year; and 
(2) neither redemptions of Fund bonds nor their payment at 
scheduled maturity shall have any bearing on the limitation in 
paragraph (1) of this subsection. 
REDEEMABLE PREFERENCE SHARES 
SEC. 506. (a) CHARACTERISTICS.—The redeemable preference shares 45 USC 826. 
acquired by the Secretary pursuant to section 505(d) of this title 
are securities which are issued by a railroad for the purpose of obtain-
ing financing under this title. Each such redeemable preference share— 
(1) shall be nonvoting and shall have a par value of $10,C00; 
(2) shall be senior in right (i) to all common stock of the issu-
ing railroad, whenever issued, (ii) to any previously issued pre-
ferred stock where such seniority does not mitigate any rights of 
the holders of such stock accorded by the terms and conditions of 
_ 
such stock, and (iii) to any subsequently issued preferred stock, 
with respect to dividend and redemption payments and in case of 
liquidation or dissolution of such railroad, but shall be otherwise 
subordinate in such matters to any of such railroad's previously 
issued and outstanding securities which rank ahead of its common 
stock and shall be subordinate to all securities other than com-
mon stock received in exchange as a part of a court approved 
reorganization plan under section 77 of the Bankruptcy Act (11 
U.S.C. 205) approved after the date of enactment of this sentence 
for previously incurred senior debt or previously issued and out-
standing securities which ranked ahead of its common stock; 
(3) shall accrue dividends, commencing on the 10th anniver-
sary date of the date of its original issuance, at such rate as shall 
be fixed by the Secretary for each issuance prior to the issuance 
thereof and which, when added to the amount of the mandatory 
redemption payments under subparagraph (4) of this paragraph, 
shall return to the Fund not less than 150 percent of the aggregate 
par value thereof, over the scheduled life of the issue and in 
annual payments which shall be as nearly equal as practicable; 
and 
(4) shall be subject to mandatory redemption, at par, com-
mencing not earlier than the 6th and not later than the 11th (as 
determined by the Secretary for each issuance) anniversary date 
of the date of its original issuance, in annual amounts which 
shall, over the period ending (as determined by the Secretary for 
90 STAT. 74 
PUBLIC LAW 94-210—FEB. 5, 1976 
' 
each issuance) not later thxan the 30th anniversary date of the 
date of its original issuance, aggregate the total par value of such 
share. 
(b) DEPOSIT.—^AU redeemable preference shares which are acquired 
by the Secretary pursuant to section 505(d) of this title shall, upon 
such acquisition, be deposited in the Fund. 
(c) OVERDUE PAYMENTS.—Whenever any dividend or redemption 
payment which is due on redeemable preference shares issued by any 
railroad remains unpaid for a period of 4 months, the Secretary shall 
be entitled to appoint two members to the Board of Directors of such 
railroad. The term of office of such members shall not extend beyond 
the period during which such dividend or redemption payments 
remains unpaid. 
FUND ANTICIPATION NOTES 
45 use 827. 
SEC. 507. (a) GENERAL.—The Secretary shall, until September 30, 
1978, issue and sell, and the Secretary of the Treasury until such date 
shall, to the extent of appropriated funds, purchase Fund anticipation 
notes in an aggregate principal amount of not more than $600,000,000, 
in order to provide financial assistance to railroads for such financing 
needs as the Secretary approves. 
(b) TERMS OF ISSUE.—Fund anticipation notes shall be issued in 
denominations of $100,000 (or any integral multiple thereof), upon 
MM ; y ; 
such terms and conditions, with such maturities, such rates of interest, 
if any, and such redemption premiums, if any, as the Secretary in 
his sole discretion may determine. The date of maturity of each Fund 
anticipation note may not exceed 7 years from the date of its issuance. 
(c) REDEMPTION.—If the Congress, following its receipt of the rec-
ommendations of the Secretary pursuant to section 504(d) of this title 
(with respect to the amount of facilities rehabilitation and improve-
^ 
ment financing which should be effected through the Fund and the 
method of long-term public sector funding therefor) authorizes the 
issuance of Fund bonds, the Secretary shall redeem the Fund anticipa-
tion notes then outstanding, in such manner, and over such period of 
time, as the Secretary shall determine, from the proceeds of the sale 
of such Fund bonds and from such other public sector moneys as have 
been appropriated to the Fund. 
(d) REMITTANCE AND TERMINATION.—If the Congress does not, on 
or before September 30, 1978, enact legislation of the type referred 
to in subsection (c) of this section, the Secretary shall hold in trust 
all redeemable preference shares issued by railroads which are held 
in the Fund, and the Fund shall thereupon terminate. 
FUND BONDS 
45 use 828. 
SEC. 508. (a) ISSUANCE.—The Secretary may, following enactment 
of the legislation referred to in section 507(c) of this title, issue 
Fund bonds in denominations of $100,000 (or any integral multiple 
thereof), in such total amounts as may be authorized by the Congress. 
No Fund bonds— 
(1) shall be issued which mature in less than 8, or more than 
15, years from the date of original issuance thereof; 
(2) shall be issued later than the 10th anniversary of the date 
of publication of the final standards and designations under sec-
tion 503 (e) of this title; and 
(3) shall, except as otherwise provided pursuant to subsections 
(d) (6) and (g) of this section, be subject to redemption (at the 
option of the Secretary) (A) at any time prior to the 10th anni-
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 75 
versary of the date of original issuance thereof, and (B) at any 
time thereafter. 
(b) PLEDGE AND LIEN.—The Secretary, subject to sections 502(g) 
and 508(g) of this title, shall impose a first pledge of, and a first lien 
on, all revenues payable to, and assets held in, the Fund, and appro-
priated for the use of the Secretary pursuant to this title. The Sec-
retary may impose such a pledge of and lien on all other revenues or 
property of the Fund. The purpose of any such pledge and lien shall 
i
^ 
be to secure the payment, when due, of the principal of, any redemp-
tion premiums on, and any interest on, all Fund anticipation notes and 
Fund bonds, and for other purposes incidental thereto. Such incidental 
purposes may include the creation of reserve and other funds which 
may be similarly pledged and used, to such extent and in such manner 
as the Secretary deems necessary or desirable. Any pledge made by 
the Secretary shall be valid and binding from the time it is made. The 
revenues and assets held in the Fund, and the revenues or property of 
the Fund which are so pledged and which are subsequently received 
by the Fund, shall immediately be subject to the lien of such pledge 
without any physical delivery thereof or any further act. The lien of 
any such pledge shall be valid and binding as against all parties hav-
ing claims of any kind, in tort, contract, or otherwise, against the Sec- 
> 
retary or the Fund, without regard to whether such parties have notice 
thereof. No instrument by which a pledge is created need be recorded 
or filed to protect such pledge. 
(c) ENHANCEMENT or MARKETABILITY.—The Secretary may enter 
into binding covenants with the holders of Fund bonds, and Avith the 
trustee, if any, under any agreement entered into in connection with 
the issuance of such bonds with respect to (1) the establishment of 
reserves, and other funds; (2) stipulations concerning the subsequent 
issuance of obligations; and (3) such other matters as the Secretary 
.. 
deems necessary or desirable to enhance the marketability of Fund 
bonds. 
(d) SPECIFIC DETERMINATIONS.—Subject to subsection (a) of this 
section, the Secretary may determine, with respect to Fund bonds— 
(1) the form and denominations in which they shall be issued; 
(2) the time when they shall be sold, and in what amounts; 
(3) the time when they shall mature; 
(4) the price thereof at sale; 
(5) the rate of interest thereon; 
(6) whether, and in what manner, they may be redeemed prior 
to the date when they mature; and 
(7) whether they shall be negotiable or nonnegotiable and 
whether they shall be bearer or registered instruments, and any 
indentures or covenants relating thereto. 
(e) CHARACTERISTICS.—Fund bonds issued by the Secretary under 
this section shall— 
n ^; 
(1) contain a recital that they are issued under this section, 
which shall be conclusive evidence as to the validity and regularity 
of issuance and sale of such Fund bonds; 
(2) be subject to such other terms and conditions as the Secre-
tary may, by the resolution authorizing their issuance, determine; 
(3) be lawful investments and may be accepted as security for 
all fiduciary, trust, and public funds, the investment or deposit 
of which shall be under the authority or control of any officer or 
agency of the United States; 
(4) not be exempted from Federal, State, and local taxation; 
and 
90 STAT. 76 
PUBLIC LAW 94-210—FEB. 5, 1976 
(5) not be debts or enforceable general obligations of, nor shall 
payment of the principal thereof or interest thereon be guaranteed 
by, the United States. Neither the full faith and credit, nor the 
general taxing power, of the Federal Government shall be pledged 
to the payment of the principal of, any premium on, or interest on, 
such Fund bonds. 
(f) No PERSONAL LIABILITY.—Neither the Secretary, nor any other 
individual, who executes any Fund anticipation notes or Fund bonds, 
shall be subject to any personal liability or accountability by reason of 
the issuance of any such notes or bonds. 
(g) 
KEDEMPTION AND TRANSFER.—If, after the 10th anniversary 
date of the original issuance of the initial series of Fund bonds, the 
amount in the Fund, exclusive of the value of any redeemable pref-
erence shares held by the Fund, exceeds 250 percent of the amount 
required to satisfy amounts due in the succeeding fiscal year on account 
of Fund bonds, the Secretary may use such excess to redeem Fund 
bonds in accordance with their terms or may withdraw all or part of 
such excess from the Fund and transfer it to the general fund of the 
United States. When all Fund bonds have been redeemed, all amounts 
remaining in the Fund or thereafter accruing to it shall be transferred 
- 
to the general fund of the United States, except to the extent necessary 
to cover such expenses of the Fund as may be required to carry on 
and complete any remaining responsibilities. 
(h) 
PURCHASE BY SECRETARY.—The Secretary, subject to such 
agreements with holders of Fund bonds as may then exist, is author-
ized (out of any funds available) to purchase Fund anticipation notes 
or Fund bonds. Upon any such purchase, such bonds and notes shall 
be canceled. 
AUTHORIZATIONS 
45 use 829. 
SEC. 509. There is authorized to be appropriated to the Secretary of 
the Treasury for the purposes of the Fund not to exceed $600,000,000 
and the Secretary of the Treasury is authorized and directed to pur-
chase, from time to time, prior to September 30, 1978, from the Sec-
retary, out of such moneys in the Treasury as are appropriated under 
r 
this sentence, Fund anticipation notes in such aggregate principal 
amounts, subject to the foregoing limitation, as the Secretary may so 
offer for sale. No money in the Fund, regardless of source, shall be 
obligated, expended, or otherwise committed to any purpose from the 
Fund prior to or after September 30, 1978, without prior approval 
thereof in an annual appropriations Act. The Fund shall not qualify 
as one of the exceptions provided in section 401(d) of the Congres-
sional Budget and Impoundment Control Act of 1974 (31 U.S.C. 
1351(d)). 
EXEMPTION 
45 use 830. 
SEC, 510. Neither the provisions of section 20a of the Interstate 
Commerce Act (49 U.S.C. 20a), nor the registration and prospectus 
delivery requirements of the Securities Act of 1933, nor the provisions 
of the securities laws of any State, shall be applicable to the issuance 
and sale of redeemable preference shares by railroads under this title. 
GUARANTEE OF OBLIGATIONS 
45 use 831. 
SEC. 511. (a) GENERAL.—The Secretary may, in accordance with 
the provisions of this section, guarantee and make commitments to 
guarantee the payment of the principal balance of, and any interest 
on, an obligation of an applicant prior to, on, or after the date of execu-
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 77 
tion or the date of disbursement of such obligation, if the proceeds of 
such obligation shall be or have been used to acquire or to rehabilitate 
and improve facilities or equipment. Each guarantee of such an obli-
gation shall be made in accordance with the provisions of sections 511 
irough 513 of this title and such rules as the Secretary may prescribe 
to protect reasonably the interest of the United States. Each applica-
tion for the guarantee of such an obligation or for a commitment to 
^arantee such an obligation shall be made in writing to the Secretary 
m such form and with such content as the Secretary prescribes. Such 
application shall be granted, in whole or in part, if the Secretary 
determines that the proposed, negotiated, or executed obligation is 
eligible for such guarantee. Each such guarantee or commitment to 
guarantee shall be extended in such form, under such terms and con-
ditions, and pursuant to such regulations as the Secretary deems 
appropriate, consistent with the purposes of this title. Such a guar-
antee or commitment to guarantee shall inure to the benefit of the 
holder of the obligation to which such guarantee or commitment to 
guarantee applies. 
(b) FUND.—An obligation guarantee fund shall be established and 
administered by the Secretary as a revolving fund to carry out 
the provisions of sections 511 through 513 of this title. Moneys m the 
obligation guarantee fund shall be deposited in the Treasury of the 
United States to the credit of such fund or invested in bonds or other 
obligations of the United States approved by the Secretary of the 
Treasury. 
(c) VALUATION.—Before granting any application for a guarantee 
or a commitment to guarantee any obligation, the Secretary shall 
make a determination of the value of the facilities or equipment which 
are or will be financed or refinanced by such obligation. Such determi-
nation of value shall be conclusive and not subject to review in any 
court. 
(d) MODIFICATIONS.—The Secretary may approve any modification 
of any provision of a guarantee, or of a commitment to guarantee an 
obligation, including the rate of interest, time of payment of interest 
or principal, security, or any other terms and conditions, if the Secre-
tary makes a finding in writing that such modification is equitable and 
is in the overall best interests of the United States under this title, 
and that the holder of such obligation consents to such modification. 
(e) EXTENT OF AUTHORITY.—(1) The aggregate unpaid principal 
amounts of obligations which may be guaranteed by the Secretary 
under this section shall not exceed $1,000,000,000 at any one time, of 
which not to exceed $150,000,000 may be guaranteed for the purposes 
described in paragraph (2) of this subsection. 
(2) Obligations may be guaranteed for the purpose of improving 
rail properties designated in the final system plan pursuant to section 
206(c) (1) (C) of the Regional Rail Reorganization Act of 1973 (45 
U.S.C. 716(c) (1) (C)), if the proceeds of such obligations shall be 
or have been used to acquire or rehabilitate and improve facilities or 
equipment in a manner that returns the most public benefits for the 
costs involved. 
(f) RATE OF INTEREST.—The rate of interest (exclusive of premium 
charges for a guarantee and service fees) which shall be paid on the 
unpaid principal balance of each obligation guaranteed by the Secre-
tary under this section, shall not exceed an annual percentage rate 
which the Secretary determines to be reasonable, taking into considera-
tion the prevailing interest rates for similar obligations in the private 
market. 
Obligation 
guarantee fund. 
Establishment. 
90 STAT. 78 
PUBLIC LAW 94-210—FEB. 5, 1976 
Publication in 
Federal Register. 
Periodic 
inspection. 
Hearing. 
(g) NOTICE.—Upon receipt of an application for the guarantee of 
an obligation under this section, the Secretary shall cause a notice of 
such application to be published in the Federal Register and shall 
invite and afford interested persons an opportunity to submit com-
ments on such application. 
(h) PREQUISITES FOR GUARANTEES.—No obligation shall be guaran-
teed and no commitment shall be made to guarantee any obligation 
under this section, unless and until the Secretary makes a finding in 
writing that— 
(1) an obligation for equipment acquisition, rehabilitation, or 
improvement is secured by the particular equipment which is to 
be financed or refinanced by such obligation; 
(2) payment of the obligation is required by its terms to be 
made within 25 j^ears from the date of its execution; 
(3) the financing or refinancing is justified by the present and 
probable future demand for rail services to be rendered by the 
applicant and will serve to meet demonstrable needs for rail serv-
ices and to provide shippers with improved service; 
(4) the applicant has given reasonable assurances that the facili-
ties or equipment to be acquired, rehabilitated, or improved with 
the proceeds of the obligation will be economically and efficiently 
utilized; 
(5) the probable value of any equipment or facilities to be 
improved, rehabilitated, or acquired is sufficient to provide the 
United States with reasonable security and protection in the 
event of default by the obligor, in the case of repossession by the 
holder of the obligation or in the case of possession or purchase 
by the Secretary; and 
(6) the transaction will result in an improvement in the ability 
of any affected railroad to transport passengers or freight. 
(i) GENERAL REQUIREMENT.—^The recipients of any guarantees of, or 
of any commitments to guarantee, an obligation under this section, 
shall, consistent with their capital resources, maintain their facilities. 
on a continuing basis, in accordance with standards promulgated 
under this subsection. The Secretarj^ shall assure compliance with this 
requirement by regular periodic inspection. 
(j) CONDITIONS OF GUARANTEES.—No guarantee of, and no commit-
ment to guarantee, an obligation may be granted, approved, or 
extended under this section, unless the obligor first agrees in writing 
that so long as any principal or interest is due and payable on such 
obligation— 
(1) there will be no increase in discretionary dividend payments 
over the average ratio which such payments bore to eiamings for 
the applica'ble fiscal period during the 5 years preceding such pro-
posed increase, without prior approval of such increase by the 
Secretary; 
(2) the (Obligor will not use assets or revenues (other than 
cash) related to or derived from railroad operations in nonrail-
road enterprises, without prior approval in writing from the Sec-
retary ; and 
(3) the obligor will take all reasonable and practicable steps 
possible, in accordance with such guidelines as may be established 
by the Secretary, to improve the ec[uitable distribution and effi-
cient and expeditious use of all equipment and facilities in order 
to improve rail service. 
Approval under paragraph (1) or (2) of this subsection may only be 
granted if, after a public hearing with an opportunity for interested 
persons to submit comments, the Secretary makes a written 
finding 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 79 
that such increase in dividends (or such use of assets or revenues) 
will not materially affect the ability of the obligor to comply with the 
requirements of this section. 
(k) BREACH OF CONDITIONS.—The Attorney General shall commence 
a civil action in any appropriate district court of the United States 
to enjoin any activity which the Secretary finds is in violation of any 
requirement or condition specified in subsection (i) or (j) of this sec-
tion, and to secure any other appropriate relief, including termination, 
suspension, and punitive damages. 
(1) INVESTIGATION CHARGE.—^The Secretary shall charge and collect 
from each applicant such amounts as he deems reasonable for the 
investigation of any application submitted under this section, for 
appraisal of the value of the equipment or facilities involved, and for 
making the necessary determinations and findings. Such charges shall 
not aggregate more than one-half of 1 percent of the principal amount 
of the obligation with respect to which the applicant seeks a guarantee 
or commitment to guarantee. 
(m) PREMIUM CHARGE.—The Secretary shall assess and collect from 
the obligor an annual premium charge on each obligation guaranteed 
under this section. The amount of such premium may not exceed an 
annual rate of 1 percent on the unpaid principal balance of such 
obligation at the time payment is due. Payment is due initially when 
the obligation is guaranteed by the Secretary, and, thereafter, on the 
anniversary date of such guarantee. 
(n) ADMINISTRATIVE COSTS.—All moneys received by the Secretary 
under this section shall be deposited in the obligation guarantee fund, 
and to the extent provided in appropriation acts, may be used by the 
Secretary to pay administrative costs and expenses incurred by him 
pursuant to this section. 
ISSUANCE OF N O T E S OR OBLIGATIONS 
SEC. 512. (a) AUTHORIZATION.—The Secretary may issue, in such 
45 USC 832. 
amounts as are provided in appropriation acts, notes or other obliga-
tions to the Secretary of the Treasury, in such forms and denomina-
tions, bearing such maturities, and subject to such terms and conditions 
as the Secretary may prescribe. Such obligations may be issued 
whenever the moneys in the obligation guarantee fund are not sufficient 
to pay any amount which the Secretary is required to pay under section 
513 of this title. Such obligations shall bear interest at a rate to be Interest rate, 
determined by the Secretary of the Treasury on the basis of the current 
average market yield on outstanding marketable obligations of the 
United States on comparable maturities during the month preceding 
the issuance of such obligations. The Secretary of the Treasury shall 
purchase any such obligations, and for such purpose he may use as a 
public debt transaction the proceeds from the sale of any securities 
issued under the Second Liberty Bond Act, as now or hereafter in force. 
31 USC 774. 
The purposes for which securities may be issued under such Act are 
extended to include any purchase of notes or other obligations issued 
under this subsection. The Secretary of the Treasury may sell any such 
obligations at such times and price and upon such terms and conditions 
as he shall determine in his discretion. All purchases, redemptions, 
and sales of such obligations by such Secretary shall be treated as 
public debt transactions of the United States. Moneys obtained under 
this subsection shall be deposited in the obligation guarantee fund, and 
redemptions of any such obligations shall be made by the Secretary 
from such fund. 
89-194 O—78—pt. 1 
9 
90 STAT. 80 
PUBLIC LAW 94-210—FEB. 5, 1976 
(b) VALIDITY.—No guarantee or commitment to guarantee under 
section 511 of this title may be terminated, suspended, canceled, or 
otherwise revoked, except in accordance with lawful terms and con-
ditions prescribed by the Secretary. Such a guarantee or commitment 
shall be conclusive evidence that the underlying obligation is in com-
j 
pliance with the provisions of such sections 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 to guarantee shall be 
valid and incontestable in the hands of the holder thereof, as of the 
date when the Secretary granted the application therefor, except as 
to fraud or material misrepresentation by such holder. 
(c) DEFINITION.—As used in this section, the term "Secretary of the 
Treasury" includes any designated representative of such Secretary. 
DEFAULT ON GUARANTEED OBLIGATIONS 
45 use 833. 
SEC. 513. (a) GENERAL.—If there is a default by the obligor in any 
payment of principal or interest due under an obligation guaranteed 
under section 511 of this title, and if such default continues for 30 
days, the holder of such obligation or his agent has the right to demand 
payment by the Secretary of the unpaid interest on, and the unpaid 
principal of, such obligation consistent wnth the terms of the guaran-
tee of such obligation. Such payment may be demanded after or before 
the expiration of such period as may be specified in the guarantee 
or related agreements, but not later than 90 days from the date of 
such default. Within such specified period, but not later than 60 
days from the date of such demand, the Secretary shall pay to such 
holder the unpaid interest on, and the unpaid principal of, such obli-
gation, consistent with the terms of the guarantee of such obligation, 
except that (1) the Secretary shall not be required to make any such 
payment if he finds, prior to the expii-ation of such period, that there 
was no default by the obligor in the payment of interest or principal or 
that such default has been remedied, and (2) no such holder shall 
receive payment or be entitled to retain payment in a total amount 
which, together with an other recovery (including any recovery based 
upon a security interest in equipment or facilities) exceeds the actual 
loss of such holder. 
(b) RIGHTS OF THE SECRETARY.— (1) If the Secretary makes payment 
to a holder under subsection (a) of this section, the Secretary shall 
thereupon— 
(A) have all of the rights granted to him by laAv or agreement 
with the obligor; and 
(B) be subrogated to all of the rights which v»ere granted such 
holder, by law, assignment, or security agreement betAveen such 
holder and the obligor. 
(2) The Secretary may, in his discretion, complete, recondition 
reconstruct, renovate, repair, maintain, operate, charter, rent, sell, or 
otherwise dispose of any property or other interests obtained by him 
pursuant to this section. The terms of any such sale or other disposition 
shall be as approved by the Secretary. 
(c) FORM OF PAYMENT.—Any amount required to be paid by the 
Secretary pursuant to subsection (a) of this section shall be paid in 
cash. 
(d) ACTION AGAINST OBLIGOR.—If there is a default by the obligor 
in any payment due under an obligation guaranteed under section 511 
of this title, the Secretary shall take such action against such obligor 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 81 
or any other person as is, in his discretion, necessary or appropriate 
to protect the interests of the United States. Such an action may be 
brought in the name of the United States or in the name of the holder 
of such obligation. Such holder shall make available to the Secretary 
all records and evidence necessary to prosecute any such suit. The 
Secretary may, in his discretion, accept a conveyance of property in 
full or partial satisfaction of any sums owed to him. If the Secretary 
receives, through the sale of property, an amount greater than his cost 
and the amount paid to the holder under subsection (a) of this section, 
he shall pay such excess to the obligor. 
AUDIT o r 
TRANSACTIONS 
SEC. 514. (a) GENERAL.—The Comptroller General of the United 45 USC 834. 
States is authorized to audit the operations of the Fund and of the 
obligation guarantee fund in accordance with such rules and regula-
tions as he may prescribe. Any such audit shall be conducted at the 
place or places where accounts of the Fund or of the obligation guar-
antee fund are normally kept. The representatives 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 or in 
connection with the Fund, the obligation guarantee fund, or the Sec-
retary which pertain to the financial transactions of the Fund or the 
obligation guarantee fund and which are necessary to facilitate an 
audit. Such representatives shall be afforded full facilities for verify-
ing transactions with the balances or securities held by depositories, 
fiscal agents, and custodians. All such books, accounts, records, reports, 
files, papers, things, and property shall remain in the possession and 
custody of the Fund, the obligation guarantee fund, or the Secretary, 
as the case may be. 
(b) ACCESS TO INFORMATION.—The representatives of the Comp-
troller General shall have access to all books, accounts, records, 
reports, files, and other papers, things, or property belonging to or in 
use by any person or entity which has entered into a financial transac-
tion with or involving the Fund, the obligation guarantee fund, or the 
Secretary, under this title, to the extent deemed necessary by the 
Comptroller General to facilitate any audit of financial transactions 
pursuant to subsection (a) of this section. Such representatives shall 
be afforded full facilities for verifying transactions with the balances 
or securities held by depositories, fiscal agents, and custodians. All 
such property of such person or entity shall, to the extent practicable, 
remain in the possession and custody of such person or entity. 
(c) REPORT.—The Comptroller General shall make a report of 
each such audit to the Congress. Such report shall contain all comments 
and information which the Comptroller General deems necessary to 
inform Congress of the financial operations and condition of the Fund 
and of the obligation guarantee fund and any recommendations which 
he deems advisable. Such report shall indicate specifically and describe 
in detail any program, expenditure, or other financial transaction or 
undertaking observed in the course of such audit which the Comptrol-
ler General deems to have been carried on or made without lawful 
authority or which is inconsistent with the purposes and provisions of 
this title. A copy of such report shall be furnished to the President, 
the Secretary, and the Commission, at the time it is submitted to the 
Congress. 
90 STAT. 82 
PUBLIC LAW 94-210—FEB. 5, 1976 
ANNUAL 
REPORT 
45 use 835. 
SEC. 515. The Secretary shall report to the Congress within 90 
days following the end of each fiscal year on the financial condition and 
operations of the Fund and of the obligation guarantee fund during 
such fiscal year, and on the anticipated condition and operations of the 
Fund and of the obligation guarantee fund during the current fiscal 
year. 
EMPLOYEE 
PROTECTION 
45 use 836. 
SEC. 516. (a) GENERAL,—Fair and equitable arrangements shall be 
provided, in accordance with this section, to protect the interests of 
any employees not otherwise protected under title V of the Kegional 
« 
Rail Reorganization Act of 1973 (45 U.S.C. 771 et seq.), who may be 
affected by actions taken pursuant to authorizations or approval 
obtained under this title. Such arrangements shall be determined by 
the execution of an agreement between the representatives of the rail-
roads and the representatives of their employees, within 120 days after 
the date of enactment of this title. In the absence of such an executed 
agreement, the Secretary of Labor shall prescribe the applicable pro-
tective arrangements, within 150 days after the date of enactment of 
this title. 
(b) TERMS.—The arrangements required by subsection (a) of this 
section shall apply to each employee who has an employment relation-
ship with a railroad on the date on which such railroad first applies 
for applicable financial assistance under this title. Such arrangements 
shall include such provisions as may be necessary for the negotiation 
and execution of agreements as to the manner in which the protective 
^ 
arrangements shall be applied, including notice requirements. Such 
agreements shall be executed prior to implementation of work funded 
from financial assistance under this title. If such an agreement is not 
reached within 30 days after the date on which an application for 
such assistance is approved, either party to the dispute may submit 
the issue for final and binding arbitration. The decision on any such 
arbitration shall be rendered within 30 days after such submission. 
Such arbitration decision shall in no way modify the protection 
afforded in the protective arrangements established pursuant to this 
section, shall be final and binding on the parties thereto, and shall 
become a part of the agreement. Such arrangements shall also include 
such provisions as may be necessary— 
(1) for the preservation of compensation (including subse-
quent general wage increases, vacation allowances, and monthly 
compensation 
guarantees), rights, privileges, and 
benefits 
(including fringe benefits such as pensions, hospitalization, and 
vacations, under the same conditions and so long as such benefits 
continue to be accorded to other employees of the employing rail-
road in active service or on furlough, as the case may be) to such 
employees under existing collective-bargaining agreements or 
otherwise; 
(2) to provide for final and binding arbitration of any dispute 
which cannot be settled by the parties, with respect to the inter-
pretation, application, or enforcement of the provisions of the 
protective arrangements; 
(3) to provide that an employee who is unable to secure 
employment by the exercise of his or her seniority rights, as a 
result of actions taken with financial assistance obtained under 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 83 
this title, shall be offered reassignment and, where necessary, 
retraining to fill a position comparable to the position held at 
the time of such adverse effect and for which he is, or by training 
and retraining can become, physically and mentally qualified, so 
long as such offer is not in contravention of collective bargaining 
agreements relating thereto; and 
(4) to provide that the protection afforded pursuant to this 
section shall not be applicable to employees benefited solely as a 
result of the work which is financed by funds provided pursuant 
to this title, 
(c) SuBCONTRACTiXG.—The arrangements which are required to be 
negotiated by the parties or prescribed by the Secretary of Labor, 
pursuant to subsections (a) and (b) of this section, shall mclude pro-
visions regulating subcontracting by the railroads of work which is 
financed by funds provided pursuant to this title. 
INTERCITY RAIL PASSENGER SERVICE 
SEC. 517. The Secretary is authorized, pursuant to the provisions 
45 USC 837. 
of, and within the authorizations contained in, this title, to provide 
financial 
assistance, in the aggregate sum of up to $200,000,000, to 
any railroad or railroads for the purpose of improving intercity rail 
passenger service on any lines of such railroad or railroads which are 
located outside of the Northeast Corridor (as defined in section 701 
(c) of this Act). 
Post, 
^.119. 
T I T L E V I — B I P L E M E N T A T I O N OF T H E FINAL 
S Y S T E M P L A N 
GENERAL 
SEC. 601. (a) Unless otherwise specified, whenever, in this title, 
an amendment or repeal is expressed in terms of an amendment to, 
or a repeal of, a section or provision of "such Act", the section or 
' • 
other provision amended or repealed is a section of the Regional Rail 
Reorganization Act of 1973 (45 U.S.C. 701 et seq.). 
(b) The table of contents of such Act is amended to read as follows: 
"TABLE OF CONTENTS 
"TITLE I—GENERAL PROVISIONS 
"Sec. 101. Declaration of policy. 
"Sec. 102. Definitions. 
"TITLE II—UNITED STATES RAILWAY ASSOCIATION 
A ^ ' 
"Sec. 201. Formation and structure. 
"Sec. 202. General powers and duties of the Association. 
"Sec. 203. Access to information. 
"Sec. 204. Report. 
"Sec. 205. Rail Services Planning OfBce, 
"Sec. 206. Final system plan. 
"Sec. 207. Adoption of final system plan. 
"Sec. 208. Review by Congress. 
"Sec. 209. Judicial review. 
"Sec. 210. Obligations of the Association. 
"Sec. 211. Loans. 
"Sec. 212. Records, audit, and examination. 
"Sec. 213. Emergency assistance pending implementation. 
"Sec. 214. Authorization for appropriations. 
"Sec. 215. Maintenance and improvement of plant. 
"Sec. 216. Purchase of debentures and series A preferred stock. 
90 STAT. 84 
PUBLIC LAW 94-210—FEB. 5, 1976 
"TITLE III—CONSOLIDATED RAIL CORPORATION 
"Sec. 301, Formation and structure. 
"Sec. 302. Powers and duties of tiie Corporation. 
"Sec. 303. Valuation and conveyances of rail properties. 
"Sec. 304. Termination and continuation of rail services. 
"Sec. 305. Continuing reorganization; supplemental transactions. 
"Sec. 306. Certificates of value. 
"Sec. 307. Protection of Federal funds. 
"TITLE IV—LOCAL RAIL SERVICES 
"Sec. 401. Findings and purposes. 
"Sec. 402. Rail service continuation assistance. 
"Sec. 403. Acquisition and modernization loans. 
"TITLE V—EMPLOYEE PROTECTION 
"Sec. 501. Definitions. 
;, 
"Sec. 502. Employment offers. 
V 
"Sec. 503. Assignment of work. 
"Sec. 504. Collective-bargaining agreements. 
"Sec. 505. Employee protection. 
f>;it ;^j^ ; 
"Sec. 506. Contracting out. 
, 
•; 
"Sec. 507. Arbitration. 
"Sec. 508. Duties of acquiring and selling railroads. 
"Sec. 509. Payment of benefits. 
"TITLE VI—MISCELLANEOUS PROVISIONS 
"Sec. 601. Relationship to other laws. 
; : 
"Sec. 602. Annual evaluation by the Secretary. 
"Sec. 603. Freight rates for recyclables. 
"Sec. 604. Separability. 
; 
'.-::{ 
T; > 
"Sec. 605. Duty of transferee.". 
(c) Section 202(a)(2) of such Act (45 U.S.C. 712(a)(2)) is 
amended to read as follows: 
45 use 720. 
" (2) issue obligations under section 210 of this title; make loans 
45 use 721. 
under section 211 of this title; purchase or otherwise acquire or 
receive and hold and dispose of securities (whether debt or equity) 
Post, p. 89. 
of the Corporation under section 216 of this title and exercise all 
of the rights, privileges, and powers of a holder of any such 
securities; and issue certificates of value under section 306 of this 
Act;". 
(d) Section 303 of such Act (45 U.S.C. 743) is amended by adding 
at the end thereof the following new subsection: 
" (e) TRANSFER AND OTHER TAXES AND RECORDING FEES.—^All trans-
fers or conveyances of rail properties (whether real, personal, or 
mixed) which are made under this Act (including transfers and 
conveyances which are made in accordance with a supplemental trans-
pose, p. 100. 
action pursuant to section 305 of this title) shall be exempt from any 
taxes, imposts, or levies now or hereafter imposed, by the United States 
or by any State or any political subdivision of a State, on or in 
connection with such transfers or conveyances or on the recording of 
deeds, bills of sale, liens, encumbrances, or other instruments evidenc-
ing, effectuating, or incident to any such transfers or conveyances, 
whether imposed on the transferor or on the transferee. Such trans-
ferors and transferees shall be entitled to record any such deeds, bills 
of sale, liens, encumbrances, or other instruments and, consistent with 
the designations and applicable principles in the final system plan, to 
record the release or removal of any pre-existing liens or encumbrances 
of record with respect to properties so transferred or conveyed, upon 
payment of any appropriate and generally applicable charges to 
compensate for the cost of the service performed.". 
(e) Section 208 of such Act (45 U.S.C. 718) is amended by adding 
at the end thereof the following new subsection: 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 85 
"(d) ADDITIONS.—(1) The supplemental report, dated September 18, 
1975, to the final system plan, and the provisions of the Association's 
official errata supplement to the final system plan, dated December 1, 
1975, including all designations made therein, shall be treated for all 
purposes as if they had been part of and included in the final system 
plan adopted by the Association and reviewed by the Congress. The 
final system plan shall, for all purposes, be deemed to be approved as 
modified and amended by such supplemental report and such 
supplement. 
"(2) The Association may, upon petition of any State, modify the 
final system plan to make further designations with respect to rail 
properties of railroads in reorganization in the region designated for 
transfer to the Corporation under such plan, if such designations (A) 
are likely to result m improved rail service on sudi rail properties and 
connecting rail properties, and (B) would not materially impair the 
profitability of the Corporation. Such designations, including designa-
tions of such rail properties to a State, a profitable railroad, or a 
responsible person, may be made at any time prior to delivery of the 
final system plan to the special court under section 209 (c) of this title. 
Such further designations shall be treated for all purposes as if they 
had been included in the final system plan adopted by the Association 
and reviewed by the Congress, and the final system plan shall for all 
purposes be deemed to be approved as modified by such designations. 
Any action of the Association with respect to any such petition shall 
not be subject to review by any court. 
"(3) (A) Within 20 days after the date of enactment of the Railroad 
Revitalization and Regulatory Reform Act of 1976, the Association 
may, by notice to the Congress and by publication in the Federal Reg-
ister, modify, supplement, or add to the designations of rail properties 
in the final system plan if the Association finds such actions are 
necessary to— 
"(i) achieve the efficient implementation of the final system 
plan,or 
"(ii) provide for the offer to profitable railroads of rail proper-
ties designated in the final system plan to the Corporation, if such 
properties are not essential in the operation of other rail prop-
erties of the Corporation but are or would be integrally related 
to the operation of rail properties of (or which are offered pur-
suant to the final system plan to) such profitable railroad, or 
"(iii) provide for the designation of additional rail properties 
to the Corporation or to a subsidiary thereof to enable the Cor-
poration to serve efficiently a line of railroad designated to the 
Corporation in the final system plan if such line does not connect 
with any other line of railroad so designated to the Corporation 
or if such line would be served more efficiently as a consequence 
of such designation. 
Any designation to a profitable railroad pursuant to this paragraph 
shall comply with the second sentence of section 206(d)(4) of this 
title, and shall only be made upon a finding by the Association that Post, p. 97 
such designation is integrally related to an offer of rail properties to 
a profitable railroad in the final system plan, that the goals of the final 
system plan require that the rail properties be operated as a part of 
the rail properties included in such offer, and that the implementation 
of such designation will not materially and adversely affect the impact 
of such offer on the profitability of the Corporation or any profitable 
railroad operating in the region. Any designation to a profitable 
railroad pursuant to this subsection, which amends any prior offer, 
shall terminate 30 days after the date of enactment of this paragraph 
Notice to 
Congress; 
publication in 
Federal Register. 
Ante, p. 31. 
90 STAT. 86 
PUBLIC LAW 94-210—FEB. 5, 1976 
unless, prior to such date, such profitable railroad has notified the 
Association in writing of its acceptance of such amendment to the 
prior offer. 
"(B) If a line of railroad or any segment thereof is designated for 
rail service in the final system plan, no designation may be made by 
the Association pursuant to this paragraph which would result in 
such line or segment not being so designated. Any designations made 
pursuant to this paragraph shall be treated for all purposes as if they 
had been included in the final system plan adopted by the Association 
and reviewed by the Congress. The final system plan shall for all pur-
poses be deemed to be approved as amended by such designations. 
"(C) Any designations made pursuant to this paragraph shall not 
be subject to review by any court. 
"(D) Any labor agreements entered into under section 508 of this 
Post, p. 117. 
Act shall be subject to further negotiations for any modifications 
which may be necessary to implement designations made pursuant to 
this paragraph.". 
(f) Section 102(14) of such Act (45 U.S.C. 702(14)) is amended 
to read as follows: 
"Secretary." 
"(14) 'Secretary' means the Secretary of Transportation or 
the person at the time performing the duties of the Office of the 
Secretary of Transportation in accordance with law, or the duly 
authorized representative of either of them;". 
(g) Section 102 of such Act (45 U.S.C. 702) is amended (1) by 
redesignating paragraphs (8) through (15) thereof as paragraphs 
(10) through (17) thereof, respectfully; and (2) by inserting therein 
a new paragraph (9) as follows: 
"(9) 'local or regional transportation authority' includes a 
political subdivision of a State.". 
SPECIAL COURT 
SEC. 602. (a) Section 209(b) of such Act (45 U.S.C. 719) is amended 
by striking out the sixth sentence thereof and inserting in lieu thereof 
the following new sentence: "The special court may issue rules for 
the conduct of any proceedings under this section and under section 
305 of this Act, including rules with respect to the time within which 
motions may be filed, and with respect to appropriate representation 
of interests not otherwise represented (including the Secretary with 
respect to a petition by the Association in the case of a proposal 
Post, p. 100. 
developed by the Secretary, under such section 305).". 
(b) Section 209 of such Act (45 U.S.C. 719) is amended by adding 
at the end thereof the following three new subsections: 
"(e) ORIGINAL A
N
D EXCLUSIVE JURISDICTION.— (1) Notwithstanding 
any other provision of law, any civil action— 
"(A) for injunctive or other relief against the Association 
from the enforcement, operation, or execution of this Act or any 
provision thereof, or from any action taken by the Association 
,;, ; V .* - 
pursuant to authority conferred or purportedly conferred under 
this Act; 
"(B) challenging the constitutionality of this Act or any pro-
vision thereof; 
^ 
"(C) challenging the legality of any action of the Association, 
or any failure of the Association to take any action, pursuant to 
authority conferred or purportedly conferred under this Act; 
"(D) to obtain, inspect, copy, or review any document in the 
', 
possession or control of the Association that would be discoverable 
45 use 743. -_ ' 
jjj litigation pursuant to section 303(c) of this Act; 
"Local or 
regional 
transportation 
authority." 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 87 
" ( E ) brought after a conveyance, pursuant to section 303(b) 
45 USC 743. 
of this Act, to set aside or annul such conveyance or to secure in 
any way the reconveyance of any rail properties so conveyed; or 
" ( F ) with respect to continuing reorganization and supple-
mental transactions, in accordance with section 305 of this Act; 
shall be within the original and exclusive jurisdiction of the special 
court. The special court shall not hear or determine any such action 
prior to the date of conveyance, pursuant to section 303(b) (1) of this 
Act, except as the Constitution may require. Belief shall not be granted 
USC prec. title 1. 
in any action referred to in subparagraph (A), (C), or (E) unless 
the person seeking such relief establishes that the Association acted 
in reckless or deliberate disregard of applicable law. 
"(2) The original and exclusive jurisdiction of the special court 
shall include any action, whether filed by any interested person or 
initiated by the special court itself, to interpret, alter, amend, modify, 
or implement any of the orders entered by such court pursuant to sec-
tion 303(b) of this Act in order to effect the purposes of this Act or 
the goals of the final system plan. During the pendency of any pro-
ceeding described in this paragraph, the special court may enter such 
orders as it determines to be appropriate, including orders enjoining, 
restraining, conditioning, or limiting any conveyance, transfer, or use 
of any asset or right which is subject to such an order or which is at 
issue in such a proceeding, or which involves the enforcement of any 
liens or encumbrances upon such assets or rights. Any orders pursuant 
to this paragraph which interpret, alter, amend, modify, or implement 
orders entered by the special court shall be final and shall not be 
restrained or enjoined by any court. 
"(3) A final order or judgment of the special court in any action 
referred to in this section shall be reviewable only upon petition for a 
, 
writ of certiorari to the Supreme Court of the United States, except 
that any order or judgment enjoining the enforcement, or declaring or 
determining the unconstitutionality or invalidity, of this Act, in whole 
or in part, or of any action taken under this Act, shall be reviewable 
by direct appeal to the Supreme Court of the United States in the 
same manner that an injunctive order may be appealed under section 
1253 of title 28, United States Code. Such review is exclusive and any 
petition or appeal shall be filed not more than 20 days after entry of 
such order or judgment. 
"(f) DisposrnoN OF CASH DEPOSITS.—Whenever the compensation 
which is deposited with the special court under section 303(a) of this 
Act is in the form of cash, such cash shall be invested and reinvested 
upon such terms and conditions as the special court shall determine, 
pending the making of the findings referred to in paragraphs (1), 
(2), and (3) of section 303(c) of this Act. Notwithstanding section 
303 (c) (4) of this Act, the special court may order (1) the income from 
such investments, (2) the dividends or interest, if any, received on 
any securities or obligations deposited with the special court under 
such section 303(a), and (3) the income, if any, received with respect 
to any other form of compensation so deposited, to be distributed to 
the trustee of each railroad in reorganization and to any person leased, 
operated or controlled by such a railroad which conveyed the right, 
title, and interest in the rail properties with respect to which such cash, 
securities, obligations, or other compensation have been so deposited 
with the special court. Notwithstanding section 303 (c) (4) of this Act, 
the special court may, within 90 days after the date of conveyance 
of rail properties pursuant to section 303(b) of this Act, order up to 
25 percent of any cash (including investments made with cash) and 
other compensation deposited with the special court to be distributed 
90 STAT. 88 
PUBLIC LAW 94-210—FEB. 5, 1976 
to such trustee or person. On petition of the applicable trustee or 
person, the special court may order such additional distributions as it 
finds reasonable and appropriate, prior to the making of the findings 
45 use 743. 
referred to in paragraphs (1), (2), and (3) of such section 303(c). 
" ( g ) 
STAY or COURT PROCEEDINGS.-—The special court may stay or 
enjoin any action or proceeding in any State court or in any court 
of the United States other than the Supreme Court if such action or 
proceeding is contrary to any provision of this Act, impairs the effec-
' 
' 
' 
tive implementation of this Act, or interferes with the execution of 
any order of the special court pursuant to this Act.". 
; 
FINANCE COMMITTEE 
SEC. 603. (a) Section 201 of such Act (45 U.S.C. 711) is amended 
by redesignating subsections (i) and (j) thereof as subsections (j) 
and (k) thereof, respectively, and by inserting therein a new subsec-
tion " (i)" as follows: 
" (i) FINANCE COMMITTEE.—The Board of Directors of the Associa-
tion shall have a Finance Committee which shall consist of the Chair-
man of such Board, the Secretary, and the Secretary of the Treasury 
(acting directly or, at any time, through their respective duly author-
ized representatives). The Finance Committee is authorized to exer-
cise only such powders as are vested in it pursuant to any provision of 
this Act. The vesting of such powers in the Finance Committee shall 
not be deemed to relieve the Board of Directors of its authority to 
exercise any other powers of the Association, none of which may be 
delegated to the Finance Committee, or of its general authority to 
study, analyze, and make advisory findings with respect to any matter 
relevant to the role of the Association as an investor in securities of 
the Corporation. Notwithstanding any provision of State law, (1) the 
Finance Committee, without any requirement of review or approval by 
the Board of Directors of the Association, is authorized to establish, 
revise, and maintain its own rules and procedures, by majority vote 
of the members thereof, and (2) the Board of Directors of the Associa-
tion shall not have power to take, and shall not take, any action affect-
ing the membership of the Finance Committee or limiting the exercise 
by the Finance Committee of the powers vested in it pursuant to any 
provision of this Act.". 
(b) (1) Section 201(h) of such Act (45 U.S.C. 711 (h)) is amended 
by adding at the end thereof the following new sentence: "The Secre-
tary and the Chairman of the Commission may act in such capacity 
directly or at any time through their duly authorized representatives.". 
(2) Section 201 (d)(2) of such Act (45 U.S.C. 711(d)(2)) is 
amended by striking "or" and inserting in lieu thereof the following: 
"acting directly or at any time through". 
(c) Section 102 of such Act (45 U.S.C. 702), as amended by this 
Act, is amended by redesignating paragraph (7) thereof as paragraph 
(8) thereof, and by inserting therein a new paragraph (7) as follows: 
"(7) 'Finance Committee'means the Finance Committee of the 
Board of Directors of the Association established under section 
201 (i) of this Act;". 
OBLIGATIONS OF THE ASSOCIATION 
SEC. 604. Section 210 (b) of such Act (45 U.S.C. 720 (b)) is amended 
to read as follows: 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 89 
" (b) MAXIMUM OBLIGATIONAL AUTHORITY.—The aggregate amount 
of obligations of the Association issued under this section which may 
be outstanding at any one time shall not exceed $275,000,000. No obli-
gations or proceeds thereof shall be issued or made available after the 
date of enactment of the Railroad Revitalization and Regulatory 
Reform Act of 1976 except— 
^«'e, p. 31. 
" (1) to meet existing or potential commitments for loans under 
section 211 of this title made or applied for prior to January 1, Post, p. 92. 
1976; and 
"(2) for the purpose of providing loans pursuant to subsections 
(g) and (h) of section 211 of this title.". 
DEBENTURES AND SERIES A PREFERRED STOCK 
SEC. 605. Title II of such Act is amended by adding at the end 
thereof the following new section: 
" D E B E N T U R E S AND SERIES A PREFERRED STOCK 
"SEC. 216. (a) GENERAL.—The Association is authorized, in accord- Rules and 
ance with the provisions of this section, and such rules and regulations regulations, 
as it may prescribe, to invest from time to time in the securities of the ^^ USC 726. 
Corporation by purchasing (1) up to $1,000,000,000 of debentures 
issued by the Corporation, and (2) after the acquisition of such deben-
tures, up to $1,100,000,000 of the series A preferred stock of the 
Corporation. 
"(b) PURPOSES AND PROCEDURE FOR INVESTMENT.— (1) The Associa-
tion is authorized to purchase debentures and, thereafter, series A 
preferred stock of the Corporation at such times and in such amounts 
as may be required and requested by the Corporation in accordance 
with the terms and conditions governing such purchases (which shall 
beprescribedby the Association), to pro 
vide— 
"(A) for the modernization, rehabilitation and maintenance 
of rail properties of the Corporation; 
"(B) for the acquisition of equipment and other capital needs; 
"(C) for the refinancing of indebtedness which was incurred 
by the Corporation under section 211 of this title or which was 
incurred under section 215 of this title and assumed by the Cor- 45 USC 725. 
poration; or 
"(D) working capital as contemplated by the final system plan. 
" (2) Purchases of up to $1,000,000,000 of debentures and, thereafter, 
of up to $1,100,000,000 of series A preferred stock shall be made by 
the Association as required and requested by the Corporation, unless 
the Finance Committee makes an alRrmative finding that— 
"(A) the Corporation has failed in any material respect to 
comply with any covenants or undertakings made to the Asso-
ciation and such failure remains uncorrected; 
"(B) the Corporation has failed substantially (as determined 
hy performance within the margins prescribed by the Board of 
I)irectors) to attain the overall operating (including rehabilita-
tion) and financial results projected for the Corporation in the 
final system plan (including any modifications of such projected 
results and of the performance margins applicable to such pro-
jected results which are jointly approved by the Finance Commit-
tee and the Board of Directors and which would improve the 
possibility that the Corporation will attain such projected results 
and perform within such margins, as modified); or 
90 STAT. 90 
PUBLIC LAW 94-210—FEB. 5, 1976 
"(C) it is not reasonably likely, taking into consideration all 
" 
relevant factors including the overall operating (including reha-
bilitation) and financial results achieved by the Corporation, that 
the Corporation will be able to become financially self-sustaining 
without requiring Federal financial assistance substantially in 
excess of the amounts authorized in this section. 
"(c) 
FINDING, DIRECTION, AND REVIEW BY CONGRESS.—(1) If 
the 
Finance Committee makes an affirmative finding pursuant to sub-
section (b) (2) of this section, it may direct the Association— 
"(A) not to purchase any debentures or series A preferred 
stock of the Corporation after the date of such affirmative find-
ing; or 
'(B) to purchase debentures or series A preferred stock of the 
Corporation, after the date of such affirmative finding, only in 
such amounts, at such times, and on such terms and conditions 
(notwithstanding subsection (e)(1) of this section) as the 
Finance Committee determines to be appropriate to the role of 
the Association as an investor in such debentures and series A 
preferred stock. 
"(2) A copy of each affirmative finding, the reasons therefor, and 
each direction made by the Finance Committee under paragraph (1) 
of this subsection, together with the comments and recommendations 
thereon of the Board of Directors of the Association, shall be trans-
mitted to the Congress by the Association within 10 days after the date 
on which the Finance Committee makes such finding and direction, or 
if not so transmitted, shall be transmitted by the Finance Committee. 
Each such direction so transmitted shall become finally effective and 
is required to be implemented by the Association, unless within the 
first period of 30 calendar days of continuous session of Congress after 
the date of its transmittal to Congress either House of Congress dis-
approves such direction (except that such direction shall become finally 
effective immediately upon approval of such direction by both Houses 
of Congress) in accordance with the procedures specified in section 
1017 of the Congressional Budget and Impoundment Control Act of 
1974 (31 U.S.C. 1407). For purposes of this paragraph, continuity of 
session of Congress is broken only in the circumstances described in 
section 1011 (5) of that Act (31 U.S.C. 1401 (5)). During review by the 
- 
Association and Congress, the Association shall take no action incon-
sistent with the direction of the Finance Committee pursuant to para-
graph (c) (1) of this section, except to the extent the Association finds 
necessary, in its discretion, to assure continuous orderly operation of 
the Corporation. 
"(3) If the Congress, pursuant to paragraph (2) of this subsec-
tion, disapproves a direction submitted to the Association pursuant 
to paragraph (1) of this subsection, the Association shall continue 
to purchase the debentures or series A preferred stock of the Corpora-
tion as otherwise provided in this title until such time as a direction 
is submitted under this section which is not so disapproved (or affirm-
, 
atively approved). The powers of the Association and of the Board 
of Directors of the Association shall remain in effect except to the 
extent modified by any such direction. If any such direction is dis-
approved by either House of Congress, the Finance Committee may, 
not earlier than 30 days after the date of such disapproval, make 
(and the Board of Directors of the Association shall transmit) any 
additional affirmative finding and direction with respect to the same 
matter, which direction shall become effective in accordance with 
paragraph (2) of this subsection. An affirmative finding and direc-
tion under this subsection, or action by the Association during a 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 91 
review thereof by the Congress, may not be held unlawful or set aside 
by any reviewing court on the ground that such finding and direction 
or action were not adequate to meet the requirements of subparagraph 
(A), (E), or (F) of section 706(2) of title 5, United States Code. 
"(4) Notwithstanding any other provision of this section, or any 
terms and conditions governing its purchase of securities of the Cor-
poration, the Association shall, upon written application by the Cor-
poration at least 30 days prior to such investment, make an initial 
investment in debentures of the Corporation within 60 days after 
the date of conveyance of rail properties pursuant to section 303 (b) (1) 
of this Act. Such initial investment shall be limited to such amounts 45 USC 743. 
as the Association and Finance Committee, acting jointly, determine 
are necessary for the continued and orderly operations of the Cor-
poration prior to any additional investment. 
"(5) Not later than 60 days after the date of conveyance pursuant 
to section 303(b) (1) of this Act, the Association shall select 6 indi-
viduals to serve as members of the Board of Directors of the Cor-
poration, subject to the provisions of section 301(d) of this Act. 45 USC 741. 
"(d) TERMS AND CONDITIONS.—Notwithstanding any other provision 
of State law, the debentures and the series A preferred stock of the 
Corporation shall have such terms and conditions, not inconsistent 
with the final system plan or this title, as may be prescribed by the 
Association, except as follows: 
"(1) The Corporation shall not be required to issue to the 
Association additional shares of series A preferred stock of the 
Corporation as a dividend on any such stock. 
"(2) The dividends payable on series A preferred stock of the 
Corporation shall not be cumulative and shall be paid in cash 
when and to the extent that there is 'cash available for restricted 
cash payments', as that term is defined in the final system plan. 
"(3) After the Association calls for redemption of the certifi-
cates of value, no shares of series A preferred stock of the Cor-
poration shall be issued in lieu of interest on the debentures of 
the Corporation and, to the extent such interest is not payable in 
cash by reason of the absence of sufficient 'cash available for 
; 5 
restricted cash payment', the Corporation shall deliver to the 
holders of the debentures contingent interest notes in a face 
amount equal to such unpaid interest. 
"(4) If the Board of Directors of the Association and the 
Finance Committee, acting jointly, modify the terms or con- 
• ?
. " 
ditions governing the purchase of debentures or series A pre-
ferred stock of the Corporation pursuant to subsection (e) (1) 
of this section, or if the Finance Committee waives compliance 
with any term, condition, provision, or covenant of such securities 
pursuant to subsection (e) (2) of this section, the Finance Com-
mittee may require the Corporation to issue contingent interest 
notes in such amount as, in the determination of the Finance 
Committee, will provide protection for the United States, in the 
event of bankruptcy, reorganization, or receivership of the Cor-
poration, equal to the protection the United States would have 
had in the absence of such modification or waiver. 
"(5) The contingent interest notes issued pursuant to this sec-
tion shall bear interest compounded annually at the rate of 8 per-
cent per annum and such notes and the accumulated interest 
thereon shall be payable only in the event of bankruptcy, reorga-
nization, or receivership of the Corporation occurring prior to the 
repayment and redemption of all outstanding debentures and 
accumulated series A preferred stock of the Corporation. The 
90 STAT. 92 
PUBLIC LAW 94-210—FEB. 5, 1976 
contingent interest notes and the accumulated interest thereon 
.; 
shall have the same priority in bankruptcy, reorganization, or 
receivership as the debentures of the Corporation. The other 
terms and conditions of the contingent interest notes shall be as 
set forth in an agreement to be entered into between the Associa-
tion and the Corporation prior to issuance of any debentures. 
"(e) 
MODIFICATIONS, WAIVERS, AND CONVERSIONS.—(1) The 
Board 
of Directors of the Association and the Finance Committee, acting 
jointly, may agree with the Corporation to modify any of the terms 
and conditions governing the purchase by the Association of securities 
of the Corporation, upon a finding that such action is necessary or 
appropriate to achieve the purposes of this Act or the goals of the 
final system plan. 
"(2) The Finance Committee may, in its discretion and upon a 
finding 
that such action is necessary or appropriate to achieve the 
\ 
purposes of this Act or the goals of the final system plan, waive 
compliance with any term, condition, provision, or covenant of the 
J 
,;^ 
securities of the Corporation held by the Association, including any 
provision of such securities with respect to redemption of principal 
or issuance price, payment of interest or dividends, or any term or 
condition governing the purchase of such securities. 
"(3) Notwithstanding any provision of State law, there shall be no 
conversion of the debentures of the Corporation into series A preferred 
stock of the Corporation, as provided in the terms and conditions 
of the debentures and pursuant to the final system plan, unless the 
Board of Directors of the Association and the Finance Committee 
jointly determine to effect such conversion. 
"(f) APPROPRIATION.—There is authorized to be appropriated to 
the Association $2,100,000,000 to be used for the purchase of securities 
T 
' 
of the Corporation in accordance with this section. All sums received 
^ 
by the Association on account of the holding or disposition of any such 
securities shall be deposited in the general fund of the Treasury.". 
LOANS 
45 use 721. 
SEC. 606. Section 211 of such Act (45 U.S.C. 741) is amended by 
adding at the end thereof the following new subsections: 
"(g) 
PRE-CONVEYANCE LOANS TO THE CORPORATION.—During 
the 
period between the effective date of the final system plan and the 
date of the conveyance of rail properties pursuant to section 303(b) 
45 use 743. 
of this Act, the Association may make such loans in such amounts to 
the Corporation as the Association deems essential to provide for the 
purchase by the Corporation of material, supplies, equipment, and 
services necessary to permit the orderly and efficient implementation 
of the final system plan. Notwithstanding any inability of the Asso-
ciation during such period to make the finding required by subsection 
(e) (3) of this section because of any existing contingencies, the 
Association may make any such loans to the Corporation, subject to— 
"(1) the most favorable terms and conditions for assuring 
timely repayment and security as may then be reasonably availa-
ble, and 
"(2) the requirement that any loan to the Corporation under 
this subsection be refinanced immediately out of the proceeds of 
Ante, p. 89. 
the first sale by the issuance of debentures under section 216 of 
^ 
this title. 
In order to assure that necessary funds are available to the Corpora-
tion for implementation of the final system plan, the Corporation is 
authorized to accept such loans as may he approved by the Association 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 93 
45 use 743. 
tinder this subsection, and any such acceptance shall be deemed for all 
purposes to constitute a reasonable and prudent business judgment in 
compliance with any fiduciary obligations imposed on the Corporation 
or its directors. For purposes of this subsection, the term 'Corpora-
tion' includes a subsidiary of the Corporation. 
" ( h ) LOANS FOR PAYMENT or OBLIGATIONS.— (1) The Association is 
authorized, subject to the limitations set forth in section 210(b) of 
this title, to enter into loan agreements, in amounts not to exceed Ante, p. 88. 
$230,000,000 in the aggregate, with the Corporation, the National Rail-
road Passenger Corporation, and any profitable railroad to which rail 
properties are transferred or conveyed pursuant to section 303(b) (1) 
of this Act, under which the Corporation, the National Railroad 
Passenger Corporation, and any profitable railroad entering into such 
agreement will agree to meet existing or prospective obligations of 
the railroads in reorganization in the region which the Association, 
in accordance with procedures established by the Association, deter-
mines should be paid by the Corporation, the National Railroad 
Passenger Corporation, or a profitable railroad, on behalf of the 
transferors, in order to avoid disruptions in ordinary business relation-
ships. Such obligations shall be limited to amounts claimed by suppliers 
(including private car lines) of materials or services utilized in cur-
rent rail operations, claims by shippers arising from current rail serv-
ices, payments to railroads for settlement of current interline accounts, 
claims of employees arising under the collective bargaining agreements 
of the railroads in reorganization in the region and subject to section 
3 of the Railw'ay Labor Act, claims of all employees or their personal 
representatives for personal injuries or death and subject to the pro-
visions of Employers' Liability Acts (45 U.S.C. 51-60), and amounts 45 USC 51 note, 
required for adequate funding of accrued pension benefits existing at 
the time of a conveyance or discontinuance of service under employee 
pension benefit plans described in section 505 (a) of this Act. The Asso-
ciation shall not make such a loan unless it first finds that the loan is 
for the purpose of paving obligations with respect to accrued pension 
plans referred to in the preceding sentence or that the Corporation, 
the National Railroad Passenger Corporation, or a profitable railroad 
is entitled to a loan pursuant to subsections (e) and (g) of section 504 
of this Act, or unless it first finds that— 
" ( A ) provision for the payment of such obligations was not 
included in the financial projections of the final system plan; 
"(B) such obligations arose from rail operations prior to the 
date of conveyance of rail properties pursuant to section 303(b) 
(1) of this Act and are, under other applicable law, the respon-
sibility of a railroad in reorganization in the region; 
"(C) the Corporation, the National Railroad Passenger Corpo-
ration, or a profitable railroad has advised the Association that the 
direct pavment of such obli.q:ations by the Corporation, the 
National Railroad Passenger Corporation or profitable railroad is 
necessary to avoid disruptions in ordinary business relationships; 
"(D) the transferor is unable to pay such obligations within a 
reasonable period of time; and 
" ( E ) with respect to loans made to the Corporation, the pro-
cedures to be followed by the Corporation, in seeking reimburse-
ment from the railroa(is in reorganization in the region for 
obligations paid on their behalf under this subsection, have been 
jointly agreed to by the Finance Committee and the Corporation. 
"(2) The trustees of each railroad in reorganization in the region 
shall attempt to negotiate agency agreements with the Corporation, 
45 USC 153. 
45 USC 775. 
Post, p. 113. 
90 STAT. 94 
PUBLIC LAW 94-210—FEB. 5, 1976 
the National Railroad Passenger Corporation, or a profitable railroad 
for the processing of all accounts receivable and accounts payable 
attributable to operations prior to the conveyance of property pur-
45 use 743. 
suant to section 303(b) (1) of this Act, If any railroad in reorganiza-
tion in the region fails to conclude such an agreement within a 
reasonable time prior to such conveyance, the applicable reorganization 
courts, after giving all parties an opportunity to be heard, shall pre-
scribe the terms of such an agency arrangement by order, giving due 
consideration to the need, wherever possible, to make such agreements 
uniform among the various estates. 
" (3) The Association may, not less than 30 days prior to the date of 
conveyance pursuant to section 303(b) (1) of this Act, petition each 
district court of the United States having jurisdiction over the reorga-
nization of a railroad in reorganization in the region for an order, 
which shall be entered prior to such conveyance, and which— 
"(A) identifies that cash and other current assets of the estate 
of such railroad which shall be utilized to satisfy obligations of 
the estates identified in paragraph (1) of this subsection; and 
"(B) provides for the application by the trustees of such rail-
roads and their agents, consistent with the principles of reorga-
nization under section 77 of the Bankruptcy Act (11 U.S.C. 205) 
and with the agency agreement specified in paragraph (2) of this 
subsection, of all such current assets, including cash available as 
of or subsequent to such date of conveyance, to the payment in 
the postconveyance period of the obligations of the estates identi-
fied in paragraph (1) of this subsection. 
"(4) (A) Each obligation of a railroad in reorganization in the 
region which is paid with financial assistance under paragraph (1) 
of this subsection shall be processed, on behalf of such railroad, by the 
Corporation, the National Railroad Passenger Corporation, or a prof-
itable railroad, whichever is appropriate. An obligation of a railroad 
in reorganization in the region shall be paid, on behalf of such rail-
road, by the Corporation, the National Railroad Passenger Corpora-
tion, or a profitable railroad, whichever is appropriate, if— 
" (i) such obligation is deemed by the Corporation, the National 
Railroad Passenger Corporation, or a profitable railroad, which-
ever is appropriate, to have been, on the date of conveyance of 
rail properties pursuant to section 303(b) (1) of this Act, the obli-
gation of a railroad in reorganization in the region; 
"(ii) such obligation accrues after such date of conveyance but 
as a result of rail operations conducted prior to such date, and 
the trustees of such railroad in reorganization acknowledge that 
it is an obligation of such railroad; or 
" (iii) the district court of the United States having jurisdiction 
over such railroad in reorganization in the region approves such 
obligation as a valid administrative claim against such railroad; 
to the extent that payment is required under a loan agreement with 
the Association under such paragraph (1). 
"(B) The Association shall resolve any disputes among the Corpora-
tion, the National Railroad Passenger Corporation, and a profitable 
railroad concerning which of them shall process and pay any particu-
lar obligation on behalf of a particular railroad in reorganization. 
"(C) The Corporation, the National Railroad Passenger Corpora-
tion, or a profitable railroad shall have a direct claim, as a current 
expense of administration, for reimbursement from the estate of a rail-
road in reorganization in the region for all obligations of such estate 
(plus interest thereon) which are paid by the Corporation, the National 
Railroad Passenger Corporation, or a profitable railroad, as the case 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 95 
may be. The right of the Corporation or the National Raih-oad 
Passenger Corporation to receive reimbursement under this subpara-
graph from the estate of a railroad in reorganization in the region 
shall be reduced by the amount, if any, of loans, plus interest forgiven 
under paragraph (5) of this subsection. 
"(5) (A) If, at any time, the Finance Committee of the Association 
determines that the failure of the Corporation to receive full reim-
bursement with interest from the estate of a railroad in reorganization 
in the region for any obligation of such estate paid pursuant to this 
subsection could adversely affect the fairness and equity of the trans-
fers and conveyances pursuant to section 303(b)(1) of this Act, or 45 USC 743. 
that the failure of the National Railroad Passenger Corporation to 
receive such full reimbursement plus interest for any such obligation 
would be contrary to the public interest, the Association shall forgive 
; • 
the indebtedness, plus accrued interest, of the Corporation or of the 
National Railroad Passenger Corporation incurred pursuant to para-
graph (1) of this subsection in the amount recommended by the 
Finance Committee. The Association shall have a direct claim, as a 
current expense of administration of the estate of such railroad in 
reorganization, equal to the amount by which loans of the Corporation 
or of the National Railroad Passenger Corporation, plus interest, have 
been forgiven. Such direct claim shall not be subject to any reduction 
by way of setoff, cross-claim, or counter-claim which the estate of such 
railroad in i-eorganization may be entitled to assert against the Cor-
poration, the National Railroad Passenger Corporation, the Associa-
tion, or the United States. 
"(B) The direct claim of the Association under this paragraph, 
and any direct claim authorized under paragraph (4) of this subsec-
tion, shall be prior to all other administrative claims of the estate of 
a railroad in reorganization, except claims arising under trustee's 
certificates or from default on the payment of such certificates. 
"(6) Notwithstanding any other provision of this subsection, the 
Association shall forgive any loan made to the Corporation or the 
National Railroad Passenger Corporation pursuant to this subsection, 
plus accrued interest thereon, on the 3r(i anniversary date of any such 
loan, except that the Association shall not forgive any loan or portion 
thereof, in accordance with this paragraph, if— 
"(A) the Finance Committee makes an affirmative finding, with 
respect to such loan or portion thereof, that— 
"(i) the Corporation has not exercised due diligence in 
executing the procedures adopted pursuant to paragraph 
(1) (E) of this subsection, and 
"(ii) the failure of the Association to forgive such loan 
or portion thereof will not adversely affect the ability of the 
Corporation to become financially self-sustaining; 
"(B) the Finance Committee so directs the Association; and 
> 
"(C) neither House of the Congress disapproves such affirma-
tive finding and direction, in accordance with the following pro-
visions of this paragraph. 
A copy of each such finding, the reasons therefor, and such direction 
made by the Finance Committee, together with the comments and 
recommendations thereon of the Board of Directors of the Association, 
shall be transmitted to the Congress by the Association within 10 days 
after the date on which the Finance Committee makes such finding and 
direction, or if not so transmitted, shall be transmitted by the Finance 
Committee. Each such finding and direction so transmitted shall 
become effective immediately, and shall remain in effect, unless, within 
89-194 O—78—pt. 1 
10 
90 STAT. 96 
PUBLIC LAW 94-210—FEB. 5, 1976 
the first period of 30 calendar days of continuous session of Congress 
after the date of transmittal of such finding and direction to Congress, 
either House of Congress disapproves such finding and direction in 
accordance with the procedures specified in section 1017 of the Con-
gressional Budget and Impoundment Control Act of 1974 (31 U.S.C. 
1407). For purposes of this pai'agraph, continuity of session of Con-
gress is broken only in the circumstances described in section 1011(5) 
of that Act (31 U.S.C. 1401 (5)). 
"Corporation." 
" (7) For purposes of this subsection, the term 'Corporation' includes 
a subsidiary of the Corporation. 
^ 
"(i) ELECTRIFICATION.—Upon application by the Corporation, the 
Secretary shall, pursuant to the provisions of and within the obliga-
tional limitations contained in sections 511 through 513 of the Rail-
Ante, pp. 76-80. road Revitalization and Regulatory Reform Act of 1976, guarantee 
obligations of the Corporation for the purpose of electrifying high-
density mainline routes if the Secretary finds that such electrification 
will return operating and financial benefits to the Corporation and 
will facilitate compatibility with existing or renewed electrification 
systems. The aggregate unpaid principal amount of obligations which 
may be guaranteed by the Secretary under this paragraph shall not 
exceed $200,000,000 at any one time.". 
Ante, p. 89; 
Post, p. 104. 
MISCELLANEOUS AMENDMENTS TO TITLE II 
SEC. 607. (a) Section 201(j) of such Act (45 U.S.C. 711 (j)), as 
redesignated by section 603(a) of this Act, is amended by adding at 
the end thereof the following new paragraph: 
"(4) Any reference in this Act to the Secretary of the Treasury is 
to the Secretary of the Treasury or the person at the time performing 
the duties of the Office of the Secretary of the Treasury in accordance 
with law, or the duly authorized representative of either of them. Any 
reference in this Act to the Chairman of the Commission is to the 
Chairman of the Commission or the person at the time performing the 
duties of the Chairman of the Commission in accordance with law, 
or the duly authorized representative of either of them.". 
(b) Section 202(e) of such Act (45 U.S.C. 712(e)) is amended by 
inserting after "obligations issued" and before "and loans" in clause 
(4) thereof the following: ", certificates of value issued, securities 
T)ll 1
*
0 II 3ySPO 
(c) Section 202(f) of such Act (45 U.S.C. 712(f)) is amended by 
inserting after "section" and before " ) " in the first sentence thereof the 
following: "and receipts and disbursements under section 216 of this 
title and section 306 of this Act.". 
(d) Section 203(a) of such Act (45 U.S.C. 713(a)) is amended by 
striking out the last sentence thereof. 
(e) Section 206(d)(3) of such Act (45 U.S.C. 716(d)(3)) is 
amended by inserting after the first sentence thereof the following 
three new sentences: "All determinations made by the Association in 
the correction to the preliminary system plan published on April 11, 
1975 (40 Fed. Reg. 16377), shall be treated for all purposes as if they 
had been made upon adoption and release by the Association of the 
preliminary system plan. All determinations made by the Commission 
with respect to such correction shall be treated for all purposes as if 
they had been made within 90 days after adoption and release by the 
Association of the preliminary system plan. All determinations made 
by the Commission with respect to acquisitions by profitable railroads 
referred to in any supplement to the preliminary system plan pub-
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 97 
lished under section 207 (b) (2) of this title shall be deemed to be timely 
if made prior to the adoption of the final system plan under section 
207(c) of this title.". 
(f) Section 206(c) (1) (B) of such Act (45 U.S.C. 716(c) (1) (B)) 
is amended by inserting immediately after "paragraph" the follow-
ing: "and what alternative designations shall be made under this 
paragraph". 
(g) Section 206(c) (1) (A) of such Act (45_U.S.C. 716(c) (1) (A)) 
is amended by striking out the semicolon and inserting in lieu thereof 
the following: " : Provided^ That the Corporation shall, within 95 days 
after the effective date of the final system plan, give notice to the 
Association of which such rail properties, if any, are to be transferred 
to a subsidiary of the Corporation in the event that the Board of 
Directors of the Association finds that such transfer would be con-
sistent with the final system plan;". 
(h) Section 206(c)(2) of such Act (45 U.S.C. 716(c)(2)) is 
amended by adding at the end thereof the following new sentence: 
"Any rail properties designated to be offered for sale to the Corpora-
tion may be sold instead to a subsidiary of the Corporation.". 
(i) Sections 206(d) (1), 209 (c) and (d), 215(d), 304(e), and 501 
(1) and (2) of such Act (45 U.S.C. 716(d) (1), 719(c) and (d), 744 
(e), and 771 (1) and (2)) are amended by inserting after "Corpora-
tion" each time it appears the following: "or any subsidiary thereof". 
(]•) Section 206(c) (1) (D) of such Act (45 U.S.C. 716(c) (1) (D)) 
is amended by— 
(1) inserting immediately after "by" the following "(i)"; and 
(2) striking out "; and" at the end thereof and adding the fol-
lowing: ", or (ii) the National Railroad Passenger Corporation to 
meet the needs of improved rail passenger service over intercity 
routes, other than properties designated pursuant to subpara-
graph (C) of this paragraph; and". 
(k) Section 210(c) of such Act (45 U.S.C. 720(c)) is amended by 
adding at the end thereof the following new sentence: "All guarantees 
entered into by the Secretary under this section shall constitute gen-
eral obligations of the United States for the payment of which its 
full faith and credit are pledged.". 
(1) Section 209(c) of such Act (45 U.S.C. 719(c)) is amended by 
striking out "obligations of the Association" each time it appears and 
inserting in lieu thereof "certificates of value of the Association". 
(m) (1) Subsection (b) of section 214 of such Act (45 U.S.C. 
724(b)) is amended by striking out "$5,000,000" and inserting in lieu 
thereof "$7,000,000". 
(2) Section 214(c) of such Act is amended by striking out the period 
and inserting in lieu thereof ", and not to exceed $14,000,000 for the 
fiscal period which includes the period ending September 30,1977.". 
(n) Section 214(a) of such Act (45 U.S.C. 724(a)) is amended by 
adding at the end thereof the following: "There are authorized to be 
appropriated to the Secretary such sums as may be necessary to dis-
charge the obligations of the United States arising under section 303 
(c) (5) of this Act.". 
(o) Paragraph (4) of section 206(d) of such Act (45 U.S.C. 716 
(d) (4)) is amended— 
(1) in the first sentence thereof, by striking out "30 days after 
the effective date of the final system plan" and inserting in lieu 
thereof "7 days after the date of the enactment of the Railroad 
Revitalization and Regulatory Reform Act of 1976"; and in the 
45 use 717. 
45 use 716, 
719, 725, 744, 
771. 
Guarantees. 
Appropriation 
authorization. 
Appropriation 
authorization. 
Post, p. 109. 
Ante, p. 31. 
90 STAT. 98 
PUBLIC LAW 94-210—FEB. 5, 1976 
second sentence thereof, by striking out "60" and inserting in lieu 
thereof "95"; and 
(2) by inserting immediately after the first sentence thereof the 
following new sentence: "Any such offer may be modified until 
the date of acceptance thereof, unless such modification results 
in an offer for the sale of rail properties at less than the net 
liquidation value thereof.", 
(p) Section 206(d) of such Act (45 U.S.C. 716(d)) is amended 
by adding at the end thereof the following new paragraph: 
"(6) Notwithstanding any statement to the contrary in the final 
system plan, a State (or a local or regional transportation author-
ity) shall not be required to deliver to the Corporation a firm 
commitment to acquire rail properties designated to such State or 
authority prior to 7 days after the date of enactment of this 
paragraph.". 
45 use 716. 
(q) Section 206 of such Act (45 U.S.C. 717(c)) is amended by add-
ing at the end thereof the following new subsection: 
" (j) Any rail properties over which rail service was being provided 
^ 
as of the date of enactment of this Act, and which were recommended 
in the preliminary system plan for transfer to the Corporation, shall 
be deemed to be designated in the final system plan for transfer to 
the Corporation under subsection (c)(1)(A) of this section. Any 
designation in the final system plan, pursuant to subsection (c)(1) 
(B) of this section, of overhead trackage rights to be acquired by a 
profitable railroad operating in the region over specified rail proper-
ties to be acquired by the Corporation, where such designation does 
not (1) authorize such profitable railroad to interchange traffic with 
at least one railroad, or (2) provide for the connection of portions of 
such profitable railroad's rail properties, and where the transfer of 
ownership of such rail properties (including trackage rights) to such 
profitable railroad was recommended in the preliminary system plan, 
, ,. 
• . 
and the Commission has made a determination with respect thereto, in 
accordance with subsection (d) (B) of this section, shall be deemed to 
authorize such profitable railroad to interchange traffic with the Cor-
poration and any other profitable railroad connecting with such speci-
fied rail properties.". 
Final system 
(r) Section 209(c) of such Act (45 U.S.C. 719(c)) is amended by 
plan, certified 
adding at the end thereof, without paragraph indentation, the follow-
copy, delivery 
j ^ ^ ^^^ sentences: "Notwithstanding any other provisions of this 
^
*
®
" 
subsection and subsection (d) of this section, the time for the delivery 
of a certified copy of the final system plan shall be March 12,1976, and 
may be extended to a date not more than 80 days thereafter, prescribed 
in a notice filed by the Association not later than February 10, 1976, 
with the special court, the Congress, and each court referred to in such 
subsection (d). Such notice shall contain the certification of the Associ-
ation that an orderly conveyance of rail properties cannot reasonably 
be effected before the date for conveyance determined with respect to 
45 use 743. 
such notice. The time prescribed in section 303(a) of this Act shall be 
determined with respect to the date prescribed in such notice.". 
(s) Section 209(c) (1) and (2) of such Act (45 U.S.C. 719(c) 
(1) and (2)) is amended by striking out "railroad leased" each time 
it appears therein and inserting in lieu thereof "person leased". 
(t) Section 102(12) of such Act (45 U.S.C. 702(12)), as redesig-
Ante, p. 86. 
nated by this Act, is amended (1) by inserting immediately before 
"which are used or useful" the following: " (or a person owned, leased, 
;: 5 
;. or otherwise controlled by a railroad)"; and (2) by striking out 
"phase" and inserting in lieu thereof "phrase". 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 99 
CAPITALIZATION OF THE CX)RP0RATlON 
; . 
SEC. 608. Section 301 (e) of such Act (45 U.S.C. 741 (e)) is amended 
to read as follows: 
"(e) INITIAL CAPITALIZATION.— (1) In order to carry out the final 
system plan, the Corporation is authorized to issue debentures, series 
A preferred stock, series B preferred stock, common stock, contingent 
interest notes, and other securities. 
"(2) Debentures and series A preferred stock shall be issued ini-
tially to the Association. Series B preferred stock and common stock 
shall be issued initially to the estates of railroads in reorganization 
in the region, to railroads leased, operated, and controlled by railroads 
in reorganization in the region, and to other persons leased, operated 
or controlled by a railroad in reorganization who are transferors of 
rail properties in exchange for rail properties transferred to the Cor-
poration pursuant to the final system plan. Notwithstanding any other 
provisions of State or Federal law, the series B preferred stock and 
common stock shall have terms and conditions not inconsistent with 
the final system plan. As a condition of its investment in the Corpo-
ration, the Association may require that the Corporation adopt limita-
tions consistent with the final system plan on the circumstances under 
which dividends on the series B preferred stock and common stock are 
payable so long as any of the debentures or series A preferred stock 
are outstanding.". 
PROTECTION or FEDERAL FUNDS 
SEC. 609. Title III of such Act, as amended by this Act, is further 
amended by inserting the following new section: 
"PROTECTION OF FEDERAL FUNDS 
"SEC. 307. (a) AUDIT.—(1) The Comptroller General of the United 45 USC 747. 
States is authorized to audit the programs, activities, and financial 
operations of the Corporation for any period during which (A) Fed-
eral funds provided pursuant to this Act are being used to finance any 
portion of its operations, or (B) Federal funds have been invested 
therein pursuant to this Act. Any such audit may be conducted under 
such rules and regulations as the Comptroller General may prescribe. 
The Comptroller General shall report to the Congress at such times 
and to such extent as he considers necessary to keep the Congress 
informed on the security of such Federal funds and guarantees and, 
to the extent appropriate, make recommendations for achieving greater 
economy, efficiency, and effectiveness in such programs, activities, and 
operations. 
" (2) For the purpose of any audit conducted pursuant to subsection 
(a) of this section, the Comptroller General, or a designated repre-
sentative of the Comptroller General, shall have access to and the right 
to examine all books, accounts, records, reports, files, and other papers, 
items, or property belonging to or in use by the Corporation. 
"(b) REPORT.—The Association shall prepare and submit an annual 
Report to 
report to Congress on the performance of the Corporation in order to Congress, 
keep the Congress informed as to matters which may affect the quality 
of rail services in the region and which may affect the security of Fed-
eral funds referred to in subsection (a) of this section. Each such 
report shall be submitted within 150 days after the end of the fiscal 
year of the Corporation. Each such report shall include an evaluation 
of— 
90 STAT. 100 
PUBLIC LAW 94-210—FEB. 5, 1976 
45 use 716. 
Ante, p. 89. 
" (1) the degree to which the goals of section 206 (a) of this Act 
are being met; 
"(2) the amounts and causes of deviations, if any, from the 
financial projections of the final system plan; 
"(3) the amount of Federal funds made available to the Corpo-
ration and a clear description of the uses of such funds; 
" (4) the projected financial needs of the Corporation; 
"(5) the projected sources from which such financial needs are 
likely to be met; and 
"(6) the ability of the Corporation to become financially self-
sustaining without requiring Federal funds in excess of those 
authorized by section 216(f) of this Act.". 
'Subsidiary." 
"Supplemental 
transaction." 
Infra. 
45 use 743. 
CONTINUING 
R E O R G A N I Z A T I O N ; 
SUPPLEMENTAL TRANSACTIONS 
SEC. 610. (a) Section 102 of such Act (45 U.S.C. 702), as amended 
by this Act, is amended— 
(1) in paragraph (16) thereof, by striking out "and"; 
(2) in paragraph (17) thereof, by striking out the period and 
inserting in lieu thereof a semicolon; and 
(3) by adding at the end thereof the following two new para-
graphs : 
"(18) 'subsidiary' means any corporation 100 percent of whose total 
combined voting shares are, directly or indirectly, owned or controlled 
by the Corporation; and 
"(19) 'supplemental transaction' means any transaction set forth in 
a proposal under section 305 of this Act, within 6 years after the date on 
which the special court orders conveyances of rail properties to the 
Corporation under section 303(b) of this Act, under which the Corpo-
ration or a subsidiary thereof would (A) acquire rail properties not 
'; : )
H 
designated for transfer or conveyance to it under the final system plan, 
(B) convey rail properties to a profitable railroad, a subsidiary of 
the Corporation or, other than as designated in the final system plan, 
to the National Railroad Passenger Corporation or to a State or a 
local or regional transportation authority, or to any other responsible 
person for use in providing rail service, or (C) enter into contractual 
or other arrangements with any person for the joint use of rail proper-
ties or the coordination or separation of rail operations or services.". 
(b) Title I I I of such Act is amended by adding at the end thereof 
the following new sections: 
''CONTINUING 
R E O R G A N I Z A T I O N ; 
SUPPLEMENTAL TRANSACTIONS 
45 use 745. 
"SEC. 305. (a) PROPOSALS.—If the Secretary or the Association deter-
mines that, as part of continuing reorganization, further restructur-
ing of rail properties in the region through transactions supplemental 
to the final system plan would promote the establishment and reten-
tion of a financially self-sustaining rail service system in the region 
adequate to meet the needs of the region, the Secretary or the Associa-
' '. •' • 
tion, as the case may be, may develop proposals for such supplemental 
transactions as are necessary or appropriate to implement the needed 
restructuring. Transfers of rail properties included in proposals 
developed by the Association shall be limited to (1) rail properties 
which would have qualified for designation under section 206(c) (1) 
45 use 716. 
(A) of this Act but which were not transferred or conveyed under the 
final system plan, and which the Association finds to be essential to 
the efficient operations of the Corporation, and (2) transfers, con-
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 101 
sistent with the final system plan, of rail properties from the Corpora-
tion to a subsidiary thereof. Each proposal (other than a proposal 
developed by the Association) shall be submitted in writing to the 
Association and shall state and describe any transactions proposed, 
the rail properties involved, the parties to such transactions, the finan-
cial and other terms of such transactions, the purposes of the Act or 
the goals of the final system plan intended to be effectuated by such 
transactions, and such other information incidental thereto as the 
Association may prescribe. Within 10 days after i-eceipt of'a proposal 
developed by the Secretary, and upon the development of a proposal 
developed by the Association, the Association shall publish a summary 
of such proposal in the Federal Register, and shall afford interested 
persons (including the Corporation when property is to be transferred 
to or from the Corporation) an opportunity to comment thereon. 
"(b) EVALUATION BY ASSOCIATION.—The Association shall analyze 
each proposal containing one or more supplemental transactions, tak-
ing into account the comments of interested persons and statements 
and exhibits submitted at any public hearings which may have been 
held. The Association shall, within 120 days after the publication of a 
summary thereof under subsection (a) of this section, publish in the 
Federal Register a report evaluating such proposal. Such evaluation 
shall state whether the supplemental transactions contained in such 
proposal, considered in their entirety, are (1) in the public interest and 
consistent with the purposes of this Act and the goals of the final 
system plan, and (2) fair and equitable. If the Corporation opposes, 
or seeks modification of, any such proposed transfer, its written com-
ments shall be given due consideration by the Association and shall be 
published as part of the evaluation. Within 30 days after the Associa-
tion publishes its report, each proposed transferor or transferee shall 
notify the Association in writing as to whether any proposed supple-
mental transaction requiring the transfer of any property from or to 
such transferor or transferee is acceptable to such proposed trans-
feror or transferee. If any such proposed transferor (other than the 
Corporation) or transferee fails to notifv the Association that any 
proposed supplemental transaction requiring the transfer of any 
property from such transferor or to such transferee is acceptable to it, 
no further administrative or judicial proceedings shall be conducted 
with respect to such proposed supplemental transaction. 
"(c) REVIEW BY THE COMMISSION.—^Within 90 days after the publi-
cation in the Federal Register of each report referred to in subsection 
(b) of this section, the Commission shall determine whether the sup-
plemental transactions referred to in the report, considered in their 
entirety, would be in the public interest and consistent with the pur-
poses of this Act and the goals of the final system plan. In making 
such determination, the Commission shall give due consideration to 
the views received by it, within 30 days after the publication of the 
applicable report, from the Corporation and the Secretary. The Com-
mission may condition its approval of such supplemental transactions 
on such reasonable terms and conditions as it may deem necessary in 
the public interest. The approval by the Commission of such supple-
mental transactions shall not be a prerequisite to the consummation of 
such transactions, but any determination of the Commission modify-
ing, approving, or disapproving any proposed supplemental transac-
tions shall be ^ v e n due weight and consideration by the special court 
in the proceedings prescribed in subsection (d) of this section. If the 
Commission fails to act within the time period provided in this sub-
Publication in 
Federal Register. 
Publication in 
Federal Register. 
90 STAT. 102 
PUBLIC LAW 94-210—FEB. 5, 1976 
section, the supplemental transactions involved shall be deemed to 
have been approved by the Commission. The Commission may pre-
scribe such regulations as may be necessary for the administration of 
this section. 
"(d) 
SPECIAL COUKT PROCEKDINGS.—(1) If the Association has 
made the determination pursuant to subsection (b) of this section 
that a proposal for supplemental transactions is in the public inter-
est and consistent with the purposes of this Act and the goals of the 
final system plan, and is fair and equitable, the Association shall, 
within 40 days after the date of the Commission's determination under 
subsection (c) of this section, or after the expiration of the 90-day 
period referred to in such subsection (c), whichever is applicable, 
petition the special court for an order of such court finding that such 
proposal for supplemental transactions is in the public interest and 
consistent with the purposes of this Act and the goals of the final 
system plan, and is fair and equitable, and directing the Corporation 
to carry out the supplemental transactions specified in such proposal. 
If the Association has determined, pursuant to subsection (b) of this 
section that a proposal made by the Secretary is not in the public 
' ; 
interest or is not consistent with the purposes of this Act and the 
goals of the final system plan or is not fair and equitable, the Secre-
tary may, if he determines that such proposal is in the public interest 
and consistent with the purposes of this Act and the goals of the final 
system plan and is fair and equitable, petition the special court for 
an order of such court finding that such proposal for supplemental 
transactions is in the public interest and consistent with the purposes 
of this Act and the goals of the final system plan and is fair and 
equitable, and directing the Corporation to carry out any supple-
mental transactions specified in such proposal. Such a petition shall 
be submitted to the special court within 90 days after the date of the 
Commission's determination under such subsection (c), or after the 
expiration of the 90-day period referred to in such subsection (c), 
whichever is applicable. 
" (2) Within 180 days after the filing of a petition under paragraph 
(1) of this subsection, the special court shall decide, after a hearing, 
whether the proposed supplemental transactions contained in such 
petition, considered in their entirety, are in the public interest and 
consistent with the purposes of this Act and the goals of the final sys-
tem plan and are fair and equitable. If the special court determines 
that such proposed supplemental transactions, considered in their 
entirety, are in the public interest and consistent with the purposes of 
this Act and the goals of the final system plan and are fair and equi-
table, it shall, upon making such determination, issue such orders as 
may be necessary to direct the Corporation to consummate the trans-
actions. If the special court determines that such proposed supple-
mental transactions, considered in their entirety, are not in the public 
interest or not consistent with the purposes of this Act and the goals 
of the final system plan, or are not fair and equitable, it shall file an 
; 
opinion stating its conclusion and the reasons therefor. In such event 
the Association (in the case of a proposal developed by tlie Associa-
tion) or the Secretary (in the case of a proposal developed by the 
Secretary) may, within 120 days after the filing of such opinion, 
certify to the special court that the terms and conditions of the pro-
posal have been modified consistent with the opinion of the court 
and are acceptable to each proposed transferor (other than the Cor-
poration) or transferee, and may petition the special court for recon-
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 103 
sideration of the proposal as so modified. Within 90 days after the 
filing of such petition, the special court shall decide, after a hearing, 
whether the proposal as modified by the certification is in the public 
interest and consistent with the purposes of this Act and the goals 
of the final system plan and is fair and equitable, and shall enter 
such further orders as are consistent with its determination. 
"(3) The Corporation is authorized to petition the special court 
and to be represented regarding any proposed supplemental trans-
action, contained in a proposal developed by either the Association or 
the Secretary, which involves the properties of the Corporation. 
"(4) In proceedings under this subsection, the special court is 
authorized to exercise the powers of a judge of a United States district 
court with respect to such proceedings and such powers shall include 
those of a reorganization court. 
"(5) Any evaluation by the Association, the Secretary, or the Com-
mission shall not be reviewable in any court except the special court in 
accordance with the provisions of this section. The supplemental trans-
actions shall not be restrained or enjoined by any court nor shall they 
be otherwise reviewable by any court other than by the special court 
to the extent provided in this section. 
"(6) Notwithstanding any other provision of this Act, no findings, 
determinations, or proceedings shall be required with respect to any 
proposal for supplemental transactions other than as expressly set 
forth in this section. 
"(7) Any supplemental transaction under this section shall subject 
the transferor and transferee, in each such supplemental transaction, 
to the requirements and other provisions of title V of this Act, except 45 USC 771. 
that the term 'effective date of this Act' contained in such title V shall 
be applied to such supplemental transaction as if it read 'effective date 
of the supplemental transaction'. 
''(8) A final order or judgment of the special court entering or 
denying an order pursuant to this subsection shall be reviewable in the 
same manner as provided in section 209(e) (3) of this Act. 
-^nte, p. 86. 
"(e) DEFINITION.—As used in this section, the term 'fair and equi-
table' means fair and equitable, in accordance with the standards 
applicable to the approval of a plan of reorganization (or a step in 
such plan) under section 77 of the Bankruptcy Act (11 XJ.S.C. 205) 
to— 
"(1) the estates of railroads in reorganization in the region and 
persons leased, operated, or controlled by such railroads who have 
conveyed rail properties, under section 303(b) (1) of this title, in 45 USC 743. 
exchange for securities of the Corporation, the Association, or 
profitable railroads and other benefits provided as a consequence 
of this Act and to any subsequent holders of such securities at the 
time of the supplemental transaction involved; and 
"(2) the holders of other securities of the Corporation. 
Whenever any property or securities of the Corporation are required 
to be valued in order to determine whether the terms of a supplemental 
transaction are fair and equitable, the special court shall give proper 
recognition to the contributions to the Corporation by all classes of 
security holders, except that such court shall not assign to the series 
B preferred stock or the common stock of the Corporation any values 
added to those securities, by reason of investment by the Association 
in debentures and series A preferred stock of the Corporation, in 
excess of any value required by constitutional principles applicable 
to a reorganization process. 
90 STAT. 104 
PUBLIC LAW 94-210—FEB. 5, 1976 
"CERTIFICATES or VALUE 
45 use 746. 
"SEC. 306. (a) GENERAL.—On the date when the Corporation is 
required to deposit securities with the special court pursuant to sec-
45 use 743. 
tion 303 (a) (1) of this title, the Association shall deposit with the spe-
cial court the certificates of value of the Association required by this 
Guaranteed 
section. The Secretary shall guarantee the payment of all certificates 
payment. 
of value delivered in accordance with this title. All guarantees entered 
by the Secretary under this section shall constitute general obliga-
tions of the United States of America for the payment or redemption 
of which its full faith and credit are pledged. Such guarantees shall 
be valid and incontestable except as to mutual mistake of fact or as 
to fraud or material misrepresentation by the holder of such certifi-
cates or the transferor of rail properties to which certificates of value 
of any series so guaranteed are issued. 
"(b) NUMBER AND DISTRIBUTION.—A separate series of certificates 
of value shall be issued to each railroad in reorganization in the region 
and each person leased, operated, or controlled by such a railroad that 
transfers rail properties to the Corporation or a subsidiary thereof. 
The number of certificates of value of each series to be deposited pur-
suant to subsection (a) shall be equal to the number of shares of series 
B preferred stock of the Corporation which are required to be depos-
ited by the Corporation with the special court, pui-suant to section 
303(a) (1) of this title in exchange for the rail properties transferred 
to the Corporation or a subsidiary thereof by such transferor. Certifi-
cates of value of the appropriate series shall be distributed by the spe-
; * ,; 
cial court, pursuant to section 303(c) (4) of this title, at the same time 
to the same transferors, and in the same numbers of units as shares of 
such series B preferred stock are distributed to such transferor. 
"(c) REDEMPTION.— (1) Certificates of value, of any series, shall be 
redeemed by the Association on December 31, 1987, or on such earlier 
date as the Board of Directors of the Association and the Finance 
t)i$ 
Committee jointly may determine and specify. 
"(2) Each certificate of value of each series shall be redeemable for 
an amount, payable in cash, equal to its base value on the redemption 
date, minus— 
" ( A ) the sum of the fair market value of the series B pre-
ferred stock applicable to such certificate, the fair market value 
of the common stock applicable to such certificate, and all cash 
dividends theretofore paid on any such series B preferred stock 
: • ;; ; 
and on any such common stock; and 
"(B) any sums paid to a transferor of rail properties to whom 
such series of certificates of value was issued resulting from sales 
s 
or leases by the Corporation of properties transferred to it by 
such transferor divided by the number of certificates of value dis-
tributed to such transferor. 
"(3) The number of shares of series B preferred stock and common 
stock applicable to each certificate of value of any series, pursuant to 
paragraph (2) of this subsection, shall be— 
"(A) one share of series B preferred stock (without regard to 
any stock splits, stock combinations, reclassifications or similar 
transactions affecting the number of shares of outstanding series 
B preferred stock following the date of distribution pursuant to 
section 303(c) (4) of this title); and 
"(B) the number of shares of common stock determined by 
dividing the total number of shares of common stock distributed 
pursuant to section 303 (c)(4) of this Act to the transferor receiv-
PUBLIC LAW 94-210--FEB. 5, 1976 
90 STAT. 105 
Base value. 
ing such series of certificate of value by the total number of cer-
tificates of value in the series so distributed to such transferor. 
" (4) The base value of each certificate of value of any series shall be 
the value obtained by (A) taking the net liquidation value, as deter-
mined by the special court, to which the transferor to whom such series 
of certificates of value is issued is entitled by virtue of transfers 
of rail properties, under section 303(b) (1) of this title to the Corpo- 45 USC 743 
ration or a subsidiary thereof; (B) subtracting the value of other 
benefits provided under this Act, as determined by the special court; 
(C) adding such amount, if any, as the special court may determine 
shall be required after taking into consideration compensable uncon-
stitutional erosion, if any, in the estate of a railroad in reorganization, 
or of a railroad leased, operated, or controlled by such a railroad, 
which the special court finds to have occurred during any bankruptcy 
proceeding with respect to such railroad; (D) adding interest from 
the transfer date to the redemption date to be compounded annually 
at a rate of 8 percent per annum; and (E) dividing the resulting 
value by the number of certificates of value of such series distributed 
to such transferor. In determining such base value, the special court 
shall give due weight and consideration to the finding of the Asso-
ciation as to the net liquidation value to which each transferor is 
entitled by virtue of conveyances of rail properties under section 303 
(b) (1) of this title. For purposes of this paragraph, the term 'rail 
properties' includes all rights with respect to employee benefit plans 
transferred and assigned to the Corporation pursuant to section 303 
(b) (6) of this title. Net liquidation value with respect to such rights Post, p. 110. 
shall be determined after taking into account all obligations finally 
transferred or assigned to the Corporation pursuant to such section. 
"(5) The fair market value of series B preferred stock and of com-
mon stock of the Corporation shall be determined in accordance with 
regulations prescribed by the Association, on the basis of the average 
price of each such security in the primary established market in which 
such securities are traded over a period of 120 consecutive trading 
days ending not less than 20 nor more than 40 trading days preceding 
the redemption date, or, in the case of a security for which there is 
not an established trading market, on the basis of the fair market 
value thereof as determined by the majority vote of three experts in 
the valuation of securities, one to be selected by the Association, one 
to be selected by the directors of the Corporation elected by the holders 
of the security to be valued, and one to be selected by the two first 
selected. 
"(d) AUTHORIZATION TOR APPROPRIATIONS.—There are authorized 
to be appropriated to the Secretary such sums as are necessary to 
discharge the obligations of the United States arising under this 
section.". 
"Rail 
properties. 
Fair market 
value. 
OFFICERS AND DIRECTORS OF THE CORPORATION 
LI. (a) Section 301(c) of such Act (45 U.S.C. 741(c)) is 
by inserting "(1)" immediately before "The members", by 
SEC. 611. 
amended 
deleting the second sentence of such paragraph (1) and by adding at 
the end thereof the following new paragraph: 
" (2) Notwithstanding any provision of State law, after the date of 
enactment of this paragraph, the members of the executive committee 
of the Association (including duly authorized representatives of mem-
bers who are authorized by this Act to be represented) and the chief 
executive officer and chief operating officer of the Corporation shall 
adopt the bylaws of the Corporation and serve as the Board of Direc-
90 STAT. 106 
PUBLIC LAW 94-210—FEB. 5, 1976 
tors of the Corporation until all members of the Board of Directors 
of the Corporation have been selected in accordance with subsec-
>''' 
tion (d) of this section. The chief executive officer shall serve as chair-
man of such Board until a chairman thereof is selected pursuant to 
subsection (d) of this section, after which time such chairman shall 
serve at the pleasure of such Board.". 
''*- 
' 
(b) Section 301(d) of such Act (45 U.S.C. 741(d)) is amended to 
read as follows: 
"(d) BOARD OF DIRECTORS.— (1) Notwithstanding any provision of 
State law, the articles of incorporation and bylaws of the Corporation 
shall provide that the Board of Directors of the Corporation shall con-
sist of 13 members selected in accordance with the articles and bylaws 
of the Corporation, as follows: 
"(A) six individuals selected by the holders of the Corporation's 
debentures and series A preferred stock voting as one class, with 
every $100 principal amount of debentures, and every $100 liquida-
tion amount of series A preferred stock each receiving one vote for 
directors; 
"(B) three individuals selected by the holders of the Corpora-
tion's series B preferred stock; and 
"(C) two individuals selected by the holders of the Corpora-
tion's common stock. 
" (2) The chief executive officer and the chief operating officer of the 
Corporation shall also serve on the Board, but the chief executive officer 
and chief operating officer of the Corporation shall not be entitled 
'
^
*
i 1 
to vote on the election or removal of either. In the event a vacancy 
occurs on the Board of Directors due to death, disability or resignation 
of a director (other than resignations pursuant to this subsection), 
such vacancy shall be filled only by a vote of the holders of the class of 
securities that initially elected such director. Two members of the 
Board selected by the holders of the Corporation's debentures and 
series A preferred stock shall resign when the total of the principal 
amount of the outstanding debentures and the amount of the liquida-
tion amount of the outstanding series A preferred stock, once having 
exceeded $1,500,000,000, has been reduced below that amount; two 
additional members of the Board selected by the holders of the Corpo-
ration's debentures and series A preferred stock of the Corporation 
shall resign when the total of the principal amount of the outstanding 
debentures and the amount of the liquidation amount of the outstand-
ing series A preferred stock, once having exceeded $1,500,000,000, has 
been reduced below $750,000,000. The two remaining members of the 
^
"
~ 
Board selected by the holders of the Corporation's debentures and 
series A preferred stock shall resign when all the debentures and series 
A preferred stock have been redeemed by the Corporation. As directors 
resign in accordance with the foregoing provisions, the election of 
corporate directors to fill the vacancies created by their resignations 
shall be governed by applicable State law and the articles and bylaws 
of the Corporation.". 
(c) Section 301 of such Act (45 U.S.C. 741) is amended by (1) 
striking out subsection (f) thereof; (2) redesignating subsection (g) 
thereof as subsection (h); and (3) inserting therein the following 
two new subsections: 
"(f )
^ OFFICERS.—The officers of the Corporation shall include a chief 
executive officer and a chief operating officer, who shall be appointed 
by the Board of Directors and who shall serve at the pleasure of the 
Board; and such other officers as shall be provided for in the bylaws 
of the Corporation. 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 107 
"(g) VOTING TRUSTEES.—For and during the period between the 
deposit of securities of the Corporation with the special court, in 
accordance with section 303(a) of this title, and the distribution of 
such securities, in accordance with section 303(c) of this title, the 
special court shall, within 30 days after the date of conveyance pur-
suant to section 303(b) (1) of this Act, appoint one or more voting 
trustees for each class of securities which is so deposited. Such voting 
trustees shall, on behalf of the distributees, exercise the rights of the 
holders of such securities as their interests may appear. Within 30 
days after such appointment, such voting trustees shall select mem-
bers of the Board of Directors of the Corporation on behalf of the 
holders of the class of securities whose rights they exercise pursuant to 
this subsection.". 
45 use 743. 
MISCELLANEOUS AMENDMENTS TO TITLE III 
SEC. 612. (a) Section 303(b) (3) of such Act (45 U.S.C. 743(b) (3)) 
is amended to read as follows: 
"(3)(A)(i) Notwithstanding any other provision of this Act, if 
an interest in railroad rolling stock is included in the rail properties 
conveyed pursuant to subsection (b)(1) of this section, and if such 
conveyance is in accordance with the requirements of clause (ii) of 
this subparagraph, the conveyance of such properties shall be deemed 
an assignment. Any such assignment shall relieve the assignor of 
liability for any breach which occurs after the date of such con-
veyance, except that such assignor shall remain liable for any breach, 
event of default, or violation of covenant which occurred (and any 
charges or obligations which accrued) prior to the date of such 
conveyance, regardless of whether the assignee thereof assumes such 
liabilities, charges or obligations. If any such liabilities, charges, or 
obligations (accrued prior to the date of such conveyance) are paid 
by or on behalf of any person or entity other than such assignor, 
such person or entity shall have a claim to direct reimbursement, as 
a current expense of administration, from such assignor, together 
with interest on the amount so paid. 
"(ii) A conveyance referred to in clause (i) of this subparagraph 
may be effected only if— 
"(I) the Corporation or a subsidiary thereof, the profitable 
railroad operating in the region, or the State or responsible 
person to whom such conveyance is made assumes all of the 
obligations under any applicable conditional sale agreement, 
equipment trust agreement, or lease with respect to such rolling 
stock (including any obligations which accrued prior to the date 
on which such properties are conveyed), and 
"(II) such conveyance is made subject to such obligations. 
As used in this subparagraph, the term 'railroad rolling stock means 
assets which could be carried in Interstate Commerce Commission 
account numbers 52,53,54, and 57. 
"(B) Subject to the provisions of this paragraph, the provisions 
of this Act shall not affect the title and interests of any lessor, equip-
ment trust trustee, or conditional sale vendor under any conditional 
sale agreement, equipment trust agreement, or lease under section 
77(j) of the Bankruptcy Act (11 U.S.C. 205(j)). A profitable rail-
road operating in the region, the Corporation or a subsidiary thereof, 
or a State or responsible person, to whom such a conveyance is 
made as assignee or as lesseCj shall assume all liability under such con-
ditional sale agreement, equipment trust agreement, or lease. Such an 
assignment or conveyance to, and such an assumption of liability by. 
Railroad rolling 
stock, 
conveyance. 
"Railroad rolling 
stock." 
90 STAT. 108 
PUBLIC LAW 94-210—FEB. 5, 1976 
such a profitable railroad, Corporation, subsidiary, State, or respon-
. 
, 
sible person shall not be deemed a breach, an event of default, or a 
' 
violation of any covenant of any such conditional sale agreement, 
equipment trust agreement, or lease so assigned or conveyed, not-
withstanding any provisions of any such agreement or lease.". 
(b) Section 201 of the Government Corporation Control Act (31 
U.S.C. 856) is amended by (1) inserting "and" after the comma at 
the end of subsection (7) thereof; and (2) deleting ", and (9) the 
Consolidated Rail Corporation to the extent provided in the Regional 
45 use 701 note. Rail Reorganization Act of 1973." and inserting in lieu thereof ".". 
(c)(1) Section 303(a)(1) of such Act (45 U.S.C. 743(a)(1)) is 
amended by inserting after "Corporation", the second time it appears 
" 
"or any subsidiary thereof". 
(2) Paragraphs (1) and (2) of section 303(b) of such Act (45 
- 
U.S.C. 743(b) (1) and (2)) are amended by inserting after "Corpora-
tion" each time it appears therein (except the first time) "or any sub-
sidiary thereof". 
(3) Section 303(c)(1) of such Act (45 U.S.C. 743(c)(1)) is 
amended by inserting after "Corporation" each time it appears "or 
any subsidiary thereof". 
(4) Paragraph (2) (A) of section 303(c) of such Act (45 U.S.C. 
743 (c) (2) (A)) is amended by striking "Corporation" the second time 
it appears and inserting in lieu thereof "Corporation or any subsid-
iarv thereof". 
(d)(1) Section 303(a)(2) of such Act (45 U.S.C. 743(a)(2)) is 
amended by inserting after "region" the first time it appears "and each 
State or responsible person (including a government entity)". 
(2) Section 303(b)(1) oi such Act (45 U.S.C. 743(b)(1)) is 
amended (A) by inserting immediately after "region" the first place 
it appears the following: ", States, and responsible persons", and 
(B) by striking out "and the respective profitable railroads operating 
in the region" and inserting in lieu thereof ", the respective profitable 
railroads operating in the region. States, and responsible persons". 
(3) Section 303(b)(2) of such Act (45 U.S.C. 743(b)(2)) is 
amended by striking out "and the respective profitable railroads oper-
ating in the region" and inserting in lieu thereof ", the respective 
profitable railroads operating in the region, States, and responsible 
persons". 
(4) Paragraph (4) of section 303(b) of such Act (45 U.S.C. 743 (b) 
(4)) is amended by striking "or the profitable railroad" and inserting 
in lieu thereof ", profitable railroad. State, or responsible person". 
(5) Section 303(c) of such Act (45 U.S.C. 743(c)) is amended by 
striking "and profitable railroads operating in the region" and insert-
ing in lieu thereof ", profitable railroads operating in the region, 
. ., 
States, and responsible persons". 
• ' • •' ' 
(6) Paragraph (1) (A) (ii) of section 303 (c) of such Act (45 U.S.C. 
743(c) (1) (A) (ii)) is amended by inserting "State, or responsible 
person" after "region,". 
(7) Paragraph (3) of section 303(c) of such Act (45 U.S.C. 743(c) 
(3)) is amended by inserting ", State, or responsible person" after 
"region" and by inserting after "railroad" each time it appears therein 
(except the first time) ", State, or responsible person". 
(8) Paragraph (4) of section 303(c) of such Act (45 U.S.C. 743 (c) 
(4)) is amended by inserting ", States, and responsible persons" after 
"railroads". 
(e) Section 303(c)(2) of such Act (45 U.S.C. 743(c)(2)) is 
amended by (1) striking out "shall" in the clause preceding subpara-
graph (A) thereof and inserting "may" in lieu thereof; (2) striking 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 109 
out the semicolon at the end of subparagraph (A) thereof and insert-
ing in lieu thereof ", except that at least one share of series B preferred 
stock and one certificate of value shall be allocated to each such rail-
road;"; and (3) amending subparagraph (C) thereof to read as 
follows: 
"(C) entera judgment against the Corporation if the judgment 
would not endanger the viability or solvency of the Corporation.". 
(f) Section 303(c) of such Act (45 U.S.C. 743(c)) is amended by 
adding at the end thereof the following new paragraph: 
"(5) Whenever the special court omers, pursuant to section 303(b) 
' 
(1) of this title, the transfer or conveyance to the Corporation or any 
subsidiary thereof of rail properties designated under section 206 
(c) (1) (C) or (D) of this Act, to the National Railroad Passenger 45 USC 716. 
Corporation, to a profitable railroad, or to a State, or responsible per-
son (including a government entity), the United States shall pay any 
judgment entered against the Corporation with respect to the con-
veyance of any such rail properties or against the National Railroad 
Passenger Corporation, such profitable railroad. State, or responsi-
ble person, plus interest thereon at such rate as is constitutionally 
required. The United States may, in its discretion, represent the Cor-
poration or the National Railroad Passenger Corporation, such prof-
itable railroad. State or responsible person, in any proceedings before 
the special court that could result in such a judgment against the 
Corporation under paragraph (2) of this subsection or against the 
National Railroad Passenger Corporation, such profitable railroad. 
State or responsible person, under paragraph (3) of this subsection. 
The Corporation, the National Railroad Passenger Corporation, any 
P
rofitable railroad. State, or responsible person, which is represented 
y the United States of America shall cooperate diligently in what-
ever manner the United States shall reasonably request of it in 
connection with such proceedings. Neither the Corporation, or its sub-
sidiaries, nor the National Railroad Passenger Corporation, any prof-
itable railroad. State or responsible person, shall be obligated to reim-
burse the United States for any moneys paid by the United States 
pursuant to this section.". 
(g) Section 303(d) of such Act (45 U.S.C. 743(d)) is amended by 
(1) striking out "5" and inserting in lieu thereof "20". 
(h) Section 303(c)(4) of such Act (45 U.S.C. 743(c)(4)) is 
amended by (1) striking out "subsection (b)" and inserting in lieu 
thereof "subsection (a)"; and (2) inserting after "region" the follow-
ing: "and to persons leased, operated, or controlled by such railroads 
who so transferred or conveyed rail properties". 
(i) Section 303 of such Act (45 U.S.C. 743) is amended by (1) add-
ing ", certificates of value" after "securities" in subsection (c)(1) 
,, 
(A) (i) thereof, in the preamble of subsection (c) (2) and in subsection 
(c)(2) thereof, and in subsection (c)(3) thereof; (2) adding "and 
certificates of value" after "of the Corporation" in subsection (c) (2) 
(A) thereof and after "Corporation's securities" in subsection (c) (2) 
(B) thereof; (3) striking out "obligations of the Association" each 
place the phrase appears and inserting in lieu thereof "certificates of 
value issued by the Association"; and (4) striking out "obligations" 
each place it appears other than as part of such phrase and inserting in 
lieu thereof "certificates of value". 
(j) (1) Section 301(a) of such Act (45 U.S.C. 741(a)) is amended 
by inserting immediately after "Corporation" the following: "or such 
other corporate name as may be duly adopted by the Corporation". 
(2) Section 201 (k) of such Act (45 U.S.C. 7ll(k)), as redesignated 
by section 603(a) of this Act, is amended (A) by striking out "these 
provisions" in the third sentence thereof and inserting in lieu thereof 
"this provision"; (B) by striking out "or the Corporation" each place 
90 STAT. 110 
PUBLIC LAW 94-210—FEB. 5, 1976 
it appears in the third and fourth sentences thereof; and (C) by strik-
ing out the second sentence thereof. 
(3) Section 301(b) of such Act (45 IJ.S.C. 741(b)) is amended in 
the third sentence thereof by inserting immediately after "of the Cor-
poration" the following: "or of its principal railroad operating 
subsidiary". 
(k) Section 303(b)(4) of such Act (45 U.S.C. 743(b)(4)) is 
amended by inserting immediately after "is made assumes" the follow-
ing : "all future liability under such lease and". 
(1) Section 303(b) of such Act (45 U.S.C. 743(b)) is amended by 
inserting at the end thereof the following two new paragraphs: 
"(5) Notwithstanding any covenant, undertaking, condition, or 
provision of any sort in any lease, agreement, or contract, the convey-
ance, transfer, assignment, or other disposition of such lease, agree-
ment, or contract or of any interest therein to, or the assumption by, 
the Corporation or any subsidiary thereof, or a profitable railroad of 
obligations thereunder, shall not be deemed a breach, an event of 
default, or a violation of any covenant of such lease, agreement, or 
contract. 
"(6) Notwithstanding anything to the contrary contained in this 
Act or any other provision of law, the special court shall include in its 
order such further directions as may be necessary to assure (A) that 
the operation and administration of the employee pension benefit plans 
45 use 775. 
described in section 505(a) of this Act shall be continued, without 
termination or interruption, by the Corporation until such time as the 
Corporation elects to amend or terminate any such plan, in whole or in 
part; and (B) that appropriate transfers and assignments with respect 
to all rights and obligations relating to such plans shall be made to the 
Corporation for such purposes, without prejudice to payment of con-
sideration for whatever rights any railroad in reorganization may have 
in any residual assets under any such employee pension benefit plan. 
No court shall enter any judgment against the Corporation with 
respect to any such rights, except that the special court may enter such 
a judgment in an order issued by it pursuant to subsection (c) of this 
section, after taking into consideration the rights and obligations 
transferred pursuant to this paragraph. All liabilities as an employer 
shall be imposed solely upon the railroad in reorganization in the 
event such plan is terminated, in whole or in part, by the Corporation 
within 1 year after the date of such transfer or assignment (except 
liabilities as an employer under the Employee Retirement Income 
29 use 1001 
Security Act of 1974 for benefits accruing during such period).". 
not«- 
(m) Section 301 of such Act (45 U.S.C. 741) is amended by adding 
at the end thereof the following two new subsections: 
"(h) LIABILITY OF DIRECTORS.—No director of the Corporation shall 
be liable, for money damages or otherwise, to any party by reason of 
the fact that such person is or was a director, if, with respect to the 
subject matter of the action, suit, or proceeding, such person was ful-
filling a duty which he in good faith reasonably believed to be required 
by law or vested in him in his capacity as a director of the Corpora-
tion or as an officer of the United States. The United States shall 
indemnify such person against all judgments, amounts paid in settle-
ment, and costs and expenses (including fees of accountants, experts, 
and attorneys), actually and reasonably incurred in connection with 
any such action, suit, or proceeding in which such person is determined 
to have met such standard of conduct. This subsection shall not be 
construed to grant any immunity from any criminal law of the United 
States. 
"(i) CORPORATE SIMPLIFICATION.—In the interest of corporate sim-
plification, the Corporation, in implementing the final system plan, 
shall undertake, as soon as possible and pursuant to financial assist-
ance provided by the Railroad Revitalization and Regulatory Reform 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. I l l 
Act of 1976, to acquire all interests in rail lines and related rail prop- Ante, p. 31. 
erties otherwise conveyed to the Corporation, upon the tender of such 
interests to it, so as to eliminate any remaining intermediate layers of 
ownership or interest, such as leaseholds, owned or held by persons who 
are neither a railroad, a railroad in reorganization, nor controlled by a 
railroad in reorganization. Any option conditions regarding the pur-
chase price for such interests, in existence since prior to January 2, 
1974, shall be deemed to be conclusive of fair and equitable value.". 
(n) Section 303(c)(3) of such Act (4.5 U.S.C. 743(c) (3)) is 
amended by adding at the end thereof the following: "The special 
couit shall also find the amount of the payments, if any, which each 
profitable railroad has made on behalf of a transferor railroad in 
reorganization in accordance with section 211 (h) of this Act, for which Ante, p. 92. 
payment the profitable railroad has not been reimbursed, as provided 
in section 211(h). Notwithstanding any other provision of this para-
graph or of paragraph (4), the special court shall order the return to 
any such profitable railroad from compensation deposited by such 
profitable railroad pursuant to section 303(a) (2), of any such amount 
so found together with interest at the rate provided in section 211 (h).". 
(o) Section 303(b)(1) of such Act (45 U.S.C. 743(b)(1)) is 
amended by striking out "railroad leased" and inserting in lieu thereof 
"person leased". 
(p) Section 303(b)(1) of such Act (45 U.S.C. 743(b)(1)) is 
amended by adding at the end thereof the following: "In any case 
where the special court orders the trustee or trustees of a railroad in 
reorganization in the region to execute and deliver deeds or other 
instruments conveying rail properties to the Corporation or a subsidi-
ary tliereof or to a profitable railroad operating in the region or a State 
or responsible person, those deeds or other instruments may be exe-
cuted, acknowledged, and delivered on behalf of the trustee or trustees 
by any person or persons who have been duly authorized to perform 
such acts on behalf of the trustee or triistees by the district court of 
the United States or any other court having jurisdiction over the re-
spective railroad in reorganization in the region. Notwithstanding any 
provision of State or local law, in any case where deeds or other instru-
ments ha\e been executed, acknowledged, or delivered by a represent-
ative of the trustee or trustees of a railroad in reorganization in the 
region in accordance with the previous sentence, such execution, 
acknowledgment, and delivery, and the deeds or other instruments to 
which they pertain, shall have the same legal effect as they would have 
had if the trustee or trustees had themselves executed, acknowledged 
and delivered such deeds or other instruments.". 
(q) (1) Section 303(c) (1) (A) (i) of such Act is amended by insert-
ing after "exchange" the second time it appears the following: 
"(taking into consideration compensable unconstitutional erosion, if 
any, which the special court finds to have occurred in the estate of 
each such railroad, during the bankruptcy proceeding with respect 
to such railroad)". 
(2)_ Section 303(c) (1) (A) (ii) of such Act (45 U.S.C. 743(c) (1) 
(A) (ii)) is amended by inserting immediately after "region," the fol-
lowing: "in exchange for compensation and other benefits accruing 
to such transferor as a result of such exchange (taking into considera-
tion compensable unconstitutional erosion, if any, which the special 
court finds to have occurred in the estate of each such railroad, during 
the bankruptcy proceeding wdth respect to such railr-oad)". 
(3) Section 303(c)(2) of such Act (45 U.S.C. 743(c)(2)) is 
amended by inserting immediately after "reorganization" the second 
time it appears the following: "(taking into consideration compensa-
89-194 O—78—pt. 1 
11 
.^, 
90 STAT. 112 
PUBLIC LAW 94-210—FEB. 5, 1976 
ble unconstitutional erosion, if any, which the special court finds to 
have occurred in the estate of each such railroad, during the bank-
ruptcy proceeding with respect to such railroad)". 
(4) Section 303(c)(3) of such Act (45 U.S.C. 743(c)(3)) is 
amended by adding at the end thereof the following new sentence: 
"In making any finding under this paragraph, the special court shall 
take into consideration compensable unconstitutional erosion, if any, 
which it finds to have occurred in the estate of a railroad in reorga-
nization in the region, or of a railroad leased, operated, or controlled 
by such a railroad, during the bankruptcy proceeding with respect to 
such railroad.". 
DEFINITIONS 
SEC. 613. Section 501 of such Act (45 U.S.C. 771) is amended— 
(1) in paragraphs (1) and (6) thereof, by inserting immedi-
ately after "Corporation" each place it appears the following: 
"or a subsidiary thereof"; 
(2) in paragraph (2) thereof (A) by inserting immediately 
after "Corporation" the following: "or a subsidiary thereof, to 
the National Railroad Passenger Corporation,"; and (B) by 
striking out "except a president," and inserting in lieu thereof 
"(except a Class I railroad which is not wholly owned, operated, 
or leased by a railroad in reorganization but is controlled by a 
railroad in reorganization), but does not include a president,"; 
(3) by amending paragraph (3) thereof to read as follows: 
" (3) 'protected employee' means any employee of— 
"(A) an acquiring or selling railroad who is adversely 
affected by a transaction; 
"(B) the Corporation who, immediately preceding such 
employment by the Corporation, was employed by a selling 
railroad and who is adversely affected by the sale of rail 
properties to the Corporation pursuant to an offer designated 
45 use 716. 
under section 206 (c) (2) of this Act; 
"(C) a railroad in reorganization in the region; and 
"(D) a railroad who is adversely affected by a supplemen-
Ante, p. 100. 
tal transaction under section 305 of this Act or by a project 
recommended under section 206 (g) of this Act; 
, 
who, in any such case, has not reached age 65 on the effective date 
of this Act;" 
(4) amending paragraph (8) thereof by (A) striking out "this 
Act or" and inserting in lieu thereof "this Act, including section 
305 thereof, or", and (B) striking out "and" at the end of such 
paragraph; 
(5) striking out the period at the end of paragraph (9) thereof 
and inserting in lieu thereof "; and"; and 
(6) adding at the end thereof the following new paragraph: 
"(10) 'selling railroad' means a railroad which sells rail prop-
erties pursuant to an offer designated under section 206(c) (2) of 
;' 
this Act.". 
EMPLOYMENT OFFERS 
SEC. 614. (a) Section 502(b) of such Act (45 U.S.C. 772(b)) ia 
amended to read as follows: 
"(b) MANDATORY OFFER.—The Corporation shall offer employment, 
to be effective as of the date of a conveyance or discontinuance of serv-
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 113 
ice under the provisions of this Act, to each employee of a railroad in 
reorganization in the region who has not already accepted an offer of 
employment by the Association (where applicable), an acquiring rail-
road, or the Corporation. Such offers of employment to employees rep-
resented by labor organizations shall be confined to their same craft 
and class. The Corporation shall apply to such employees the protec-
tive provisions of this title.". 
(b) Section 502(a) of such Act (45 U.S.C. 772(a)) is amended by 
adding at the end thereof the following new sentence: "As used in 
this subsection, the term 'where applicable' refers to the relation of the 
,^ 
Association, as an employer (A) to employees of the Association who, 
before the date of conveyance, under section 303(b) (1) of this Act, 45 USC 743. 
had creditable service under the relevant statute and who were offered 
and accepted coverage under such statute, and (B) to former 
employees of railroads in reorganization in the region, after the 
date of such conveyance.". 
COLLECTIVE BARGAINING AGREEMENTS 
SEC. 615. Section 504 of such Act (45 U.S.C. 774) is amended by 
adding at the end thereof the following three new subsections: 
: 
"(e) LIABILITY FOR EMPLOYEE CLAIMS.—In all cases of claims by 
employees, arising under the collective bargaining agreements of the 
railroads in reorganization in the region, and subject to section 3 of 
the Railway Labor Act (45 U.S.C. 153), the Corporation, the National 
Railroad Passenger Corporation, or an acquiring carrier, as the case 
may be, shall assume responsibility for the processing of any such 
claims, and payment of those which are sustained or settled on or 
subsequent to the date of conveyance, under section 303(b) (1) of 
this Act, and shall be entitled to direct reimbursement from the Asso-
ciation pursuant to section 211(h) of this Act. In those cases in which Ante, p. 92. 
claims for employees were sustained or settled prior to such date of 
conveyance, it shall be the obligation of the employees to seek satis-
fication against the estates of the railroads in reorganization which 
were their former employers. 
"(f) TRANSFER OF EMPLOYEES TO THE NATIONAL RAILROAD PASSEN-
GER CORPORATION OR ACQUIRING RAILROADS.—Notwithstanding any 
otherwise applicable provisions of this title, protected employees to 
whom the Corporation has made offers of employment may be trans-
ferred to the National Railroad Passenger Corporation in accordance 
with the following procedure: 
"(1) Not later than 90 days after the date of completion of 
the transaction required by section 206(c) of this Act, implement- 45 USC 716. 
ing agreement negotiations between representatives of the various 
crafts or classes of employees associated with the involved proper-
ties, the Corporation, and the National Railroad Passenger Cor-
poration shall commence. These negotiations shall— 
"(A) identify the specific employees of the Corporation 
to whom the National Railroad Passenger Corporation offers 
employment; 
"(B) the procedure by which those employees of the Cor-
poration may elect to accept employment with the National 
Railroad Passenger Corporation; 
[ 
"(C) the procedure for acceptance of such employees into 
the National Railroad Passenger Corporation's employment; 
and 
"(D) the procedure for determining the seniority of such 
*
« 
employees in their respective crafts or classes on the National 
90 STAT. 114 
PUBLIC LAW 94-210—FEB. 5, 1976 
Kailroad Passenger Corporation's system which shall, to the 
- 
extent possible, preserve their prior seniority rights. 
If no agreement regarding the matters referred to in this sub-
section IS reached by the end of 60 days after the date of com-
mencement of negotiations (which shall also be a date which is at 
least 90 days after the transaction contemplated by section 601(d) 
45 use 791. 
of this Act), upon notice of any party, all parties thereto shall 
within an additional 10 days select a neutral referee. If such 
parties are unable to agree upon the selection of such a referee, 
the National Mediation Board shall promptly appoint a referee. 
Hearings. 
Hearings shall commence not later than 30 days after the date 
of selection or appointment of such referee, and a decision shall 
be rendered by such referee within 60 days after the date of com-
mencement or the hearings. The referee shall resolve and decide 
all matters in dispute regarding the negotiation of the imple-
menting agreement or agreements. All parties may participate, 
but the referee shall have the only vote. The referee's decision 
shall be final and binding and shall constitute the implementing 
agreement or agreements between the parties. The salary and 
expenses of the referee shall be paid pursuant to the provisions 
45 use 151. 
of the Railway Labor Act. 
"(2) Prior to implementation of an agreement or agreements 
pursuant to paragraph (1) of this subsection, the representatives 
of the various crafts or classes of employees designated to be 
transferred to the National Railroad Passenger Corporation shall 
meet with representatives of the National Railroad Passenger 
Corporation for the purposes of negotiating agreements regard-
ing rates of pay, rules, and working conditions. If, 60 days after 
the date of commencement of such negotiations, no agreement 
has been reached, the bargaining agreement in existence on the 
rail properties from which the employees are to be transferred 
and which is applicable to the craft or class of employees being 
transferred will apply and such implementing agreement w ill be 
put into effect. 
" (3) An employee of the Corporation who is entitled to protec-
tion and who is transferred as a result of an acquisition pursuant 
to this Act shall upon transfer to the National Railroad Passenger 
Corporation or to an acquiring railroad, carry with him his pro-
tected status. The National Railroad Passenger Corporation or an 
acquiring railroad, as new employers, shall be responsible for pay-
ment of protective benefits and shall be entitled to reimbursement 
Post, T^. 116. 
pursuant to section 509 of this title. 
"(4) The National Railroad Passenger Corporation may prior 
to completion of any of the agreements referred to in this section, 
offer employment to any noncontract employee. Noncontract 
employees accepting employment with the National Railroad 
Passenger Corporation shall carry with them all rights and bene-
fits accorded to them under this title. 
" (g) ASSUMPTION OF PERSONAL INJURY CLAIMS.—^All cases or claims 
by employees or their personal representatives for personal injuries 
or death against a railroad in reorganization in the region arising 
prior to the date of conveyance of rail properties, pursuant to section 
45 use 743. 
303 of this Act, shall be assumed by the Corporation or an acquiring 
railroad, as the case may be. The Corporation or the acquiring railroad 
shall process and pay any such claims that are sustained or settled, 
and shall be entitled to direct reimbursement from the Association 
Anfe, p. 92. 
pursuant to section 211 (h) of this Act.". 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 115 
EMPLOYEE PROTECTION 
SEC. 616. (a) Section 505(a) oi such Act (45 U.S.C. 775(a)) is 
amended by striking out the period at the end thereof and inserting 
in lieu thereof the following: ", including benefits under any em-
ployee pension benefit plan in effect on December 1, 1975, other than 
a plan maintained primarily for the purpose of providing deferred 
compensation for a select group of management personnel or other 
highly compensated employees. For purposes of protecting employee 
pension benefits under this title, the term 'protected employee whose 
employment is governed by a collective-bargaining agreement' includes 
any beneficiary of, and any participant in, such plan, including non-
contract employees. The protected benefits of such beneficiary or par-
ticipant, accrued as of the date of conveyance, may be limited to the 
amount guaranteed under terminated plans pursuant to title IV of 
the Employee Retirement Income Security Act of 1974. Pension bene- 29 USC 1301. 
fits shall not be paid to any beneficiary of a terminated plan whose 
benefits are guaranteed by such Act.". 
(b) Section 505(b)(1) of such Act (45 U.S.C. 775(b)(1)) is 
amended by striking out "the last 12 months immediately prior to his 
being adversely affected" and inserting in lieu thereof "the 12 full 
calendar months immediately preceding February 26, 1975, or in the 
case of a supplementary transaction, the 12 full calendar months 
immediately preceding the effective date of such transaction". 
(c) Section 505(b)(3) of such Act (45 U.S.C. 775(b)(3)) is 
amended by striking out "his being adversely affected" and inserting 
in lieu thereof "February 26, 1975, or the effective date of the supple-
mental transaction, as the case may be". 
(d) Section 505(b) of such Act (45 U.S.C. 775) is amended by (1) 
redesignating paragraph (4) thereof as paragraph (5) thereof and 
(2) inserting a new paragraph (4) therein as follows: 
"(4) If a noncontract employee exercises seniority rights in a Noncontract 
craft or class of employees protected under this Act, then, during employees, 
the period such seniority is exercised, such noncontract employee 
shall be entitled to the same protection offered under this 
Act to employees in the craft or class in which such seniority is 
exercised. However, in computing the monthly displacement allow"-
ance, the last 12 months prior to F'ebruary 26,1975, during which 
such noncontract employee performed service under a collective-
bargaining agreement, shall be used.". 
(e) Section 505(f) of such Act (45 U.S.C. 775(f)) is amended to 
read as follows: 
"(f) TERMINATION ALLOWANCE.—The Corporation may terminate 
the employment of an employee of a railroad in reorganization who 
has less than 3 years' service with such railroad, as of the date of 
enactment of this Act. The Corporation's right to terminate an 
employee must be exercised within a period of 1 year from the date of 
conveyance, pursuant to section 303 of this Act. Upon notification to 45 USC 743. 
the employee of the Corporation's intent to terminate his services, the 
employee shall have the option of accepting the termination allowance 
or of accepting a voluntary furlough without pay. If the employee 
entitled to receive a lump sum separation allowance accepts such an 
allowance, the amount shall be determined as follows: 
2 to 3 years' service 
180 days' pay at the rate of the position 
last held. 
1 to 2 years' service 
90 days' pay at the rate of the position 
last held. 
Less than 1 year's service 
5 days' pay at the rate of the position 
last held for each month of service.". 
90 STAT. 116 
PUBLIC LAW 94-210—FEB. 5, 1976 
Regional Rail 
Transportation 
Protective 
Account. 
45 use 367. 
Appropriation 
authorization. 
(f) Section 505(h) of such Act (45 U.S.C. 775(h)) is amended by 
adding at the end thereof the following new sentence: "Provisions of 
this title shall be applied, upon a conveyance or discontinuance of 
service, to employees who are otherwise entitled to protective benefits 
and who were placed in furlough status on or after February 26,1975.". 
(g) Section 505 of such Act (45 U.S.C. 775) is amended by adding 
at the end thereof the following new subsection: 
"(i) NoNCONTRACT EMPLOYEES.—Compensation, severance, termina-
tion, and moving expense benefits for employees not governed by a 
collective-bargaining agreement shall be consistent with subsections 
(b), (c), (e), (f), and (g) of this section and shall be in accordance 
with the following provisions: 
"(1) A protected employee, whose employment is not governed 
by the terms of a collective-bargaining agreement, may be required 
by the Corporation, upon reasonable notice, to transfer to any 
position on the Corporation's system. If such transfer requires a 
change in residence, the employee may either voluntarily suspend 
his employment at his home location in lieu of protective benefits, 
or he may sever his employment and receive a benefit computed 
in accordance with subsection (e) or (f) of this section. These 
provisions supersede all provisions or conditions in subsection (d) 
of this section. 
"(2) If any dispute arises between the Corporation and a 
noncontract employee regarding the interpretation or applica-
tion of any provision of this title, the Corporation shall establish 
a resolution procedure with arbitration as the final step. Either 
party may request arbitration, and the cost and expenses of such 
arbitration shall be shared equally by the parties.", 
(h) Section 509 of such Act (45 U.S.C. 779) is amended to read as 
follows: 
"PAYMENT OF BENEFITS 
"SEC. 509. The Corporation, the Association (where applicable), 
and acquiring railroads, as the case may be, shall be responsible for 
the actual payment of all allowances, expenses, and costs provided 
protected employees pursuant to the provisions of this title. The Cor-
poration, the Association (where applicable), and acquiring railroads 
shall then be reimbursed for the actual amounts paid to, or for the 
benefit of, protected employees, pursuant to the provisions of this title, 
other than provisions with respect to employee pension benefits, 
not to exceed the aggregate sum of $250,000,000, by the Railroad 
Retirement Board, upon certification to such Board, by the Corpora-
tion, the Association (where applicable), and acquiring railroads, of 
the amounts paid such employees. Such reimbursement shall be made 
from a separate account maintained in the Treasury of the United 
States to be known as the Regional Rail Transportation Protective 
Account. Neither the Regional Rail Transportation Protective Account 
nor the Corporation nor an acquiring railroad shall be charged for any 
amounts of benefits paid to a protected employee under the provisions 
of the Railroad Unemployment Insurance Act or any other income 
protection law or regulation. There is authorized to be appropriated to 
the Regional Rail Transportation Protective Account annually such 
sums as may be required to meet the obligations payable hereunder, not 
to exceed the aggregate sum of $250,000,000. There is further author-
ized to be appropriated to the Railroad Retirement Board annually 
such sums as may be necessary to provide for additional administrative 
expenses to be incurred by the Board in the performance of its func-
tions imder this section.". 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 117 
DUTIES OF ACQUIRING AND SELLING RAILROADS 
SEC. 617. Section 508 of such Act (45 U.S.C. 778) is amended to 
read as follows: 
" D U T I E S O F ACQUIRING AND SELLING RAILROADS 
"SEC. 508. (a) ACQUIRING RAILROADS.—(1) An acquiring railroad 
shall oifer such employment, subject to such rules and working condi-
tions, and afford such employment protection to employees of a 
railroad from which it acquires properties or facilities (including 
operating rights) pursuant to this Act, and shall afford such protec-
tion to its own employees who are adversely affected by such 
acquisition, as shall be agreed upon between such acquiring railroad 
and the representatives of such employees prior to such acquisition, 
except that the protection and benefits (except as to rules and Avorkin.": 
conditions) provided for protected employees in such agreements shall 
be the same as those specified in section 505 of this title. Unless and 45 USC 775. 
iJ 
until such agreements are reached, the acquiring railroad shall not 
enter into purchase agreements pursuant to section 206(d) (4) of this 
Act. For purposes of this subsection, the N"ational Railroad Passenger 45 USC 716. 
Corporation shall be deemed to be an acquiring railroad, with respect 
to employees described in section 501(3) of this title. 
45 USC 771. 
"(2) If the ^National Railroad Passenger Corporation acquires rail 
properties of a railroad in reorganization in the region, prior to the 
date of conveyance of rail properties to the Corporation pursuant to 
section 303(b) (1) of this Act but after the publication of the prelim- 45 USC 743. 
inary system plan, it shall offer such employment and afford such 
employment protection to employees of a railroad from which it 
acquires rail properties and shall further protect its own employees 
who may be adversely affected by such acquisition, as shall be agreed 
/ 
upon between the National Railroad Passenger Corporation and the 
representatives of such employees prior to such acquisitions. The 
protection and benefits provided for employees in such agreements 
shall be the same as those specified in section 505 of this titl^, and 
such protection and benefits shall supersede conflicting provisions in 
any previously applicable job stabilization agreements or agreements 
implementing such stabilization agreements, and the National Rail-
road Passenger Corporation shall be reimbursed for expenses incurred 
as a result of any such acquisition, as provided in section 509 of this 
title. 
Ante, p. 116. 
"(b) 
SELLING RAILROADS.—A selling railroad shall offer 
such 
employment and shall provide such employment protection to each 
of its employees who are adversely affected bv such sale, pursuant to 
agreements to be entered into between it and the representatives of 
such employees prior to said sale: Provided, 
That (1) the protection 
and benefits provided for protected employees in such agreements 
shall be the same as those specified in section 505 of this title, and (2) 
unless and until such agreements are reached, the selling railroad 
shall not enter into selling agreements pursuant to section 206(d) of 
this Act.". 
EXEMPTIONS 
SEC. 618. (a) Section 601 (a) (2) of such Act (45 U.S.C. 791 (a) (2)) 
is amended by adding immediately before the period at the end thereof 
the following: "and with respect to any action taken to formulate or 
implement any supplemental transaction". 
(b) Section 601(b) of such Act (45 U.S.C. 791(b)) is amended to 
read as follows: 
90 STAT. 118 
PUBLIC LAW 94-210—FEB. 5, 1976 
"(b) COMMERCE, SECURITIES, A
N
D BANKRUPTCY.—(1) The provisions 
of the Interstate Commerce Act (49 U.S.C. 1 et seq.) and the Bank-
11 use 1 note. 
ruptcy Act (11 U.S.C. 205 et seq.) are inapplicable (A) to actions 
taken under this Act to formulate and implement the final system plan 
where such action was in compliance with the requirements of such 
plan, and (B) to actions taken under this Act to formulate or imple-
ment any supplemental transaction. 
"(2) All securities of the Corporation which are issued to the Asso-
ciation as the initial holder, or which are issued in connection with 
the transfer to the Corporation or a subsidiary thereof of rail 
properties under this Act, shall be deemed for all purposes to have 
been issued subject to and authorized pursuant to section 20a of the 
Interstate Commerce Act (49 U.S.C. 20a). 
"(3) The provisions of section 5 of the Securities Act of 1933 (15 
U.S.C. 77e), shall not apply to transactions involving the issuance of 
any security of the Corporation to the Association, transactions involv-
ing the issuance of any security of the Corporation that is deposited 
45 use 743. 
with the special court pursuant to section 303(a) of this Act, or trans-
actions involving the issuance or distribution of any security of the 
Corporation, where the terms and conditions of such issuance or dis-
-' 
tribution are approved by the special court pursuant to section 303(c) 
of this Act. 
-i^'?^ 
"(4) The powers and duties of the Commission under section 77 of 
the Bankruptcy Act (11 U.S.C. 205), with respect to a railroad in 
reorganization in the region which conveys all or substantially all of its 
designated rail properties to the Corporation or a subsidiary thereof, 
'- 
or to profitable railroads in the region, pursuant to the final system 
plan, and the requirement that plans of reorganization be filed wnth 
the Commission, shall cease upon the date of such conveyance. The 
powers and duties of the Commission under section 77 of the Bank-
ruptcy Act shall also so terminate, as of the date of enactment of this 
paragraph, with respect to any railroad in reorganization under such 
section 77 but not subject to this Act which (1) does not operate any 
line of railroad, and (2) has transferred all or substantially all of its 
rail properties to a railroad in reorganization in the region which was 
subject to this Act prior to the date of enactment of this paragraph. 
Thereafter, such powers and duties of the Commission shall be vested 
in the district court of the United States which has jurisdiction of the 
estate of any such railroad in reorganization at the time of such con-
veyance. Such court shall proceed to reorganize or liquidate such rail-
'' • 
road in reorganization pursuant to such section 77 on such terms as 
the court deems just and reasonable, or pursuant to any other provi-
sions of the Bankruptcy Act, if the court finds that such action would 
be in the best interests of such estate. This paragraph does not affect 
any obligation of any carrier by railroad subject to regulation under 
the Interstate Commerce Act. The powers and duties of the Commis-
sion under section 77 of the Bankruptcy Act shall continue in effect 
only to the extent that the railroad in reorganization continues to 
operate any line of railroad.". 
(c) Section 601(c) of such Act (45 U.S.C. 791(c)) is amended to 
read as follows: 
"(c) ENVIRONMENT.—The provisions of section 102(2) (C) of the 
National Environmental Policy Act of 1969 (42 U.S.C. 4332(2) (C)) 
shall not apply with respect to any action taken under authority of 
this Act before, and including, the conveyance of rail properties 
ordered by the special court under section 303(b) (1) of this Act, and 
shall not apply thereafter to any action taken in compliance with the 
requirements of the final system plan.". 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 119 
APPLICATION o r THE NATIONAL ENVIRONMENTAL POLICY ACT 
SEC. 619. Nothing in this title shall affect the application of the 45 USC 791 note. 
National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) 
to actions of the Commission. 
TITLE VII—NORTHEAST CORRIDOR PROJECT 
IMPLEMENTATION 
NATIONAL RAILROAD PASSENGER CORPORATION 
SEC 701. (a) GENERAL.—To carry out the purposes of this title, 45 USC 851. 
the Rail Passenger Service Act, and the Regional Rail Reorganiza- 45 USC 501 note, 
tion Act of 1973, the National Railroad Passenger Corporation is 45 USC 701 note, 
authorized to— 
(1) acquire by purchase, lease, exchange, gift, or otherwise, 
and to hold, maintain, sell, lease or otherwise dispose of, any real 
or personal property or interest therein which is necessary or 
useful in establishing and maintaining improved high-speed rail 
services, as specified in section 703 of this title; 
(2) enter into and implement such contracts and agreements 
as are necessary or appropriate in the conduct of its functions; 
(3) provide for the continuous operation and maintenance of 
rail freight, intercity rail passenger, and commuter rail passenger 
service over the properties acquired pursuant to this section: 
Provided, That any provision of rail freight or rail commuter 
service shall be effectuated by a compensatory contract with the 
responsible carrier; 
(4) improve railroad rights-of-way betAveen Boston, Massa-
chusetts, and Washington, District of Columbia (including at 
its option, the route through Springfield, Massachusetts, and 
routes to Harrisburg, Pennsylvania, and Albany, New York, 
from the Northeast Corridor main line) to enable improved high-
speed rail passenger service to be provided between Boston, 
Massachusetts, and Washington, District of Columbia, and inter-
mediate intercity markets, in accordance with the goals set forth 
in section 703 of this title; 
(5) acquire, construct, improve, and install passenger stations; 
communications, electric power, and other facilities and equip-
ment; public and private highway and pedestrian crossings; 
other safety facilities or equipment; and any other facilities or 
equipment which it determines are necessary to enable improved 
high-speed rail passenger service to be provided over the railroad 
rights-of-way to be improved under paragraph (4) of this 
subsection; 
(6) enter into agreements with other railroads, other carriers, 
and commuter agencies, for the purpose of granting, acquiring, or 
entering into trackage rights, contract services, and other appro-
priate arrangements for freight and commuter services over the 
rights-of-way acquired under this title, with such agreement to 
be on such terms and conditions as are necessary to reimbursement 
for costs on an e(|uitable and fair basis, except that cross sub-
sidization among intercity, commuter, or rail freight services is 
prohibited; 
(7) appoint a qualified individual to serve as the General Man-
ager of the Northeast Corridor improvement project; and 
(8) enter into agreements with telecommunications common 
carriers on a basis which is consistent with, and subject to, the 
90 STAT. 120 
PUBLIC LAW 94-210—FEB. 5, 1976 
47 use 609. 
Communications Act of 1934, for the purpose of continuing exist-
ing, and creating new and improved, rail passenger radio mobile 
w,-ai =.>.M.^ 
telephone service in the higli-speed rail passenger service area 
specified in section 703(1) of this title. 
(b) TRANSFER OF KAIL PROPERTIES.—The Corporation, on the date of 
conveyance pursuant to section 303(b) (1) of the Kegional Rail Reor-
ganization Act of 1973 (45 U.S.C. 743), shall, by purchase or lease, 
transfer to the National Railroad Passenger Corporation all rail 
properties designated pursuant to sections 206(c) (1) (C) and 601(d) 
of the Regional Rail Reorganization Act of 1973 (45 U.S.C. 716(c) 
(1) (C) and 791(d)), and it shall, within 180 days after the date of 
enactment of this title, execute agreements providing for the National 
Railroad Passenger Corporation to assume (1) all operational respon-
sibilit}^ for intercity rail passenger services with respect to such prop-
erties, and (2) control and maintenance of the properties transferred. 
Such parties maj^ agree to retaining or transferring, in whole or in 
part, operational responsibility for rail freight or commuter rail serv-
ices in the area specified. 
(c) DEFINITION.—As used in this title, the term "Northeast Cor-
ridor" means the States of Massachusetts, Rhode Island, Connecticut, 
New York, New Jersey, Pennsylvania, Delaware, and Maryland, and 
the District of Columbia. 
OPERATIONS REVIEW PANEL 
45 use 852. 
SEC. 702. (a) ESTABLISHMENT.—There is established an entity which 
shall be representative of the various users of Northeast Corridor 
rail transportation facilities, to be known as the Operations Review 
Panel (hereafter in this section referred to as the "Panel"). The Panel 
shall have the authority to take such actions as are necessary to resolve 
differences of opinion concerning operations (among or between the 
National Railroad Passenger Corporation, other railroads, and State, 
local, and regional agencies responsible for the provision of com-
muter rail, rapid rail, or rail freight services), with respect to all 
matters except those conferred on the Commission in section 402(a) 
of the Rail Passenger Service Act (45 U.S.C. 562(a)). 
(b) ME3fBERSHip.—The Panel shall consist of 5 members, as follows: 
(1) one member who shall be selected by the chief executive 
officer of the National Railroad Passenger Corporation; 
(2) one member who shall be selected by majority vote of the 
commuter rail authorities which are subject to the jurisdiction of 
the Panel; 
(3) one member who shall be selected by the chief executive 
officer of the Corporation; and 
(4) two neutral members who shall be selected by the Chairman 
of the National Mediation Board. 
The members shall each serve a term of 4 years from the date of such 
selection, or until a successor has been selected. If, within 45 days 
after the date of enactment of this Act, the National Railroad Pas-
senger Corporation, the commuter authorities, or the Corporation 
fails to select the member who it is authorized to select under this 
subsection, the Chairman of the National Mediation Board shall, 
within 30 days after the expiration of such 45-day period, appoint 
a member on behalf of such party. Any member so appointed shall 
serve until such time as the party so represented selects a successor. 
(c) DECISIONS AND REVIEW.—All decisions of the Panel shall be final 
and binding on the parties. All costs and expenses of the Panel shall 
be paid by (1) the National Railroad Passenger Corporation, (2) the 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 121 
commuter rail authorities which are subject to such Panel, and (3) the 
Corporation, each of which shall pay one-third of such costs and 
expenses, unless otherwise determined by a majority of the members 
of such Panel. The Panel may adopt such rules of procedure and may 
employ such resources as it considers appropriate. It may issue pre-
liminary and final orders, which shall have the force and effect of law, 
with respect to any difference of opinion concerning any operational 
matter which is the subject of such an order. No order of the Panel 
shall be subject to review by any court. Upon petition by any party 
subject to the Panel, the United States District Court for the District 
of Columbia shall enforce any final order issued by the Panel. 
REQUIRED 
GOALS 
SEC. 703. The Northeast Corridor improvement project shall be 45 USC 853. 
implemented by the Secretary in order to achieve the following goals: 
(1) INTERCITY RAIL PASSENGER SERVICES.—(A) (i) Within 5 
years after the date of enactment of this Act, the establishment of 
regularly scheduled and dependable intercity rail passenger serv-
ice between Boston, Massachusetts, and New York, New York, 
operating on a 3-hour-and-40-minute schedule, including appro-
priate intermediate stops; and regularly scheduled and depend-
able intercity rail passenger service between New York, New 
York, and Washington, District of Columbia, operating on a 
2-hour-and-40-minute schedule, including appropriate inter-
mediate stops. 
(ii) Improvements in facilities in accordance with route criteria 
approved by the Congress, on routes to Harrisburg, Pennsylvania, 
and Albany, New York, from the Northeast Corridor main line, 
and from Springfield, Massachusetts, to Boston, Massachusetts, 
and New Haven, Connecticut, in order to facilitate compatibility 
with improved high-speed rail service operated on the Northeast 
Corridor main line. 
(B) The improvement of nonoperational portions of stations 
(as determined by the Secretary in consultation with the National 
Railroad Passenger Corporation) used in intercity rail passenger 
service and of related facilities and fencing. Fifty percent of the 
cost of such improvements shall be borne by States (or local or 
regional transportation authorities), except that the Secretary 
may, in his sole discretion, fund entirely any safety-related 
improvement. 
(C) The improvements required by this section shall be accom-
plished in a manner which is compatible with the accomplishment 
in the future of additional improvements in service levels, and 
which will produce the maximum labor benefit in terms of hiring 
persons who are presently unemployed. 
(D) The submission b;^ the Secretary and the National Rail-
road Passenger Corporation to the Congress of annual reports 
on progress achieved and work in progress and planned (includ-
ing the need for further improvements) with respect to the 
completion of this program, including an up-to-date account- 
; ; 
ing of intercity passenger ridership, revenues from such ridership, 
expenses, and on-time dependability of intercity passenger trains 
in the Northeast Corridor. 
(E) Within 2 years after the date of enactment of this Act, the Report to 
submission by the Secretary to the Congress of a report on the Congress, 
financial and operating results of the intercity rail passenger serv-
ice established under this section, on the rail freight service 
improved and maintained pursuant to this section, and on the 
90 STAT. 122 
PUBLIC LAW 94-210—FEB. 5, 1976 
practicability, considering engineering and financial feasibility 
and market demand, of the establishment of regularly scheduled 
and dependable intercity rail passenger service between Boston, 
Massachusetts, and New York, New York, opera;ting on a 3-hour 
schedule, including appropriate intermediate stops, and regularly 
\ 
scheduled and dependable intercity rail passenger service between 
New York, New York, and Washington, District of Columbia, 
operating on a 2i/^-hour schedule, including appropriate inter-
mediate stops. Such report shall include a full and complete 
accounting of the need for improvements in intercity passenger 
transportation within the Northeast Corridor and a full account-
ing of he public costs and benefits of improving various modes of 
transp<irtation to meet those needs. If such report shows (i) that 
further improvements are needed in intercity passenger trans-
,-, 
; • . 
. 
portation in the Northeast Corridor, and (ii) that improvements 
(in addition to those required by subparagraph (A) (i) of this 
paragraph) in the rail system in such area would return the most 
, 
public benefits for the public costs involved, the Secretary shall 
make appropriate recommendations to the Congress. Within 6 
years after the date of enactment of this Act, the Secretary shall 
submit an updated comprehensive report on the matters referred 
to in this subparagraph. Thereafter, if it is practicable, the Secre-
tary shall facilitate the establishment of intercity rail passenger 
service in the Corridor which achieves the service goals specified 
in this subparagraph. 
(2) RAIL COMMUTER SERVICES, RAIL RAPID TRANSIT, AND LOCAL 
TRANSPORTATION.—To the extent compatible with the goals con-
tained in paragraph (1) of this section, the facilitation of improve-
ments in and usage of rail commuter services, rail rapid transit, 
and local public transportation. 
(3) RAIL FREIGHT SERVICE.—The maintenance and improve-
ment of rail freight service to all users of rail freight service 
located on or adjacent to the Northeast Corridor and the mainte-
nance and improvement of all through-freight services which 
remain in the Northeast Corridor, to the extent compatible with 
the goals contained in paragraphs (1) and (2) of this section. 
(4) PASSENGER RADIO TELEPHONE SERVICE.—To the extent com-
patible with the goals contained in paragraph (1) of this section, 
the continuation of and improvement in passenger radio tele-
phone service aboard trains operated in high-speed rail service 
between Washington, District of Columbia, and Boston, Massa-
chusetts. The President and relevant Federal agencies, including 
the Federal Communications Commission, shall take such actions 
as are necessary to achieve this goal, subject to the provisions of 
the Communications Act of 1934 (47 U.S.C. 151 et seq.), including 
necessary licensing, construction, operation, and maintenance 
standards for the radio service, as determined by the Federal Com-
munications Commission to be in the public interest, convenience, 
and necessity. 
FUNDING 
45 use 854. 
SEC. 704. (a) AUTHORIZATION or APPROPRIATIONS.—There is author-
ized to be appropriated to the Secretary— 
(1) $1,600,000,000 to remain available until expended in order 
to effectuate the goals of section 703(1) (A) (i) of this title and 
• -' ;T >••' 
after such goals have been achieved, the goals of section 
703(1) (A) (ii); 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 123 
(2) $150,000,000 to remain available until expended in order to 
effectuate the goal of section 703 (1) ( B ) ; 
(3) for payment to the National Railroad Passenger Corpora-
tion— 
(A) $10,000,000 to remain available until expended for 
nonrecurring costs related to the initial assumption of control 
and responsibility for maintaining rail operations on the 
Northeast Corridor; 
^ 
(B) $85,182,956 to acquire the properties of the North-
east Corridor; 
(C) $650,000 to remain available until expended, for the 
development and utilization of mobile radio frequencies for 
high-speed rail passenger radio telephone service; and 
(D) $20,000,000, to remain available until expended, for 
acquiring and improving properties designated in accordance 
with section 206(c) (1) (D) of the Regional Rail Reorganiza-
tion Act of 1973 (45 U.S.C. 716(c) (1) ( D ) ) . 
(b) LIMITATION.—No funds appropriated under this section or pur-
suant to section 601 of the Rail Passenger Service Act may be used to 
45 USC 601. 
subsidize any operating losses of commuter rail or rail freight services. 
(c) COORDINATION.—The Secretary shall take all steps necessary to 
coordinate all transportation programs related to the Northeast Cor-
ridor to assure that all such programs are integrated and consistent 
with implementation of the Northeast Corridor improvement project 
under this title, including, if the Secretary finds any significant non-
compliance with the implementation of the goals of section 703 of this 
title, the denial of funding to any noncomplying program until such 
noncompliance is corrected. 
(d) 
EMERGENCY MAINTENANCE CONTINUATION.—After the convey-
ance of rail properties, pursuant to section 303 (b) of the Regional Rail 
Reorganization Act of 1973 (45 U.S.C. 743(b)) and section 701 (b) of 
this title, not to exceed $25,000,000 of the funds appropriated pursuant 
to Public Law 91-6 (89 Stat. 11) shall remain available to be utilized 
by the Secretary for the purpose of performing emergency mainte-
nance on the rail properties designated in accordance with section 206 
(c) (1) (C) of the Regional Rail Reorganization Act of 1973 (45 
U.S.C. 716 ( c ) ( 1 ) ( C ) ) . 
CONFORMING AMENDMENTS 
SEC. 705. (a) Section 402(a) of the Rail Passenger Service Act (45 
U.S.C. 562(a)) is amended by adding at the end thereof the following 
three new sentences: "Notwithstanding any other pi'ovision of this 
Act, the Corporation may enter into agr-eements with any other rail-
roads and with any State (or local or regional transportation agency) 
responsible for providing commuter rail or rail freight services over 
tracks, rights-of-way, and other facilities acquired by the Corporation 
pursuant to authority granted by the Regional Rail Reorganization 
Act of 1973 and the Railroad Revitalization and Regulatory Reform 
Act of 1976. In the event of a failure to agree, the Commission shall 
order that rail services continue to be provided, and it shall, consistent 
with equitable and fair compensation principles, decide, within 180 
days after the date of submission of a dispute to the Commission, the 
proper amount of compensation for the provision of such services. The 
Commission, in making such a determination, shall consider all rele-
vant factors, and shall not permit cross subsidization among intercity, 
commuter, and rail freight services.". 
(b) Section 601(d)(1) of the Regional Rail Reorganization Act 
of 1973 (45 U.S.C. 791(d) (1)) is amended to read as follows: 
45 USC 701 note, 
Ante, p. 31. 
90 STAT. 124 
PUBLIC LAW 94-210—FEB. 5, 1976 
"(d) 
NORTHEAST CORRIDOR.— (1) Rail properties designated in 
45 use 716. 
accordance with section 206(c) (1) (C) of this Act shall be purchased 
or leased by the National Railroad Passenger Corporation. The Corpo-
ration shall negotiate an appropriate sale or lease agreement with the 
National Railroad Passenger Corporation for the properties desig-
nated for transfer pursuant to section 206(c) (1) (C) of this Act (45 
U.S.C. 716(c) (1) (C)), which shall take effect on the date of convey-
ance of such properties to the Corporation.". 
(c) Section 403(b) of the Rail Passenger Service Act (45 U.S.C. 
663(D) ) is amended (1) by inserting "(1)" immediately after "(b)", 
and (2) by striking out the second sentence thereof and inserting in 
lieu thereof the following: "The Corporation shall institute such serv-
ice under an agreement if the State, regional, or local agency agrees to 
I 
reimburse the Corporation for 50 percent of total operating losses and 
associated capital costs of such service if service can be provided with 
the resources available to the Corporation and if it is consistent with 
the following requirements: 
"(A) The State or agency must make an adequate assurance 
• *'' j'<1 i. 
to the Corporation that it has sufficient resources to meet its share 
of the costs of such service for the period such service is to be 
provided under this section. 
"(B) The State or agency has conducted a market analysis 
acceptable to the Corporation to insure that there is adequate 
demand to warrant such service. 
! 
An agreement made pursuant to this section may by mutual agree-
ment be renewed for one or more additional terms of not more than 
2 years. 
"(2) If more than one application is made for service and all 
applications are consistent with the requirements of this subsection, but 
all the services applied for cannot be provided with the available 
resources of the Corporation, the Board of Directors shall decide in its 
discretion which application or applications best serve the public 
interest and can be provided with the available resources of the 
Corporation, except that a proposal for State support of a service 
deleted from the basic system shall be given preference. 
"(3) The Board of Directors shall establish the basis for deter-
mining the total costs and the total revenue of the service provided 
' 
pursuant to this subsection.". 
(d) Section 404(b) (4) of the Rail Passenger Service Act (45 U.S.C. 
564(b)) is amended by striking out the first sentence thereof and 
inserting in lieu thereof the following: "For 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 equal to 50 per-
cent of the total operating losses and associated capital costs of such 
service.". 
(e) Section 306 of the Rail Passenger Service Act (45 U.S.C. 546) 
is amended by adding at the end thereof the following new subsection: 
"(i) The provisions of section 361 of the Public Health Service Act 
^ " 
(42 U.S.C. 264) shall not apply to railroad conveyances operated in 
intercity rail passenger service.". 
- 
(f) Section 303(a) (5) of the Rail Passenger Service Act (45 U.S.C. 
543(a)(5)) is amended by (1) striking out "for each meeting of 
the board he attends." and inserting in lieu thereof "per diem when 
engaged in the actual performance of duties.", and (2) inserting 
", secretarial or professional staff support which is reasonably 
required" immediately after "necessary travel". 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 125 
(g) Section 305(d) (1) (B) of the Rail Passenger Service Act (45 
U.S.C. 545(d) (1) (JB) is amended by striking out "for the construc-
tion of tracks or other facilities necessary to provide". 
(h) Section 402(d)(1) of the Eail Passenger Service Act (45 
U.S.C. 562(d)(1)) is amended by striking out "the construction of 
tracks or other facilities necessary to provide". 
(i) Section 403(c) of the Rail Passenger Service Act (45 U.S.C. 
563(c)) is amended by adding the following sentence at the end 
thereof: "After January 1,1977, all route additions shall be in accord-
ance with the Criteria and Procedures for Making Route and Service 
Decisions approved by the Congress pursuant to section 404(c)(3), 
and this subsection shall no longer apply to route additions.". 
FACILITIES WITH HISTORICAL OR ARCHITECTURAL SIGNIFICANCE 
SEC. 706. Section 4(i) of the Department of Transportation Act (49 
U.S.C. 1653) is amended by— 
(1) redesignating paragraph (1) (C) thereof and all references 
thereto as paragraph (1) (D) thereof; 
(2) inserting immediately after paragraph (1) (B) thereof the 
following new subparagraph: "(C) acquiring and utilizing space 
in suitable buildings of historic or architectural significance, unless 
the use of such space would not prove feasible and prudent com-
pared with available alternatives;"; 
(3) redesignating paragraph (4), (5), (6), (7), (8), (9), and 
? 
(10) thereof as paragraphs (5), (6), (7), (8), (9), (10), and (11) 
thereof, respectively; 
(4) inserting after paragraph (3) thereof the following new 
paragraph: 
"(4) Acquisitions made for the purpose set forth in paragraph (1) 
(C) of this subsection shall be made only after consultation with the 
chairman of the National Endowment for the Arts and the Advisory 
Council on Historic Preservation."; and 
(5) amending paragraph (9) thereof, as redesignated by this 
section, to read as follows: 
"(9) (A) There is authorized to be appropriated for the purpose set Appropriation 
forth— 
authorization. 
"(i) in paragraphs (1) (A) and (1) (C) of this subsection, not 
to exceed $15,000,000; 
"(ii) in paragraph (1) (B) of this subsection, not to exceed 
$5,000,000; and 
"(iii) in paragraph (1) (D) of this subsection, not to exceed 
$5,000,000. 
"(B) There shall be available to the National Endowment for the 
Arts, from the sums available under subparagraphs (A) (ii) and 
(A) (iii) of this paragraph, not to exceed $2,500,000 for planning pur-
suant to paragraph (1) (D) of this subsection, and not to exceed 
' 
$2,500,000 for interim maintenance pursuant to paragraph (1) (B) of 
this subsection. 
"(C) Sums appropriated for the purposes of this subsection are 
authorized to remain available until expended.". 
TITLE VIII—LOCAL RAlL SERVICE CONTINUATION 
EXTENSION OF SERVICE 
SEC. 801. (a) Section 1(18) of the Interstate Commerce Act (49 
U.S.C. 1 (18)) is amended to read as follows: 
" (18) (a) No carrier by railroad subject to this part shall— 
90 STAT. 126 
PUBLIC LAW 94-210—FEB. 5, 1976 
Publication in 
newspaper. 
Publication in 
Federal Register. 
Rules and 
regulations. 
"(i) undertake the extension of any of its lines of railroad or 
the construction of any additional line of railroad; 
"(ii) acquire or operate any such extension or any such addi-
tional line; or 
"(iii) engage in transportation over, or by means of, any such 
extended or additional line of railroad, 
unless such extension or additional line of railroad is described in and 
covered by a certificate which is issued by the Commission and which 
declares that the present or future public convenience and necessity 
require or will be enhanced by the construction and operation of such 
extended or additional line of railroad. Upon receipt of an application 
lor such a certificate, the Commission shall (A) send a copy of the 
application to the chief executive officer of each State that would be 
directly affected by the construction or operation of such extended or 
additional line, (B) send an accurate and understandable summary 
of such application to a newspaper of general circulation in such 
affected area or areas with a request that such information be made 
available to the general public, (C) cause a copy of such summary 
to be published in the Federal Register, (D) take such other steps as 
it deems reasonable and effective to publicize such application, and 
(E) indicate in such transmissions and publications that each inter-
ested person is entitled to recommend to the Commission that it 
approve, disapprove, or take any other specified action with respect to 
such application. 
"(b) The Commission shall establish, and may from time to time 
amend, rules and regulations (as to hearings and other matters) to 
govern applications for, and the issuance of, any certificate required 
by subdivision (a). An application for such a certificate shall be sub-
mitted to the Commission in such form and manner and with such 
documentation as the Commission shall prescribe. The Commission 
may— 
"(i) issue such a certificate in the form requested by the appli-
cant; 
"(ii) issue such a certificate with modifications in such form 
and subject to such terms and conditions as are necessary in the 
public interest; or 
" (iii) refuse to issue such a certificate. 
"(c) Upon petition or upon its own initiative, the Commission may 
authorize any carrier by railroad subject to this part to extend any of 
its lines of railroad or to take any other action necessary for the pro-
vision of adequate, efficient, and safe facilities for the performance 
of such carrier's obligations under this part. No authorization shall 
be made unless the Commission finds that the expense thereof will not 
impair the ability of such carrier to perform its obligations to the 
public. 
"(d) Carriers by railroad subject to this part may, notwithstanding 
this paragraj)h and section 5 of this part, and without the approval of 
the Commission, enter into contracts, agreements, or other arrange-
ments for the j)oint ownership or joint use of spur, industrial, team, 
switching, or side tracks. The authority granted to the Commission 
under this paragraph shall not extend to the construction, acquisition, 
or operation of spur, industrial, team, switching, or side tracks if such 
tracks are located or intended to be located entirely within one State, 
and shall not apply to any street, suburban, or interurban electric 
railway which is not operated as part of a general system of rail 
transportation. 
"(e) Any construction or operation which is contrary to any pro-
vision of this paragraph, of any regulations promulgated under this 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 127 
paragraph, or of any terms and conditions of an applicable certificate, 
may be enjoined by an appropriate district court of the United States 
in a civil action commenced and maintained by the United States, the 
Commission, or the attorney general or the transportation regulatory 
body of an affected State or area. Such a court may impose a civil Penalty, 
penalty of not to exceed $5,000 on each person who knowingly author-
izes, consents to, or permits any violation of this paragraph or of the 
conditions of a certificate issued under this paragraph.". 
(b) Paragraphs (19), (20), (21), and (22) of section 1 of the Inter- Repeal, 
state Commerce Act (49 U.S.C. 1(19) through 1(22)) are repealed. 
DISCONTINUANCE OR ABANDONMENT 
SEC. 802, The Interstate Commerce Act is amended by inserting 
after section 1 thereof the following new section: 
a 
DISCONTINUANCE AND ABANDONMENT OF RAIL SERVICE 
"SEC. la. (1) No carrier by railroad subject to this part shall aban- 49 USC la. 
don all or any portion of any of its lines of railroad (hereafter in this 
section referred to as 'abandonment') and no such carrier shall discon-
tinue the operation of all rail service over all or any portion of any such 
line (hereafter referred to as 'discontinuance'), unless such abandon-
ment or discontinuance is described in and covered by a certificate 
which is issued by the Commission and which declares that the present 
or future public convenience and necessity require or permit such 
abandonment or discontinuance. An application for such a certificate 
shall be submitted to the Commission, together with a notice of intent 
to abandon or discontinue, not less than 60 days prior to the proposed 
effective date of such abandonment or discontinuance, and shall be in 
accordance wnth such rules and regulations as to form, manner, con-
tent, and documentation as the Commission may from time to time 
prescribe. Abandonments and discontinuances shall be governed by 
the provisions of this section or by the provisions of any other appli-
cable Federal statute, notwithstanding any inconsistent or contrary 
provision in any State law or constitution, or any decision, order, or 
procedure of any State administrative or judicial body. 
"(2) (a) Whenever a carrier submits to the Commission a notice of Notice, 
intent to abandon or discontinue, pursuant to paragraph (1), such 
carrier shall attach thereto an affidavit certifying that a copy of 
such notice (i) has been sent by certified mail to the chief executive 
officer of each State that would be directly affected by such abandon-
ment or discontinuance, (ii) has been posted in each terminal and 
station on any line of railroad proposed to be so abandoned or dis-
continued, (iii) has been published for 3 consecutive weeks in a news- Publication in 
paper of general circulation in each county in which all or any part newspapers, 
of such line of railroad is located, and (iv) has been mailed, to the 
extent practicable, to all shippers who have made significant use (as 
determined by the Commission in its discretion) of such line of rail-
road during the 12 months preceding such submission. 
"(b) The notice required under subdivision (a) shall include (i) 
an accurate and understandable summary of the carrier's application 
for a certificate of abandonment or discontinuance, together with the 
reasons therefor, and (ii) a statement indicating that each interested 
person is entitled to recommend to the Commission that it approve, 
disapprove, or take any other specified action with respect to such 
application. 
89-194 O—78—pt. 1 
12 
90 STAT. 128 
PUBLIC LAW 94-210—FEB. 5, 1976 
Hearings. 
49 use 5. 
Transportation 
system diagram. 
"(3) During the 60-day period between the submission of a com-
pleted application for a certificate of abandonment or discontinuance 
pursuant to paragraph (1) and the proposed effective date of an 
abandonment or discontinuance, the Commission shall, upon petition, 
or may, upon its own initiative, cause an investigation to be con-
ducted to assist it in determining what disposition to make of such 
application. An order to the Commission to implement the preceding 
sentence must be issued and served upon any affected carrier not less 
than 5 days prior to the end of such 60-day period. If no such investiga-
tion is ordered, the Commission shall issue such a certificate, in accord-
ance with this section, at the end of such 60-day period. If such an 
investigation is ordered, the Commission shall order a postponement, 
in whole or in part, in the proposed effective date of the abandonment 
or discontinuance. Such postponement shall be for such reasonable 
period of time as is necessary to complete such investigation. Such 
an investigation may include, but need not be limited to, public hear-
ings at any location reasonably adjacent to the line of railroad 
involved in the abandonment or discontinuance application, pursuant 
to rules and regulations of the Commission. Such a hearing may be 
held upon the request of any interested party or uj^on the Commis-
sion's ow^n initiative. The burden of proof as to public convenience 
and necessity shall be upon the applicant for a certificate of abandon-
ment or discontinuance. 
"(4) The Commission shall, upon an order witli respect to each 
application for a certificate of abandonment or discontinuance— 
"(a) issue such certificate in the form requested by the appli-
cant if it finds that such abandonment or discontinuance is con-
sistent with the public convenience and necessity. In determining 
whether the proposed abandonment is consistent with the public 
convenience and necessity, the Commission shall consider whether 
there will be a serious adverse impact on rural and community 
development by such abandonment or discontinuance; 
" (b) issue such certificate with modifications in such form and 
subject to such terms and conditions as are required, in the judg-
ment of the Commission, by the public convenience and necessity; 
or 
"(c) refuse to issue such certificate. 
Each such certificate which is issued by the Commission shall contain 
provisions for the protection of the interests of employees. Such provi-
sions shall be at least as beneficial to such interests as provisions 
established pursuant to section 5(2) (f) of this Act and pursuant to 
section 405 of the Eail Passenger Service Act (45 U.S.C. 565). If such 
a certificate is issued, actual abandonment or discontinuance may take 
effect, in accordance Avith such certificate, 120 days after the date of 
issuance thereof. 
"(5) (a) Each carrier by railroad subject to this part shall, within 
180 days after the date of promulgation of regulations by the Com-
mission pursuant to this section, prepare, submit to the Commission, 
and publish, a full and complete diagram of the transportation sys-
tem operated, directly or indirectly, by such carrier. Each such dia-
gram which shall include a detailed description of each line of railroad 
which is 'potentially subject to abandonment", as such term is defined 
by the Commission. Such term shall be defined by the Commission by 
rules and such rules may include standards which vary by region of 
the Nation and by railroad or group of railroads. Each such diagram 
shall also identify any line of railroad as to which such carrier plans 
to submit an application for a certificate of abandonment or discon-
tinuance in accordance with this section. Each such carrier shall sub-
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 129 
mit to the Commission and publish, in accordance with regulations of 
the Commission, such amendments to such diagram as are necessary to 
maintain the accuracy of such diagram. 
" (b) The Commission shall not issue a certificate of abandonment or 
discontinuance with respect to a line of railroad if such abandonment 
or discontinuance is opposed by— 
"(i) a shipper or any other person who has made significant 
use (as determined by the Commission in its discretion) of such 
line of railroad during the 12-month period preceding the sub-
mission of an applicable application under paragraph (1); or 
"(ii) a State, or any political subdivision of a State, if such 
line of railroad is located, in whole or in part, within such State 
or political subdivision; 
unless such line or railroad has been identified and described in a dia-
gram or in an amended diagram which was submitted to the Com-
mission under subdivision (a) at least 4 months prior to the date of 
submission of an application for such certificate. 
"(6) (a) Whenever the Commission makes a finding, in accordance 
with this section, that the public convenience and necessity permit the 
abandonment or discontinuance of a line or railroad, it shall cause 
such finding to be published in the Federal Register. If, within 30 
days of such publication, the Commission further finds that— 
"(i) a financially responsible person (including a government 
entity) has offered financial assistance (in the form of a rail 
service continuation payment) to enable the rail service involved 
to be continued; and 
" (ii) it is likely that such proffered assistance would— 
"(A) cover the difference between the revenues which are 
attributable to such line of railroad and the avoidable cost of 
providing rail freight service on such line, together with a 
reasonable return on the value of such line; or 
"(B) cover the acquisition cost of all or any portion of such 
line of railroad; 
the Commission shall postpone the issuance of a certifica4:e of aban-
donment or discontinuance for such reasonable time, not to exceed 
6 months, as is necessary to enable such person or entity to enter into a 
binding agreement, with the carrier seeking such abandonment or 
discontinuance, to provide such assistance or to purchase such line and 
to provide for the continued operation of rail services over such line. 
Upon notification to the Commission of the execution of such an assist-
ance or acquisition and operating agreement, the Commission shall 
postpone the issuance of such a certificate for such period of time as 
such an agreement (including any extensions or modifications) is in 
effect. 
"(b) A carrier by railroad subject to this part shall promptly make 
available, to any party considering offering financial assistance in 
accordance with subdivision (a), its most recent reports on the physi-
cal condition of any line of railroad with respect to which it seeks a 
certificate of abandonment or discontinuance, together with such 
traffic, revenue, and other data as is necessary to determine the amount 
of assistance that would be required to continue rail service. 
"(7) Whenever the Commission finds, under paragraph (6) (a) of 
this section, that an offer of financial assistance has been made, the 
Commission shall determine the extent to which the avoidable cost of 
providing rail service plus a reasonable return on the value of the rail 
properties involved exceed the revenues attributable to the line of 
railroad or the rail service involved. 
Publication in 
Federal Register. 
90 STAT. 130 
PUBLIC LAW 94-210—FEB. 5, 1976 
Penalty. 
"Avoidable 
cost." 
"Reasonable 
return." 
"(8) Petitions for abandonment or discontinuance which were filed 
and pending before the Commission as of the date of enactment of this 
section or prior to the promulgation by the Commission of regulations 
required under this section shall be governed by the provisions of sec-
tion 1 of this Act which were in effect on such date of enactment, 
except that paragraphs (6) and (7) of this section shall be applicable 
to such petitions. 
"(9) Any abandonment or discontinuance which is contrary to any 
provision of this section, of any regulation promulgated under this 
section, or of any terms and conditions of an applicable certificate, 
may be enjoined by an appropriate district court of the United States 
in a civil action commenced and maintained by the United States, the 
Commission, or the attorney general or the transportation regulatory 
body of an affected State or area. Such a court may impose a civil 
penalty of not to exceed $5,000 on each person who knowingly author-
izes, consents to, or permits any violation of this section or of any 
regulation under this section. 
" (10) As used in this section: 
" (a) The term 'avoidable cost' means all expenses which would 
be incurred by a carrier in providing a service which would not be 
incurred, in the case of discontinuance, if such service were discon-
tinued or, in the case of abandonment, if the line over which such 
service was provided were abandoned. Such expenses shall include 
but are not limited to all cash inflows which are foregone and all 
cash outflows which are incurred by such carrier as a result of not 
discontinuing or not abandoning such service. Such foregone cash 
inflows and incurred outflows shall include (i) working capital 
and required capital expenditures, (ii) expenditures to eliminate 
deferred maintenance, (iii) the current cost of freight cars, loco-
motives and other equipment, and (iv) the foregone tax benefits 
from not retiring properties from rail service and other effects of 
applicable Federal and State income taxes. 
"(b) The term 'reasonable return' shall, in the case of a rail-
road not in reorganization, be the cost of capital to such railroad 
(as determined by the Commission), and, in the case of a railroad 
in reorganization, shall be the mean cost of capital of railroads not 
in reorganization, as determined by the Commission.". 
Federal share. 
LOCAL RAIL SERVICE ASSISTANCE 
SEC. 803. Section 5 of the Department of Transportation Act, as 
added by section 401 of this Act (49 U.S.C. 1654), is amended by add-
ing at the end thereof the following 10 new subsections: 
"(f) The Secretary shall, in accordance with this section, provide 
financial assistance to States for rail freight assistance programs that 
are designed to cover— 
" (1) the cost of rail service continuation payments; 
"(2) the cost of purchasing a line of railroad or other rail 
properties to maintain existing or provide for future rail service; 
"(3) the cost of rehabilitating and improving rail properties 
on a line of railroad to the extent necessary to permit adequate 
and eificient rail freight service on such line; and 
" (4) the cost of reducing the costs of lost rail service in a man-
ner less expensive than continuing rail service. 
"(g) The Federal share of the costs of any rail service assistance 
program shall be as follows: (1) 100 percent for the period from 
July 1, 1976 to June 30, 1977; (2) 90 percent for the period from 
July 1, 1977 to June 30, 1978; (3) 80 percent for the period from 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 131 
July 1, 1978 to June 30, 1979; and (4) 70 percent for the period from 
July 1, 1979 to June 30, 1981. For the period from July 1, 1979 to 
June 30, 1981, the Secretary may make such adjustments in the per-
centage level of the Federal share as may be necessary and appropriate 
so as not to exceed the maximum amount of funds authorized under 
subsection (o) of this section. The Secretary shall, within 1 year after 
Standards and 
the date of enactment of this subsection, promulgate standards and 
procedures, 
procedures under which the State share of such cost may be provided 
through in-kind benefits such as forgiveness of taxes, trackage rights, 
and facilities which would not otherwise be provided. 
"(h) Each State which is, pursuant to subsection (j) of this sec-
tion, eligible to receive rail service assistance is entitled to an amount 
equal to the total amount authorized and appropriated for such pur-
pose, multiplied by a fraction whose numerator is the rail mileage in 
- : 
such State which is eligible for rail service assistance under this sec-
tion and whose denominator is the rail mileage in all of the States 
which are eligible for rail service assistance under this section. Not-
withstanding the provisions of the preceding sentence, the entitlement 
of each State shall not be less than 1 percent of the funds appropriated. 
For purposes of this subsection, rail mileage shall be measured by the 
Secretary, in consultation with the Interstate Commerce Commission. 
Any portion of the entitlement of any State which is withheld, in 
accordance with this section, and any such sums which are not used 
or committed by a State shall be reallocated immediately, to the extent 
practicable, among the other States, in accordance with the formula 
set forth in the first sentence of this subsection. 
"(i) Rail service assistance to which a State is entitled under this 
section may be allocated by such State to meet the cost of establishing 
and implementing the State rail plan required by subsection (j) of 
this section or by section 402(c) (1) of the Regional Rail Reorganiza-
tion Act of 1973 (45 U.S.C. 762(c) (1)). Such grants shall be made 
available by the Secretary during the course of the State rail planning 
process, and shall be distributed by the Secretary as needed by the 
States. The amount of State rail planning grants to which each State 
(including each State referred to in subsection (n) (1) of this section) 
is entitled shall be proportionate to the amount of rail service assist-
ance to which such State is entitled under this Act. 
"(j) A State is eligible to receive rail service assistance from the Eligibility. 
Secretary if— 
"(1) such State has established an adequate plan for rail serv-
ices in such State as part of an overall planning process for all 
transportation services in such State, including a suitable process 
for updating, revising, and amending such plan; 
" (2) such State plan is administered or coordinated bv a desig-
nated State agency and provides for the equitable distribution of 
resources; 
"(3) such State agency (A) has authority and administrative 
jurisdiction to develop, promote, supervise, and support safe, 
adequate, and efficient rail transportation services, (B) employs or 
will employ, directly or indirectly, sufficient trained and qualified 
personnel, (C) maintains or will maintain adequate programs of 
investigation, research, promotion, and development, Avith pro-
visions for public participation, and (D) is designated and 
directed solely, or in cooperation with other State agencies to take 
all practicable steps to improve transportation safety and to 
reduce transportation-related energy utilization and pollution ; 
"(4) such State provides satisfactory assurance that it has or 
will adopt and maintain adequate procedures for financial control, 
90 STAT. 132 
PUBLIC LAW 94-210—FEB. 5, 1976 
accounting, and performance evaluation in order to assure proper 
use of Federal funds; and 
"(5) such State complies with regulations of the Secretary 
issued under this section and the Secretary determines that such 
State meets or exceeds the requirements of paragraphs (1) through 
'' ' 
(4) of this subsection. 
"(k) A project is eligible in any year for financial assistance from 
the applicable rail service assistance program only if— 
" 
" (1) (A) the Commission has found that the public convenience 
and necessity permit the abandonment of, or the discontinuance 
of rail service on, the line of raih-oad wliicli is related to such 
project, or (B) the line of railroad or related project was eligible 
for assistance under title IV of the Regional Rail Reorganization 
45 use 761. 
Act of 1973; and 
"(2) such line, or related projects, has not previously been tlie 
subject of Federal rail service assistance under this section for 
more than 5 fiscal years. 
" (1) The Secretary shall pay to each eligible State an amount equal 
to its entitlement under subsection (h) of this section, to be expended 
or committed to one or more projects which are eligible, pursuant to 
subsection (k) of this section. 
Recordkeeping. 
" (m) (1) Each recipient of financial assistance under subsections (e) 
through (o) of this section, whether in the form of grants, subgrants, 
contracts, subcontracts, or other arrangements, shall keep such records 
as the Secretary shall prescribe including records which fully disclose 
the amount and disposition by such recipient of the proceeds of such 
assistance, the total cost of the project or undertaking in connection 
with which such assistance was given or used, the amount of that por-
tion of the cost of the project which was supplied by other sources, and 
such other records as will facilitate an effective audit. Such records 
shall be maintained for 3 years after the completion of such a project 
or undertaking. 
"(2) The Secretary and the Comptroller General of the United 
States, or any of their duly authorized representatives, shall have 
access, for the purpose of audit and examination, to any books, docu-
ments, papers, and records of receipts which, in the oninion of the 
Secretary or of the Comptroller General may be related or pertinent 
to the grants, contracts, or other arrangements referred to in 
paragraph (1) of this subsection. 
"(3) The Secretary and the Comptroller General shall regularly 
conduct, or cause to be conducted— 
"(A) a financial audit, in accordance with generally accepted 
* auditing standards; and 
"(B) a performance audit of the activities and transactions 
assisted under this section, in accordance with generally accepted 
management principles. 
Such audits may be conducted by independent certified or licensed 
public accountants and management consultants approved by the Sec-
retary and the Comptroller General, and they shall be conducted in 
accordance with such rules and regulations as may be prescribed by 
the Comptroller General. 
" (n) As used in this section, the term 'State' moans— 
"(1) during the period from the date of enactment of this sub-
section through the second anniversary of the date on which rail 
properties are conveyed pursuant to section 303(b)(1) of the 
Regional Rail Reorganization Act of 1973 (4,5 U.S.C. 743(b) 
(1)), any State in which a carrier by railroad subject to part I 
49 use 1. 
of the Interstate Commerce Act maintains any line of railroad, 
Audit. 
Rules and 
regulations. 
"State. 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 133 
except that tlie term shall not include the States of Maine, New 
Hampshire, Vermont, Massachusetts, Connecticut, Rhode Island, 
New York, New Jersey, Pennsylvania, Delaware, Maryland, Vir-
p n i a . West Virginia, Ohio, Indiana, Michigan, and Illinois, and 
< 
the District of Columbia; and 
"(2) during the period following the second anniversary of the 
date on which rail properties are conveyed pursuant to such sec-
tion 303(b) (1), any State in which a carrier by railroad subject 45 USC 743. 
to part I of the Interstate Commerce Act maintains any line of 
railroad, 
"(o) There are authorized to be appropriated to the Secretary for 
Appropriation 
the purposes of subsections (f) through (o) of this section not to authorization, 
exceed $360,000,000, without fiscal year limitation. Of the foregoing 
sums, not to exceed $5,000,000 shall be made available for planning 
grants during each of the 3 fiscal years ending June 30, 1976; Sep-
tember 30, 1977; and September 30, 1978. In addition, any appro-
priated sums remaining after the repeal of section 402 of the Regional 
Rail Reorganization Act of 1973 are authorized to remain available 45 USC 762. 
to the Secretary for purposes of subsections (f) through (o) of this 
section. Such sums as are appropriated are authorised to remain avail-
able until expended.". 
; 
TERMINATION AND CONTINUATION OF RAIL SERVICES 
SEC. 804. Section 304 of the Regional Rail Reorganization Act of 
1973 (45 IT.S.C. 744) is amended to read as follows: 
"TERMINATION AND CONTINUATION OF RAIL SERVICES 
"SEC. 304. (a) DISCONTINUANCE.— (1) Except as provided in sub-
sections (c) and (f) of this section, rail service on rail properties of a 
railroad in reorganization in the region, or of a person leased, operated, 
or controlled by such a railroad, which transfers to the Corporation 
or to profitable railroads operating in the region all or substantially 
all of its rail properties designated for such conveyance in the final 
system plan, and rail service on rail properties of a profitable railroad 
operating in the region which transfers substantially all of its rail 
properties to the Corporation or to other railroads pursuant to the 
final system plan, may be discontinued, to the extent such discon-
tinuance is not precluded by the terms of the leases and agreements 
referred to in section 303(b) (2) of this title, if— 
" ( A ) the final system plan does not designate rail service to be 
operated over such rail properties; 
"(B) not sooner than 30 days following the effective date of the 
final system plan, the trustee or trustees of the applicable rail-
road in reorganization or a profitable railroad give notice in writ-
ing of intent to discontinue such service on a date certain which is 
not less than 60 days after the date of such notice or on the date 
of any conveyance ordered by the special court pursuant to sec-
tion 303 (b)(1) of this title, whichever is later; and 
"(C) the notice required by subparagraph (B) of this para-
graph is sent by certified mail to the Commission; to the chief 
executive officer, the transportation agencies, and the government 
of each political subdivision of each State in which such rail 
properties are located; and to each shipper who has used such rai 1 
service during the previous 12 months. 
"(2) (A) If rail properties are not, in accordance with the desig-
nations in the final system plan, required to be operated, as a conse-
quence of a recommended arrangement for joint use or operation of 
90 STAT. 134 
PUBLIC LAW 94-210—FEB. 5, 1976 
45 use 716. 
45 use 743. 
45 use 715. 
Rules and 
regulations. 
Notice. 
rail properties (under section 206(g) of this Act) or as part of a 
coordination project (under sections 206 (c) and (g) of this Act), rail 
service on such properties may be discontinued, subsequent to the date 
of conveyance of rail properties pursuant to such section 303(b) (1), 
if the Commission determines that such rail service on such rail prop-
erties is not compensatory and if— 
"(i) the petitioner and any other railroad involved in such 
arrangement or coordination project have, prior to filing an appli-
cation for such discontinuance, entered into a binding agreement 
(effective on or before the effective date of such discontinuance) 
to carry out such arrangement or project; 
"(ii) such application is filed with the Conmiission not later 
than 1 year after the effective date of the final system plan; and 
"(iii) such discontinuance is not precluded by the terms of the 
leases and agreements referred to in such section 303(b) (2). 
"(B) For purposes of this paragraph, rail sendee on rail properties 
is compensatory if the revenue attributable to such properties from 
such service equals or exceeds the sum of the avoidable costs of pro-
viding such service on such properties plus a reasonable return on the 
value of such rail properties, as determined in accordance with the 
standards developed pursuant to section 205(d) (6) of this Act. 
"(C) The Commission shall make its final determination, with 
respect to any discontinuance requested under this paragraph, not later 
than 120 days after the date of filing of an application therefor. The 
applicant shall have the burden of proving that the service involved 
is not compensatory. If the Commission fails to make a final determi-
nation within such time, the application shall be deemed to be granted. 
"(D) The Commission may issue such rules, regulations, and pro-
cedures as it deems necessary for the conduct of its functions under 
this paragraph. 
"(b) ABANDONMENT.— (1) Except as provided in subsections (c) 
and (f) of this section, rail properties over which rail service has been 
discontinued under subsection (a) of this section may not be aban-
doned sooner than 120 days after the effective date of the discontinu-
ance. Thereafter, except as provided in subsection (c) of this section, 
such rail properties may be abandoned upon 30 days' notice in writing 
to any person (including a government entity) required to receive 
notice under subsection (a) (1) (C) of this section. 
"(2) In any case in which rail properties proposed to be abandoned 
under this section are designated by the final system plan as rail prop-
erties which are suitable for use for other public purposes (including 
roads or highways, other forms of mass transportation, conservation, 
and recreation), such rail properties shall not be sold, leased, 
exchanged, or otherwise disposed of during the 240-day period begin-
ning on the date of notice of proposed abandonment under this section 
unless such rail properties have first been offered, upon reasonable 
terms, for acquisition for public purposes. 
"(3) Rail service may be discontinued, under subsection (a) of this 
section, and rail properties may be abandoned, under this section, not-
withstanding any provision of the Interstate Commerce Act, the 
constitution or law of any State, or the decision of any court or admin-
istrative agency of the United States or of any State. 
"(c) CONTINUATION OF RAIL, SERVICES.—No rail service may be dis-
continued and no rail properties may be abandoned, pursuant to this 
section— 
"(1) in the case of service and properties referred to in sub-
sections (a) (1) and (b) (1) of this section, after 2 years from the 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 135 
effective date of the final system plan or more than 2 years after 
the date on which the final rail service continuation payment is 
received, whichever is later; or 
"(2) if a financially responsible person (including a govern-
ment entity) offers— 
"(A) to provide a rail service continuation payment which 
is designed to cover the difference between the revenue attrib-
utable to such rail properties and the avoidable costs of pro-
viding rail service on such properties, together with a 
reasonable return on the value of such properties; 
"(B) to provide a rail service continuation payment which 
is payable pursuant to a lease or agreement with a State or 
with a local or regional transportation authority under which 
financial support was being provided on January 2, 1974 for 
the continuation of rail passenger service; or 
"(C) to purchase, pursuant to subsection (f) of this sec-
tion, such rail properties in order to operate rail services 
thereon. 
If a rail service continuation payment is offered, pursuant to para-
graph (2) (A) of this subsection, for both freight and passenger 
service on the same rail properties, the owner of such properties may 
not be entitled to more than one payment of a reasonable return on the 
value of such properties. 
"(d) RAIL FREIGHT SERVICE.— (1) If a rail service continuation 
payment is offered, pursuant to subsection (c) (2) (A) of this section, 
for rail freight service, the person offering such payment shall desig-
nate the operator of such service and enter into an operating agree-
ment with such operator. The person offering such payment shall 
designate as the operator of such service— 
" (A) the Corporation, if rail properties of the Corporation con-
nect with the line of railroad involved, unless the Commission 
determines that such rail service continuation could be performed 
more efficiently and economically by another railroad; 
"(B) any other railroad whose rail properties connect with such 
line, if the Corporation's rail properties do not so connect or if the 
Commission makes a determination in accordance with subpara-
graph (A) of this paragraph; or 
"(C) any responsible person (including a government entity) 
which is willing to operate rail service over such rail properties. 
A designated railroad may refuse to enter into such an operating 
agreement only if the Commission determines, on petition by any 
affected party, that the agreement would substantially impair such 
railroad's ability to serve adequately its own patrons or to meet its 
outstanding common carrier obligations. The designated operator 
shall, pursuant to each such operating agreement (i) be obligated to 
operate rail freight service on such rail properties, and (ii) be entitled 
to receive, from the person offering such payment, the difference 
between the revenue attributable to such properties and the avoidable 
costs of providing service on such rail properties, together with a 
reasonable management fee, as determined by the Office. 
"(2) The trustees of a railroad in reorganization shall permit rail 
service to be continued on any rail properties with respect to M^hich a 
rail service continuation payment operating agreement has been 
entered into under this subsection. Such trustees shall receive a reason-
able return on the value of such properties, as determined in accord-
ance with the standards developed pursuant to section 205(d) (6) of 
this Act. 
45 use 715. 
90 STAT. 136 
PUBLIC LAW 94-210—FEB. 5, 1976 
"(3) If necessary to prevent any disruption or loss of rail service, 
at any time after the date of conveyance, pursuant to section 303(b) 
45 use 743. 
(1) of this title, the Commission— 
"(A) shall take such action as may be appropriate under its 
existing authority (including the enforcement of common carrier 
requirements applicable to railroads in reorganization in the 
region) to ensure compliance with obligations imposed under this 
subsection; and 
"(B) shall have authority, in accordance with the provisions of 
section 1(16) (b) of the Interstate Commerce Act (49 U.S.C. 
1 (16) (b)), to direct rail service to be provided by any designated 
railroad or b}^ the trustees of a railroad in reorganization in the 
region, if a rail service continuation payment has been offered but 
an applicable operating or lease agreement is not in effect. 
For purposes of the preceding sentence, any compensation required 
as a result of such directed service shall be determined in accordance 
with the standards developed pursuant to section 205(d) (6) of this 
^•5 use 715. 
Act. The district courts of the United States shall have jurisdiction, 
Jurisdiction. 
upon petition by the Commission or any interested person (including 
a government entity), to enforce any order of the Commission issued 
pursuant to the exercise of its authority under this subsection, or to 
enjoin any designated entity or the trustees of a railroad in reorganiza-
tion in the region from refusing to comply with the provisions of this 
subsection. 
"(e) RAIL PASSENGER SERVICE.— (1) The Corporation (or a profit-
able railroad) shall provide rail passenger service for a period of 180 
days immediately following the date of conveyance (pursuant to sec-
tion 303(b) (1) of this title), with respect to any rail properties over 
which a railroad in reorganization in the region, or a person leased, 
operated, or controlled by such a railroad, was providing rail passen-
ger service immediately prior to such date of conveyance. Such service 
shall be provided on such properties regardless of whether or not such 
properties are designated in the final system plan as rail properties 
over which rail service is required to be operated, except with respect 
to properties over which such service is provided by the National Rail-
road Passenger Corporation. 
"(2) If a State (or a local or regional transportation authority) 
was providing financial assistance to support the operation of rail 
passenger service, pursuant to a lease or agreement which was in effect 
immediately prior to the date of conveyance (pursuant to such sec-
tion 303(b) (1)), the Corporation (or a profitable railroad) shall be 
bound by the service provisions of such lease or agreement for the 
duration of the 180-day mandatory operation period specified in para-
graph (1) of this subsection. If a State or such an authority was pro-
viding financial assistance for the continuation of rail passenger service 
on rail properties immediately prior to such date of conveyance, it 
shall provide the same level of financial assistance during such 180-
day mandatory operation period. If no such financial assistance was 
being provided or if no such lease or agreement was in effect imme-
diately prior to such date of conveyance, with respect to any such rail 
properties, the Corporation (or a profitable railroad) shall provide the 
same level of rail passenger service, for the duration of such 180-day 
mandatory operation period, that was provided prior to such date by 
the applicable railroad. If— 
" (A) such financial assistance is not provided; 
-^., 
, ^ , 
" ( B ) a State (or a local or regional transportation authority) 
• 
' ' ' 
has not, by the end of such 180-day mandatory operation period, 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 137 
offered a rail service continuation payment pursuant to subsection 
(c^ (2) (A) of this section; 
(Cf) an applicable rail service continuation payment pursuant 
to such subsection (c) (2) (A) is not paid when it is due; or 
"(D) a payment required under a lease or agreement, pursuant 
to section 303(b) (2) of this title or subsection (c) (2) (B) of this 45 USC 743. 
section, is not paid when it is due, 
the Corporation (or, where applicable, the National Railroad Pas-
senger Corporation, a profitable railroad, or the trustee or trustees of 
a railroad in reorganization in the region) may (i) discontinue such 
rail passenger service, and (ii) with respect to rail properties not 
designated for inclusion in the final svstem plan, abandon such prop-
erties pursuant to subsections (a) and (b) of tnis section. 
"(3) Nothing in this subsection shall be construed to affect the 
obligation of the Corporation (or a profitable railroad), or of the 
trustees of the railroads in reorganization in the region, to provide 
rail passenger service pursuant to section 303(b) (2) of this title or 
subsection (c) (2) (B) of this section. 
"(4) If a State (or a local or regional transportation authority) — 
"(A) offers a rail service continuation payment, pursuant to 
subsection (c) (2) (A) of the section and under regulations 
issued by the Office pursuant to section 205(d)(5) of this Act, 45 USC 715. 
for the operation of rail passenger service after the 180-day 
mandatory operation period, and 
"(B) provides compensation, pursuant to paragraph (2) of this 
subsection, for operations conducted during the 180-day manda-
tory operation period, 
the Corporation (or a profitable railroad) shall continue to provide 
such service after the end of such period, except as otherwise provided 
in this subsection. 
"(5) (A) The Secretary shall reimburse the Corporation (or a prof-
itable railroad) for any loss which is incurred by it during the 180-day 
mandatory operation period specified in paragragh (1) of this subsec-
tion which is not compensated for by a State (or a local or regional 
transportation authority). The amount of such reimbursement shall 
' 
" ' •
* 
be determined pursuant to section 17(a) (1) of the Urban Mass Trans-
portation Act of 1964 and under regulations issued by the Office pur- Post, p. 143. 
suant to section 205 (d) (5) of this Act. 
"(B) The Secretary shall reimburse States, local public bodies, and 
agencies thereof for additional costs incurred by such States, bodies, 
and agencies for rail service continuation payments for rail passenger 
service pursuant to section 17(a) (2) of the Urban Mass Transporta-
tion Act of 1964 and under regulations issued by the Office pursuant 
to section 205 (d) (5) of this Act. 
"(C) If a dispute arises with respect to the application of any such 
regulations, the parties to such dispute may submit such dispute to 
arbitration by a third party. If the parties are unable to agree upon 
the selection of an arbitrator, the Chairman of the Commission shall 
serve in that capacity (except as to matters required to be decided by 
the Commission, pursuant to section 402(a) of the Rail Passenger 
Service Act (45 U.S.C. 562(a))). 
"(6) Notwithstanding any other provision of this subsection, the 
Corporation is not obligated to provide rail passenger service on rail 
properties if a State (or a local or regional transportation authority) 
contracts for such service to be provided on such properties by an 
operator other than the Corporation, except that the Corporation shall, 
where appropriate, provide such operator with access to such proper-
ties for such purpose. 
90 STAT. 138 
PUBLIC LAW 94-210—FEB. 5, 1976 
" (f) PURCHASE.—If an offer to purcliase is made under subsection 
(c)(2)(C) of this section, such offer shall be accompanied by an offer 
of a rail service continuation payment. Such payment shall continue 
until the purchase transaction is completed, unless a railroad assumes 
operations over such rail properties of its own account pursuant to an 
order or authorization of the Commission, Wlienever a railroad in 
reorganization in the region or a profitable railroad gives notice of 
intent to discontinue service pursuant to subsection (a) of this section, 
such railroad shall, upon the request of anyone apparently qualified to 
make an offer to purchase or to provide a rail service continuation pay-
ment, promptly make available its most recent reports on the physical 
^ 
condition of such property, together with such traffic and revenue data 
as would be required under subpart B of part 1121 of chapter X of 
title 49 of the Code of Federal Regulations and such other data as are 
necessary to ascertain the avoidable costs of providing service over 
such rail properties. 
"(g) ABANDONMENT BY CORPORATION.—After the rail system to be 
operated by the Corporation or a subsidiary thereof under the final 
system plan has been in operation for 2 years, the Commission may 
authorize the Corporation or a subsidiary thereof to abandon any rail 
properties as to which it determines that rail service over such prop-
•; 
erties is not required by the public convenience and necessity, if the 
Corporation or a subsidiary thereof can demonstrate that no State (or 
local or regional transportation authority) is willing to offer a rail 
service continuation payment pursuant to subsection (c) of this sec-
tion. The Commission may, at any time after the effective date of 
the final system plan, authorize additional rail service in the region 
or authorize the abandonment of rail properties which are not being 
operated by the Corporation or any subsidiary or affiliate thereof or 
by any other person. Determinations by the Commission under this 
subsection shall be made pursuant to applicable provisions of the Inter-
state Commerce Act. 
"(h) INTERIM ABANDONMENT,—After the date of enactment of this 
section and prior to the date of conveyance (pursuant to section 303 
45 use 743. 
(b) (1) of this title), no railroad in reorganization in the region may 
discontinue service or abandon any line of railroad other than in 
accordance with the provisions of this Act, unless (1) it is authorized 
to do so by the Association, and (2) no affected State (or local or 
regional transportation authority) reasonably opposes such action, 
notwithstanding any provision of any other Federal law, the con-
stitution or law of any State, or the decision or order of, or the 
pendency of any proceeding before any Federal or State court, agency, 
or authority. 
"(i) DISPOSITION or DESIGNATED RAIL PROPERTIES.—No railroad in 
reorganization in the region and no person leased, operated or con-
trolled by such a railroad shall sell, transfer, encumber, or otherwise 
dispose of rail property, or any right or interest therein, designated 
for transfer to the Corporation or conveyance to a profitable railroad 
in the final system plan, except pursuant to section 303 (b) of this title. 
The provisions of this subsection shall not apply to any such sale, 
transfer, encumbrance, or other disposition— 
"(1) as to w^hich the Association generally or specifically con-
sents in writing; 
" (2) which, prior to enactment of the Railroad Revitalization 
Ante, p, 31. 
and Regulatory Reform Act of 1976, had been specifically 
approved by a United States district court having jurisdiction 
over the reorganization of a railroad in reorganization under 
section 77 of the Bankruptcy Act (11 U.S.C. 205); or 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 139 
45 use 719. 
"(3) following certification to the special court, pursuant to 
section 209(c) of the Regional Rail Reorganization Act of 1973, 
of any such rail properties not previously so certified. 
"(j) EXEMPTION.— (1) No local public body which provides mass 
transportation services and which is otherwise subject to the Interstate 
Commerce Act shall, with respect to the provision of such services, 49 USC 1. 
be subject to the Interstate Commerce Act or to rules, regulations and 
orders promulgated under such Act, except that any such local public 
body shall continue to be subject to applicable Federal laws pertaining 
to (A) safety, (B) the representation of employees for purposes of 
collective bargaining, and (C) employment retirement, annuity, and 
miemployment systems or any other provision pertaining to dealings 
between employees and employers. 
" (2) For purposes of this subsection, the term— 
"(A) 'local public body' has the meaning prescribed for such 
term in section 12(c) (2) of the Urban Mass Transportation Act 
(49 U.S.C. 1608(c) (2)) and includes any person or entity which 
contracts Avith a local public body to provide transportation serv-
ices; and 
"(B) 'mass transportation' has the meaning prescribed for such 
term in section 12(c) (5) of the LTrban Mass Transportation Act 
(49 U.S.C. 1608(c)(5)).". 
"Local public 
body." 
"Mass 
transportation." 
CONTINUATION ASSISTANCE 
SEC. 805. (a) Section 402 of the Regional Rail Reorganization Act 
of 1973 (45 U.S.C. 762) is amended to read as follows: 
a 
RAIL SERVICE CONTINUATION 
ASSISTANCE 
"SEC. 402. (a) GENERAL.— (1) The Secretary shall provide finan-
cial assistance in accordance with this section to assist in the provision 
of rail service continuation payments, the acquisition or moderniza- 
' ' 
tion of rail properties, including the preservation of rights-of-way for 
future rail service, the construction or improvement of facilities neces-
sary to accommodate the transportation of freight previously moved 
by rail service, and the cost of operating and maintaining rail service 
facilities such as yards, shops, docks, or other facilities useful in 
facilitating and maintaining main line or local rail service. The 
* 
Federal share of the costs of any such assistance shall be as follows: 
(A) 100 percent for the 12-month period following the date that rail 
properties are conveyed pursuant to section 303(b) (1) of this Act; 45 USC 743. 
and (B) 90 percent for the succeeding 12-month period. 
"(2) The Secretary shall, within one year after the date of enact- Standards and 
ment of the Railroad Revitalization and Regulatory Reform Act of procedures. 
1976, promulgate standards and procedures imder which the State Ante, p. 31. 
share of such cost may be provided through in-kind benefits such as for-
giveness of taxes, trackage rights, and facilities which would not 
otherwise be provided. 
"(3) The Secretary, in cooperation with the Secretary of Labor, the Report to 
Association, and the Commission, shall assist States and local or Congress, 
regional transportation authorities in negotiating initial operating or 
lease agreements and shall report to the Congress not later than 
30 days after the date of enactment of the Railroad Revitalization and 
Regulatory Reform Act of 1976 on the progress of such negotiations. 
The Secretary may, with the concuri'ence of a State, enter directly into 
operating or lease agreements with railroads designated to provide 
service under section 304(d) of this Act, and with the trustees of rail- 45 USC 744. 
90 STAT. 140 
PUBLIC LAW 94-210—FEB. 5, 1976 
roads in reorganization in the region over whose rail properties such 
'•''^ 
service will be provided, to assure the uninterrupted continuation of 
rail service after such date of conveyance. Such agreements may be 
entered into only during the period when the Federal share is 100 
percent. Payments shall be made from the funds to which a State 
would otherwise be entitled under this section. 
"(b) ENTITLEMENT,— (1) Each State in the region which is, pur-
suant to subsection (c) of this section, eligible to receive rail service 
continuation assistance is entitled to an amount equal to the total 
amount authorized and appropriated for such purpose multiplied 
by a fraction whose numerator is the rail mileage in such State which 
is eligible for rail service continuation assistance under this section 
and whose denominator is the rail mileage in all of the States in the 
region which are eligible for rail service continuation assistance under 
-
~ 
this section, Notwithstanding the preceding sentence, the entitlement 
of each State shall not be less than 3 percent of the funds appro-
priated. Not more than 5 percent of a State's entitlement may be used 
Rail mileage, 
for rail planning activities. For purposes of this subsection, rail 
measurement, 
mileage shall be measured by the Secretary in consultation with the 
Interstate Commerce Commission, Any portion of the entitlement 
of any State which is withheld, in accordance with this section, and 
any such sums which are not used or committed by a State shall be 
reallocated immediately, to the extent practicable, among the other 
States in accordance with the formula set forth in this subsection. In 
^ 
addition to amounts provided pursuant to such rail mileage formula, 
funds shall also be made available to each State for the cost of operat-
ing and maintaining rail service facilities such as yards, shops, and 
docks which are useful in facilitating and maintaining mainline or 
local rail services and which are contained in each State's rail plan, 
except that (A) any such assistance shall extend for a period of only 
12 months following the date rail properties are conveyed under sec-
45 use 743, 
tion 303(b) (1) of this Act, and (B) no railroad shall be required to 
operate such facilities. With respect to the limitation on assistance 
for rail service facilities under the preceding sentence, the Secretary 
shall, not later than 90 days prior to the end of such 12-month period, 
submit a report to the Congress in conjunction with a designated State 
agency, recommending future action with respect to such facilities. 
Financial 
" (2) For a period of not more than 1 year following the date rail 
assistance, 
properties are conveyed pursuant to section 303(b)(1) of this Act, 
the Secretary is authorized to provide financial assistance, from the 
funds to which a State would otherwise be entitled under this section 
> 
for the continuation of local rail services, to anv person determined by 
the Secretary to be financially responsible wlio will enter into any 
operating and lease agreements with railroads designated to provide 
45 use 744. 
service under section 304(d) of this Act, regardless of the eligibility 
of the State, where the applicable rail properties are located, to receive 
assistance under subsection (c) of this section. In any case in which a 
State is eligible to receive rail service continuation assistance under 
subsection (c) of this section, States shall have priority to receive such 
payments over any other person eligible under this paragraph and 
no other person eligible under this paragraph shall receive such pay-
ments unless his application therefor has been approved by the State 
agency designated under subsection (c) to administer the State plan. 
"(c) ELIGIBILITY.— (1) A State in the region is eligible to receive 
financial assistance pursuant to subsection (b) of this section if, in 
any fiscal year— 
... 
" (A) the State has established a State plan for rail transporta-
' ' 
tion and local rail services (herein referred to as the 'State rail 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 141 
plan') which is administered or coordinated by a designated State 
agency and such plan includes a suitable process for updating, 
revising, and amending such plan and provides for the equitable 
distribution of such financial assistance among State, local, and 
regional transportation authorities; 
"(B) the State agency (i) has authority and administrative 
jurisdiction to develop, promote, supervise, and support safe, 
adequate, and efficient rail services, (ii) employs or will employ, 
directly or indirectly, sufficient trained and qualilied personnel, 
and (^iii) maintains or will maintain adequate programs of 
investigation, research, promotion, and development with provi-
sion for public participation; 
"(C) the State provides satisfactory assurance that such fiscal 
control and fund accounting procedures will be adopted as may 
be necessary to assure proper disbursement of, and accounting 
for. Federal funds paid under this title to the State; and 
"(D) the State complies with the regulations of the Secretary 
issued under this section. 
"(2) The rail freight services which are eligible for rail service 
continuation assistance pursuant to this section are— 
"(A) those rail services of railroads in reorganization in the 
region, or persons leased, operated, or controlled by any such 
railroad, which the final system plan does not designate to be 
continued; 
"(B) those rail services on rail properties referred to in section 
304(a)(2) of this Act; 
"(C) those rail services in the region which have been, at any 
time during the 5-year period prior to the date of enactment of 
this Act, or which, are subsequent to the date of enactment of this 
Act, owned, leased, or operated by a State agency or by a local or 
regional transportation authority, or with respect to which a 
State, a political subdivision thereof, or a local or regional trans-
portation authority has invested (at any time during the 5-year 
period prior to the date of enactment of this Act), or invests 
(subsequent to the date of enactment of this Act), substantial 
sums for improvement or maintenance of rail service; or 
,-,. . •]}.. 
"(D) those rail services in the region with respect to which the 
Commission authorizes the discontinuance of rail services or the 
abandonment of rail properties, effective on or after the date of 
enactment of this Act. 
"(3) The rail freight properties which are eligible to be acquired 
or modernized with financial assistance pursuant to subsection (b) of 
this section are those rail properties which are used for services eligible 
for rail service continuation assistance, pursuant to paragraph (2) of 
this subsection, including those properties which are identified, in the 
applicable State rail plan as having potential for future use for rail 
freight service. 
" (4) The facilities which are eligible to be constructed or improved 
with financial assistance pursuant to subsection (b) of this section 
are those facilities in the region (including intermodal terminals and 
highways or bridges) which are needed in orde^-to provide rail freight 
service which will no longer be available because of the discontinuance 
of rail freight service under section 304 of this Act or other lawful 
authority. No funds provided under this paragraph may be used to 
pay the State share of any highway projects under title 23, United 
States Code. 
"(5) Rail properties are eligible to be acquired with financial 
assistance pursuant to subsection (b) of this section if (A) they are 
90 STAT. 142 
PUBLIC LAW 94-210—FEB. 5, 1976 
to be used for intercity or commuter rail passenger service, and (B) 
they pertain to a line in the region (other than rail properties desig-
45 use 716. 
nated in accordance with section 206(c) (1) (C) of this Act) which, 
if so acquired (i) would enable the National Railroad Passenger 
Corporation to serve, more efficiently, a route which it operated on 
November 1, 1975, (ii) would provide intercity rail passenger service 
designated by the Secretary under title II of the Rail Passenger Service 
45 use 521. 
Act, or (iii) would provide such service over a route designated for 
service pursuant to section 403(c) of the Rail Passenger Service Act 
(45 U.S.C. 563(c)). 
"(d) REGULATIONS.—Within 90 days after the date of enactment of 
this Act, the Secretary shall issue, and may from time to time amend, 
regulations with respect to the provision of financial assistance vmder 
this title. 
"(e) PAYMENT.—The Secretary shall pay to each eligible State in 
the region an amount equal to its entitlement under subsection (b) of 
this section. 
"(f) RECORDS, AUDIT, AND EXAMINATION.—(1) Each recipient of 
financial assistance under this section, whether in the form of grants, 
subgrants, contracts, subcontracts, or other arrangements, shall keep 
such records as the Secretary shall prescribe, including records which 
fully disclose the amount and disposition by such recipient of the 
proceeds of such assistance, the total cost of the project or undertaking 
in connection with which such assistance was given or used, the amount 
of that portion of the cost of the project supplied by other sources, and 
such other records as will facilitate an effective audit. Such records 
shall be maintained for 3 years after the completion of such a project 
or undertaking. 
"(2) The Secretary and the Comptroller General of the United 
States, or any of their duly authorized representatives, shall have 
access for the purpose of audit and examination to any books, docu-
ments, papers, and records of such receipts which in the opinion of 
the Secretary or the Comptroller General may be related or pertinent 
to the grants, contracts, or other arrangements referred to in such 
paragraph. 
Notice and 
"(g) WITHHOLDING.—If the Secretaiy, after reasonable notice and 
hearing. 
an opportunity for a hearing to any State agency, finds that a State 
is not eligible for financial assistance under subsections (c) and (d) 
of this section, payment to such State shall not be made until there is 
no longer any failure to comply. 
" (h) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be 
appropriated to the Secretary to carry out the purposes of this section 
an amount not to exceed $180,000,000 without fiscal year limitation. 
Such sums as are appropriated shall remain available until expended. 
" (i) DEFINITION.—As used in this section, the term 'rail service con-
tinuation assistance' includes expenditures made by a State (or a local 
or regional transportation authority), at any time during a 1-year 
period preceding the date of enactment of this Act, or subsequent to 
the date of enactment of this Act, for acquisition, rehabilitation, or 
modernization of rail facilities on which rail freight services would 
have been curtailed or abandoned but for such expenditures.". 
(b) Section 403 (a) of the Regional Rail Reorganization Act of 1973 
(45 U.S.C. 763), is amended by striking the colon and the proviso and 
inserting in lieu thereof a period. 
(c) Section 403 (b) of the Regional Rail Reorganization Act of 1973 
(45 U.S.C. 763(b)) is amended by striking the last sentence thereof 
and inserting in lieu thereof the following: "Notwithstanding any 
other provision of this title, a State may expend sums received by it 
under paragraphs (1) and (2) of section 402(b) of this title for 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 143 
acquisition and modernization pursuant to this section, or for any 
project designated pursuant to a State rail plan.". 
REPEAL 
SEC. 806. Effective on the date of the second anniversary of the date 
Effective date, 
on which rail properties are conveyed, pursuant to section 303(b) (1) 
of the Eegional Rail Reorganization Act of 1973 (45 U.S.C. 743), title 
IV of sucli Act is repealed. 
45 USC 
761-763. 
EAIL PASSENGER SERVICE 
SEC. 807. Section 206(d) (5) of the Regional Rail Reorganization 
Act of 1973 (45 U.S.C. 716(d) (5)) is amended to read as follows: 
"(5) All properties— 
"(A) transferred by the Corporation pursuant to sections 
206(c) (1) (C) and 601(d) of this Act; 
45 USC 716, 
"(B) transferred by the Corporation to any State (or local 791. 
or regional transportation authority), pursuant to subsection 
(c)(1)(D) of this section, or 
"(C) transferred by the Corporation to any State, local or 
regional transportation authority, or the National Railroad 
Passenger Corporation, within 900 days after the date of con-
veyance, pursuant to section 303(b) (1) of this Act, to meet 45 USC 743. 
the needs of commuter or intercity rail passenger service, 
shall be transferred at a value related to the value received from 
the Corporation pursuant to the final system plan for the transfer 
to such Corporation of such properties. The value of any such 
properties, which are transferred pursuant to subparagraph (B) 
or (C) of this paragraph, shall be adjusted to reflect the value 
attributable to any applicable maintenance and improvement pro-
vided by the Corporation (to the extent the Corporation has not 
been released from the obligation to pay for such improvements) 
and the cost to the Corporation of transferring such properties.". 
EMERGENCY OPERATING ASSISTANCE 
SEC. 808. The Urban Mass Transportation Act of 1964 is amended 
by adding at the end thereof the following new section: 
a 
EMERGENCY OPERATING ASSISTANCE 
"SEC. 17. (a) The Secretary shall provide financial assistance for 49 USC 1613. 
the purpose of reimbursing— 
"(1) the Consolidated Rail Corporation, the National Railroad 
Passenger Corporation, other railroads, and, if applicable, the 
trustee or trustees of a railroad in reorganization in the region 
(as defined in section 102 of the Regional Rail Reorganization 
Act of 1973 (45 U.S.C. 702)) for the costs of rail passenger service 
operations conducted at a loss during the 180-day mandatory 
operation period, as required under section 304(e) of fuch Act 
(45 U.S.C. 744(e)). Such reimbursement shall cover all costs not 
otherwise paid by a State or a local or regional transportation 
authority which would have been payable by such State or au-
thority, pursuant to regulations issued by the Office under sec-
tion 205(d) (5) of the Regional Rail Reorganization Act of 1973 
(45 U.S.C. 715) if such regulations had been in effect on the 
date of conveyance of rail properties under section 303(b) (1) of 
such Act: and 
90 STAT. 144 
PUBLIC LAW 94-210—FEB. 5, 1976 
.-M' 
49 use 1609. 
Federal share. 
49 use 1604. 
Appropriation 
authorization. 
"(2) States, local public bodies, and agencies thereof for addi-
tional costs incurred by such States, bodies, and agencies with 
respect to rail passenger service required by section 304(e) (4) of 
the Eegional Eail Reorganization Act of 1973 (45 U.S.C. 744 
(e)(4)J. 
"(b) Financial assistance under subsection (a) of this section shall 
not apply to intercity rail passenger service provided pursuant to an 
agreement with the National Railroad Passenger Corporation which 
was in effect immediately prior to such date of conveyance. 
"(c) Financial assistance provided pursuant to subsection (a) of 
this section shall be subject to such terms, conditions, requirements, 
and provisions as the Secretary may deem necessary and appropriate 
with such reasonable exceptions to requirements and provisions other-
wise applicable under this Act as the Secretary may deem I'equired by 
the emergency nature of the assistance authorized by this section. 
Nothing in this section shall authorize the Secretary to waive the pro-
visions of section 13 (c) of this Act. 
"(d) The Federal share of the costs of any rail passenger service 
required by subsections (c) and (e) of section 304 of the Regional 
Rail Reorganization Act of 1973 (45 U.S.C. 744 (c) and (e)) shall be 
as follows: 
"(1) 100 percent of the costs eligible under subsections (a) (1) 
or (a) (2) of this section for the 180-day mandatory operation 
period required by section 304(e) of such Act; 
"(2) 100 percent for the 180-day period following tlie 180-day 
mandatory operation period; 
"(3) 90 percent for the 12-month period succeeding the period 
specified in subparagraph (2) of this subsection; and 
"(4) 50 percent for the 180-day period succeeding the period 
specified in subparagraph (3) of this subsection. 
No assistance may be provided beyond the time specified in subsection 
(d) (3) of this section, unless the applicant for such assistance provides 
satisfactory assurances to the Secretary that the service for which 
such assistance is sought will be continued after the termination of 
the assistance authorized by this section. 
"(e) The terms and provisions which are applicable to assistance 
provided pursuant to this section shall be consistent, insofar as is 
practicable, with the terms and provisions which are applicable to 
operating assistance under section 5 of this Act. 
"(f) To finance assistance under this section, the Secretary may 
incur obligations on behalf of the United States in the form of grants, 
contract agreements, or otherwise, in such amounts as are provided 
in appropriations Acts, in an aggregate amount not to exceed 
$125,000,000. There are authorized to be appropriated for liquidation 
of the obligations incurred under this section not to exceed $40,000,000 
by September 30, 1976, $95,000,000 by September 30, 1977, and 
$125,000,000 by September 30, 1978, such sums to remain available 
until expended.". 
Report to 
President and 
eongress. 
49 use la note. 
CONVERSION OF ABANDONED RAILROAD RIGHTS-OF-WAY 
SEC. 809. (a) STUDY.—The Secretary shall, within 360 days after the 
date of enactment of this Act, and in consultation with the Secretary 
of the Interior, the Office, the Association, the Environmental Pro-
tection Agency, any other appropriate Federal agency, any appropri-
ate State and regional transportation agency, any other appropriate 
State and local governmental entities, and any appropriate private 
groups and individuals, prepare and submit to the Congress and the 
President a report on the conversion of railroad rights-of-way. This 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 145 
report shall evaluate and make suggestions concerning potential 
alternate uses of, and public policy with respect to the conversion of, 
=
c 
, 
railroad rights-of-way on which service has been discontinued or is 
likely to be discontinued. This report shall include— 
(1) an inventory statement developed by the Secretary as to 
all abandoned railroad rights-of-way and significant segments of 
such rights-of-way which retain their linear characteristics, 
including, as to each, identification of the owner of record and an 
evaluation of its topography, characteristics, condition, approxi-
mate value, and alternate use suitability; 
(2) an evaluation of the advantages of establishing a rail bank 
consisting of selected such rights-of-way, as a means of assuring 
their availability for potential railroad use in the future, a dis-
cussion of interim uses for such rights-of-way, the development 
of conveyancing and leasing forms, conditions, and practices to 
assure such availability, a projection as to the costs of such a pro-
gram, and recommendations regarding the administration of such 
a program; 
(3) a survey of existing Federal, State, and local programs 
utilizing or attempting to utilize abandoned railroad rights-of-
way for public purposes, including an assessment of the benefits 
and costs of each; and 
(4) an assessment and evaluation of suggestions for more effec-
tive public utilization of abandoned railix>ad rights-of-way, 
including recommendations for legislative, administrative, and 
regulatory action, if any, and proposals as to the optimum level 
of funding therefor. 
(b) iNroRMATioN A
N
D FuNDiNG.—The Secretary of the Interior, 
after consultation with the Secretary, shall, in accordance with this 
subsection, provide financial, educational, and technical assistance to 
local. State, and Federal governmental entities for programs involv-
ing the conversion of abandoned railroad rights-of-way to recreational 
and conservational uses, in such manner as to coordinate and acceler-
ate such conversion, where appropriate. Such assistance shall include— 
(1) encouraging and facilitating exchanges of information 
dealing with the availability of railroad rights-of-way, the tech-
nology involved in converting such properties to such public 
purposes, and related matters; 
(2) making grants, in consultation with the Bureau of Out-
door Eecreation of the Department of the Interior, to State and 
local governmental entities to enable them to plan, acquire, and 
develop recreational or conservational facilities on abandoned 
railroad rights-of-way, which grants shall cover not more than 90 
percent of the cost of the planning, acquisition, or development 
activity of the particular project for which funds are sought; 
(3) allocating funds to other Federal programs concerned with 
recreation or conservation in order to enable abandoned railroad 
rights-of-way, where appropriate, to be included in or made into 
national parks, national trails, national recreational areas, wild-
life refuges, or other national areas dedicated to recreational or 
conservational uses; and 
(4) providing technical assistance to other Federal agencies. 
States, local agencies, and private groups for the purpose of 
enhancing conversion projects. To increase the available informa-
tion and expertise, the Secretary may contract for special studies 
or projects and may otherwise collect, evaluate, and disseminate 
information dealing with the utilization of such rights-of-way. 
90 STAT. 146 
PUBLIC LAW 94-210—FEB. 5, 1976 
(c) CoNroRMiNG AMENDMENT.—Section l a of the Interstate Com-
49 use la. 
merce Act, as inserted by this Act, is amended by redesignating para-
graph (10) thereof as paragraph (11), and by inserting immediately 
after paragraph (9) the following new paragraph: 
" (10) In any instance in which the Commission finds that the present 
or future public convenience and necessity permit abandonment or 
discontinuance, the Commission shall make a further finding whether 
such properties are suitable for use for other public purposes, includ-
ing roads or highways, other forms of mass transportation, conserva-
tion, energy production or transmission, or recreation. If the 
Commission finds that the properties proposed to be abandoned are 
suitable for other public purposes, it shall order that such rail proper-
ties not be sold, leased, exchanged, or otherwise disposed of except in 
accordance with such reasonable terms and conditions as are prescribed 
by the Commission, including, but not limited to, a prohibition on any 
such disposal, for a period not to exceed 180 days after the effective 
date of the order permitting abandonment unless such properties have 
first been offered, upon reasonable terms, for acquisition for public 
purposes.". 
49 use la note. 
(d) AUTHORIZATION or APPROPRIATIONS.—There are authorized to 
be appropriated to carry out the provisions of this section, not to exceed 
$6,000,000 for the fiscal year and the transitional fiscal period ending 
September 30, 1976, not to exceed $7,000,000 for the fiscal year ending 
September 30, 1977, and not to exceed $7,000,000 for the fiscal year 
ending September 30, 1978. Sums appropriated pursuant to this 
authorization are authorized to remain available until expended. Of 
the funds appropriated, at least four-fifths are to be made available 
to the Secretary of the Interior to carry out subsection (b) of this 
section. 
RAIL BANK 
49 use 1653a. 
SEC. 810. (a) ESTABLISHMENT.—The Secretary shall, within 180 
days after the date of enactment of this Act, and after consultation 
with the Secretary of the Interior and the Secretary of Commerce, in 
accordance with this section, establish a rail bank to consist of rail 
trackage and other rail properties eligible under this subsection, for 
purposes of preserving existing service in certain areas of the United 
States in which fossil fuel natural resources or agricultural production 
is located. The Secretary may include in such rail bank any railroad 
trackage or other rail properties which are listed for consideration for 
inclusion in a rail bank under part I I I , section C, of the final system 
plan. 
(b) POWERS.— (1) The Secretary may acquire, by lease, purchase, 
or in such other manner as he considers appropriate, rail properties or 
any interests therein eligible for inclusion in the rail bank established 
under this section. Except as provided in paragraph (2) of this subsec-
tion, the Secretary may hold rail properties acquired for such rail 
bank, and may sell, lease, grant rights over, or otherwise dispose of 
interests or rights in connection with such rail properties. 
(2) The Secretary may not dispose of any such rail properties 
pursuant to paragraph (1) of this subsection if he determines, after 
consultation with the Secretary of the Interior and the Secretary of 
Commerce, that such disposition would adversely affect the avail-
ability of such properties for any continued necessary access to, and 
egress by rail from, facilities in which fossil fuels are being or can be 
extracted or processed. 
(c) AUTHORIZATION OP APPROPRIATIONS.—^There are authorized to 
be appropriated to the Secretary for purposes of carrying out the 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 147 
provisions of this section such sums as are necessary, not to exceed 
$6,000,000. Sums appropriated pursuant to this section are authorized 
to remain available until expended. 
TITLE IX—MISCELLANEOUS PROVISIONS 
COMPREHENSIVE STUDY OF RAIL SYSTEM 
SEC. 901. The Secretary shall conduct a comprehensive study of the 49 USC 1654 
American railway system. Such study shall commence not later than note. 
45 days after the date of enactment of this Act. Such study shall 
include— 
(1) a showing of the potential cost savings and of possible 
improvements in service quality which could result from restruc-
turing the railroads in the United States; 
(2) an identification of the potential economies and improve-
ments in performance which could result from the improvement 
of local and terminal operations; 
(3) estimates as to potential savings in the cost of rehabilitat-
ing the United States raihvay system if rehabilitation is limited 
to those portions of such system which are essential to interstate 
, commerce or national defense; 
(4) an assessment of the extent to which common or public 
ownership of fixed facilities could improve the national rail trans-
portation system; 
(5) an assessment of the potential effects of alternative rail 
corporate structures upon the national rail transportation system; 
^6) a listing, in order of descending priority, of the rail prop-
erties which should be improved to the extent necessary to permit 
high-speed rail passenger or freight service over such properties, 
in terms of the costs and benefits of such improvements and the 
reasons therefor; and 
(7) an estimate of the potential benefits of railroad electrifica-
tion for high density rail lines in the United States, and an evalu-
ation of the costs and benefits of electrifying rail lines in the 
United States with a high density of traffic, including— 
(A) the capital costs of such electrification and the oil fuel 
economies which would be derived therefrom, the ability of 
existing power facilities to supply the additional power 
required, and the amount of coal or other fossil fuels required 
to generate the power necessary for railroad electrification; 
and 
(B) the advantages to the environment of electrification 
of railroads in terms of reduced fuel consumption and air 
pollution, and the disadvantages to the environment from 
increased use of fuels such as coal; and 
(8) a survej^ and analysis of the financial and physical condi-
tion of the facilities, rolling stock, and equipment oi the various 
railroads in the United States. 
Within 540 days after the date of enactment of this Act, the Secretary Report to 
shall submit a report to the Congress setting forth the results of the Congress, 
study conducted pursuant to this section. 
STUDY OF AID TO RAIL TRANSPORTATION 
SEC. 902. (a) STUDY.—^Within 30 days after the date of the enact- 49 USC 1654 
ment of this Act, the Secretary shall initate a comprehensive study note, 
and analysis of (1) past and present policies and methods of provid-
ing Federal aid for the construction, improvement, operation, and 
90 STAT. 14fi 
PUBLIC LAW 94-210—FEB. 5, 1976 
maintenance of rail transportation facilities and services, (2) the rela-
tionship of such policies and methods to the policies and methods of 
providing Federal aid for other modes of transportation, and (3) 
whether common carriers by railroad have been or are disadvantaged 
by reason of such policies and methods, and, if such carriers have been 
or are disadvantaged, the extent of such disadvantage. The Secretary 
shall examine ways and means by which future policy respecting 
Federal aid to rail transportation may be so determined and developed 
•Koi >-; 
as to encourage the establishment and maintenance of an open and 
competitive market in which rail transportation competes on equal 
terms with other modes of transportation, and in which market shares 
are governed by customer preference based upon the service and full 
economic costs. 
(b) COOPERATION.—The Commission and the Secretary of the Army 
are authorized and directed to cooperate fully with the Secretary 
. 
^ 
in carrying out the purposes of this section, and also to submit such 
independent and separate reports, comments, and recommendations 
as they consider appropriate. 
(c) INFORMATION.—In carrying out the purposes of this section, the 
Secretary may require all common carriers by railroad to file such 
reports containing such information as the Secretary considers neces-
sary. The Secretary shall have the power to require by subpoena the 
production of such books, papers, tariffs, contracts, agreements, or 
other documents or data of a common carrier by railroad related to the 
study and analysis as he considers relevant. The Secretary may treat 
as confidential and privileged any document, data, or information 
received for such study and analysis, notwithstanding the provisions 
of section 552 of title 5, United States Code. 
(d) REPORT TO CONGRESS.—^Within 1 year after the date of enact-
ment of this Act, the Secretary shall complete the study and analysis 
authorized and directed by this section, and shall transmit a report to 
the Congress containing his findings and conclusions, together with 
his recommendations for a sound and rational policy with respect to 
Federal aid to rail transportation. 
STUDY o r 
CONGLOMERATES 
49 use 5c note. 
SEC. 903. The Commission shall undertake a study of conglomerates 
and of such other corporate structures as are presently found within 
the rail transportation industry. The Commission shall determine what 
effects, if any, such diverse structures have on effective transportation, 
on intermodal competition, on revenue levels, and on such other aspects 
of national transportation as the Commission considers to be legiti-
Report to 
mate subjects of study. The Commission shall prepare a report with 
Congress. 
appropriate recommendations and shall submit its report to the Con-
gress within 1 year after the date of enactment of this Act. 
RAIL ABANDONMENT REPORT 
Report to 
SEC. 904. The Secretary shall submit to the Congress, within 90 
Congress. 
days after the date of enactment of this Act, a comprehensive report 
45 use 745 note, 
on the anticipated effect, including the environmental impact, of an^ 
abandonments of lines of railroad and any discontinuances of rail 
service in States outside the region, as defined in section 102 of the 
Regional Rail Reorganization Act of 1973 (45 U.S.C. 702). 
NONDISCRIMINATION 
45 use 803. 
SEC. 905. (a) GENERAL.—No person in the United States shall on 
the ground of race, color, national origin, or sex be excluded from 
PUBLIC LAW 94-210—FEB. 5, 1976 
90 STAT. 149 
participation in, or denied the benefits of, or be subjected to discrimi-
nation under, any project, program, or activity funded in whole or in 
part through financial assistance under this Act. 
(b) COMPLIANCE.—(1) Whenever the Secretary determines that any 
person receiving financial assistance, directly or indirectly, under this 
Act, or under any provision of law amended by this Act, has failed to 
comply with subsection (a) of this section, with anv Federal civil 
rights statute, or with any order or regulation issued under such a 
statute, the Secretary shall notify such person of such determination 
and shall direct such person to take such action as may be necessary to 
assure compliance with such subsection. 
(2) If, within a reasonable period of time after receiving notifica-
tion pursuant to paragraph (1) of this subsection, such person fails 
or refuses to comply with subsection (a) of this section, the Secretary 
shall— 
(A) direct that no further Federal financial assistance be pro-
vided to such person; 
(B) refer the matter to the Attorney General with a recom-
mendation that an appropriate civil action be instituted; 
(C) exercise the powers and functions provided by title V I 
of the Civil Rights Act of 1964 (42 U.S.C. 2000d et seq.) ; and/or 
(D) take such other actions as may be provided by law, 
(c) CIVIL ACTION.—Whenever a matter is referred to the Attorney 
General pursuant to subsection (b) of this section, or whenever the 
Attorney General has reason to believe that any person is engaged in a 
pattern or practice in violation of the provisions of this section, the 
Attorney General may commence a civil action in any appropriate 
district court of the United States for such relief as may be appropri-
ate, including injunctive relief. 
(d) REGULATIONS.—The Secretary may prescribe such regulations 
and take such actions as are necessary to monitor, enforce, and affirma-
tively carry out the purposes of this section. 
(e) JUDICIAL REVIEW.—Any determinations made or actions taken 
by the Secretray pursuant to this section shall be subject to judicial 
review. 
(f) DEFINITION.—For purposes of this section, the term "financial 
assistance" includes obligation guarantees. 
1659. 
Establishment. 
49 use 1657a. 
MINORITY RESOURCE CENTER 
SEC. 906. The Department of Transportation Act (49 U.S.C. 1651 49 USC 1651 
et seq.) is amended (1) by redesignating sections 11 through 15 thereof 
notes, 1658, 
as sections 12 through 16 thereof, and (2) by inserting a new section 11 
as follows: 
" M I N O R I T Y RESOURCE CENTER 
"SEC. 11. (a) The Secretary shall, within 180 days after the date of 
enactment of this section, establish a Minority Resource Center (here-
after in this section referred to as the 'Center'). 
"(b) The Center shall have an Advisory Committee, which shall 
consist of 5 individuals appointed by the Secretary from lists of 3 
qualified individuals recommended by minority-dominated trade asso-
ciations in the minority business community. 
"(c) The Center is authorized to— 
" (1) establish and maintain, and disseminate information from, 
a national information clearinghouse for minority entrepreneurs 
and businesses, for purposes of furnishing, to such entrepreneurs 
and businesses, information with respect to business opportunities 
90 STAT. 150 
PUBLIC LAW 94-210—FEB. 5, 1976 
involving the maintenance, rehabilitation, restructuring, improve-
ment, and revitalization of the Nation's railroads; 
"(2) assist minority entrepreneurs and businesses in obtaining 
"' investment capital and debt financing; 
"(3) conduct market research, planning, economic and business 
analyses, and feasibility studies to identify such opportunities; 
"(4) design and conduct programs to encourage, promote, and 
assist minority entrepreneurs and businesses to secure contracts, 
subcontracts, and projects related to the maintenance, rehabilita-
tion, restructuring, improvement, and revitalization of the 
Nation's railroads; 
"(5) enter into such contracts, cooperative agreements, or other 
transactions as may be necessary in the conduct of its functions 
and duties; 
"(6) develop support mechanisms, including venture capital, 
'• surety and bonding organizations, and management and technical 
services, which will enable minority entrepreneurs and businesses 
to take advantage of business opportunities related to the 
maintenance, rehabilitation, restructuring, improvement, and 
revitalization of the Nation's railroads; and 
"(7) participate in, and cooperate with, all Federal programs 
and other programs designed to provide financial, management, 
and other forms of support and assistance to minority entrepre-
neurs and businesses. 
" (d) The United States Railway Association, the Consolidated Rail 
Corporation, and the Secretary shall provide the Center with such 
relevant information, including procurement schedules, bids, and 
specifications with respect to particular maintenance, rehabilitation, 
restructuring, improvement, and revitalization projects, as may be 
requested by the Center in connection with the performance of its 
functions. 
"Minority." 
"(e) As used in this section, the term 'minority' includes women.". 
Approved February 5, 1976. 
LEGISLATIVE HISTORY: 
HOUSE REPORTS: No. 94-725 accompanying H.R. 10979 (Comm. on Interstate and 
Foreign Commerce) and Nos. 94-768 and 94-781 (Comm. of 
Conference). 
SENATE REPORTS: No. 94-499 (Comm. on Commerce) and Nos. 94-585 and 94-595 
(Comm. of Conference). 
CONGRESSIONAL RECORD: 
Vol. 121 (1975): Dec. 2, 4, considered and passed Senate. 
Dec. 17, considered and passed House, amended, in lieu of 
H.R. 10979. 
Dec. 19, Senate and House agreed to conference report. 
Vol. 122 (1975): Jan. 20, House vacated certain actions and recommitted the bill 
to committee of conference. 
.. = '(! i 
Jan. 21, Senate vacated certain actions and recommitted the bill 
to committee of conference. 
Jan. 28, House and Senate agreed to conference report. 
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS: 
Vol. 12, No. 6 (1976): Feb. 5, Presidential statement.