[Federal Register Volume 59, Number 163 (Wednesday, August 24, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-20722]


[[Page Unknown]]

[Federal Register: August 24, 1994]


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Part IV





Department of Transportation





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Federal Railroad Administration



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49 CFR Part 209




Remedial Actions Reporting; Final Rule
DEPARTMENT OF TRANSPORTATION

Federal Railroad Administration

49 CFR Part 209

[Docket No. RSEP-7, Notice No. 2]
RIN 2130-AA85

 
Remedial Actions Reporting

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

ACTION: Final Rule.

-----------------------------------------------------------------------

SUMMARY: FRA is amending its railroad safety enforcement regulations to 
require railroads to report actions taken to remedy certain alleged 
violations of law. If a railroad receives notice from an FRA or State 
safety inspector that (i) the inspector is recommending that a civil 
penalty be assessed for an alleged violation of law and (ii) that a 
remedial actions report must be submitted, the railroad shall report to 
the inspector the actions that it took to remedy the alleged violation. 
In such a case, the railroad is required to submit the remedial actions 
report within 30 days after the end of the month in which the railroad 
received the notice. The rule also provides that if appropriate 
required remedial actions cannot be taken by the railroad within such 
30-day period, it shall submit to the inspector (i) a written 
explanation of the reasons for any delay and (ii) a final report upon 
completion of the remedial actions.

EFFECTIVE DATE: This final rule will be effective January 1, 1995.

ADDRESSES: Any petition for reconsideration should reference Docket No. 
RSEP-7, Notice No. 2, and be submitted in triplicate to the Docket 
Clerk, Office of Chief Counsel, Federal Railroad Administration, 400 
Seventh Street SW., Room 8201, Washington, D.C. 20590.

FOR FURTHER INFORMATION CONTACT: Edward R. English, Director, Office of 
Safety Enforcement (RRS-10), FRA, Office of Safety, 400 Seventh Street, 
S.W., Washington, D.C. 20590 (telephone number: 202-366-9252), or David 
H. Kasminoff, Trial Attorney (RCC-30), FRA, Office of Chief Counsel, 
400 Seventh Street, S.W., Washington, D.C. 20590 (telephone number: 
202-366-0635).

SUPPLEMENTARY INFORMATION:

Background

    On June 18, 1993, FRA published in the Federal Register a notice of 
proposed rulemaking (NPRM) to amend part 209, entitled ``Railroad 
Safety Enforcement Procedures,'' by revising Sec. 209.3 and adding a 
new ``Subpart E--Reporting of Remedial Actions.'' The proposed Subpart 
E prescribed reporting procedures for railroads notified by an FRA or 
State safety inspector both that assessment of a civil penalty would be 
recommended against them for their alleged noncompliance with the 
Federal railroad safety laws and that a remedial actions report must be 
submitted to the inspector. 58 FR 33595.
    In a study released on July 31, 1990 (GAO/RCED-90-194), the General 
Accounting Office (GAO) concluded that FRA had no assurance that 
railroads were correcting problems identified in FRA's routine 
inspections because there were no requirements that railroads respond 
in writing to indicate that an identified defect had been repaired. The 
GAO report acknowledged that, even in the absence of requirements to 
report corrective actions, railroads voluntarily responded in writing 
to FRA concerning most track and signal defects indicating that 
corrective actions have been taken. For example, in 1986 through 1988 
FRA identified about 361,000 track defects, for which approximately 
320,000, or 89 percent, had a railroad response recorded in the 
``Action'' and ``Date'' columns of the railroad's copy of the Track 
Inspection Report. In the same period, FRA identified about 35,000 
signal defects, for which approximately 30,000, or 86 percent, had a 
railroad response recorded in the ``Action'' and ``Date'' columns of 
the railroad's copy of the Signal and Train Control Inspection Report.
    The GAO report further noted that, although some railroads also 
reported corrective actions for equipment and operating practices 
defects, FRA maintained no record of these written responses and that 
FRA did not reinspect in every case to verify the correction of a 
safety defect. The GAO recommended that FRA establish an effective 
inspection follow-up program that would include (i) requiring railroads 
to report actions taken on FRA inspection findings, (ii) determining 
what reinspection levels are needed to ensure that railroads are 
responding to inspection findings, and (iii) assessing civil penalties 
for failure to report corrective actions.
    On September 3, 1992, the President signed into law the Rail Safety 
Enforcement and Review Act (RSERA), Pub. L. 102-365, 106 Stat. 972, 
which mandated in Sec. 3 the issuance of rules requiring submission of 
remedial actions reports. On July 5, 1994, the general and permanent 
provisions of the RSERA and of all the other Federal railroad safety 
laws were simultaneously repealed, reenacted without substantive 
change, and recodified as positive law in title 49 of the U.S. Code by 
Public Law 103-272. See H.R. Rep. No. 103-180, 103d Cong., 1st Sess. 
(1993). Section 3 of the RSERA provided as follows:
    (a) Regulations.--The Secretary of Transportation (hereafter in 
this Act referred to as the ``Secretary'') shall issue regulations to 
require that any railroad notified by the Secretary that assessment of 
a civil penalty will be recommended for a failure to comply with a 
provision of the Federal railroad safety laws, as such term is defined 
in section 212(e) of the Federal Railroad Safety Act of 1970 (45 U.S.C. 
441(e)), or any rule, regulation, order, or standard issued under such 
provision, shall report to the Secretary, within 30 days after the end 
of the month in which such notification is received, actions taken to 
remedy that failure.
    (b) Explanation of Delay.--Regulations issued under subsection (a) 
shall provide that, if appropriate remedial actions cannot be taken by 
a railroad within such 30-day period, such railroad shall submit to the 
Secretary an explanation of the reasons for any delay.
    (c) Schedule for Regulations.--The Secretary shall--(1) within 9 
months after the date of enactment of this Act, issue a notice of 
proposed rulemaking for regulations to implement this section; and (2) 
within 2 years after the date of enactment of this Act, issue final 
regulations to implement this section.
    49 U.S.C. 20111(d), formerly codified at 45 U.S.C. 437 note. As 
recodified at 49 U.S.C. 20111(d), the section now reads as follows:
    (d) Regulations Requiring Reporting of Remedial actions.--(1) The 
Secretary shall prescribe regulations to require that a railroad 
carrier notified by the Secretary that imposition of a civil penalty 
will be recommended for a failure to comply with this part, chapter 51 
or 57 of this title, or a regulation prescribed or order issued under 
any of those provisions, shall report to the Secretary, not later than 
the 30th day after the end of the month in which the notification is 
received--
    (A) actions taken to remedy the failure; or
    (B) if appropriate remedial actions cannot be taken by that 30th 
day, an explanation of the reasons for the delay.
    (2) The Secretary--
    (A) not later than June 3, 1993, shall issue a notice of a 
regulatory proceeding for proposed regulations to carry out this 
subsection; and
    (B) not later than September 3, 1994, shall prescribe final 
regulations to carry out this subsection.
    The Secretary has delegated these rulemaking responsibilities to 
the Federal Railroad Administrator. 49 CFR 1.49 (c), (d), (f), (g), 
(m), (s), (ee), (gg), and internal delegations.
    The term ``Federal railroad safety laws'' in Sec. 3 of the RSERA 
means the provisions of law that as a result of recodification are now, 
generally, at 49 U.S.C. subtitle V, part A or 49 U.S.C. chap. 51 or 57 
and the rules, regulations, orders, and standards issued under any of 
those provisions. See Pub. L. 103-272 (1994). Before recodification, 
these statutory provisions were contained in the following statutes: 
(i) the Federal Railroad Safety Act of 1970 (Safety Act) (49 U.S.C. 
20101-20117, 20131, 20133-20141, 20143, 21301, 21302, 21304, 21311, 
24902, and 24905, and Secs. 4(b)(1), (i), and (t) of Pub. L. 103-272, 
formerly codified at 45 U.S.C. 421, 431 et seq.); (ii) the Hazardous 
Materials Transportation Act (Hazmat Act) (49 U.S.C. 5101 et seq., 
formerly codified at 49 App. U.S.C. 1801 et seq.); (iii) the Sanitary 
Food Transportation Act of 1990 (SFTA) (49 U.S.C. 5713, formerly 
codified at 49 App. U.S.C. 2801 (note)); and those laws transferred to 
the jurisdiction of the Secretary of Transportation by subsection 
(e)(1), (2), and (6)(A) of section 6 of the Department of 
Transportation Act (DOT Act), as in effect on June 1, 1994 (49 U.S.C. 
20302, 21302, 20701-20703, 20305, 20502-20505, 20901, 20902, and 80504, 
formerly codified at 49 App. U.S.C. 1655(e)(1), (2), and (6)(A)). 49 
U.S.C. 20111 and 20109, formerly codified at 45 U.S.C. 437 (note) and 
441(e). Those laws transferred by the DOT Act include, but are not 
limited to, the following statutes: (i) the Safety Appliance Acts (49 
U.S.C. 20102, 20301, 20302, 20304, 21302, and 21304, formerly codified 
at 45 U.S.C. 1-14, 16); (ii) the Locomotive Inspection Act (49 U.S.C. 
20102, 20701-20703, 21302, and 21304, formerly codified at 45 U.S.C. 
22-34); (iii) the Accident Reports Act (49 U.S.C. 20102, 20701, 20702, 
20901-20903, 21302, 21304, and 21311, formerly codified at 45 U.S.C. 
38-43); (iv) the Hours of Service Act (49 U.S.C. 20102, 21101-21107, 
21303, and 21304, formerly codified at 45 U.S.C. 61-64b); and (v) the 
Signal Inspection Act (49 U.S.C. 20102, 20502-20505, 20902, 21302, and 
21304, formerly codified at 49 App. U.S.C. 26).
    FRA performs its safety inspections in order to monitor and enforce 
compliance with the Federal railroad safety laws by all entities 
subject to its jurisdiction, not simply by railroads. The entities 
themselves still retain ultimate responsibility for detecting, 
repairing, and avoiding violations of those laws. Nevertheless, the 
reporting requirement will assist FRA in monitoring followup actions by 
railroads with respect to conditions sufficiently serious to warrant 
possible future civil penalty actions.
    If an FRA inspector, State inspector participating in investigative 
and surveillance activities under 49 C.F.R. Part 212, or other duly 
authorized official performing a railroad safety inspection 
(hereinafter referred to collectively as ``FRA Safety Inspector'') 
determines that a railroad has not complied with a provision of the 
Federal railroad safety laws and if the inspector decides to recommend 
the assessment of a civil penalty against the railroad for the 
noncompliance, the inspector will first prepare an inspection report. 
This report includes the following information: the name of the FRA 
Safety Inspector, his or her identification number, the report number, 
the name and job title of the railroad representative served with the 
report, the railroad's name and computer code, the railroad division 
and subdivision (if applicable), and the inspection report date. 
Further, the inspection report also indicates if the FRA Safety 
Inspector has checked the box specifying ``Violation Recommended.'' If 
a violation is recommended, the FRA Safety Inspector will prepare a 
violation report including a recommendation for the assessment of a 
civil penalty.
    The central requirement of the final regulations is that any 
railroad receiving notification on the new version of the inspection 
report that (i) the FRA Safety Inspector is recommending the assessment 
of a civil penalty for a failure by that railroad to comply with a 
provision of the Federal railroad safety laws and (ii) a report of 
remedial actions must be filed, shall fill out the ``Railroad 
Followup'' section of the railroad copy of the inspection report. The 
railroad must then return the form to the designated FRA Safety 
Inspector within 30 days after the end of the month in which such 
notification is received. The remedial actions report must include the 
name and job title of the individual completing the form on behalf of 
the railroad and indicate the date(s) on which the remedial actions 
occurred. A copy of the new inspection report on which to report to FRA 
remedial actions taken is appended to this final rule.
    Under the terms of the final regulations, the duty to submit a 
remedial actions report does not arise merely upon notification that a 
recommendation for the assessment of a civil penalty will be made 
(i.e., in the box stating ``Violation Recommended,'' the word ``yes'' 
is selected). It arises only if notification is also provided to the 
railroad on the inspection report itself that submission of a remedial 
actions report for that specific failure is required (i.e., in the box 
stating ``Written Notification to FRA of Remedial Action is:'' the word 
``Required'' is selected). Broadly construed, under one permissible 
interpretation of the reporting requirement of Sec. 3 of the RSERA, the 
requirement could apply to all violations for which the assessment of a 
civil penalty is recommended. This reading of Sec. 3 would, of course, 
include all violations involving physical defects (e.g., in track, 
equipment, and signals) where, absent remedial actions, the physical 
defect continues to pose a safety hazard, e.g., a defective wheel on a 
freight car. However, this interpretation would also include violations 
involving a defect in human performance, such as permitting a 
locomotive engineer to work in excess of 12 hours in violation of the 
Federal hours of service laws. In that instance, the excess service 
creates a risk during the period of the excess service itself, but does 
not carry a continuing threat to safety.
    FRA concludes that the intent of Congress in enacting Sec. 3 of the 
RSERA was to require the reporting of remedial actions only for a 
failure to comply that, in the judgment of the FRA Safety Inspector, 
could literally and specifically be corrected by the specific railroad 
notified. In other words, we think that Congress required remedial 
actions reports only for violations that could still pose an ongoing 
risk to rail safety if not corrected (e.g., operation of a freight car 
that the railroad received in interchange in revenue service with a 
defective wheel). In light of FRA's interpretation of Sec. 3 of the 
RSERA and in an effort to develop meaningful compliance data, the final 
regulations apply remedial actions reporting to only three general 
categories of failures to comply with a provision of the Federal 
railroad safety laws for which the assessment of a civil penalty is 
recommended. The three general categories consist of (i) physical 
defects, (ii) recordkeeping and reporting violations, and (iii) filing 
violations.
    The final regulations neither compel nor permit any affected 
railroad to decide for itself whether a particular recommendation to 
FRA for the assessment of a civil penalty falls under one of the three 
general categories, and thus results in the need to submit a remedial 
actions report. Consider, for example, a situation in which a railroad 
is informed that because of its operation of a box car with a plain 
bearing box having no visible free oil, in violation of 49 CFR 215.107, 
a recommendation will be made for the assessment of a civil penalty. 
However, the safety inspector neglects to include the requisite 
notification on the inspection report that submission of a remedial 
actions report is required. Although the inspector's omission would not 
affect the railroad's underlying obligation to pay any civil penalty 
assessed for the substantive freight car violation, FRA's failure to 
provide the required notification would, under this rule, mean that the 
railroad had no duty to file a remedial actions report regarding the 
substantive violation.
    After a railroad returns the completed remedial actions report to 
the FRA Safety Inspector, he or she will first determine if the 
remedial actions taken were proper and adequate under the circumstances 
of the violation. If not, he or she will contact the representative of 
the railroad who completed the report form to obtain additional 
information. If necessary, the FRA Safety Inspector will return a 
deficient report to the appropriate railroad representative for 
revision. Once the remedial actions report is sufficient, the FRA 
Safety Inspector will submit a copy of this report to FRA's Office of 
Chief Counsel, which may make use of it during the penalty assessment 
and negotiation process. FRA's Office of Safety will then correlate the 
data representing the different types of remedial actions that entities 
affected by the reporting requirement have undertaken. This 
computerized data will assist FRA in systematically targeting 
inspections by integrating available accident and injury data with 
inspection and compliance data, so as to better determine if affected 
entities are minimizing and correcting safety problems.
    Under certain unusual circumstances, a railroad may be notified 
that assessment of a civil penalty will be recommended for a failure of 
that railroad to comply with a provision of the Federal railroad safety 
laws unless the company undertakes a specific programmatic response to 
the compliance problem. In such cases, although penalty action may be 
withheld, it will be treated as if the penalty has already been 
recommended, that is submission of a remedial actions report would be 
required. Further, there are instances where a recommendation for the 
assessment of a civil penalty may be made, but later overturned by 
regional officials for technical or policy reasons or declined by FRA's 
Office of Chief Counsel for evidentiary or other legal deficiencies. 
FRA considers the phrase `` * * * that has received written 
notification * * * from an FRA Safety Inspector both that assessment of 
a civil penalty will be recommended * * * and that it must submit a 
remedial actions report * * * ``as the triggering language that 
requires a railroad to report its remedial actions to FRA within 30 
days after the end of the month in which such notification is received. 
See 49 CFR 209.405.

Discussion of Comments and Conclusions

    A total of 11 responses were received concerning the NPRM. At the 
public hearing held in Washington, D.C. on October 19, 1993, six 
organizations were represented: the Association of American Railroads 
(AAR); The American Short Line Railroad Association (ASLRA); 
Consolidated Rail Corporation (Conrail); National Railroad Passenger 
Railroad Corporation (Amtrak); Union Pacific Railroad Company (UP); and 
Brotherhood Railway Carmen Division, Transportation Communications 
International Union (BRC). Prepared statements were provided by the 
AAR, the ASLRA, and the BRC, and written comments were received from 
the AAR, the ASLRA, the UP, the BRC, the American Public Transit 
Association (APTA), Akzo Chemicals Inc. (Akzo), Chemical Manufacturers 
Association (CMA), and Southeastern Pennsylvania Transportation 
Authority (SEPTA). Discussions follow with respect to the primary 
issues raised by the commenters. In light of the comments received, FRA 
has reconsidered some of its proposals.
    1. Should the final rule require remedial actions reports for all 
categories of failures to comply with provisions of the Federal 
railroad safety laws for which assessment of civil penalties have been 
recommended, or just for failures that can literally and specifically 
be corrected?
    The NPRM set forth FRA's belief that the intent of Congress in 
enacting Sec. 3 of the RSERA was to require reporting of remedial 
actions only for failures to comply that could literally and 
specifically be corrected. FRA, however, acknowledged that one 
permissible reading of the statute is that remedial actions reports are 
required for all categories of alleged violations, and encouraged 
commenters to submit their views on FRA's interpretation of Sec. 3 of 
the RSERA. Specifically, FRA asked any commenter believing that 
expansive reporting is required by the statute, or inherently useful, 
to recommend specific ways that generally responsive measures taken to 
prevent violations similar to those involved in completed or past 
transactions could usefully be reported to FRA.
    Five commenters agreed with FRA's position that the rule should 
apply to only three general categories of failures to comply with a 
provision of the Federal railroad safety laws for which the assessment 
of a civil penalty is recommended. The three general categories consist 
of (i) physical defects, (ii) recordkeeping and reporting violations, 
and (iii) filing violations.
    The AAR believed that to require more expansive reporting would 
expand the scope of the rule beyond FRA's statutory authority, since in 
Sec. 3(a) of the RSERA Congress ordered remedial actions reports only 
on ``actions taken to remedy that failure,'' referring to the 
particular ``failure'' to comply for which a civil penalty would be 
sought. The AAR also stated that there is no policy or safety reason 
for FRA to expand the scope of the rule and that FRA already has 
sufficient information available to assist it in allocating agency 
resources. The ASLRA opined that to require reporting of actions not 
susceptible to physical change or administrative correction would be 
counterproductive, leading to unnecessary paperwork and costs. The CMA 
believed that FRA should be more selective in determining when a 
remedial actions report must be filed and that FRA Safety Inspectors 
(as that term is now defined in the final rule) should have discretion 
to decide if safety concerns warrant the submission of a report even 
for failures involving physical defects, recordkeeping and reporting 
violations, and filing violations.
    In contrast, the BRC believed that FRA's proposed restrictive 
approach runs contrary to the legislative history and does not comport 
with Congressional intent, and that Congress specifically intended to 
limit FRA's discretion in implementation of the RSERA. The BRC stated 
that completed or past transactions in violation of the law and 
regulations are not usually isolated instances, but are indicative of 
an ongoing pattern of violations which can be remedied by additional 
instruction, education, or discipline. The BRC also indicated that even 
if the rule is applied to all categories of violations, remedial 
actions reporting would still address only violations that FRA Safety 
Inspectors could confirm with sufficient evidence to warrant the 
recommendation of assessment of a civil penalty.
    While FRA disagrees with the AAR's conclusion that it would lack 
the statutory authority to expand the scope of the rule, FRA also 
disagrees with the BRC's conclusion that the legislative history, 
including House Report No. 102-205, establishes a Congressional intent 
to subject all violations to the reporting requirement. Section 3 of 
the RSERA required remedial actions reports for ``actions taken to 
remedy that failure'' (emphasis added), and FRA concludes that Congress 
was referring to actions taken to remedy the particular ``failure'' to 
comply for which a civil penalty would be sought (i.e., to the specific 
instance that constituted a violation), not to the generic failure on 
other occasions to comply with the same regulatory or statutory 
provision.
    After careful consideration of all of the comments, FRA has decided 
to require the reporting of remedial actions only for failures to 
comply that can literally and specifically be corrected, as set forth 
in the NPRM. In response to the concerns raised by the BRC, FRA 
emphasizes that for violations involving completed or past transactions 
that can no longer be remedied by the given railroad (e.g., permitting 
a locomotive engineer to work in excess of 12 hours in violation of the 
Federal hours of service laws or offering a freight car in interchange 
with a defective wheel that FRA identified to the receiving railroad as 
requiring repair), FRA will expect the railroad against whom a civil 
penalty is recommended (or even against whom only a written warning is 
issued) to reassess its own overall policy and attitude toward future 
compliance, such as by reallocating its resources or providing 
additional employee training. Moreover, since the civil penalty that 
will be recommended is expected to serve as an incentive toward 
generally responsive actions, to require a remedial actions report for 
violations that can no longer be remedied by that railroad would be 
superfluous.
    2. Should the reporting requirement apply to all entities over 
which FRA has enforcement authority, e.g., shippers of hazardous 
materials, or just to railroads?
    The only two organizations that commented on this issue favored the 
proposed expanded coverage of the rule. The BRC believed that expanded 
coverage would promote better accountability and permit FRA to fully 
monitor compliance with the law and regulations. CMA generally 
supported the proposed reporting requirement, including expansion of 
the proposed definition of ``responsible company'' to include shippers, 
if improved safety in the shipment of hazardous materials by rail can 
be realized. However, CMA noted that a discussion of the rule's 
economic impact on shippers was omitted from FRA's regulatory impact 
analysis.
    As acknowledged in the NPRM, Sec. 3 of the RSERA mandated issuance 
of rules requiring remedial actions reports only from railroads. FRA 
proposed making the rule applicable to all persons other than 
individuals under our rulemaking authority under Sec. 202 of the Safety 
Act, in furtherance of our enforcement authority under the Hazardous 
Materials Transportation Act, in order to develop more comprehensive 
safety data, better utilize its limited resources, and consistently 
treat all similarly situated violators of the Federal railroad safety 
laws.
    FRA has reconsidered its proposal and decided to limit the 
applicability of the final rule to only railroads. First, FRA believes 
that if Congress had intended for all persons besides railroads to be 
included under Sec. 3 of the RSERA, Congress would have expanded the 
scope of the rule. Second, FRA now concludes that in most instances in 
which FRA Safety Inspectors choose to cite shippers of hazardous 
materials for violations of the Hazardous Materials Regulations, the 
tank cars or shipping papers that are the subjects of the civil penalty 
recommendations are no longer under the control of the shipper. 
Accordingly, the majority of these violations are for completed or past 
transactions and thus would not subject shippers to the reporting 
requirement even under the proposed expanded approach.
    The shippers would still, however, be expected to reevaluate their 
future compliance policies and procedures. For example, a shipper 
receives written notification from an FRA Safety Inspector that a 
recommendation for the assessment of a civil penalty is being made 
pursuant to 49 CFR 173.29 for failure to properly secure all of the 
closures on a residue tank car, but the car is found in a rail yard 
hundreds of miles from the shipper's facility. Although this failure 
would fall within one of the three general categories of correctable 
violations, under ordinary circumstances the required remedial actions 
(e.g., securement of the car's closures) would be performed exclusively 
by the railroad. The shipper might investigate the circumstances 
surrounding the tank car's preparation and then implement new 
procedures, but under the terms of the NPRM the shipper would not be 
required to submit a remedial actions report.
    3. Does FRA have the legal authority to impose civil or criminal 
penalties on railroads and/or individuals that either violate or cause 
a violation of the reporting requirements?
    The proposed rule identified the penalties that FRA might impose 
upon any person who violates or causes the violation of any requirement 
of Subpart E, and noted that penalties were authorized by Sec. 209 of 
the Safety Act. However, the AAR, the ASLRA, and the UP stated that 
although the source of FRA's authority in promulgating the rule was 
Sec. 3 of the RSERA, neither that section nor any other section of the 
RSERA authorized the imposition of civil or criminal penalties. The 
three commenters noted that while Sec. 209 of the Safety Act authorized 
penalties for violations of safety rules or regulations issued under 
that Act, Sec. 3 of the RSERA was neither an amendment nor an addition 
to the Safety Act. They then concluded that since FRA never provided 
any notice or a reasoned explanation for why the rule's substantive 
provisions are ``necessary'' for railroad safety under Sec. 202(a) of 
the Safety Act (now codified at 49 U.S.C. 20103), or ``necessary or 
appropriate'' for safe transportation of hazardous materials under 
Sec. 105(a)(1) of the Hazardous Materials Transportation Act (now 
codified at 49 U.S.C. 5103), neither civil nor criminal penalties are 
authorized.
    These commenters opined that since the underlying violation is 
already subject to a civil penalty, and the necessary incentives to 
submit a remedial actions report are already in place, the possible 
imposition of an additional penalty would be superfluous. The BRC 
contended that the incentive provided by a separate penalty for 
submitting an improper remedial actions report increases accountability 
and forces the railroads to ensure completion of the report.
    FRA adopts the NPRM proposal that civil and/or criminal penalties 
may be imposed upon any person, including a railroad, who either 
violates or causes the violation of any requirement of Subpart E. As 
stated in the authority citation for the proposed revised part 209, 
FRA's authority for including civil and criminal penalty provisions in 
the remedial actions reporting rule derives from our rulemaking 
authority under 49 U.S.C. 20103 (formerly contained in Sec. 202 of the 
Safety Act). See 49 CFR 1.49(m). Contrary to the implication of the 
AAR, the ASLRA, and the UP, FRA is not issuing the remedial actions 
reporting rule with respect to violations of the Hazardous Materials 
Regulations under the authority of 49 U.S.C. 5103 (formerly contained 
in Sec. 105(a)(1) of the Hazardous Materials Transportation Act). With 
regard to submission of remedial actions reports for violations of the 
Hazardous Materials Regulations, our authority for including civil and 
criminal penalty provisions in the rule derives from our rulemaking 
authority under 49 U.S.C. 20103, in furtherance of our enforcement 
authority under the provisions of law formerly known as the Hazardous 
Materials Transportation Act. See 49 CFR 1.49 (m) and (s). Of course, 
FRA could issue these rules under the provisions of law formerly 
contained in the Safety Act even if the provisions of law formerly 
contained in Sec. 3 of the RSERA did not exist, so this is an academic 
argument. For the record, FRA believes these rules are necessary for 
safety.
    Accordingly, consistent with FRA's belief that Congress did not 
intend for FRA to lack the authority to enforce the remedial actions 
reporting rule, we are issuing the rule under both 49 U.S.C. 20111(d) 
and 49 U.S.C. 20103 in order to avail ourselves of all potential 
remedies that may be necessary to achieve compliance. To the extent 
that we are issuing the rule under 49 U.S.C. 20103, we have concluded 
that it is ``necessary'' to ensure railroad safety, as required by 
Sec. 20103(a). FRA strongly disagrees with the AAR's conclusion that 
the NPRM failed to sufficiently set forth why the submission of 
remedial actions is ``necessary'' for railroad safety. The AAR quoted 
FRA's statement in the NPRM that ``* * * it is doubtful that this 
proposed rule alone will reduce the number of defective conditions in 
the industry, or that it will materially impact on the already 
declining rate of train accidents.'' 58 FR 33601. The AAR also observed 
that FRA ``* * * is unable to quantify any direct or indirect safety 
benefit from this proposed rule.'' 58 FR 33601. The AAR further noted 
that even if certain correctable violations (which, if uncorrected, 
pose ongoing safety risks) have meaningful connections to safety, this 
nexus does not establish that the submission of remedial actions 
reports is ``necessary'' to railroad safety.
    Although FRA readily acknowledged in the NPRM that it is unable to 
quantify any direct or indirect safety benefit from the proposed rule, 
it also stated that the potential benefit will come about by increasing 
the ability of the railroad industry to manage quality control. 58 FR 
33601. FRA also concluded that the rule will improve its ability to 
efficiently and effectively manage its inspection resources. 58 FR 
33601. In addition, it was hoped that railroads (previously included 
under the term ``responsible company''), after being required to report 
remedial actions to FRA, will create their own internal databases of 
the remedial actions reports. Although we noted that internal analyses 
of the information was not required by the NPRM, we stated that such 
analyses (in conjunction with other resource management data) might 
lead railroad management to take actions designed to reduce and/or 
effectively respond to defective conditions. 58 FR 33601.
    We also stated in the NPRM that remedial actions reporting will 
assist FRA in monitoring follow-up actions by railroads with respect to 
conditions sufficiently serious to warrant possible future civil 
penalty actions. 58 FR 33601. FRA then noted that the rule also holds 
particular potential for reducing the amount of time that FRA Safety 
Inspectors spend returning to an inspection location to check on the 
status of a violation for which a violation report had previously been 
submitted. 58 FR 33601. The rule also will permit FRA to develop more 
comprehensive safety data, better utilize its limited resources, and 
consistently treat all similarly situated violators of the Federal 
railroad safety laws.
    4. Should notification to a railroad that it must submit a remedial 
actions report be provided to a specific person and place designated by 
that railroad?
    The proposed rule identified the entity itself as the person upon 
whom written notification of the requirement to submit a remedial 
actions report would be served. No provision was included to permit a 
railroad to direct FRA to serve the written notice upon either a named 
individual or an individual having a particular job title or job 
function on the railroad. FRA anticipated that written notice would be 
given directly to an appropriate local railroad official, such as a 
foreman, trainmaster, or supervisor.
    Five commenters opined that unless FRA requires each railroad to 
identify a specific person or contact within that railroad, delays or 
failure to respond to the remedial actions report could result. The AAR 
proposed that FRA provide initial notification of a filing requirement 
to nonagreement officers (or their designates) involved in managerial 
field supervision, with duplicate notice sent to a location to be 
specified by each railroad. The AAR stated that while cost savings are 
difficult to quantify, providing notification to a headquarters 
location would enhance timeliness and compliance. The AAR requested 
that if the final rule does not require central notification, then FRA 
Safety Inspectors should be required to make every effort to hand 
deliver notification to the nonagreement managers (or their designates) 
who accompany the field inspectors. Conrail stated that many of its 
first-line supervisors, with whom FRA Safety Inspectors currently leave 
inspection reports, assume that the reports are not their 
responsibility to forward or answer because the problems did not exist 
or originate in their territories.
    The BRC argued that if the railroads need to implement internal 
reforms in order to comply with FRA regulations then blame cannot be 
placed on the remedial actions reporting requirement. The BRC opined 
that to the extent that the railroads already monitor and control 
required repairs to track and equipment, their current internal 
accountability will foster compliance with this rule. It also believed 
that since most violations are resolved and handled locally, the 
remedial actions report form could be completed locally.
    FRA is not persuaded that a requirement to provide notification of 
the duty to submit a remedial actions report to either a specific 
local-level nonagreement official and/or to an official at a central 
location of the railroad is either necessary or appropriate. Upon 
consideration of all of the comments, FRA believes that to require its 
inspectors to expend additional time serving notice upon only certain 
categories of railroad employees at each inspection location and also 
to maintain current lists of names and mailing addresses of designated 
railroad officials at central locations, would undermine FRA's ability 
to efficiently and effectively manage its inspection resources.
    Under current FRA procedures, FRA Safety Inspectors usually will 
deliver their inspection report directly to the individual who 
accompanied them on the railroad's property during the inspection. 
Other times, the inspectors will communicate with an appropriate local 
railroad official (either agreement or nonagreement) shortly after they 
perform an unaccompanied inspection. In any event, the inspection 
report form shows to whom FRA has delivered the report, so there is a 
clear basis on which a railroad can insist on accountability by its own 
officers and employees. Accordingly, we believe that each railroad is 
uniquely qualified to establish its own internal control mechanism for 
ensuring that all information concerning remedial actions reporting, 
delivered by FRA to any relevant local employee of the railroad, is 
reported to the necessary individuals in the railroad's hierarchy in a 
timely and efficient manner.
    5. Should the inspection report itself be adapted and modified to 
serve as the remedial actions report form?
    The NPRM proposed the continued use by FRA Safety Inspectors of a 
different type of inspection report form specific to each discipline. 
However, only one generic remedial actions report form, regardless of 
the rule, regulation, order, or standard involved, would be used by all 
railroads required to report their remedial actions. It was anticipated 
that FRA would develop a number of specific remedial actions report 
forms unique to each discipline, either as part of, or as attachments 
to, the inspection reports themselves.
    The AAR, the UP, and the ASLRA strongly urged FRA to amend its 
existing inspection reports to serve as remedial actions report forms, 
thus eliminating much of the paperwork and reporting burdens from the 
railroads. The AAR also noted that several of FRA's current inspection 
forms already serve this purpose, such as the ``Railroad Followup'' 
section on inspection reports for Track, Motive Power and Equipment, 
and Signal and Train Control inspections.
    FRA agrees with the commenters that modifying the inspection report 
to serve as the remedial actions report form will generally ease the 
paperwork burden imposed by this rule on the railroads and will 
specifically reduce the amount of time required to complete the form. 
FRA has also decided to combine all four of its discipline-specific 
inspection reports into one new generic inspection report, to be 
designated as Form FRA F 6180.96. To denote that a railroad is required 
to submit a remedial actions report, the FRA Safety Inspector checks 
the box marked ``required'' in the section entitled ``Remedial 
Actions'' of the new inspection report form. The railroad will then 
provide the required remedial actions report information directly on 
its copy of the inspection report, and mail that form back to the 
appropriate FRA Safety Inspector.
    6. Should the instructions on the remedial actions report form be 
changed to make submission of a brief narrative statement optional, 
thus permitting a railroad to submit its report by only selecting the 
appropriate remedial action code?
    The NPRM proposed prohibiting a railroad from reporting its 
remedial actions simply by indicating that corrective actions were 
performed. The proposed rule would have required a railroad to report 
to FRA with the necessary level of specificity by selecting the 
appropriate reporting code along with a brief narrative description to 
indicate the nature of the actions taken.
    The AAR and the ASLRA contended that, with the exception of the 
code ``other remedial actions,'' FRA should not require written 
narrative statements when an applicable action code already exists. 
They believed that preparation of a narrative adds to compliance time 
and costs, but yields no railroad safety benefits. They further argued 
that the absence of a narrative would not undermine the quality of 
railroad compliance, since FRA could perform field audits and random 
samplings of railroad records.
    The BRC strongly favored retention of the narrative description 
requirement and suggested that additional instructions be added to the 
reporting form to enhance the quality of the narrative statement, e.g., 
when repairs to a railroad car are necessary the narrative statement 
should indicate the place of repair, the extent of the repair, and the 
name of the person performing the repair. The BRC opined that the 
narrative statement would assist FRA in determining if a railroad 
needed to take additional actions, without the need for a formal audit.
    FRA agrees with the AAR and the ASLRA that under most circumstances 
the selection of a remedial action code on the reporting form will 
fully and accurately reflect the action or actions taken to remedy a 
failure to comply with a provision of the Federal railroad safety laws. 
Examples of such codes include the following: repair or replacement of 
a defective component without movement, movement of a locomotive or car 
for repair (where permitted) and its subsequent repair, completion of a 
required test or inspection, removal of a noncomplying item from 
service but not for repair (where permitted), or reduction of operating 
speed (where sufficient to achieve compliance). It is primarily this 
coded information that FRA anticipates entering into its computer 
database to augment FRA's ability to efficiently and effectively manage 
its inspection resources. With the exception of the residuary code for 
``other remedial actions,'' FRA concludes that requiring inclusion of a 
narrative statement on the report form would unnecessarily add to the 
time that a railroad would expend on completion of the form and would 
be of marginal value to railroad safety.
    Contrary to the BRC's argument, FRA believes that the possibility 
of a followup FRA inspection, coupled with potential imposition of 
civil and criminal penalties for filing a false remedial actions 
report, will serve as a significant deterrent to any railroad 
considering filing a report with a false or misleading remedial action 
code selected. Accordingly, FRA is revising the final rule to require a 
railroad compelled to file a remedial actions report to select only an 
appropriate remedial action code to fully describe the remedial action 
or actions performed. Completion of the brief narrative description 
section will ordinarily be optional; however, for any railroad 
selecting the remedial action code ``other remedial actions'' 
completion of the brief narrative description section will be 
mandatory.
    7. Did FRA substantially underestimate the regulatory impact of the 
rule when it stated that it would cost the railroad industry only 
$66,500 per year to fill out the required remedial actions reports?
    The NPRM noted that the potential benefit of the rule comes from 
increasing the ability of the railroad industry to manage quality 
control, as well as by improving FRA's ability to efficiently and 
effectively manage its inspection resources. It was anticipated that it 
would not take the realization of many benefits to offset the 
relatively insignificant cost to society of approximately $75,000 per 
year ($66,500 to the railroad industry each year to fill out the 
required remedial actions reports and approximately $8,100 to FRA to 
review the reports). Moreover, the public reporting burden for the 
collection of information was estimated to average approximately 23 
minutes per response, including the time for reviewing instructions, 
searching existing data sources, gathering and maintaining the data 
needed, and completing and reviewing the collection of information.
    The AAR argued that FRA's cost estimate is off by at least a factor 
of ten. This commenter believed that although a voluntary report may 
take only 15 minutes to complete, the risk of civil and criminal 
penalties would require a railroad to devote more management time and 
attention to reporting and would increase the completion time to at 
least one and one-half hours. The AAR further contended that FRA erred 
by estimating the actual employee cost per hour to be $24.00, rather 
than $36.00 per hour with fringe benefits included in the calculation.
    The ASLRA agreed with the AAR that the cost of implementation was 
grossly understated. This commenter believed that based upon wage 
levels for the larger Class II and Class III railroads of approximately 
$28.00 to $30.00 per hour, along with an average 90-minute time period 
required for recording, checking accuracy, and senior management 
clearance, the estimated annual administration cost to small railroads 
will be approximately $50,000 to $75,000. Both commenters, and the UP, 
argued that the reporting burden would be eased if FRA incorporated the 
reporting requirement directly onto the inspection report, and relied 
primarily on a checkoff of coded responses in lieu of a written 
description of remedial actions performed.
    As already discussed in this preamble, FRA has addressed many of 
the concerns about time and cost raised by the three commenters by 
modifying the inspection report to serve as the remedial actions report 
form and by making a railroad's submission of a narrative description 
optional, under most circumstances, instead of required. Accordingly, 
FRA anticipates that the public reporting burden for collection of 
information required for this rule will remain as estimated in the 
NPRM, an average of approximately 23 minutes per response for all 
reports filed as a result of Secs. 209.405 and 209.407.
    FRA rejects the argument that the risk of civil and criminal 
penalties will increase the time required to complete a mandatory 
remedial actions report over the time now required to complete a 
voluntary report. A railroad is legally obligated to correct a cited 
violation and avoid continued noncompliance, regardless of whether it 
is required to inform FRA of its remedial actions. Presumably, a 
railroad that currently voluntarily submits remedial actions reports to 
FRA is not choosing to provide inaccurate and untruthful information 
merely because the threat of civil and criminal penalties may be 
lacking. Accordingly, FRA concludes that the time required to read the 
remedial actions report form and select an appropriate remedial action 
code will be minimal.

Section-by-Section Analysis

    Section 209.3 is reorganized, the definition of ``person'' is 
revised, and definitions of three important terms employed in the 
remedial actions regulations are added. The first of the newly defined 
terms is ``FRA Safety Inspector.'' It is defined to mean an FRA safety 
inspector, a State inspector participating in railroad safety 
investigative and surveillance activities under Part 212 of this 
chapter, or any other official duly authorized by FRA. The term 
``railroad'' is defined as it appears in the recodification of the 
provisions of law formerly contained in the Safety Act. The term 
``Federal railroad safety laws'' includes the provisions of law that 
before their repeal and reenactment in title 49 of the U.S. Code were 
contained in the Safety Act, the Hazmat Act, SFTA, and those laws 
transferred to the jurisdiction of the Secretary of Transportation by 
subsections (e)(1), (2), and (6)(A) of section 6 of the DOT Act. Those 
laws which were transferred include, but are not limited to, the Safety 
Appliance Acts, the Locomotive Inspection Act, the Accident Reports 
Act, the Hours of Service Act, and the Signal Inspection Act. In 
addition, the term ``Federal railroad safety laws'' encompasses the 
rules, regulations, orders, and standards issued pursuant to the above 
provisions of law.
    As discussed elsewhere in this preamble, FRA has decided to limit 
the applicability of the final rule to railroads only. Accordingly, the 
term ``responsible company'' has been eliminated.
    Section 209.401 describes the purpose and scope of the remedial 
actions reporting regulations. FRA seeks to prevent and avoid accidents 
and injuries that could result from a railroad's failure to remedy 
certain violations of the Federal railroad safety laws that have been 
recommended for the assessment of a civil penalty. The rules require a 
railroad notified by an FRA Safety Inspector both that assessment of a 
civil penalty will be recommended for a failure to comply with a 
provision of the Federal railroad safety laws and that a remedial 
actions report must be submitted, to report to the inspector actions 
taken to remedy that failure. The railroad must report within 30 days 
after the end of the month in which it receives such notification.
    In response to AAR's request, FRA has added new subsection (d) to 
Sec. 209.401 to clarify that FRA requires the submission of a remedial 
actions report from a railroad against whom a civil penalty is 
recommended only for a failure to comply that could literally and 
specifically be corrected by that railroad. For completed or past 
transactions that can no longer be remedied (e.g., permitting an 
engineer to work over 12 hours in violation of the Federal hours of 
service laws), FRA expects the railroad against whom a civil penalty is 
recommended to reassess its own overall policy and attitude toward 
future compliance, perhaps by reallocating its resources or providing 
additional employee training. In all these situations, a civil penalty 
has already been recommended as an incentive toward such generally 
responsive actions. Accordingly, to require a railroad to inform FRA of 
remedial actions taken in response to a particular violation that can 
no longer be remedied by that railroad would be superfluous.
    Accordingly, a railroad that has delivered a freight car in 
interchange with a defective wheel that FRA identifies to a receiving 
railroad as requiring repair might be recommended for the assessment of 
a civil penalty, but the offering railroad would not be required to 
submit a remedial actions report to FRA for this completed transaction. 
However, if the receiving railroad is recommended for the assessment of 
a civil penalty, it would be required to submit a report because the 
nature of its violation poses an ongoing risk to rail safety. Of 
course, for purposes of resource allocation with respect to future FRA 
inspection and enforcement activity, FRA welcomes the receipt of 
remedial actions reports from all entities (including railroads and 
shippers of hazardous materials) on a voluntary basis when the FRA 
Safety Inspector checks the ``Optional Box'' on the inspection report. 
However, no entity will be penalized for failing to submit a 
noncompulsory report.
    Section 209.403 defines the applicability of these regulations. The 
final regulations do not expand the number of entities affected by the 
reporting requirement beyond the single category required by the 
provisions of law formerly contained in the RSERA, i.e., all railroads 
receiving written notification from an FRA Safety Inspector both that a 
recommendation for the assessment of a civil penalty is being made and 
that a remedial actions report must be submitted. The primary impact of 
this change from the proposed rule is that hazardous materials shippers 
over which FRA exercises enforcement authority will not be required to 
report their remedial actions to the inspector. While the regulations 
do not directly apply to individuals, as the penalty provision in 
Sec. 209.409 makes clear, any individual who willfully thwarts the 
reporting provisions of the proposed rule would be held individually 
liable for the violation.
    Section 209.405(a) requires that upon receipt of written 
notification on Form FRA F 6180.96 from an FRA Safety Inspector both 
that assessment of a civil penalty will be recommended for a failure to 
comply with a provision of the Federal railroad safety laws and that a 
remedial actions report must be submitted, the railroad shall report to 
the inspector all actions taken to remedy that failure. The railroad 
shall have 30 days after the calendar month in which the notification 
is received to submit this report to the inspector in writing. The duty 
to report to the inspector is not triggered merely by receiving written 
notification from the inspector that assessment of a civil penalty will 
be recommended, but only in conjunction with receiving written 
notification from the inspector that a remedial actions report must be 
submitted.
    Since a recommendation for the assessment of a civil penalty must 
be made before submission of a remedial actions report is required, the 
duty would never arise merely upon notification that a defect has been 
discovered. Alternatively, if a recommendation for the assessment of a 
civil penalty is made and a railroad receives written notification that 
a remedial actions report must be submitted, but no civil penalty is 
later assessed either for policy or evidentiary reasons, the duty to 
report remedial actions taken pursuant to this section still exists. 
Accordingly, if the railroad is ultimately not required to pay a civil 
penalty for the underlying alleged violation, the railroad would still 
be liable for a civil penalty under Sec. 209.405 for failing to file a 
required remedial actions report regarding the underlying alleged 
violation.
    Written notification that the submission of a remedial actions 
report is required will occur only when a failure to comply with a 
provision of a Federal railroad safety law for which the assessment of 
a civil penalty is recommended falls into one of three general 
categories. The three general categories consist of (i) physical 
defects, (ii) recordkeeping and reporting violations, and (iii) filing 
violations. These categories represent types of violations that could 
still pose ongoing risks to rail safety if left uncorrected and/or can 
actually be specifically corrected. The obligation to determine whether 
a particular failure recommended for the assessment of a civil penalty 
triggers the requirement to submit a remedial actions report rests 
totally with FRA. Moreover, since a railroad's duty to submit a 
remedial actions report arises only upon specific notification to this 
effect, no violation can occur under this section unless such 
notification is properly provided by FRA.
    The ASLRA commented that since circumstances vary as to what 
constitutes a violation, FRA Safety Inspectors must receive clear 
guidance as to when a violation requires the submission of a remedial 
actions report. The commenter argues that without such guidance an 
inspector might impose the reporting requirement on all categories of 
violations, not just for the three general categories of violations 
discussed earlier. FRA is aware of the potential for inconsistent 
enforcement of the reporting regulations by its inspectors, and intends 
to provide them with comprehensive training concerning the types and 
circumstances of violations that require the submission of remedial 
actions reports.
    The 30-day time period is merely provided for the administrative 
convenience of the railroad, so as to allow sufficient time to report 
its remedial actions by filling out the form provided to it. The pre-
existing duty to correct the defect or take other appropriate remedial 
action remains the same as it was before the effective date of these 
regulations. Accordingly, a railroad would be subject to a new 
recommendation for the assessment of a civil penalty for a willful 
violation if, for example, it operated a freight car subject to the 
Freight Car Safety Standards, except under the provisions of 49 CFR 
215.9, knowing it to be defective, but with the intent to delay making 
repairs until the end of the 30-day reporting deadline. Indeed, under 
49 U.S.C. 21301 (formerly contained in Sec. 209(c) of the Safety Act), 
each day the violation continued would constitute a separate offense. 
In an instance where the FRA Safety Inspector hand delivers the written 
notification directly to an appropriate official, such as a foreman, 
trainmaster, or supervisor on duty at the location where the failure to 
comply with the provision of a Federal railroad safety law is either 
found or discovered, the date of actual delivery will be the operative 
date for reporting purposes. This provision is intended to affect the 
same categories of railroads that currently receive notification from 
FRA either that a defect exists and/or that a recommendation for the 
assessment of a civil penalty is being made. A railroad receiving 
written notification by first class mail that a recommendation for the 
assessment of a civil penalty is being made would be deemed to have 
received such notification five business days after the date of 
mailing, as determined by the date accompanying the signature of the 
safety inspector.
    This subsection also requires that the railroad reporting remedial 
actions shall not simply indicate that corrective actions were taken, 
but shall select the appropriate reporting code to indicate what 
actions were taken, including the date of corrective actions. To take 
an example from the accident/incident reporting regulations, if a 
railroad fails to submit to FRA a monthly report of railroad accidents/
incidents within 30 days after the expiration of the month during which 
the accident/incident occurred, an example of remedial action would be 
to file a late report with FRA for the relevant month. The railroad 
would select the remedial action code ``Report filed.'' See 49 CFR 
225.11 and 225.13. Or if, under the Railroad Operating Rules, a 
railroad required to file with the Federal Railroad Administrator one 
copy of its code of operating rules, timetables, and timetable 
instructions failed to do so, an example of remedial action would be to 
file the copy of the relevant documents as soon as possible after 
receiving the notification. The railroad would select the remedial 
action code ``Document filed.'' See 49 CFR 217.7.
    Unless the railroad selects the remedial action code ``other 
remedial actions,'' submission of a brief narrative description will be 
optional. Although a railroad selecting ``other remedial actions'' is 
required to describe its remedial actions in a somewhat precise manner, 
FRA does not expect a lengthy and technical step-by-step explanation of 
what remedial actions were taken.
    Section 209.405(a)(3) provides that each railroad shall return the 
form only to the FRA Safety Inspector whose name and address are so 
designated. Although FRA presently employs a different type of 
inspection report specific to each discipline, the reporting form to be 
provided by FRA is the current version of a new inspection report (a 
copy of which is appended to this final rule) for use by all railroads 
required to report their remedial actions. The FRA inspector will 
submit a copy of the completed remedial actions report form to FRA's 
Office of Chief Counsel for use during the penalty assessment and 
negotiation process. It is anticipated that the available remedial 
action codes along with the brief narrative section (when applicable) 
will be sufficient to report the remedial actions involved. 
Accordingly, a railroad will not be permitted the option of submitting 
its own version of a reporting form to FRA, even if it contains the 
same information as the FRA form.
    A railroad is expected to submit its remedial actions report to FRA 
within the time limit specified in Sec. 209.405(a), even if the 
railroad believes that a question exists as to factual elements 
constituting a violation of the statute or regulation cited on the 
inspection report. The only exception to this requirement concerns a 
railroad unable either to initiate or complete remedial actions that 
comply with the ``Delayed Reports'' requirement of Sec. 209.407. If a 
railroad does contest the allegation, Sec. 209.405(b) permits the 
railroad to explain its reasons on the remedial actions report form. To 
illustrate, while FRA does not expect a railroad to make repairs to a 
component part that the railroad does not believe is broken or 
defective, Sec. 209.405(b) does require the railroad to explain what 
actions it took to reach the conclusion that FRA's allegation was 
incorrect. For example, consider a situation in which a railroad 
disagrees with an inspector's conclusion that the height of a wheel 
flange on a car, from the tread to the top of the flange, was 1\1/2\ 
inches or more, in violation of 49 C.F.R. 215.103(b). Rather than 
select the category code corresponding to an actual repair job, the 
railroad would be expected to discuss what actions it took to disprove 
the inspector's conclusion. In response to SEPTA's concern, that by 
requiring the reporting of remedial actions FRA is in reality obtaining 
a guilty plea which interferes with the review and negotiations 
process, FRA states in Sec. 209.405(b) that a railroad's failure to 
raise all pertinent defenses on the remedial actions report does not 
preclude it from doing so later in response to a penalty demand.
    Section 209.407 sets forth in subsection (a) the procedure that 
must be followed by a railroad if, upon receipt of written notification 
from FRA both that assessment of a civil penalty will be recommended 
for a failure by that railroad to comply with a provision of the 
Federal railroad safety laws and that a remedial actions report must be 
submitted, it is unable to either initiate and/or complete remedial 
actions within the time limit set forth in Sec. 209.405. Each railroad 
shall have 30 days after the calendar month in which the notification 
is received to report to FRA in writing the reasons for such delay and 
a good faith estimate of the date by which the remedial actions will be 
completed. For purposes of determining the calendar month in which 
written notification is received, the same analysis as applied to 
Sec. 209.405(a) applies to this subsection as well. Further, as 
explained in the analysis of Sec. 209.405(a), the 30-day time period is 
provided for the administrative convenience of the railroad, and the 
pre-existing duty to correct the defect or take other appropriate 
remedial actions would remain the same as it was before the effective 
date of these regulations.
    This subsection also requires that the railroad reporting a delay 
in either initiating and/or completing remedial actions in a timely 
manner pursuant to Sec. 209.405, shall not simply indicate that 
corrective actions could not be taken. It shall report to FRA with the 
necessary level of specificity to indicate why these actions could not 
be taken. This subsection makes clear that although FRA does not expect 
a lengthy and technical step-by-step explanation of why remedial 
actions could not be taken, the regulations are intended to force a 
railroad to be somewhat precise in its report. Consider an example from 
the Track Safety Standards: A railroad is informed that a 
recommendation for the assessment of a civil penalty is being made 
pursuant to 49 C.F.R. 213.109 for the failure of a 39-foot segment of 
its track to have a sufficient number of crossties which in combination 
will hold gage within the limits prescribed in Sec. 213.53(b). Under 
the wording of this subsection, a written explanation to FRA merely 
stating that ``the defect could not be corrected'' would be 
insufficient. However, an explanation briefly stating either that ``no 
crossties are currently in stock but will arrive within 45 days and be 
installed within three days after arrival'' or ``no funds are currently 
available to initiate repairs and track has been taken out of service; 
repairs will be completed in 60 days when funds are expected to become 
available'' would fulfill the regulatory requirement. However, if 
immediately upon receiving written notification from FRA that a 
remedial actions report must be submitted, a railroad in the above 
example makes a business decision to permanently cease operations over 
a segment of track, the appropriate section under which to report this 
remedial action would be Sec. 209.405.
    Section 209.407(a)(1) provides that each railroad shall submit its 
explanation of the reasons for its delay in a manner that provides the 
inspection report number, the inspection date, and the item number. A 
photocopy of both sides of the Form FRA F 6180.96 on which the railroad 
received notification may be used for this purpose. The railroad must 
retain the original of Form FRA F 6180.96 and, as soon as it finally 
takes all actions necessary to remedy its failure to comply with a 
provision of the Federal railroad safety laws, submit it to FRA in 
accordance with Sec. 209.407(b).
    Section 209.407(a)(2) requires that upon completing all actions 
necessary to remedy a failure to comply with a provision of the Federal 
railroad safety laws, each railroad shall have 30 days after the 
calendar month in which the actions are completed to report to FRA in 
writing, in accordance with the remedial action code reporting 
procedures referenced in Sec. 209.405(a) and (b).
    FRA will expect a railroad to exercise good faith to determine the 
date by which it will complete its remedial actions, and to do so as 
promptly as possible. However, FRA has dropped the proposed requirement 
of Sec. 209.407(c) concerning a showing of good cause by any railroad 
failing to complete its remedial actions within 90 days of receiving 
written notification of a failure to comply with a provision of the 
Federal railroad safety laws.
    As set forth in the discussion of Sec. 209.405(b), Sec. 209.407(b) 
requires a railroad to submit its remedial actions report to FRA under 
the provisions of Sec. 209.405 even if the railroad believes that a 
question exists as to factual elements constituting a violation of the 
statute or regulation cited on the inspection report. As also set forth 
in the analysis of Sec. 209.405(b), if a railroad does contest the 
allegation it may explain its reasons on the remedial action report 
form and later present all pertinent defenses in response to a penalty 
demand.
    Section 209.409 identifies the penalties FRA may impose upon any 
person, including a railroad, that violates any requirement of this 
subpart. These penalties are authorized by 49 U.S.C. 21301, 21304, and 
21311 (formerly contained in Sec. 209 of the Safety Act). The penalty 
provision parallels penalty provisions included in numerous other 
regulations issued by FRA under authority of the provisions of law 
formerly contained in the Safety Act. Essentially, any person who 
violates any requirement of this subpart or causes the violation of any 
such requirement will be subject to a civil penalty of at least $500 
and not more than $10,000 per violation. Civil penalties may be 
assessed against individuals only for willful violations, and where a 
grossly negligent violation or a pattern of repeated violations creates 
an imminent hazard of death or injury to persons, or causes death or 
injury, a penalty not to exceed $20,000 per violation may be assessed. 
In addition, each day a violation continues will constitute a separate 
offense. Finally, a person may be subject to criminal penalties for 
knowingly and willfully falsifying reports required by these 
regulations. FRA believes that the inclusion of penalty provisions for 
failure to comply with the regulations is important in ensuring that 
compliance is achieved not only in terms of submitting the relevant 
reports of remedial actions taken, but also in development of more 
accurate inspection and compliance data so as to better determine if 
railroads are minimizing and correcting safety problems.

Environmental Impact

    FRA has evaluated these final regulations in accordance with its 
procedures for ensuring full consideration of the potential 
environmental impacts of FRA actions, as required by the National 
Environmental Policy Act (42 U.S.C. 4321 et seq.) and related 
directives. These final regulations meet the criteria that establish 
this as a non-major action for environmental purposes.

Regulatory Impact

Executive Order l2866 and DOT Regulatory Policies and Procedures

    This final rule has been evaluated in accordance with existing 
policies and procedures. It is considered to be non-significant under 
both Executive Order 12866 and the DOT policies and procedures (44 FR 
11034; February 26, 1979). FRA has prepared and placed in the docket a 
regulatory evaluation addressing the economic impact of the final rule. 
It may be inspected and photocopied at Office of Chief Counsel, Federal 
Railroad Administration, 400 Seventh Street, S.W., Room 8201, 
Washington, D.C. 20590. Photocopies may also be obtained by submitting 
a written request to the FRA Docket Clerk at the above address.
    FRA believes that, in general, the railroad industry performs 
repairs or takes other remedial actions in response to notification by 
FRA of defects and violations in a timely and complete manner. 
Especially where violations have been filed, failure to take corrective 
action could lead to vastly increased penalties and even individual 
liability. These regulations may provide some additional incentive to 
take such corrective action where it otherwise might not be taken, but 
that potential benefit cannot be quantified. However, it is doubtful 
that these regulations alone will reduce the number of defective 
conditions in the industry, or that they will materially reduce the 
rate of train accidents. Further, these regulations will not change the 
manner in which FRA enforces the other Federal railroad safety laws; 
the types of violations for which safety inspectors currently recommend 
the assessment of a civil penalty will remain the same.
    At this time, FRA is unable to quantify any direct or indirect 
safety benefit from this final rule. The potential benefit of this rule 
comes about by increasing the ability of the railroad industry to 
manage quality control, as well as by improving FRA's ability to 
efficiently and effectively manage its inspection resources. It is 
hoped that railroads, after being required by these regulations to 
report remedial actions, will create their own internal databases of 
these reports. Although not required by these regulations, an internal 
analysis of this information, in conjunction with other resource 
management data, might lead railroad management to take actions 
designed to reduce or effectively respond to defective conditions.
    The regulations will assist FRA in monitoring follow-up actions by 
railroads with respect to conditions sufficiently serious to warrant 
possible future civil penalty actions. Moreover, the regulations hold 
particular potential for reducing the amount of time safety inspectors 
spend returning to an inspection location to check on the status of a 
violation for which a violation report had previously been submitted. 
Further, the regulations permit FRA to develop more comprehensive 
safety data, better utilize its limited resources, and consistently 
treat all similarly situated violators of the Federal railroad safety 
laws.
    The extent to which these potential benefits will be realized will 
become clearer over time as both the railroads and FRA learn how to 
best use the data required by these regulations. What appears clear at 
this time, however, is that it will not take the realization of many 
benefits to offset the relatively insignificant cost to society of 
approximately $71,000 per year ($63,121 to the railroad industry each 
year to fill out the required remedial actions reports and 
approximately $7,700 to FRA to review the reports).

Regulatory Flexibility Act

    The Regulatory Flexibility Act of 1980 (5 U.S.C. 601 et seq.) 
requires a review of rules to assess their impact on small entities. In 
reviewing the economic impact of the rule, FRA has concluded that it 
will have a minimal economic impact on a minor number of small 
entities. There are no direct or indirect economic impacts for small 
units of government, businesses, or other organizations; therefore, it 
is certified that this rule will not have a significant economic impact 
on a substantial number of small entities under the provisions of the 
Regulatory Flexibility Act. State rail safety agencies remain free to 
participate in the administration of FRA's rules, but are not required 
to do so.

Federalism Implications

    This rule does not have substantial direct effects on the States, 
on the relationship between the national government and the States, or 
on the distribution of power and responsibilities among the various 
levels of government. Therefore, in accordance with Executive Order 
12612, FRA has determined that this rule does not have sufficient 
federalism implications to warrant the preparation of a Federalism 
Assessment.

Paperwork Reduction Act

    This final rule has information collection requirements in 
Secs. 209.405 and 209.407. Section 209.405 provides that when a 
railroad is notified in writing by an FRA Safety Inspector that a civil 
penalty will be recommended for a failure to comply with a provision of 
the Federal railroad safety laws, and that a remedial actions report 
must be submitted, the railroad must report to FRA all actions taken to 
remedy that failure. Section 209.407 has an additional information 
collection requirement, stating that any railroad unable to either 
initiate and/or complete remedial actions within the time limit set 
forth in Sec. 209.405 shall submit a written explanation of the reasons 
for the delay and a good faith estimate of the date by which the 
remedial actions will be completed. FRA is submitting this information 
collection requirement to the Office of Management and Budget for 
approval under the Paperwork Reduction Act of 1980 (44 U.S.C. 3501 et 
seq.). The public reporting burden for this collection of information 
is estimated to average approximately 23 minutes per response, 
including the time for reviewing instructions, searching existing data 
sources, gathering and maintaining the data needed, and completing and 
reviewing the collection of information. A Federal Register notice will 
be published when Paperwork Reduction Act approval is obtained.

List of Subjects in 49 CFR Part 209

    Railroad safety, Railroad remedial actions reporting rules.

The Final Rule

    In consideration of the foregoing, chapter II, subtitle B, of title 
49, Code of Federal Regulations is amended as follows:

PART 209--[AMENDED]

    1. The authority citation for part 209 is revised to read as 
follows:

    Authority: 49 U.S.C. subtitle V, part A; 49 U.S.C. chap. 51 and 
57; Pub. L. 103-272; 49 U.S.C. 20301, 20303, 20304, 21302, and 
21304; 49 U.S.C. 21302 and 21304; 49 U.S.C. 21302, 21304, 21311, and 
20901; 49 U.S.C. 21303, 21304, and 21102; 49 U.S.C. 20102, 20103, 
20107, 20108, 20110-20114, 20131-20143, 21301, 21302, 21304, 21311, 
and 24902; 49 U.S.C. 103(c); 49 U.S.C. 21302 and 21304; 49 U.S.C. 
20302, 20305, 20502-20505, 20701-20703, 20901, 20902, 21302, and 
80504; 49 U.S.C. 5103, 5104, 5110, 5112, 5120, and 5123-5125; and 49 
CFR 1.49(c), (d), (f), (g), (m), (s), (ee), (gg), and internal 
delegations.

    2. By revising Sec. 209.3 to read as follows:


Sec. 209.3.   Definitions.

    As used in this part--
    Administrator means the Administrator of FRA, the Deputy 
Administrator of FRA, or the delegate of either.
    Chief Counsel means the Chief Counsel of FRA or his or her 
delegate.
    Day means calendar day.
    Federal railroad safety laws means the provisions of law generally 
at 49 U.S.C. subtitle V, part A or 49 U.S.C. chap. 51 or 57 and the 
rules, regulations, orders, and standards issued under any of those 
provisions. See Pub. L. 103-272 (1994). Before recodification, these 
statutory provisions were contained in the following statutes: (i) the 
Federal Railroad Safety Act of 1970 (Safety Act) (49 U.S.C. 20101-
20117, 20131, 20133-20141, 20143, 21301, 21302, 21304, 21311, 24902, 
and 24905, and Secs. 4(b)(1), (i), and (t) of Pub. L. 103-272, formerly 
codified at 45 U.S.C. 421, 431 et seq.); (ii) the Hazardous Materials 
Transportation Act (Hazmat Act) (49 U.S.C. 5101 et seq., formerly 
codified at 49 App. U.S.C. 1801 et seq.); (iii) the Sanitary Food 
Transportation Act of 1990 (SFTA) (49 U.S.C. 5713, formerly codified at 
49 App. U.S.C. 2801 (note)); and those laws transferred to the 
jurisdiction of the Secretary of Transportation by subsection (e)(1), 
(2), and (6)(A) of section 6 of the Department of Transportation Act 
(DOT Act), as in effect on June 1, 1994 (49 U.S.C. 20302, 21302, 20701-
20703, 20305, 20502-20505, 20901, 20902, and 80504, formerly codified 
at 49 App. U.S.C. 1655(e)(1), (2), and (6)(A)). 49 U.S.C. 20111 and 
20109, formerly codified at 45 U.S.C. 437 (note) and 441(e). Those laws 
transferred by the DOT Act include, but are not limited to, the 
following statutes: (i) the Safety Appliance Acts (49 U.S.C. 20102, 
20301, 20302, 20304, 21302, and 21304, formerly codified at 45 U.S.C. 
1-14, 16); (ii) the Locomotive Inspection Act (49 U.S.C. 20102, 20701-
20703, 21302, and 21304, formerly codified at 45 U.S.C. 22-34); (iii) 
the Accident Reports Act (49 U.S.C. 20102, 20701, 20702, 20901-20903, 
21302, 21304, and 21311, formerly codified at 45 U.S.C. 38-43); (iv) 
the Hours of Service Act (49 U.S.C. 20102, 21101-21107, 21303, and 
21304, formerly codified at 45 U.S.C. 61-64b); and (v) the Signal 
Inspection Act (49 U.S.C. 20102, 20502-20505, 20902, 21302, and 21304, 
formerly codified at 49 App. U.S.C. 26).
    FRA means the Federal Railroad Administration, U.S. Department of 
Transportation.
    FRA Safety Inspector means an FRA safety inspector, a state 
inspector participating in railroad safety investigative and 
surveillance activities under Part 212 of this chapter, or any other 
official duly authorized by FRA.
    Motion means a request to a presiding officer to take a particular 
action.
    Person generally includes all categories of entities covered under 
1 U.S.C. 1, including but not limited to the following: a railroad; any 
manager, supervisor, official, or other employee or agent of a 
railroad; any owner, manufacturer, lessor, or lessee of railroad 
equipment, track, or facilities; any independent contractor providing 
goods or services to a railroad; and any employee of such owner, 
manufacturer, lessor, lessee, or independent contractor; however, 
person, when used to describe an entity that FRA alleges to have 
committed a violation of the provisions of law formerly contained in 
the Hazardous Materials Transportation Act or contained in the 
Hazardous Materials Regulations, has the same meaning as in 49 U.S.C. 
5102(9) (formerly codified at 49 App. U.S.C. 1802(11)), i.e., an 
individual, firm, copartnership, corporation, company, association, 
joint-stock association, including any trustee, receiver, assignee, or 
similar representative thereof, or government, Indian tribe, or 
authority of a government or tribe when offering hazardous material for 
transportation in commerce or transporting hazardous material to 
further a commercial enterprise, but such term does not include the 
United States Postal Service or, for the purposes of 49 U.S.C. 5123-
5124 (formerly contained in Secs. 110 and 111 of the Hazardous 
Materials Transportation Act and formerly codified at 49 App. U.S.C. 
1809-1810), a department, agency, or instrumentality of the Federal 
Government.
    Pleading means any written submission setting forth claims, 
allegations, arguments, or evidence.
    Presiding Officer means any person authorized to preside over any 
hearing or to make a decision on the record, including an 
administrative law judge.
    Railroad means any form of nonhighway ground transportation that 
runs on rails or electro-magnetic guideways, including (i) commuter or 
other short-haul railroad passenger service in a metropolitan or 
suburban area and commuter railroad service that was operated by the 
Consolidated Rail Corporation on January 1, 1979; and (ii) high speed 
ground transportation systems that connect metropolitan areas, without 
regard to whether those systems use new technologies not associated 
with traditional railroads; but does not include rapid transit 
operations in an urban area that are not connected to the general 
railroad system of transportation.
    Respondent means a person upon whom FRA has served a notice of 
probable violation, notice of investigation, or notice of proposed 
disqualification.
    3. By adding a new Subpart E--Reporting of Remedial Actions, to 
read as follows:

Subpart E--Reporting of Remedial Actions

Sec.
209.401.  Purpose and scope.
209.403.  Applicability.
209.405.  Reporting of remedial actions.
209.407.  Delayed reports.
209.409.  Penalties.

    (a) The purpose of this subpart is to prevent accidents and 
casualties arising from the operation of a railroad that result from a 
railroad's failure to remedy certain violations of the Federal railroad 
safety laws for which assessment of a civil penalty has been 
recommended.
    (b) To achieve this purpose, this subpart requires that if an FRA 
Safety Inspector notifies a railroad both that assessment of a civil 
penalty will be recommended for its failure to comply with a provision 
of the Federal railroad safety laws and that a remedial actions report 
must be submitted, the railroad shall report to the FRA Safety 
Inspector, within 30 days after the end of the calendar month in which 
such notification is received, actions taken to remedy that failure.
    (c) This subpart does not relieve the railroad of the underlying 
responsibility to comply with a provision of the Federal railroad 
safety laws. The 30-day period after the end of the calendar month in 
which notification is received is intended merely to provide the 
railroad with an opportunity to prepare its report to FRA, and does not 
excuse continued noncompliance.
    (d) This subpart requires the submission of remedial actions 
reports for the general categories of physical defects, recordkeeping 
and reporting violations, and filing violations, where the railroad can 
literally and specifically correct a failure to comply with a provision 
of the Federal railroad safety laws, as reasonably determined by the 
FRA Safety Inspector. No railroad is required to submit a report for a 
failure involving either a completed or past transaction or a 
transaction that it can no longer remedy.


Sec. 209.403.  Applicability.

    This subpart applies to any railroad that receives written 
notification from an FRA Safety Inspector both (i) that assessment of a 
civil penalty will be recommended for its failure to comply with a 
provision of the Federal railroad safety laws and (ii) that it must 
submit a remedial actions report.


Sec. 209.405.  Reporting of remedial actions.

    (a) Except as provided in Sec. 209.407, each railroad that has 
received written notification on Form FRA F 6180.96 from an FRA Safety 
Inspector both that assessment of a civil penalty will be recommended 
for the railroad's failure to comply with a provision of the Federal 
railroad safety laws and that it must submit a remedial actions report, 
shall report on this form all actions that it takes to remedy that 
failure. The railroad shall submit the completed form to the FRA Safety 
Inspector within 30 days after the end of the calendar month in which 
the notification is received.
    (1) Date of receipt of notification. If the FRA Safety Inspector 
provides written notification to the railroad by first class mail, then 
for purposes of determining the calendar month in which notification is 
received, the railroad shall be presumed to have received the 
notification five business days following the date of mailing.
    (2) Completion of Form FRA F 6180.96, including selection of 
railroad remedial action code. Each railroad shall complete the 
remedial actions report in the manner prescribed on the report form. 
The railroad shall select the one remedial action code on the reporting 
form that most accurately reflects the action or actions that it took 
to remedy the failure, such as, repair or replacement of a defective 
component without movement, movement of a locomotive or car for repair 
(where permitted) and its subsequent repair, completion of a required 
test or inspection, removal of a noncomplying item from service but not 
for repair (where permitted), reduction of operating speed (where 
sufficient to achieve compliance), or any combination of actions 
appropriate to remedy the noncompliance cited. Any railroad selecting 
the remedial action code ``other remedial actions'' shall also furnish 
FRA with a brief narrative description of the action or actions taken.
    (3) Submission of Form FRA F 6180.96. The railroad shall return the 
form by first class mail to the FRA Safety Inspector whose name and 
address appear on the form.
    (b) Any railroad concluding that the violation alleged on the 
inspection report may not have occurred may submit the remedial actions 
report with an appropriate written explanation. Failure to raise all 
pertinent defenses does not foreclose the railroad from doing so in 
response to a penalty demand.


Sec. 209.407.  Delayed reports.

    (a) If a railroad cannot initiate or complete remedial actions 
within 30 days after the end of the calendar month in which the 
notification is received, it shall--
    (1) Prepare, in writing, an explanation of the reasons for such 
delay and a good faith estimate of the date by which it will complete 
the remedial actions, stating the name and job title of the preparer 
and including either:
    (i) A photocopy of both sides of the Form FRA F 6180.96 on which 
the railroad received notification; or
    (ii) The following information:
    (A) The inspection report number;
    (B) The inspection date; and
    (C) The item number; and
    (2) Sign, date, and submit such written explanation and estimate, 
by first class mail, to the FRA Safety Inspector whose name and address 
appear on the notification, within 30 days after the end of the 
calendar month in which the notification is received.
    (b) Within 30 days after the end of the calendar month in which all 
such remedial actions are completed, the railroad shall report in 
accordance with the remedial action code procedures referenced in 
Sec. 209.405(a). The additional time provided by this section for a 
railroad to submit a delayed report shall not excuse it from liability 
for any continuing violation of a provision of the Federal railroad 
safety laws.


Sec. 209.409.  Penalties.

    Any person who violates any requirement of this subpart or causes 
the violation of any such requirement is subject to a civil penalty of 
at least $500 and not more than $10,000 per violation, except that: 
Penalties may be assessed against individuals only for willful 
violations, and, where a grossly negligent violation or a pattern of 
repeated violations has created an imminent hazard of death or injury 
to persons, or has caused death or injury, a penalty not to exceed 
$20,000 per violation may be assessed. Each day a violation continues 
shall constitute a separate offense. A person may also be subject to 
the criminal penalties provided for in 49 U.S.C. 21311 (formerly 
codified in 45 U.S.C. 438(e)) for knowingly and willfully falsifying 
reports required by this subpart.

    Issued in Washington, D.C., on August 16, 1994.

    Note: The following Inspection Report/Remedial Actions Report 
will not appear in the Code of Federal Regulations.
Jolene M. Molitoris,
Administrator.

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[FR Doc. 94-20722 Filed 8-23-94; 8:45 am]
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