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[Code of Federal Regulations]
[Title 49, Volume 7]
[Revised as of October 1, 2003]
[CITE: 49CFR1152]

[Page 196-249]
 

TITLE 49--TRANSPORTATION
CHAPTER X--SURFACE TRANSPORTATION BOARD, DEPARTMENT OF TRANSPORTATION
PART 1152--ABANDONMENT AND DISCONTINUANCE OF RAIL LINES AND RAIL TRANSPORTATION UNDER 49 U.S.C. 10903



                           Subpart A--General

Sec.
1152.1 Purpose and scope.
1152.2 Definitions.

                        Subpart B--System Diagram

1152.10 System diagram map.
1152.11 Description of lines to accompany the system diagram map or 
          information to be contained in the narrative.
1152.12 Filing and publication.
1152.13 Amendment of the system diagram map or narrative.
1152.14 Availability of data.
1152.15 Reservation of jurisdiction.

    Subpart C--Procedures Governing Notice, Applications, Financial 
          Assistance, Acquisition for Public Use, and Trail Use

1152.20 Notice of intent to abandon or discontinue service.
1152.21 Form of notice.
1152.22 Contents of application.
1152.23 [Reserved]
1152.24 Filing and service of application.
1152.25 Participation in abandonment or discontinuance proceedings.
1152.26 Board determination under 49 U.S.C. 10903.
1152.27 Financial assistance procedures.
1152.28 Public use procedures.
1152.29 Prospective use of rights-of-way for interim trail use and rail 
          banking.

  Subpart D--Standards for Determining Costs, Revenues, and Return on 
                                  Value

1152.30 General.
1152.31 Revenue and income attributable to branch lines.
1152.32 Calculation of avoidable costs.
1152.33 Apportionment rules for the assignment of expenses to on-branch 
          costs.
1152.34 Return on investment.
1152.35 [Reserved]
1152.36 Submission of revenue and cost data.
1152.37 Financial status reports.

Subpart E [Reserved]



   Subpart F--Exempt Abandonments and Discontinuances of Service and 
                             Trackage Rights

1152.50 Exempt abandonments and discontinuances of service and trackage 
          rights.

  Subpart G--Special Rules Applicable to Petitions for Abandonments or 
Discontinuances of Service or Trackage Rights Filed Under the 49 U.S.C. 
                        10502 Exemption Procedure

1152.60 Special rules.

    Authority: 11 U.S.C. 1170; 16 U.S.C. 1247(d) and 1248; 45 U.S.C. 
744; and 49 U.S.C. 701 note (1995) (section 204 of the ICC Termination

[[Page 197]]

Act of 1995), 721(a), 10502, 10903-10905, and 11161.

    Source: 61 FR 67883, Dec. 24, 1996, unless otherwise noted.

                           Subpart A--General

Sec.1152.1  Purpose and scope.

    (a) 49 U.S.C. 10903 et seq. governs abandonment of rail lines and 
discontinuance of rail service by common carriers. Section 10903(d) 
provides that no line of railroad may be abandoned and no rail service 
discontinued unless the Board finds that the present or future public 
convenience and necessity require or permit the abandonment or 
discontinuance.
    (b) Part 1152 contains regulations governing abandonment of, and 
discontinuance of service over, rail lines. This part also sets forth 
procedures for providing financial assistance to assure continued rail 
freight service under 49 U.S.C. 10904, for acquiring rail lines for 
alternate public use under 49 U.S.C. 10905, and for acquiring or using a 
rail right-of-way for interim trail use and rail banking.

Sec.1152.2  Definitions.

    Unless otherwise provided in the text of the regulations, the 
following definitions apply in this part:
    (a) Account means an account in the Board's Uniform System of 
Accounts for Railroad Companies (49 CFR part 1201).
    (b) Act means the ICC Termination Act of 1995 (Pub. L. 104-88, 109 
Stat. 803), as amended.
    (c) Base year means the latest 12-month period, ending no earlier 
than 6 months prior to the filing of the abandonment or discontinuance 
application, for which data have been collected at the branch level as 
prescribed in Sec.1152.30(b).
    (d) Board means the Surface Transportation Board.
    (e) Branch means a segment of line for which an application for 
abandonment or discontinuance, pursuant to 49 U.S.C. 10903, has been 
filed.
    (f) Carrier means a railroad company or the trustee or trustees of a 
railroad company subject to regulation under 49 U.S.C., Subtitle IV, 
chapter 105.
    (g) Designated state agency means the instrumentality created by a 
state or designated by appropriate authority to administer or coordinate 
its state rail plan.
    (h) Forecast Year means the 12-month period, beginning with the 
first day of the month in which the application is filed with the Board, 
for which future revenues and costs are estimated.
    (i) Form R-1 means the railroad's annual report filed with the Board 
in accordance with the requirements of 49 U.S.C. 11145.
    (j) Offeror means a shipper, a state, the United States, a local or 
regional transportation authority, or any financially responsible person 
offering rail service continuation assistance under 49 U.S.C. 10904.
    (k) URCS means the Uniform Railroad Costing System.
    (l) Significant user means:
    (1) Each of the 10 rail patrons which originated and/or received the 
largest number of carloads (or each patron if there are less than 10); 
and
    (2) Any other rail patron which originated and/or received 50 or 
more carloads, on the line proposed for abandonment or discontinuance, 
during the 12-month period preceding the month in which notice is given 
of the abandonment or discontinuance application.
    (m) Subsidy year means any 12-month period for which a subsidy 
agreement has been negotiated and is in operation.

                        Subpart B--System Diagram

Sec.1152.10  System diagram map.

    (a) Each carrier shall prepare a diagram of its rail system on a 
map, designating all lines in its system by the categories established 
in paragraph (b) of this section. A Class III carrier shall either 
prepare the aforementioned map of its rail system or file only a 
narrative description of its lines that provides all of the information 
required in this subpart.
    (b) All lines in each carrier's rail system shall be separated into 
the following categories:

[[Page 198]]

    (1) All lines or portions of lines which the carrier anticipates 
will be the subject of an abandonment or discontinuance application to 
be filed within the 3-year period following the date upon which the 
diagram or narrative, or any amended diagram or narrative, is filed with 
the Board;
    (2) All lines or portions of lines which are potentially subject to 
abandonment, defined as those which the carrier has under study and 
believes may be the subject of a future abandonment application because 
of either anticipated operating losses or excessive rehabilitation 
costs, as compared to potential revenues;
    (3) All lines or portions of lines for which an abandonment or 
discontinuance application is pending before the Board on the date upon 
which the diagram or narrative, or any amended diagram or narrative, is 
filed with the Board;
    (4) All lines or portions of lines which are being operated under 
the rail service continuation provisions of 49 U.S.C. 10904 (and former 
49 U.S.C. 10905) on the date upon which the diagram or narrative, or any 
amended diagram or narrative, is filed with the Board; and
    (5) All other lines or portions of lines which the carrier owns and 
operates, directly or indirectly.
    (c) The system diagram map shall be color-coded to show the 5 
categories of lines as follows:
    (1) Red shall designate those lines described in Sec.1152.10(b)(1);
    (2) Green shall designate those lines described in 
Sec.1152.10(b)(2);
    (3) Yellow shall designate those lines described in 
Sec.1152.10(b)(3);
    (4) Brown shall designate those lines described in 
Sec.1152.10(b)(4); and
    (5) Black or dark blue shall designate those lines described in 
Sec.1152.10(b)(5).
    (d) The system diagram map shall also identify, and shall be drawn 
to a scale sufficient to depict clearly, the location of:
    (1) All state boundary lines;
    (2) Boundaries of every county in which is situated a rail line 
owned or operated by the carrier which is listed in categories 1 thru 4 
(Sec.1152.10(b)(1) thru (4));
    (3) Every Standard Metropolitan Statistical Area (SMSA) any portion 
of which is located within 5 air miles of a rail line owned or operated 
by the carrier; and
    (4) Every city outside an SMSA which has a population of 5,000 or 
more persons (according to the latest published United States census 
reports) and which has any portion located within 5 air miles of a rail 
line owned or operated by the carrier. A series of interrelated maps may 
be used where the system serves a very large or congested area. An 
explanation of the interrelationship must be furnished.

Sec.1152.11  Description of lines to accompany the system diagram map or 
          information to be contained in the narrative.

    Each carrier required to file a system diagram map or narrative 
shall list and describe, separately by category and within each category 
by state, all lines or portions of lines identified on its system 
diagram map or to be included in its narrative as falling within 
categories 1 thru 3 (Sec.1152.10(b)(1) thru (3)) as follows:
    (a) Carrier's designation for each line (for example, the Zanesville 
Secondary Track);
    (b) State or states in which each line is located;
    (c) County or counties in which each line is located;
    (d) Mileposts delineating each line or portion of line; and
    (e) Agency or terminal stations located on each line or portion of 
line with milepost designations.

Sec.1152.12  Filing and publication.

    (a) Each carrier required to file a system diagram map or a 
narrative shall file with the Board three copies of a complete and up-
dated color-coded system diagram map or narrative (identified by its 
``AB number'') and the accompanying line descriptions in conformance 
with the filing and publication requirements of this section. If a 
revised map or narrative is filed, the line descriptions for the lines 
which were revised must be filed.
    (b) The color-coded system diagram map or narrative, any amendments, 
and accompanying line descriptions shall be served upon the Governor, 
the

[[Page 199]]

Public Service Commission (or equivalent agency) and the designated 
state agency of each state within which the carrier operates or owns a 
line of railroad.
    (c) The carrier shall: (1) Publish in a newspaper of general 
circulation in each county containing category 1 through 3 lines or 
lines being revised, a notice containing:
    (i) A black-and-white copy of the system diagram map (or a portion 
of the map clearly depicting its lines in that county); and
    (ii) A description of each line (in the case of Class III carriers 
only the line description is required);
    (2) Post a copy of the newspaper notice:
    (i) In each agency station or terminal on each line in categories 1 
through 3 and on each line which has been revised; or
    (ii) If there is no agency station on the line, at any station 
through which business for the line is received or forwarded;
    (3) Furnish, at reasonable cost, upon request of any interested 
person, a copy of its system diagram map (either color-coded or black-
and-white) or narrative; and
    (4) Notify interested persons of this availability through its 
publication in the appropriate county newspaper.
    (d) Each carrier required to file a system diagram map or narrative 
shall file with the Board an affidavit of service and publication 
stating the date each was accomplished. A copy of each newspaper notice 
published shall be attached to the affidavit. The effective date of the 
filing of the initial system diagram map or narrative and each amended 
system diagram map or narrative as required in paragraph (a) of this 
section shall be deemed to be the date upon which the Board receives the 
affidavit required in this paragraph.
    (e) The Board shall require republication of the notice if it is 
found to be inadequate.

[61 FR 67883, Dec. 24, 1996 as amended at 64 FR 53268, Oct. 1, 1999]

Sec.1152.13  Amendment of the system diagram map or narrative.

    (a) Each carrier shall be responsible for maintaining the continuing 
accuracy of its system diagram map and the accompanying line 
descriptions or narrative. Amendments may be filed at any time and will 
be subject to all carrier filing and publication requirements of 
Sec.1152.12.
    (b) By March 24, 1997, each carrier shall file with the Board a 
revised and updated color-coded system diagram map and line descriptions 
or narrative which shall be subject to the filing and publication 
requirements of Sec.1152.12. Thereafter, each carrier shall file 
amendments as line designations change and update its map or narrative, 
as appropriate. Also, each carrier shall file an updated or amended map 
or narrative upon order of the Board. Each new rail carrier shall comply 
with the requirements of this subsection within 60 days after it becomes 
a carrier.
    (c) The Board will reject an abandonment or discontinuance 
application filed by a rail carrier if any part of the application 
includes a line that has not been identified and described, by amendment 
or otherwise, on the carrier's system diagram map or narrative, as 
appropriate, as a line in category 1 (Sec.1152.10(b)(1)) for at least 60 
days.

Sec.1152.14  Availability of data.

    Each carrier shall provide to the designated state agency, upon 
request, information concerning the net liquidation value (as defined in 
Sec.1152.34(c)) of any line placed in category 1 (Sec.1152.10(b)(1)) on 
its system diagram map or narrative together with a description of such 
a line and any appurtenant facilities and of their condition.

Sec.1152.15  Reservation of jurisdiction.

    49 U.S.C. 10903(c)(1) authorizes the Board, at its discretion, to 
provide for designation of lines as ``potentially subject to 
abandonment'' under standards which vary by region of the United States, 
by railroad, or by group of railroads. The Board expressly reserves the 
right to adopt such varying standards in the future.

[[Page 200]]

    Subpart C--Procedures Governing Notice, Applications, Financial 
          Assistance, Acquisition for Public Use, and Trail Use

Sec.1152.20  Notice of intent to abandon or discontinue service.

    (a) Filing and publication requirements. An applicant shall give 
Notice of Intent to file an abandonment or discontinuance application by 
complying with the following procedures:
    (1) Filing. Applicant must serve its Notice of Intent on the Board, 
by certified letter, in the format prescribed in Sec.1152.21. The Notice 
shall be filed in accordance with the time requirements of paragraph (b) 
of this section.
    (2) Service. Applicant must serve, by first-class mail (unless 
otherwise specified), its Notice of Intent upon:
    (i) Significant users of the line;
    (ii) The Governor (by certified mail) of each state directly 
affected by the abandonment or discontinuance;
    (iii) The Public Service Commission (or equivalent agency) in these 
states;
    (iv) The designated state agency in these states;
    (v) The State Cooperative Extension Service in these states;
    (vi) The U.S. Department of Transportation (Federal Railroad 
Administration);
    (vii) Department of Defense (Military Traffic Management Command, 
Transportation Engineering Agency, Railroads for National Defense 
Program);
    (viii) The U.S. Department of Interior (Recreation Resources 
Assistance Division, National Park Service);
    (ix) The U.S. Railroad Retirement Board;
    (x) The National Railroad Passenger Corporation (``Amtrak'') (if 
Amtrak operates over the involved line);
    (xi) The headquarters of the Railroad Labor Executives' Association;
    (xii) The U.S. Department of Agriculture, Chief of the Forest 
Service; and
    (xiii) The headquarters of all duly certified labor organizations 
that represent employees on the affected rail line. For purposes of this 
subsection ``directly affected states'' are those in which any part of a 
line sought to be abandoned is located.
    (3) Posting. Applicant must post a copy of its Notice of Intent at 
each agency station and terminal on the line to be abandoned. (If there 
are no agency stations on the line, the Notice of Intent should be 
posted at any agency station through which business for the involved 
line is received or forwarded.)
    (4) Newspaper publication. Applicant must publish its Notice of 
Intent at least once during each of 3 consecutive weeks in a newspaper 
of general circulation in each county in which any part of the involved 
line is located.
    (b) Time limits. (1) The Notice of Intent must be served at least 15 
days, but not more than 30 days, prior to the filing of the abandonment 
application;
    (2) The Notice must be posted and fully published within the 30-day 
period prior to the filing of the application; and
    (3) The Notice must be filed with the Board either concurrently with 
service or when the Notice is first published (whichever occurs first).
    (c) Environmental and Historic Reports. Applicant must also submit 
the Environmental and Historic Reports described at Sec.Sec.1105.7 and 
1105.8 at least 20 days prior to filing an application.

Sec.1152.21  Form of notice.

    The Notice of Intent to abandon or to discontinue service shall be 
in the following form:

STB No. AB --------(Sub-No. --------)
Notice of Intent to Abandon or to Discontinue Service

    (Name of Applicant) gives notice that on or about (insert date 
application will be filed with the Board) it intends to file with the 
Surface Transportation Board, Washington, D.C. 20423, an application for 
permission for the abandonment of (the discontinuance of service on), a 
line of railroad known as ------------ extending from railroad milepost 
near (station name) to (the end of line or rail milepost) near (station 
name), which traverses through United States Postal Service ZIP Codes 
(ZIP Codes), a distance of ------------ miles, in [County(ies), 
State(s)]. The line includes the stations of (list all stations on the 
line in order of milepost number, indicating milepost location).
    The reason(s) for the proposed abandonment (or discontinuance) is 
(are) ------------ (explain briefly and clearly why the proposed action 
is being undertaken by the applicant). Based on information in our 
possession, the

[[Page 201]]

line (does) (does not) contain federally granted rights-of-way. Any 
documentation in the railroad's possession will be made available 
promptly to those requesting it.
    This line of railroad has appeared on the system diagram map or 
included in the narrative in category 1 since (insert date).
    The interest of railroad employees will be protected by (specify the 
appropriate conditions).
    The application will include the applicant's entire case for 
abandonment (or discontinuance) (case in chief). Any interested person, 
after the application is filed on (insert date), may file with the 
Surface Transportation Board written comments concerning the proposed 
abandonment (or discontinuance) or protests to it. These filings are due 
45 days from the date of filing of the application. All interested 
persons should be aware that following any abandonment of rail service 
and salvage of the line, the line may be suitable for other public use, 
including interim trail use. Any request for a public use condition 
under 49 U.S.C. 10905 (Sec.1152.28 of the Board's rules) and any request 
for a trail use condition under 16 U.S.C. 1247(d) (Sec.1152.29 of the 
Board's rules) must also be filed within 45 days from the date of filing 
of the application. Persons who may oppose the abandonment or 
discontinuance but who do not wish to participate fully in the process 
by appearing at any oral hearings or by submitting verified statements 
of witnesses, containing detailed evidence, should file comments. 
Persons interested only in seeking public use or trail use conditions 
should also file comments. Persons opposing the proposed abandonment or 
discontinuance that do wish to participate actively and fully in the 
process should file a protest.
    Protests must contain that party's entire case in opposition (case 
in chief) including the following:
    (1) Protestant's name, address and business.
    (2) A statement describing protestant's interest in the proceeding 
including:
    (i) A description of protestant's use of the line;
    (ii) If protestant does not use the line, information concerning the 
group or public interest it represents; and
    (iii) If protestant's interest is limited to the retention of 
service over a portion of the line, a description of the portion of the 
line subject to protestant's interest (with milepost designations if 
available) and evidence showing that the applicant can operate the 
portion of the line profitably, including an appropriate return on its 
investment for those operations.
    (3) Specific reasons why protestant opposes the application 
including information regarding protestant's reliance on the involved 
service [this information must be supported by affidavits of persons 
with personal knowledge of the fact(s)].
    (4) Any rebuttal of material submitted by applicant.
    In addition, a commenting party or protestant may provide a 
statement of position and evidence regarding:
    (i) Intent to offer financial assistance pursuant to 49 U.S.C. 
10904;
    (ii) Environmental impact;
    (iii) Impact on rural and community development;
    (iv) Recommended provisions for protection of the interests of 
employees;
    (v) Suitability of the properties for other public purposes pursuant 
to 49 U.S.C. 10905; and
    (vi) Prospective use of the right-of-way for interim trail use and 
rail banking under 16 U.S.C. 1247(d) and Sec.1152.29.

A protest may demonstrate that: (1) the protestant filed a feeder line 
application under 49 U.S.C. 10907; (2) the feeder line application 
involves any portion of the rail line involved in the abandonment or 
discontinuance application; (3) the feeder line application was filed 
prior to the date the abandonment or discontinuance application was 
filed; and (4) the feeder line application is pending before the Board.
    Written comments and protests will be considered by the Board in 
determining what disposition to make of the application. The commenting 
party or protestant may participate in the proceeding as its interests 
may appear.
    If an oral hearing is desired, the requester must make a request for 
an oral hearing and provide reasons why an oral hearing is necessary. 
Oral hearing requests must be filed with the Board no later than 10 days 
after the application is filed.
    Those parties filing protests to the proposed abandonment (or 
discontinuance) should be prepared to participate actively either in an 
oral hearing or through the submission of their entire opposition case 
in the form of verified statements and arguments at the time they file a 
protest. Parties seeking information concerning the filing of protests 
should refer to Sec.1152.25.
    Written comments and protests, including all requests for public use 
and trail use conditions, should indicate the proceeding designation STB 
No. AB -------- (Sub-No. --------) and must be filed with the Secretary, 
Surface Transportation Board, Washington, DC 20423, no later than 
(insert the date 45 days after the date applicant intends to file its 
application). Interested persons may file a written comment or protest 
with the Board to become a party to this abandonment (or discontinuance) 
proceeding. A copy of each written comment or protest shall be served 
upon the representative of the applicant (insert name, address, and 
phone number). The original and 10 copies of

[[Page 202]]

all comments or protests shall be filed with the Board with a 
certificate of service. Except as otherwise set forth in part 1152, each 
document filed with the Board must be served on all parties to the 
abandonment proceeding. 49 CFR 1104.12(a).
    The line sought to be abandoned (or discontinued) will be available 
for subsidy or sale for continued rail use, if the Board decides to 
permit the abandonment (or discontinuance), in accordance with 
applicable laws and regulations (49 U.S.C. 10904 and 49 CFR 1152.27). No 
subsidy arrangement approved under 49 U.S.C. 10904 shall remain in 
effect for more than 1 year unless otherwise mutually agreed by the 
parties (49 U.S.C. 10904(f)(4)(B)). Applicant will promptly provide upon 
request to each interested party an estimate of the subsidy and minimum 
purchase price required to keep the line in operation. The carrier's 
representative to whom inquiries may be made concerning sale or subsidy 
terms is (insert name and business address).
    Persons seeking further information concerning abandonment 
procedures may contact the Surface Transportation Board or refer to the 
full abandonment or discontinuance regulations at 49 CFR part 1152. 
Questions concerning environmental issues may be directed to the Board's 
Section of Environmental Analysis.
    A copy of the application will be available for public inspection on 
or after (insert date abandonment application is to be filed with Board) 
at each agency station or terminal on the line proposed to be abandoned 
or discontinued [if there is no agency station on the line, the 
application shall be deposited at any agency station through which 
business for the line is received or forwarded (insert name, address, 
location, and business hours)]. The carrier shall furnish a copy of the 
application to any interested person proposing to file a protest or 
comment, upon request.
    An environmental assessment (EA) (or environmental impact statement 
(EIS), if necessary) prepared by the Section of Environmental Analysis 
will be served upon all parties of record and upon any agencies or other 
persons who commented during its preparation. Any other persons who 
would like to obtain a copy of the EA (or EIS) may contact the Section 
of Environmental Analysis. EAs in these abandonment proceedings normally 
will be made available within 33 days of the filing of the application. 
The deadline for submission of comments on the EA will generally be 
within 30 days of its service. The comments received will be addressed 
in the Board's decision. A supplemental EA or EIS may be issued where 
appropriate.

Sec.1152.22  Contents of application.

    Applications for the abandonment of railroad lines or the 
discontinuance of rail service shall contain the following information, 
including workpapers and supporting documents, and each paragraph (a) 
through (j) of this section shall be attested to by a person having 
personal knowledge of the matters contained therein:
    (a) General. (1) Exact name of applicant.
    (2) Whether applicant is a common carrier by railroad subject to 49 
U.S.C. Subtitle IV, chapter 105.
    (3) Relief sought (abandonment of line or discontinuance of 
service).
    (4) Detailed map of the subject line on a sheet not larger than 
8x10\1/2\ inches, drawn to scale, and with the scale shown thereon. The 
map must show, in clear relief, the exact location of the rail line to 
be abandoned or over which service is to be discontinued and its 
relation to other rail lines in the area, highways, water routes, and 
population centers.
    (5) Reference to inclusion of the rail line to be abandoned or over 
which service is to be discontinued on the carrier's system diagram map 
or narrative, in compliance with Sec.Sec.1152.10 through 1152.13, and 
the date upon which such line was first listed on the system diagram map 
or included in the narrative in category 1 in accordance with 
Sec.1152.10(b)(1). A copy of the line description which accompanies the 
system diagram map shall also be submitted.
    (6) Detailed statement of reasons for filing application.
    (7) Name, title, and address of representative of applicant to whom 
correspondence should be sent.
    (8) List of all United States Postal Service ZIP Codes that the line 
proposed for abandonment traverses.
    (b) Condition of properties. The present physical condition of the 
line including any operating restrictions and estimate of deferred 
maintenance and rehabilitation costs (e.g., number of ties that need 
replacing, miles of rail that need replacing and/or new ballast, bridge 
repairs or replacement needed, and estimated labor expenses necessary to 
upgrade the line to minimum Federal Railroad Administration class 1

[[Page 203]]

safety standards). The bases for the estimates shall be stated with 
particularity, and workpapers shall be filed with the application.
    (c) Service provided. Description of the service performed on the 
line during the Base Year (as defined by Sec.1152.2(c)), including the 
actual:
    (1) Number of trains operated and their frequency.
    (2) Miles of track operated (include main line and all railroad-
owned sidings).
    (3) Average number of locomotive units operated.
    (4) Total tonnage and carloads by each commodity group on the line.
    (5) Overhead or bridge traffic by carload commodity group that will 
not be retained by the carrier.
    (6) Average crew size.
    (7) Level of maintenance.
    (8) Any important changes in train service undertaken in the 2 
calendar years immediately preceding the filing of the application.
    (9) Reasons for decline in traffic, if any, in the best judgment of 
applicant.
    (d) Revenue and cost data. (1) Computation of the revenues 
attributable and avoidable costs for the line to be abandoned for the 
Base Year (as defined by Sec.1152.2(c) and to the extent such branch 
level data are available), in accordance with the methodology prescribed 
in Sec.Sec.1152.31 through 1152.33, as applicable, and submitted in the 
form called for in Sec.1152.36, as Exhibit 1.
    (2) The carrier shall compute an estimate of the future revenues 
attributable, avoidable costs and reasonable return on the value for the 
line to be abandoned, for the Forecast Year (as defined in 
Sec.1152.2(h)) in the form called for in Exhibit 1. The carrier shall 
fully support and document all dollar amounts shown in the Forecast Year 
column including an explanation of the rationale and key assumptions 
used to determine the Forecast Year amounts.
    (3) The carrier shall also compute an ``Estimated Subsidy Payment'' 
for the Base Year in the form called for in Exhibit 1 and an alternate 
payment to reflect:
    (i) Increases or decreases in attributable revenues and avoidable 
costs projected for the subsidy year; and
    (ii) An estimate, in reasonable detail, of the cash income tax 
reductions, Federal and state, to be realized in the subsidy year. The 
bases for the adjustment, e.g., rate increase, changes in traffic level, 
necessary maintenance to comply with minimum Federal Railroad 
Administration class 1 safety standards, shall be stated with 
particularity.
    (e) Rural and community impact. (1) The name and population 
(identify source and date of figures) of each community in which a 
station on the line is located.
    (2) Identification of significant users, as defined in 
Sec.1152.2(l), by name, address, principal commodity, and by tonnage and 
carloads for each of the 2 calendar years immediately preceding the 
filing of the abandonment or discontinuance application, for that part 
of the current year for which information is available, and for the Base 
Year. In addition, the total tonnage and carloads for each commodity 
group originating and/or terminating on the line segment shall also be 
shown for the same time periods as those of the significant users.
    (3) General description of the alternate sources of transportation 
service (rail, motor, water, air) available, and the highway network in 
the proximate area.
    (4) Statement of whether the properties proposed to be abandoned are 
appropriate for use for other public purposes, including roads or 
highways, other forms of mass transportation, conservation, energy 
production or transmission, or recreation. If the applicant is aware of 
any restriction on the title to the property, including any reversionary 
interest, which would affect the transfer of title or the use of 
property for other than rail purposes, this shall be disclosed.
    (f) Environmental impact. The applicant shall submit information 
regarding the environmental impact of the proposed abandonment or 
discontinuance in compliance with Sec.Sec.1105.7 and 1105.8. If certain 
information required by the environmental regulations duplicates 
information required elsewhere in the application, the environmental 
information requirements may

[[Page 204]]

be met by a specific reference to the location of the information 
elsewhere in the application.
    (g) Passenger service. If passenger service is provided on the line, 
the applicant shall state whether appropriate steps have been taken for 
discontinuance pursuant to the Rail Passenger Service Act. (45 U.S.C. 
501 et seq.)
    (h) Additional information. The applicant shall submit such 
additional information to support its application as the Board may 
require.
    (i) Draft Federal Register notice. The applicant shall submit a 
draft notice of its application to be published by the Board. In 
addition to the regular number of copies that must be filed with the 
Board, the applicant must submit a copy of the draft notice as data 
contained on a computer diskette compatible with the Board's current 
word processing capabilities. The Board will publish the notice in the 
Federal Register within 20 days of the application's filing with the 
Board. The draft notice shall be in the form set forth below:

STB No. AB--------- (Sub-No. --------)
Notice of Application to Abandon or to Discontinue Service

    On (insert date application was filed with the Board) (name of 
applicant) filed with the Surface Transportation Board, Washington, D.C. 
20423, an application for permission for the abandonment of (the 
discontinuance of service on) a line of railroad known as ------------ 
extending from railroad milepost near (station name) to (the end of line 
or rail milepost) near (station name), a distance of ------------ miles, 
in [County(ies), State(s)]. The line includes the stations of (list all 
stations on the line in order of milepost number, indicating milepost 
location) and traverses through ------------ (ZIP Codes) United States 
Postal Service ZIP Codes.

    The line (does) (does not) contain federally granted rights-of-way. 
Any documentation in the railroad's possession will be made available 
promptly to those requesting it. The applicant's entire case for 
abandonment (or discontinuance) (case in chief) was filed with the 
application.
    This line of railroad has appeared on the applicant's system diagram 
map or has been included in its narrative in category 1 since (insert 
date).
    The interest of railroad employees will be protected by (specify the 
appropriate conditions).
    Any interested person may file with the Surface Transportation Board 
written comments concerning the proposed abandonment (or discontinuance) 
or protests (including the protestant's entire opposition case), within 
45 days after the application is filed. All interested persons should be 
aware that following any abandonment of rail service and salvage of the 
line, the line may be suitable for other public use, including interim 
trail use. Any request for a public use condition under 49 U.S.C. 10905 
(Sec.1152.28 of the Board's rules) and any request for a trail use 
condition under 16 U.S.C. 1247(d) (Sec.1152.29 of the Board's rules) 
must be filed within 45 days after the application is filed. Persons who 
may oppose the abandonment or discontinuance but who do not wish to 
participate fully in the process by appearing at any oral hearings or by 
submitting verified statements of witnesses, containing detailed 
evidence should file comments. Persons interested only in seeking public 
use or trail use conditions should also file comments. Persons opposing 
the proposed abandonment or discontinuance that do wish to participate 
actively and fully in the process should file a protest.
    In addition, a commenting party or protestant may provide:
    (i) An offer of financial assistance, pursuant to 49 U.S.C. 10904 
(due 120 days after the application is filed or 10 days after the 
application is granted by the Board, whichever occurs sooner);
    (ii) Recommended provisions for protection of the interests of 
employees;
    (iii) A request for a public use condition under 49 U.S.C. 10905; 
and
    (iv) A statement pertaining to prospective use of the right-of-way 
for interim trail use and rail banking under 16 U.S.C. 1247(d) and 
Sec.1152.29.
    Parties seeking information concerning the filing of protests should 
refer to Sec.1152.25.
    Written comments and protests, including all requests for public use 
and trail use conditions, must indicate the proceeding designation STB 
No. AB----- (Sub-No. ----) and should be filed with the Secretary, 
Surface Transportation Board (Board), Washington, DC 20423, no later 
than (insert the date 45 days after the date applicant intends to file 
its application). Interested persons may file a written comment or 
protest with the Board to become a party to this abandonment (or 
discontinuance) proceeding. A copy of each written comment or protest 
shall be served upon the representative of the applicant (insert name, 
address, and phone number). The original and 10 copies of all comments 
or protests shall be filed with the Board with a certificate of service. 
Except as otherwise set forth in part 1152, every document filed with 
the Board must be served on all parties to the abandonment proceeding. 
49 CFR 1104.12(a).
    The line sought to be abandoned (or discontinued) will be available 
for subsidy or

[[Page 205]]

sale for continued rail use, if the Board decides to permit the 
abandonment (or discontinuance), in accordance with applicable laws and 
regulations (49 U.S.C. 10904 and 49 CFR 1152.27). No subsidy arrangement 
approved under 49 U.S.C. 10904 shall remain in effect for more than 1 
year unless otherwise mutually agreed by the parties (49 U.S.C. 
10904(f)(4)(B)). Applicant will promptly provide upon request to each 
interested party an estimate of the subsidy and minimum purchase price 
required to keep the line in operation. The carrier's representative to 
whom inquiries may be made concerning sale or subsidy terms is (insert 
name and business address).
    Persons seeking further information concerning abandonment 
procedures may contact the Surface Transportation Board or refer to the 
full abandonment or discontinuance regulations at 49 CFR part 1152. 
Questions concerning environmental issues may be directed to the Board's 
Section of Environmental Analysis.
    An environmental assessment (EA) (or environmental impact statement 
(EIS), if necessary) prepared by the Section of Environmental Analysis 
will be served upon all parties of record and upon any agencies or other 
persons who commented during its preparation. Any other persons who 
would like to obtain a copy of the EA (or EIS) may contact the Section 
of Environmental Analysis. EAs in these abandonment proceedings normally 
will be made available within 33 days of the filing of the application. 
The deadline for submission of comments on the EA will generally be 
within 30 days of its service. The comments received will be addressed 
in the Board's decision. A supplemental EA or EIS may be issued where 
appropriate.

    (j) Verification. The original application shall be executed and 
verified in the form set forth below by an officer of the carrier having 
knowledge of the facts and matters relied upon.

                              Verification

State of ------------ ss.
County of ------------
    ------------ (Name of affiant) makes oath and says that (s)he is the 
------------ (title of affiant) of the ------------ (name of applicant) 
applicant herein; that (s)he has been authorized by the applicant (or as 
appropriate, a court) to verify and file with the Surface Transportation 
Board the foregoing application in STB AB----- (Sub-No. ----); that 
(s)he has carefully examined all of the statements in the application as 
well as the exhibits attached thereto and made a part thereof; that 
(s)he has knowledge of the facts and matters relied upon in the 
application; and that all representations set forth therein are true and 
correct to the best of his(her) knowledge, information, and belief.
 (Signature)

    Subscribed and sworn to before me ------------ in and for the State 
and County above named, this ---- day of ----, 19--.

My Commission expires

Sec.1152.23  [Reserved]

Sec.1152.24  Filing and service of application.

    (a) An original and 10 copies of applications, typewritten or 
printed on paper approximately 8\1/2\ inches by 11 inches with 1\1/2\ 
inch left margin, shall be filed with the Secretary of the Surface 
Transportation Board, Washington, DC 20423. The original shall bear the 
date and signature and shall be complete in itself; the signature may be 
stamped or typed and the notarial seal may be omitted on the copies. A 
check, money order or payment by credit card payable to the Surface 
Transportation Board must also be submitted to cover the applicable 
filing fee. If the applicant carrier is in bankruptcy, the application 
shall also be filed on the bankruptcy court.
    (b) The applicant shall tender with its application an affidavit 
attesting to its compliance with the notice requirement of Sec.1152.20. 
The affidavit shall include the dates of service, posting, and 
publication of the notice.
    (c) When the application is filed with the Board, the applicant 
shall serve, by first class mail, a copy on the Governor, the Public 
Service Commission (or equivalent agency), and the designated state 
agency of each state in which any part of the line of railroad sought to 
be abandoned or discontinued is situated. A copy of the application will 
be available for public inspection, on or after the date the abandonment 
application is filed with the Board, at each agency station or terminal 
on the line proposed to be abandoned or discontinued (if there is no 
agency station on the line, the application shall be deposited at any 
agency station through which business for the line is received or 
forwarded). A certificate of service shall be promptly filed with the 
Board.
    (d) The applicant shall promptly furnish by first class mail a copy 
of the application to any interested person proposing to file a written 
comment or

[[Page 206]]

protest upon request. A certificate of service shall promptly be filed 
with the Board.
    (e)(1) The Board shall reject any abandonment or discontinuance 
application which does not substantially conform to the regulations in 
this subpart C regarding notice, form, and content, or which applies to 
a line which has not properly been published on the carrier's system 
diagram map (or included in a narrative in the case of a Class III 
carrier), in conformance with the regulations of subpart B of this part.
    (2) Upon the filing of an abandonment or discontinuance application, 
the Board will review the application and determine whether it conforms 
with all applicable regulations. If the application is substantially 
incomplete or its filing otherwise defective, the Board shall reject the 
application for stated reasons by order (which order will be 
administratively final) within 20 days from the date of filing of the 
application. If the Board does not reject the application, notice of the 
filing of the application shall be published in the Federal Register by 
the Board, through the Director of the Office of Proceedings, within 20 
days of the filing of the application.
    (3) If the application is rejected, a revised application may be 
submitted, and the Board will determine whether the resubmitted 
application conforms with all prescribed regulations. A properly revised 
application submitted within 60 days of the order rejecting the 
incomplete or improper application need not be subjected to new notice 
and publication under Sec.1152.20, unless the defect causing the 
rejection was in the notice and/or publication. A revised application 
submitted after such 60-day period must be newly published and noticed.
    (4) The resubmission of an abandonment or discontinuance application 
shall be considered a de novo filing for the purposes of computation of 
the time period for filing an offer of financial assistance under 49 
U.S.C. 10904, and for other time periods prescribed in the regulations 
contained in this part (49 CFR part 1152), provided, that a resubmitted 
application is deemed complete and proper.
    (5) An applicant may seek waiver of specific regulations listed in 
subpart C of this part by filing a petition for waiver with the Board. A 
decision by the Director of the Office of Proceedings granting or 
denying a waiver petition will be issued within 30 days of the date the 
petition is filed. Appeals from the Director's decision will be decided 
by the entire Board. If waiver is not obtained prior to the filing of 
the application, the application may be subject to rejection under 
paragraphs (e) (1) and (2) of this section.
    (f) As provided in Sec.1152.29(e)(2), rail carriers authorized to 
abandon a line under 49 U.S.C. 10903 must file with the Board a notice 
that abandonment has been consummated.

[61 FR 67883, Dec. 24, 1996, as amended at 62 FR 34669, June 27, 1997; 
64 FR 53268, Oct. 1, 1999]

Sec.1152.25  Participation in abandonment or discontinuance proceedings.

    (a) Public participation. (1) Protests and comments. Interested 
persons may become parties to an abandonment or discontinuance 
proceeding by filing written comments or protests with the Board. Any 
request for a public use condition under 49 U.S.C. 10905 (Sec.1152.28 of 
the Board's rules) and any request for a trail use condition under 16 
U.S.C. 1247(d) (Sec.1152.29 of the Board's rules) must be included in 
these filings. Persons who may oppose the abandonment or discontinuance, 
but who do not wish to participate fully in the process by appearing at 
any oral hearings or by submitting verified statements of witnesses 
containing detailed evidence, should file comments. Persons interested 
only in seeking public use or trail use conditions should also file 
comments. Persons opposing the proposed abandonment or discontinuance 
that do wish to participate actively and fully in the process should 
file a protest. Protests shall include all evidence and argument in 
support of protestant's position (protestant's case in chief). Protests 
must contain the following information:
    (i) Protestant's name, address and business.

[[Page 207]]

    (ii) A statement describing protestant's interest in the proceeding 
including:
    (A) A description of protestant's use of the line;
    (B) If protestant does not use the line, information concerning the 
group or public interest it represents; and
    (C) If protestant's interest is limited to the retention of service 
over a portion of the line, a description of the portion of the line 
subject to protestant's interest (with milepost designations if 
available) and evidence showing that the applicant can operate the 
portion of the line profitably, including an appropriate return on its 
investment for those operations.
    (iii) Specific reasons why protestant opposes the application 
including information regarding protestant's reliance on the involved 
service (this information must be supported by affidavits of persons 
with personal knowledge of the fact(s)).
    (iv) Any rebuttal of material submitted by applicant.
    (v) Any request for a public use condition under 49 U.S.C. 10905 
(Sec.1152.28 of the Board's rules) and any request for a trail use 
condition under 16 U.S.C. 1247(d) (Sec.1152.29 of the Board's rules).
    (2) Additional information. In addition to the information required 
in paragraph (a)(1) of this section, a commenting party or protestant 
may provide a statement of position and a summary of evidence regarding:
    (i) Intent to offer financial assistance under 49 U.S.C. 10904;
    (ii) Environmental impact;
    (iii) Impact on rural and community development;
    (iv) Recommended provisions for protection of the interests of 
employees;
    (v) A request for a public use condition under 49 U.S.C. 10905; and
    (vi) Prospective use of the right-of-way for interim trail use and 
rail banking under 16 U.S.C. 1247(d) and 49 CFR 1152.29.
    (3) Feeder line application for all or part of the line subject to 
the abandonment application. In addition to the information required in 
paragraphs (a)(1) and (2) of this section, a commenting party or 
protestant must provide information that:
    (i) The protestant filed a feeder line application under 49 U.S.C. 
10907 (or former 49 U.S.C. 10910);
    (ii) The feeder line application involves any portion of the rail 
line involved in the abandonment or discontinuance application;
    (iii) The feeder line application was filed prior to the date the 
abandonment or discontinuance application was filed; and
    (iv) The feeder line application is pending before the Board.
    (b) Employee or employee representative participation. Employees or 
their representatives may file protests or comments to an application. 
However, because the Board will impose employee protective conditions 
under 49 U.S.C. 10903(b)(2) if an application is granted, employees and 
their representatives need not file comments or protests seeking this 
protection.
    (c) Filing and service of written comments, protests, along with 
evidence and argument, and replies. (1) Written comments and protests, 
as well as public use and trail use requests, shall be filed with the 
Board (the Secretary, Surface Transportation Board, Washington, DC 
20423) within 45 days of the filing with the Board of an abandonment or 
discontinuance application.
    (2) An original and 10 copies of each written comment or protest 
shall be filed with the Board.
    (3) A copy of each written comment or protest shall be served on 
applicant or its representative at the time of filing with the Board. If 
the applicant carrier is in bankruptcy, each comment or protest shall 
also be filed on the Bankruptcy Court. Each filing shall contain a 
certificate of service.
    (4) Replies or rebuttal to written comments and protests shall be 
filed and served by applicants no later than 60 days after the filing of 
the application. An original and 10 copies of such replies shall be 
filed with the Board.
    (d) Time limits. (1) Pleadings, requests or other papers or 
documents (including any comments or protests and any appeal from a 
Board decision) required or permitted to be filed under this part must 
be received for filing at the Board's Offices at Washington, DC within 
the time limits, if any, for such filing. The date of receipt at the 
Board

[[Page 208]]

and not the date of deposit in the mail is determinative, provided, 
however, that if such document is mailed by certified, registered, or 
express mail, postmarked at least 3 days prior to the due date, it will 
be accepted as timely filed.
    (2) In computing any time period prescribed or allowed by this part, 
the day of the act, event, or default after which the designated period 
of time begins to run is not to be included.
    (3) Any filing under this part which falls due on a Saturday, 
Sunday, or a legal holiday in the District of Columbia, may be filed at 
the Board by the end of the next day which is neither a Saturday, 
Sunday, nor a holiday, except as indicated in paragraph (d)(4) of this 
section. A half holiday shall not be considered as a holiday.
    (4) Offers of financial assistance made pursuant to Sec.1152.27(c) 
must be filed on or before their statutory or regulatory due date as 
computed in paragraph (d)(2) of this section, regardless of whether that 
date is a Saturday, Sunday, or a legal holiday in the District of 
Columbia.
    (5) The Board will reject any pleading filed after its due date 
unless good cause is shown why the pleading is filed late.
    (6) Oral hearings. (i) Any oral hearing request is due 10 days after 
the filing of the application. The Board, through the Director of the 
Office of Proceedings, will issue a decision on any oral hearing request 
within 15 days after the filing of the application. If the Board decides 
to hold an oral hearing, the oral hearing shall be for the primary 
purpose of cross examination of witnesses filing verified statements in 
the proceeding. Any direct testimony, other than applicant's rebuttal 
evidence, shall be received at the discretion of the hearing officer.
    (ii) In addition to that contained in the application, the 
submission of written evidence prior to the commencement of the hearing 
shall be established by the Board.
    (iii) Post hearing legal briefs shall be due 10 days after the close 
of the oral hearing, or at an earlier date if established at the hearing 
by the hearing officer.
    (e) Appellate procedures--(1) Scope of rule. Except as specifically 
indicated below, these appellate procedures are to be followed in 
abandonment and discontinuance proceedings in lieu of the general 
procedures at 49 CFR 1115. Appeals of initial decisions of the Director 
of the Office of Proceedings determining:
    (i) Whether offers of financial assistance satisfy the standard of 
49 U.S.C. 10904(d) for purposes of instituting negotiations or, in 
exemption proceedings, for purposes of partial revocation and 
instituting negotiations;
    (ii) Whether partially to revoke or to reopen abandonment exemptions 
authorized, respectively, under 49 U.S.C. 10502 and 49 CFR part 1152 
subpart F for the purpose of imposing public use conditions under the 
criteria in 49 CFR 1152.28 and/or conditions limiting salvage of the 
rail properties for environmental and historic preservation purposes; 
and
    (iii) The applicability and administration of the Trails Act [16 
U.S.C. 1247(d)] in abandonment proceedings under 49 U.S.C. 10903 (and 
abandonment exemption proceedings), issued pursuant to delegations of 
authority at 49 CFR 1011.8(c) (4) and (5), will be acted on by the 
entire Board as set forth at 49 CFR 1011.2(a)(7). An original and 10 
copies of all appeals, and replies to appeals, under this section must 
be filed with the Board.
    (2) Appeals criteria. Appeals to the Board's decision in abandonment 
or discontinuance proceedings will not be entertained. Those decisions 
are administratively final upon the date they are served.
    (i) Parties seeking further administrative action may file a 
petition to reopen the proceeding under paragraph (e)(4) of this 
section. If an abandonment or discontinuance is granted and a party 
wishes the Board to have the opportunity to consider a petition to 
reopen before the abandonment or discontinuance authorization becomes 
effective, it must file its petition within 15 days after the 
administratively final decision is served together with a request for a 
stay of effectiveness under paragraph (e)(7) of this section. If such a 
petition to reopen and stay request is received within that 15-day 
period, any replies to the petition to reopen must be filed no later 
than 25 days after the

[[Page 209]]

date the decision is served, and any reply to the stay request must 
reach the Board no later than 5 days after the stay request is filed.
    (ii) The Board will grant a petition to reopen only upon a showing 
that the action would be affected materially because of new evidence, 
changed circumstances, or material error.
    (3) Form. A petition to reopen and any reply shall not exceed 30 
pages in length, including the index of subject matter, argument, and 
appendices or other attachments.
    (4) Petitions to reopen administratively final actions. A person may 
file a petition to reopen any administratively final action of the 
Board. A petition to reopen shall state in detail the respects in which 
the proceeding involves material error, new evidence, or substantially 
changed circumstances. An original and 10 copies of such petitions must 
be filed with the Board.
    (5) Judicial review. (i) Parties may seek judicial review of a Board 
action in an abandonment or discontinuance proceeding on the day the 
action of the Board becomes final.
    (ii) If a petition seeking reopening is filed under this section, 
before or after a petition seeking judicial review is filed with the 
courts, the Board will act upon the petition after advising the court of 
its pendency unless action might interfere with the court's 
jurisdiction.
    (6) Petitions to vacate. In the event of procedural defects (such as 
the loss of a properly filed protest, the failure of the applicant to 
afford the public the requisite notice of its proposed abandonment, 
etc.), the Board will entertain petitions to vacate the abandonment or 
discontinuance authorization. An original and 10 copies of these 
petitions to vacate must be filed with the Board.
    (7) Petitions to stay. (i) The filing of a petition to reopen shall 
not stay the effect of a prior action. An original and 10 copies of any 
petitions to stay must be filed with the Board.
    (ii) A petition to reopen an administratively final action may be 
accompanied by a petition for a stay of the effectiveness of the 
abandonment or discontinuance. As provided in paragraph (e)(2) of this 
section, a petition to reopen must be accompanied by a stay request if 
the party wishes the Board to have the opportunity to consider the 
petition to reopen before the abandonment or discontinuance 
authorization becomes final.
    (iii) A party may petition for a stay of the effectiveness of 
abandonment or discontinuance authorization pending a request for 
judicial review. The reasons for the desired relief shall be stated in 
the petition, and the petition shall be filed not less than 15 days 
prior to the effective date of the abandonment authorization. No reply 
need be filed. If a party elects to file a reply, the reply must reach 
the Board no later than 5 days after the petition is filed.

[61 FR 67883, Dec. 24, 1996, as amended at 62 FR 34669, June 27, 1997]

Sec.1152.26   Board determination under 49 U.S.C. 10903.

    (a) The following schedule shall govern the process for Board 
consideration and decisions in abandonment and discontinuance 
application proceedings from the time the application is filed until the 
time of the Board's decision on the merits:

Day 0--Application filed, including applicant's case in chief.
Day 10--Due date for oral hearing requests.
Day 15--Due date for Board decision on oral hearing requests.
Day 20--Due date for Notice of Application to be published in the 
Federal Register.
Day 45--Due date for protests and comments, including opposition case in 
chief, and for public use and trail use requests.
Day 60--Due date for applicant's reply to opposition case and for 
applicant's response to trail use requests.
Day 110--Due date for service of decision on the merits.
Day 120--Due date for offers of financial assistance, except that if an 
application has been granted by decision issued sooner than Day 110, the 
offer of financial assistance shall be due 10 days after service of the 
decision granting the application.

    (b) If an application for abandonment or discontinuance is filed by 
a bankrupt railroad, the Board shall base its decision (Report to the 
Bankruptcy Court) on the application and any responses to the 
application that are filed. In each such instance, the Board shall 
establish a reasonable period of

[[Page 210]]

time for filing responses to the application so that public input can be 
included in the Board's decision (Report) and so that the Board will be 
able to meet a deadline imposed or requested by the Bankruptcy Court. 
Because Board action on abandonment applications by bankrupt railroads 
is advisory only, no environmental filings or analysis is necessary. See 
49 CFR 1105.5(c).

[61 FR 67883, Dec. 24, 1996, as amended at 62 FR 34670, June 27, 1997]

Sec.1152.27   Financial assistance procedures.

    (a) Provision of information. An applicant must provide promptly 
upon request to a party considering an offer of financial assistance to 
continue existing rail service, and concurrently to the Board, the 
following:
    (1)(i) In an application or petition for exemption proceeding, an 
estimate of the annual subsidy and minimum purchase price required to 
keep the line or a portion of the line in operation;
    (ii) In a class exemption proceeding, either an estimate of the 
annual subsidy or the minimum purchase price, depending upon the type of 
financial assistance indicated in the potential offeror's formal 
expression of intent submitted under paragraph (c)(2)(i) of this 
section;
    (2) Its most recent reports on the physical condition of the 
involved line; and
    (3) Traffic, revenue, and other data necessary to determine the 
amount of annual financial assistance that would be required to continue 
rail transportation over that part of the railroad line. In an exemption 
proceeding, the data to be provided must at a minimum include the 
carrier's estimate of the net liquidation value of the line, with 
supporting data reflecting available real estate appraisals, assessments 
of the quality and quantity of track materials in a line, and removal 
cost estimates (including the cost of transporting removed materials to 
point of sale or point of storage for relay use), and, if an offer of 
subsidy is contemplated, an estimate of the cost of rehabilitating the 
line to Federal Railroad Administration class 1 Safety Standards (49 CFR 
part 213).
    (b) Federal Register notice--(1) Abandonment and discontinuance 
applications. The Federal Register publication, which gives notice of 
the filing of the application 20 days after the application is filed, 
will serve as notice to persons intending to offer financial assistance 
to assure continued rail service under 49 U.S.C. 10904 and these 
regulations as they relate to abandonment and discontinuance 
applications. Offers of financial assistance will be due 120 days after 
the application is filed or 10 days after a decision granting the 
application is served, whichever occurs sooner.
    (2) Exemption proceedings. (i) If a petition for individual 
exemption from the prior approval requirements of 49 U.S.C. 10903 is 
filed with the Board for abandonment or discontinuance of a line of 
railroad, the Board will publish notice of the petition in the Federal 
Register within 20 days of the filing of the petition. The Federal 
Register publication will serve as notice to persons with a potential 
interest in providing financial assistance to assure continued rail 
service on the line under 49 U.S.C. 10904 and these regulations as they 
relate to exempt abandonments and discontinuances. Offers f financial 
assistance will be due 120 days after the filing of the petition for 
exemption or 10 days after service of a Board decision granting the 
exemption, whichever occurs sooner.
    (ii) If a notice of exemption is filed under the class exemption, 
the Board will publish notice of the exemption in the Federal Register 
within 20 days of filing. The Federal Register publication will serve as 
notice to persons with a potential interest in providing financial 
assistance to assure continued rail service on the line under 49 U.S.C. 
10904 and these regulations as they relate to exempt abandonments and 
discontinuances. Offers of financial assistance will be due no later 
than 30 days after the date of the Federal Register publication giving 
notice of the exemption.
    (c) Submission of financial assistance offer--(1) Abandonment and 
discontinuance applications and petitions for exemption--(i) Service and 
filing. An offeror must serve its offer of assistance on the carrier 
owning and operating the

[[Page 211]]

line and all parties to the abandonment or discontinuance application or 
exemption proceeding. The offer must be filed concurrently with the 
Secretary, Surface Transportation Board, Washington, DC 20423.
    (A) An offer may be filed and served at any time after the filing of 
the abandonment or discontinuance application or petition for exemption. 
Once a decision is served granting an application or petition for 
exemption, however, the Board must be notified that an offer has 
previously been submitted.
    (B) An offer, or notification of a previously filed offer, must be 
filed and served no later than 10 days after service of the Board 
decision granting the application or petition for exemption. This filing 
and service is subject to the requirements of 49 CFR 1152.25 (d)(1), 
(d)(2), and (d)(4).
    (C) If, after a bona fide request, applicant or petitioner has 
failed to provide a potential offeror promptly with the information 
required under paragraph (a) of this section and if that information is 
not contained in the application or petition, the Board will entertain 
petitions to toll the 10-day period for submitting offers of financial 
assistance under paragraph (c)(1) of this section. Petitions must be 
filed with the Board within 5 days after service of the decision 
granting the application or petition for exemption. Petitions should 
include copies of the prior written request for information or an 
accurate outline of the specific information that was orally requested. 
Replies to these petitions must be filed within 10 days after service of 
the decision granting the application or petition for exemption. These 
petitions and replies must be filed on or before their actual due date 
under 49 CFR 1152.25(d)(4). The Board will issue a decision on petitions 
within 15 days after service of the decision granting the application or 
petition for exemption.
    (ii) Contents of offer. The offeror shall set forth its offer in 
detail. The offer must:
    (A) Identify the line, or the portion of the line, in question;
    (B) Demonstrate that the offeror is financially responsible; that 
is, that it has or within a reasonable time will have the financial 
resources to fulfill proposed contractual obligations; governmental 
entities will be presumed to be financially responsible; and
    (C) Explain the disparity between the offeror's purchase price or 
subsidy if it is less than the carrier's estimate under paragraph (a)(1) 
of this section, and explain how the offer of subsidy or purchase is 
calculated.
    (2) Class exemption proceedings--(i) Expression of intent to file 
offer. Persons with a potential interest in providing financial 
assistance must, no later than 10 days after the Federal Register 
publication described in paragraph (b)(2)(ii) of this section, submit to 
the carrier and the Board a formal expression of their intent to file an 
offer of financial assistance, indicating the type of financial 
assistance they wish to provide (i.e., subsidy or purchase). Such 
submissions are subject to the filing requirements of Sec.1152.25(d)(1) 
through (d)(3). Submission of a formal expression of intent under this 
subsection will automatically stay the effective date of the notice of 
exemption under the class exemption for 40 days (normally, this will be 
10 days beyond the date stated in the Federal Register publication).
    (ii) Service and filing. An offeror must serve its offer of 
assistance on the carrier that instituted the exempt filing as well as 
all other parties to the proceeding. The offer must be filed 
concurrently with the Secretary, Surface Transportation Board, 
Washington, DC 20423.
    (A) An offer may be filed and served at any time after the filing of 
the notice of exemption. Once a notice of exemption is published in the 
Federal Register, however, the Board must be notified that an offer has 
previously been submitted.
    (B) An offer, or notification of a previously filed offer, must be 
filed and served no later than 30 days after the Federal Register 
publication described in paragraph (b)(2)(ii) of this section. This 
filing and service is subject to the requirements of 49 CFR 1152.25 
(d)(1), (d)(2), and (d)(4).
    (C) If, after a bona fide request, applicant has failed to provide a 
potential offeror promptly with the information required under paragraph 
(a) of this section and if that information is not

[[Page 212]]

contained in the notice of exemption, the Board will entertain petitions 
to toll the 30-day period for submitting offers of financial assistance 
under paragraph (c)(2) of this section. Petitions must be filed with the 
Board within 25 days after publication in the Federal Register 
(described in paragraph (b)(2)(ii) of this section). Petitions should 
include copies of the prior written request for information or an 
accurate outline of the specific information that was orally requested. 
Replies to these petitions must be filed within 30 days after the 
publication. These petitions and replies must be filed on or before 
their actual due date under 49 CFR 1152.25(d)(4). The Board will issue a 
decision on petitions to toll the offer period within 35 days after 
publication.
    (D) Upon receipt of a formal expression of intent to file an offer 
under paragraph (c)(2)(i) of this section, the rail carrier applicant 
may advise the Board and the potential offeror that additional time is 
needed to develop the information required under paragraph (a) of this 
section. Applicant shall expressly indicate the amount of time it 
considers necessary (not to exceed 60 days) to develop and submit the 
required information to the potential offeror. For the duration of the 
time period so indicated by the applicant, the 30-day period for 
submitting offers of financial assistance under paragraph (c)(2) of this 
section shall be tolled without formal Board action.
    (iii) Contents of offer. The offeror shall set forth its offer in 
detail. The offer must meet the requirements of paragraph (c)(1)(ii) of 
this section.
    (d) Access to documents. Upon receipt by the carrier of a written 
comment under Sec.1152.25 or a formal expression of intent under 
paragraph (c)(2)(i) of this section indicating an intent to offer 
financial assistance, or upon receipt by the carrier of an offer of 
financial assistance, whichever occurs earlier, the carrier must make 
available to that party or offeror the records, accounts, appraisals, 
working papers, and other documents used in preparing Exhibit 1 
(Sec.1152.36) or, if an exemption proceeding, those documents that would 
have been used in preparing Exhibit 1 had an abandonment or 
discontinuance application been filed, or other records, reports, and 
data in the possession of the carrier seeking the exemption that provide 
comparable data. These documents shall be made available during regular 
business hours at a time and place mutually agreeable to the parties.
    (e) Review of offers--(1) Abandonment and discontinuance 
applications. The Board will review each offer submitted to determine if 
a financially responsible person has offered assistance. If that 
criterion is met, the Board will issue a decision postponing the 
effective date of the authorization for abandonment or discontinuance. 
This decision will be issued within 15 days of the service of the 
decision granting the application (or within 5 days after the offer is 
filed if the time for filing has been tolled under paragraph 
(c)(1)(i)(C) of this section, or within 5 days after expiration of the 
120 day (4 month) period described in 49 U.S.C. 10904, if that occurs 
first). Under the delegation of authority at Sec.1011.8, the Director of 
the Office of Proceedings will make the initial determination whether 
offers of financial assistance satisfy the standards of 49 U.S.C. 
10904(d) for purposes of instituting negotiations. Appeals of initial 
decisions determining whether offers of financial assistance satisfy the 
standards of 49 U.S.C. 10904(d) for purposes of instituting negotiations 
will be acted upon by the entire Board pursuant to 49 CFR 1011.2(a)(7).
    (2) Exemption proceedings. The Board will review each offer 
submitted to determine if a financially responsible person has offered 
assistance. If that criterion is met, the Board will postpone the 
effective date either of the decision granting a petition for individual 
exemption or the notice of exemption under the class exemption and 
partially revoke the exemption or (in the case of a class exemption) the 
notice of exemption to the extent it applies to 49 U.S.C. 10904. The 
decision to postpone and partially revoke will be issued within 15 days 
of the service date of a decision granting a petition for exemption, or 
within 35 days of the Federal Register publication described in 
paragraph (b)(2)(ii) of this section (or within 5 days after the offer 
is filed if the time for filing has been tolled under paragraph 
(c)(1)(i)(C) or

[[Page 213]]

(c)(2)(ii) (C) or (D) of this section). Under the delegation of 
authority at Sec.1011.8, the Director of the Office of Proceedings will 
make the initial determination whether offers of financial assistance 
satisfy the standards of 49 U.S.C. 10904(d) for purposes of partial 
revocation and institution of negotiations. Appeals of initial decisions 
determining whether offers of financial assistance satisfy the standards 
of 49 U.S.C. 10904(d) for purposes of partial revocation and institution 
of negotiations will be acted upon by the entire Board pursuant to 49 
CFR 1011.2(a)(7).
    (f) Agreement on financial assistance. (1) If the carrier and a 
person offering financial assistance enter into a subsidy agreement 
designed to provide for continued rail service, the Board will postpone 
the effective date of the abandonment or discontinuance. If a decision 
granting a petition for individual exemption, or a notice of exemption, 
has been issued, the Board will postpone the effective date of the 
decision or notice of exemption. The postponement will be for as long as 
the subsidy agreement is in effect.
    (2) If the carrier and a person offering to purchase a line enter 
into a purchase agreement which will result in continued rail service, 
the Board will approve the transaction and dismiss the application for 
abandonment or discontinuance, or the petition for exemption or notice 
of exemption. Board approval is not required under 49 U.S.C. 10901, 
10902, or 11323 for the parties to consummate the transaction or for the 
purchaser to institute service and operate as a railroad subject to 49 
U.S.C. 10501(a).
    (g) Failure to reach agreement on financial assistance. (1) If the 
carrier and a financially responsible person fail to agree on the amount 
or terms of subsidy or purchase, either party may request the Board to 
establish the conditions and amount of compensation. This request must 
be filed with the Board within 30 days after the offer is made and 
served concurrently by overnight mail on all parties to the proceeding. 
The request must be accompanied by the appropriate fee, codified at 49 
CFR 1002.2(f)(26). Replies will be due 5 days later.
    (2) If no agreement is reached within 30 days after the offer of 
purchase or subsidy is made, and no request is made to the Board to set 
the conditions and amount of compensation under paragraph (g)(1) of this 
section, the Board will serve a decision vacating the prior decision, 
which postponed the effective date of the decision granting the 
application, the decision granting the exemption, or the notice of 
exemption and, which, if applicable, partially revoked either the 
decision granting the exemption or (in the case of a class exemption) 
the notice of exemption. The Board will issue the decision to vacate 
within 10 days of the due date for requesting the Board to set the 
conditions and amount of compensation, and the Board will make the 
decision to vacate effective on its date of service.
    (h) Request to establish conditions and compensation for financial 
assistance. (1) If the Board is requested to establish conditions and 
compensation for financial assistance under paragraph (g)(1) of this 
section, the Board will issue a decision within 30 days after the 
request is due.
    (2) If the applicant receives multiple offers of financial 
assistance, requests to establish conditions and compensation will not 
be permitted before the applicant selects the offeror with whom it 
wishes to transact business. (See paragraph (l)(1) of this section.)
    (3) A party requesting the Board to establish conditions and 
compensation for financial assistance must, within the time period set 
forth in paragraph (h)(4) of this section, provide its case in chief, 
including reasons why its estimates are correct and the other 
negotiating party's estimates are incorrect, points of agreement and 
points of disagreement between the negotiating parties, and evidence 
substantiating these allegations. The offeror has the burden of proof as 
to all issues in dispute.
    (4) The offeror must submit all evidence and information supporting 
the terms it seeks within 30 days after the offer is made. The carrier's 
reply to this evidence and support for the terms it seeks are due within 
35 days after the offer is made. No rebuttal evidence

[[Page 214]]

will be permitted and evidence and information submitted after these 
dates will be rejected.
    (5) If requested, the Board will determine the amount and terms of 
subsidy based on the avoidable cost of providing continued rail 
transportation, plus a reasonable return on the value of the line. Under 
49 U.S.C. 10904(f)(4)(B), no subsidy arrangement approved under section 
10904 shall remain in effect for more than one year unless mutually 
agreed by the parties.
    (6) If requested, the Board will determine the price and other terms 
of sale. The Board will not set a price below the fair market value of 
the line (including, unless otherwise agreed upon by the parties, all 
facilities on the line or portion necessary to provide effective 
transportation services). Fair market value equals constitutional 
minimum value which is the greater of the net liquidation value of the 
line or the going concern value of the line. The constitutional minimum 
value is computed without regard to labor protection costs.
    (7) Within 10 days of the service date of the Board's decision, the 
offeror must accept or reject the Board's terms and conditions with a 
written notification to the Board and all parties to the proceeding. If 
the offeror accepts the terms and conditions set by the Board, the 
Board's decision is binding on both parties. If the offeror withdraws 
its offer or does not accept the terms and conditions set by the Board 
with a timely written notification, the Board will serve, within 20 days 
after the service date of the Board decision setting the terms and 
conditions, a decision vacating the prior decision, which postponed the 
effective date of either the decision granting the application or 
exemption or the notice of exemption, and which, if applicable, 
partially revoked the exemption or (in the case of a class exemption) 
the notice of exemption (unless other offers are being considered under 
paragraph (l) of this section). The decision to vacate will be effective 
on its date of service.
    (i) Substitution of purchasers and disposition after sale. (1) Prior 
to the consummation of a purchase under this section, an offeror may 
substitute its corporate affiliate as the purchaser under an agreement, 
provided the Board has determined either:
    (i) The original offeror has guaranteed the financial responsibility 
of its affiliate; or
    (ii) The affiliate has demonstrated financial responsibility in its 
own right.
    (2) Except as provided in paragraph (i)(3) of this section, a 
purchaser under this section may not:
    (i) Transfer the line or discontinue service over the line prior to 
the end of the second year after consummation of the original sale under 
these provisions; or
    (ii) Transfer the line, except to the carrier from whom the line was 
purchased, prior to the end of the fifth year after consummation.
    (3) Paragraph (i)(2) of this section does not preclude a purchaser 
under this section from transferring the line to a corporate affiliate 
following the consummation of the original sale. Prior Board approval of 
the affiliate's acquisition and operation, however, is required under 49 
U.S.C. 10901, 10902, or 11323. A corporate affiliate acquiring a line 
under this section is prohibited from discontinuing service over the 
line or transferring the line to a party that is not a corporate 
affiliate during the time periods prescribed in paragraph (i)(2) of this 
section.
    (j) Discontinuance of subsidy. A subsidizer may discontinue a 
subsidy under this section by giving 60 days notice of the 
discontinuance to the applicant and all other parties to the proceeding. 
Unless another financially responsible party enters into a subsidy 
agreement as beneficial to the carrier as the discontinued subsidy 
agreement in a situation where the 1-year time limit of 49 U.S.C. 
10904(f)(4)(B) has not yet run, the carrier may by filing a request with 
the Board and serving the request on all parties to the abandonment or 
exemption proceeding obtain a decision vacating the decision postponing 
the effective date of either the decision granting the application, or 
petition for individual exemption, or the notice of exemption. The Board 
will issue a decision to vacate within 10 days after the filing and 
service of the request. This decision to vacate will be effective on its 
service date.

[[Page 215]]

    (k) Default on agreement. If any party defaults on its obligations 
under a financial assistance agreement, any other party to the agreement 
may promptly inform the Board of that default. Upon notification, the 
Board will take appropriate action.
    (l) Multiple offers of financial assistance. (1) If an applicant 
receives more than one offer to purchase or subsidize the line from 
offerors found to be financially responsible, the applicant must select 
the offeror from those with whom it wishes to transact business. In 
abandonment and discontinuance application and petition for exemption 
proceedings within 25 days after service of the decision granting the 
application or petition for exemption, and in class exemption 
proceedings within 45 days after the Federal Register publication 
described in paragraph (b)(2)(ii) of this section, the railroad must:
    (i) File a written notification of its selection with the Board; and
    (ii) Serve a copy of the notification on all parties to the 
proceeding.
    (2)(i) Abandonment and discontinuance applications and petitions for 
exemption. If the applicant has received multiple offers of financial 
assistance from persons found to be financially responsible and has 
selected the offeror with whom it wishes to transact business, the 
negotiating parties shall complete the sale or subsidy agreement or 
request the Board to establish the conditions and amount of compensation 
within 40 days after the service date of the decision granting the 
application or petition for exemption. A request to the Board to set 
terms and conditions must be served concurrently on all parties to the 
proceeding. If no agreement on subsidy or sale is reached within the 40-
day period and the Board has not been requested to establish the 
conditions and amount of compensation, any other financially responsible 
offeror may request the Board to establish the conditions and amount of 
compensation. This request must be filed at the Board within 50 days of 
the service date of the decision granting the application or petition 
for exemption and served concurrently on all parties to the proceeding. 
If no other request is filed, the Board will issue a decision 
authorizing abandonment or discontinuance within 60 days of the service 
date of the decision granting the application or petition for exemption. 
This decision will be effective on the date of service.
    (ii) Class exemption proceedings. If the carrier seeking the 
exemption has received multiple offers of financial assistance from 
persons found to be financially responsible and has selected the offeror 
with whom it wishes to transact business, the negotiating parties shall 
complete the sale or subsidy agreement or request the Board to establish 
the conditions and amount of compensation within 60 days after the 
Federal Register publication described in paragraph (b)(2)(ii) of this 
section. A request to the Board to set terms and conditions must be 
served concurrently on all parties to the proceeding. If no agreement on 
subsidy or sale is reached within the 60-day period and the Board has 
not been requested to establish the conditions and amount of 
compensation, any other financially responsible offeror may request the 
Board to establish the conditions and amount of compensation. This 
request must be filed at the Board within 70 days of the Federal 
Register publication described in paragraph (b)(2)(ii) of this section 
and served concurrently on all parties to the proceeding. If no other 
request is filed, the Board will issue a decision vacating the decision 
postponing the effective date of the notice of exemption within 80 days 
of the Federal Register publication described in paragraph (b)(2)(ii) of 
this section. The decision to vacate will be effective on the date of 
service.
    (3) If the Board has established the conditions and amount of 
compensation, and the original offer is withdrawn under paragraph (h)(7) 
of this section, any other offeror found to be financially responsible 
may accept the Board's decision within 20 days after the service date of 
the Board's decision setting terms and conditions. If the decision is 
accepted by another such offeror, the Board will require the applicant 
to accept the terms incorporated in the Board's decision.
    (m) Additional time for filing. Notwithstanding the deadlines 
previously set forth in part 1152 for filing an offer of

[[Page 216]]

financial assistance, parties that can show that they would be 
materially prejudiced by having less than the full 4 months for filing 
an offer of financial assistance provided in 49 U.S.C. 10904(c) for 
application proceedings may seek relief under 49 CFR part 1117.
    (n) Special provisions for summary discontinuance and abandonment of 
lines not part of the Final System Plan. (1) Board authorization is not 
needed for the cessation of service on a line of railroad formerly in 
reorganization that was not included in the Final System Plan (Plan) 
under the Regional Rail Reorganization Act of 1973, 45 U.S.C. 701 et 
seq., as amended by the Railroad Revitalization and Regulatory Reform 
Act of 1976, if the line has been continuously subsidized since the 
inception of the Plan. To provide an opportunity for rail service 
continuation through offers of financial assistance, however, the owner 
of the line must give not less than 60 days' notice of a discontinuance, 
and beginning 120 days after discontinuance, not less than 30 days' 
notice of abandonment. Designated operators need only comply with the 
notice requirements of Sec.1150.11 of this title. In instances of 
discontinuance by a designated operator, the line owner is not obligated 
to operate the line. Notice is to be sent by the line owner to the 
Board, the governor and 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 the rail service during the 
previous 12 months. The Board will generally apply the OFA procedures in 
this section (49 CFR 1152.27) for class exemptions to summary 
abandonment and discontinuance notices (except that the Board will not 
postpone the effective date of a summary discontinuance). For example, 
notice of summary abandonment or discontinuance will be published by the 
Board in the Federal Register within 20 days of filing. Paragraph 
(b)(2)(ii) of this section. Expressions of intent to file an offer must 
be filed no later than 10 days after the Federal Register publication. 
Paragraph (c)(2)(i) of this section. An offer must be filed within 30 
days of the Federal Register publication. Paragraphs (b)(2)(ii) and 
(c)(2)(ii)(B) of this section. The Board will review offers to determine 
if a financially responsible person has offered assistance. If this 
criterion is met, the Board will postpone the effective date of the 
summary abandonment (but not the discontinuance) within 35 days of the 
Federal Register publication. Paragraph (e)(2) of this section. If the 
carrier and financially responsible person fail to agree on the amount 
or terms of subsidy or purchase, either party may request the Board to 
establish the conditions and amount of the compensation. This request 
must be filed within 30 days after the offer of purchase or subsidy is 
made, and the Board will issue a decision within 30 days after the 
request is due. Paragraphs (g)(1) and (h)(1) of this section.
    (2) Where a designated operator is being used, it shall be paid a 
reasonable management fee. If the parties cannot agree on this fee, it 
shall be four and one-half percent of the total annual revenues 
attributable to the branch.

[61 FR 67883, Dec. 24, 1996, as amended at 63 FR 28290, May 22, 1998]

Sec.1152.28  Public use procedures.

    (a)(1) If the Board finds that the present or future public 
convenience and necessity require or permit abandonment or 
discontinuance, the Board will determine if the involved rail properties 
are appropriate for use for other public purposes.
    (2) A request for a public use condition under 49 U.S.C. 10905 must 
be in writing and set forth:
    (i) The condition sought;
    (ii) The public importance of the condition;
    (iii) The period of time for which the condition would be effective 
(up to the statutory maximum of 180 days); and
    (iv) Justification for the imposition of the time period. A copy of 
the request shall be mailed to the applicant.
    (3) For applications filed under part 1152, subpart C, a request for 
a public use condition must be filed not more than 45 days after the 
application is filed. A decision on the public use request will be 
issued by the Board or the Director of the Office of Proceedings

[[Page 217]]

prior to the effective date of the abandonment. For abandonment 
exemptions under part 1152, subpart F or exemptions granted on the basis 
of an individual petition for exemption filed under 49 U.S.C. 10502, a 
request for a public use condition must be filed not more than 20 days 
from the date of publication of the notice of exemption in the Federal 
Register in the case of class exemptions under subpart F of this part, 
or not more than 20 days from the date of publication of notice of the 
filing of the petition for individual exemption in the Federal Register.
    (b) If the Board finds that the rail properties are appropriate for 
use for other public purposes, the railroad may dispose of the rail 
properties only under the conditions described in the Board's decision. 
The conditions imposed by the Board may include a prohibition against 
the disposal of the rail assets for a period of not more than 180 days 
from the effective date of the decision authorizing the abandonment or 
discontinuance, unless the properties have first been offered, on 
reasonable terms, for sale for public purposes. This period will run 
concurrently with any other postponements. Jurisdiction to impose such 
conditions expires after 180 days from the effective date of the 
decision authorizing the abandonment or discontinuance.

Sec.1152.29  Prospective use of rights-of-way for interim trail use and 
          rail banking.

    (a) If any state, political subdivision, or qualified private 
organization is interested in acquiring or using a right-of-way of a 
rail line proposed to be abandoned for interim trail use and rail 
banking pursuant to 16 U.S.C. 1247(d), it must file a comment or 
otherwise include a request in its filing (in a regulated abandonment 
proceeding) or a petition (in an exemption proceeding) indicating that 
it would like to do so. The comment/request or petition must include:
    (1) A map depicting, and an accurate description of, the right-of-
way, or portion thereof (including mileposts), proposed to be acquired 
or used;
    (2) A statement indicating the user's willingness to assume full 
responsibility: for managing the right-of-way; for any legal liability 
arising out of the use of the right-of-way (unless the user is immune 
from liability, in which case it need only indemnify the railroad 
against any potential liability); and for the payment of all taxes 
assessed against the right-of-way; and
    (3) An acknowledgment that interim trail use is subject to the 
user's continuing to meet its responsibilities described in paragraph 
(a)(2) of this section, and subject to possible future reconstruction 
and reactivation of the right-of-way for rail service. The statement 
must be in the following form:

       Statement of Willingness To Assume Financial Responsibility

    In order to establish interim trail use and rail banking under 16 
U.S.C. 1247(d) and 49 CFR 1152.29, ---------- (Interim Trail User) is 
willing to assume full responsibility for management of, for any legal 
liability arising out of the transfer or use of (unless the user is 
immune from liability, in which case it need only indemnify the railroad 
against any potential liability), and for the payment of any and all 
taxes that may be levied or assessed against the right-of-way owned by 
---------- (Railroad) and operated by ---------- (Railroad). The 
property, known as ---------- (Name of Branch Line), extends from 
railroad milepost ---------- near ---------- (Station Name), to railroad 
milepost ----------, near ---------- (Station name), a distance of ----
------ miles in [County(ies), (State(s)]. The right-of-way is part of a 
line of railroad proposed for abandonment in Docket No. STB AB------- 
(Sub-No. ------).
    A map of the property depicting the right-of-way is attached.
    ------ (Interim Trail User) acknowledges that use of the right-of-
way is subject to the user's continuing to meet its responsibilities 
described above and subject to possible future reconstruction and 
reactivation of the right-of-way for rail service. A copy of this 
statement is being served on the railroad(s) on the same date it is 
being served on the Board.

    (b)(1) In abandonment application proceedings under 49 U.S.C. 10903, 
interim trail use statements are due within the 45-day protest and 
comment period following the date the abandonment application is filed. 
See Sec.1152.25(c). The applicant carrier's response notifying the Board 
whether and with whom it intends to negotiate a trail use agreement is 
due within 15 days after the close of the protest and

[[Page 218]]

comment period (i.e., 60 days after the abandonment application is 
filed).
    (i) In every proceeding where a Trails Act request is made, the 
Board will determine whether the Trails Act is applicable.
    (ii) If the Trails Act is not applicable because of failure to 
comply with Sec.1152.29(a), or is applicable but the carrier either does 
not intend to negotiate an agreement, or does not timely notify the 
Board of its intention to negotiate, a decision on the merits will be 
issued and no Certificate of Interim Trail Use or Abandonment (CITU) 
will be issued. If the carrier is willing to negotiate an agreement, and 
the public convenience and necessity permit abandonment, the Board will 
issue a CITU.
    (2) In exemption proceedings, a petition containing an interim trail 
use statement is due within 10 days after the date the notice of 
exemption is published in the Federal Register in the case of a class 
exemption and within 20 days after publication in the Federal Register 
of the notice of filing of a petition for exemption in the case of a 
petition for exemption. When an interim trail use comment(s) or 
petition(s) is filed in an exemption proceeding, the railroad's reply to 
the Board (indicating whether and with whom it intends to negotiate an 
agreement) is due within 10 days after the date a petition requesting 
interim trail use is filed.
    (3) Late-filed trail use statements must be supported by a statement 
showing good cause for late filing.
    (c) Regular and NERSA abandonment proceedings. (1) If continued rail 
service does not occur pursuant to 49 U.S.C. 10904 and Sec.1152.27, and 
a railroad agrees to negotiate an interim trail use/rail banking 
agreement, then the Board will issue a CITU to the railroad and to the 
interim trail user for that portion of the right-of-way to be covered by 
the agreement. The CITU will: Permit the railroad to discontinue 
service, cancel any applicable tariffs, and salvage track and material 
consistent with interim trail use and rail banking, as long as it is 
consistent with any other Board order, 30 days after the date it is 
issued (10 days after issuance in NERSA proceedings); and permit the 
railroad to fully abandon the line if no trail use agreement is reached 
180 days after it is issued, subject to appropriate conditions, 
including labor protection and environmental matters.
    (2) The CITU will indicate that any interim trail use is subject to 
future restoration of rail service, and subject to the user continuing 
to meet the financial obligations for the right-of-way. The CITU will 
also provide that, if the user intends to terminate trail use, it must 
send the Board a copy of the CITU and request that it be vacated on a 
specified date. The Board will reopen the abandonment proceeding, vacate 
the CITU, and issue a decision permitting immediate abandonment for the 
involved portion of the right-of-way. Copies of the decision will be 
sent to:
    (i) The abandonment applicant;
    (ii) The owner of the right-of-way; and
    (iii) The current trail user.
    (3) If an application to construct and operate a rail line over the 
right-of-way is authorized under 49 U.S.C. 10901 and 49 CFR part 1150, 
or exempted under 49 U.S.C. 10502, then the CITU will be vacated 
accordingly.
    (d) Exempt abandonment proceedings. (1) If continued rail service 
does not occur under 49 U.S.C. 10904 and Sec.1152.27 and a railroad 
agrees to negotiate an interim trail use/rail banking agreement, then 
the Board will issue a Notice of Interim Trail Use or Abandonment (NITU) 
to the railroad and to the interim trail user for the portion of the 
right-of-way to be covered by the agreement. The NITU will: permit the 
railroad to discontinue service, cancel any applicable tariffs, and 
salvage track and materials, consistent with interim trail use and rail 
banking, as long as it is consistent with any other Board order, 30 days 
after the date it is issued; and permit the railroad to fully abandon 
the line if no agreement is reached 180 days after it is issued, subject 
to appropriate conditions, including labor protection and environmental 
matters.
    (2) The NITU will indicate that interim trail use is subject to 
future restoration of rail service, and subject to the user continuing 
to meet the financial obligations for the right-of-way.

[[Page 219]]

The NITU will also provide that, if the user intends to terminate trail 
use, it must send the Board a copy of the NITU and request that it be 
vacated on a specific date. The Board will reopen the exemption 
proceeding, vacate the NITU, and issue a decision reinstating the 
exemption for that portion of the right-of-way. Copies of the decision 
will be sent to:
    (i) The abandonment exemption applicant;
    (ii) The owner of the right-of-way; and
    (iii) The current trail user.
    (3) If an application to construct and operate a rail line over the 
right-of-way is authorized under 49 U.S.C. 10901 and 49 CFR part 1150, 
or exempted under 49 U.S.C. 10502, then the NITU will be vacated 
accordingly.
    (e)(1) Where late-filed trail use statements are accepted, the 
Director (or designee) will telephone the railroad to determine whether 
abandonment has been consummated and, if not, whether the railroad is 
willing to negotiate an interim trail use agreement. The railroad shall 
confirm, in writing, its response, within 5 days. If abandonment has 
been consummated, the trail use request will be dismissed. If 
abandonment has not been consummated but the railroad refuses to 
negotiate, then trail use will be denied. If abandonment has not been 
consummated and the railroad is willing to negotiate, the abandonment 
proceeding will be reopened, the abandonment decision granting an 
application, petition for exemption or notice of exemption will be 
vacated, and an appropriate CITU or NITU will be issued. The effective 
date of the CITU or NITU will be the same date as the vacated decision 
or notice.
    (2) A railroad that receives authority from the Board to abandon a 
line (in a regulated abandonment proceeding under 49 U.S.C. 10903, or by 
individual or class exemption issued under 49 U.S.C. 10502) shall file a 
notice of consummation with the Board to signify that it has exercised 
the authority granted and fully abandoned the line (e.g., discontinued 
operations, salvaged the track, canceled tariffs, and intends that the 
property be removed from the interstate rail network). The notice shall 
provide the name of the STB proceeding and its docket number, a brief 
description of the line, and a statement that the railroad has 
consummated, or fully exercised, the abandonment authority on a certain 
date. The notice shall be filed within 1 year of the service date of the 
decision permitting the abandonment (assuming that the railroad intends 
to consummate the abandonment). Notices will be deemed conclusive on the 
point of consummation if there are no legal or regulatory barriers to 
consummation (such as outstanding conditions, including Trails Act 
conditions). If, after 1 year from the date of service of a decision 
permitting abandonment, consummation has not been effected by the 
railroad's filing of a notice of consummation, and there are no legal or 
regulatory barriers to consummation, the authority to abandon will 
automatically expire. In that event, a new proceeding would have to be 
instituted if the railroad wants to abandon the line. Copies of the 
railroad's notice of consummation shall be filed with the Secretary of 
the Board. In addition, the notice of consummation shall be sent to the 
State Public Service Commission (or equivalent agency) of every state 
through which the line passes. If, however, any legal or regulatory 
barrier to consummation exists at the end of the 1-year time period, the 
notice of consummation must be filed not later than 60 days after 
satisfaction, expiration or removal of the legal or regulatory barrier. 
For good cause shown, a railroad may file a request for an extension of 
time to file a notice so long as it does so sufficiently in advance of 
the expiration of the deadline for notifying the Board of consummation 
to allow for timely processing.
    (f)(1) When a trail user intends to terminate trail use and another 
person intends to become a trail user by assuming financial 
responsibility for the right-of-way, then the existing and future trail 
users shall file, jointly:
    (i) A copy of the extant CITU or NITU; and
    (ii) A Statement of Willingness to Assume Financial Responsibility 
by the new trail user.
    (2) The parties shall indicate the date on which responsibility for 
the right-of-way is to transfer to the new trail

[[Page 220]]

user. The Board will reopen the abandonment or exemption proceeding, 
vacate the existing NITU or CITU; and issue an appropriate replacement 
NITU or CITU to the new trail user.
    (g) In proceedings where a timely trail use statement is filed, but 
due to either the railroad's indication of its unwillingness to 
negotiate interim trail use agreement, or its failure to timely notify 
the Board of its willingness to negotiate, a decision authorizing 
abandonment or an exemption notice or decision is issued instead of a 
CITU or NITU, and subsequently the railroad and trail use proponent 
nevertheless determine to negotiate an interim trail use agreement under 
the Trails Act, then the railroad and trail use proponent must file a 
joint pleading requesting that an appropriate CITU or NITU be issued. If 
the abandonment has not been consummated, the Board will reopen the 
proceeding, vacate the outstanding decision or notice (or portion 
thereof), and issue an appropriate CITU or NITU that will permit the 
parties to negotiate for a period agreed to by the parties in their 
joint filing, but not to exceed 180 days, at the end of which, the CITU 
or NITU will convert into a decision or notice permitting abandonment.

[61 FR 67883, Dec. 24, 1996, as amended at 62 FR 34670, June 27, 1997; 
64 FR 53268, Oct. 1, 1999]

  Subpart D--Standards for Determining Costs, Revenues, and Return on 
                                  Value

Sec.1152.30  General.

    (a) Contents of subpart. (1) 49 U.S.C. 10904 directs the Board to 
determine the extent to which the avoidable costs of providing rail 
service plus a reasonable return on the value of the line exceed the 
revenues attributable to the line. This subpart contains the methodology 
for such determinations and the standards necessary for application of 
those terms in the context of a particular proceeding. Such data will be 
used in reaching the Board's findings on the merits of an abandonment or 
discontinuance proceeding and in making the necessary financial 
assistance determinations.
    (2) This subpart also sets forth a method by which the carrier may 
establish its Forecast Year estimates and Estimated Subsidy Payment to 
be included in its application (Sec.1152.22(d) of this part). 
Furthermore, an offeror of financial assistance may use this method to 
formulate a subsidy offer and/or Proposed Subsidy Payment under 49 
U.S.C. 10904 and Sec.1152.27 of subpart C of this part.
    (b) Data collection. The owning or operating carrier shall establish 
a system to collect at branch level the data necessary to compute the 
base year data and the final subsidy payment. The collection and 
compilation of such data shall be in accordance with the Branch Line 
Accounting System (49 CFR part 1201).
    (c) Final payment of financial assistance. (1) When a financial 
assistance agreement is concluded, the final payment will be adjusted to 
reflect the actual revenues derived, avoidable costs incurred, and value 
of the properties used in the subsidy year.
    (2) Where an adjustment results in an increase in the Estimated 
Subsidy Payment upon which the financial assistance agreement is based, 
the amount of such increase is limited to 15 percent of the estimated 
payment. However, if the railroad notifies the subsidizer that the 
estimate will be exceeded by more than 15 percent in one of the 
Financial Status Reports (Sec.1152.37) issued during the first 10 months 
of the subsidy year or the increase results from an expense preapproved 
by the subsidizer, the adjusted amount shall be included in the final 
payment.

Sec.1152.31  Revenue and income attributable to branch lines.

    The revenue attributable to the rail properties is the total of the 
revenues assigned to the branch in accordance with this section, plus 
any subsidy payments that would cease upon discontinuance of service on 
the branch, for the subsidy year. The revenues assigned shall be derived 
from the following accounts:
    (a) Account 101--Freight. The revenue assigned under this account 
shall be the actual revenues, including transit

[[Page 221]]

revenues, accruing to the railroad, derived from waybills and other 
source documents, for all traffic that:
    (1) Originates and terminates on the branch;
    (2) Originates or terminates on the branch and is handled off the 
branch on the system but not on another carrier; and
    (3) Originates or terminates on the branch and is handled on another 
carrier. All traffic that is received or forwarded through interchange 
at a point on the branch, including ferry operations, shall be 
considered as originating or terminating on the branch. The revenues of 
all other bridge or overhead traffic that will not be retained by the 
carrier shall be attributed to the branch on the ratio of miles moved on 
the branch to miles moved on the system, provided, however, that the 
parties may agree on a mutually acceptable usage charge for bridge 
traffic in lieu of the mileage apportionment.
    (b) Account 104--Switching; Account 105--Water transfers; Account 
106--Demurrage; Account 110--Incidental; Account 121--Joint Facility-
Credit; Account 122--Joint Facility-Debt; Account 506--Revenues from 
Properties Used in Other Than Carrier Operations; Account 510--
Miscellaneous Rent Income; Account 519--Miscellaneous Income. The 
revenues assigned under these accounts shall be the actual revenues 
accruing to the railroad that are directly attributable to the branch.
    (c) Chart for revenue accounts.

------------------------------------------------------------------------
           Revenue account title                     Account No.
------------------------------------------------------------------------
Freight...................................  101
Switching.................................  104
Water transfers...........................  105
Demurrage.................................  106
Incidental................................  110
Joint facility-credit.....................  121
Joint facility-debt.......................  122
Revenues from property used in other than   506, 534
 carrier operations, less expenses.
Miscellaneous rent income.................  510
Miscellaneous income......................  519
------------------------------------------------------------------------

Sec.1152.32  Calculation of avoidable costs.

    This section defines: Which cost elements are eligible for inclusion 
in the calculation of avoidable costs; the conditions under which 
certain cost elements become eligible for inclusion; and the basis of 
apportioning those cost elements which are not assigned to the branch on 
an actual expense basis. The avoidable costs of providing freight 
service on a branch shall be the total of the costs assigned to the 
branch in accordance with this section. The avoidable costs of providing 
freight service on a branch shall be just and reasonable, and shall not 
exceed those necessary for an honest and efficient operation. Those 
expenses apportioned under this section shall be derived from the latest 
Form R-1 Annual Report for Class I railroads filed with the Board prior 
to the conclusion of the subsidy year, and company records for all non-
Class I railroads, and assigned to the branch according to the 
procedures set forth in Sec.1152.33 of these regulations. When the term 
``Actual'' is specified as the basis for assigning an expense, it shall 
mean that the only costs which can be assigned to the account are those 
costs which are incurred solely as a result of the continuation of rail 
freight service on the branch. The accounts in the following charts, 
which list only the ``freight-only'' account numbers, shall include the 
portion of common expenses that have been apportioned to freight 
service.

------------------------------------------------------------------------
    Operating expense group and                      Basis of assignment
             accounts                 Account No.    to on-branch costs
------------------------------------------------------------------------
(a) Maintenance of way and
 structures:
  (1) Administration: Track:
    Salaries and wages............        11-13-02  Actual.
    Materials.....................        21-13-02   Do.
    Purchased services............        41-13-02   Do.
    Other expenses................        61-13-02   Do.
      Bridges and buildings
    Salaries and wages............        11-13-03   Do.
    Materials.....................        21-13-03   Do.
    Purchased services............        41-13-03   Do.
    Other expenses................        61-13-03   Do.

[[Page 222]]


      Signals
    Salaries and wages............        11-13-04   Do.
    Materials.....................        21-13-04   Do.
    Purchased services............        41-13-04   Do.
    Other expenses................        61-13-04   Do.
      Communications
    Salaries and wages............        11-13-05   Do.
    Materials.....................        21-13-05   Do.
    Purchased services............        41-13-05   Do.
    Other expenses................        61-13-05   Do.
      Other
    Salaries and wages............        11-13-06   Do.
    Materials.....................        21-13-06   Do.
    Purchased services............        41-13-06   Do.
    Other expenses................        61-13-06   Do.
  (2) Repair maintenance and other
   roadway--running:
    Salaries and wages............        11-11-10   Do.
    Materials.....................        21-11-10   Do.
    Repairs by others--DR.........        39-11-10   Do.
    Repairs for others--CR........        40-11-10   Do.
    Purchased services............        41-11-10   Do.
    Other expenses................        61-11-10   Do.
      Roadway--switching
    Salaries and wages............        11-12-10   Do.
    Materials.....................        21-12-10   Do.
    Repairs by others--DR.........        39-12-10   Do.
    Repairs for others--CR........        40-12-10   Do.
    Purchased services............        41-12-10   Do.
    Other expenses................        61-12-10   Do.
      Tunnels and subways--running
    Salaries and wages............        11-11-11   Do.
    Materials.....................        21-11-11   Do.
    Repairs by others--DR.........        39-11-11   Do.
    Repairs for others--CR........        40-11-11   Do.
    Purchased services............        41-11-11   Do.
    Other expenses................        61-11-11   Do.
      Tunnels and subways--
       switching
    Salaries and wages............        11-12-11   Do.
    Materials.....................        21-12-11   Do.
    Repairs by others--DR.........        39-12-11   Do.
    Repairs for others--CR........        40-12-11   Do.
    Purchased services............        41-12-11   Do.
    Other expenses................        61-12-11   Do.
      Bridges and culverts--
       running
    Salaries and wages............        11-11-12   Do.
    Materials.....................        21-11-12   Do.
    Repairs by others--DR.........        39-11-12   Do.
    Repairs for others--CR........        40-11-12   Do.
    Purchased services............        41-11-12   Do.
    Other expenses................        61-11-12   Do.
      Bridges and culverts--
       switching
    Salaries and wages............        11-12-12   Do.
    Materials.....................        21-12-12   Do.
    Repairs by others--DR.........        39-12-12   Do.
    Repairs for others--CR........        40-12-12   Do.
    Purchased services............        41-12-12   Do.
    Other expenses................        61-12-12   Do.
Ties--running--material...........        21-11-13   Do.
Ties--switching--material.........        21-12-13   Do.
Rails--running--material..........        21-11-14   Do.
Rails--switching--material........        21-12-14   Do.
Other track material--running--           21-11-15   Do.
 material.
Other track material--switching--         21-12-15   Do.
 material.
Ballast--running--material........        21-11-16   Do.
Ballast--switching--material......        21-12-16   Do.
      Track laying and surfacing--
       running
    Salaries and wages............        11-11-17   Do.
    Materials.....................        21-11-17   Do.
    Repairs by others--DR.........        39-11-17   Do.
    Repairs for others--CR........        40-11-17   Do.
    Purchased services............        41-11-17   Do.
    Other expenses................        61-11-17   Do.
      Track laying and surfacing--
       switching
    Salaries and wages............        11-12-17   Do.

[[Page 223]]


    Materials.....................        21-12-17   Do.
    Repairs by others--DR.........        39-12-17   Do.
    Repairs for others--CR........        40-12-17   Do.
    Purchased services............        41-12-17   Do.
    Other expenses................        61-12-17   Do.
      Road property damaged--
       running
    Salaries and wages............        11-11-48   Do.
    Materials.....................        21-11-48   Do.
    Repairs by others--DR.........        39-11-48   Do.
    Repairs for others--CR........        40-11-48   Do.
    Purchased services............        41-11-48   Do.
    Other expenses................        61-11-48   Do.
      Road property damaged--
       switching
    Salaries and wages............        11-12-48   Do.
    Materials.....................        21-12-48   Do.
    Repairs by others--DR.........        39-12-48   Do.
    Repairs for others--CR........        40-12-48   Do.
    Purchased services............        41-12-48   Do.
    Other Expenses................        61-12-48   Do.
      Road property damaged--other
    Salaries and wages............         1-13-48   Do.
    Materials.....................        21-13-48   Do.
    Repairs by others--DR.........        39-13-48   Do.
    Repairs for others--CR........        40-13-48   Do.
    Purchased services............        41-13-48   Do.
    Other expenses................        61-13-48   Do.
      Signals and interlockers--
       running
    Salaries and wages............        11-11-19   Do.
    Materials.....................        21-11-19   Do.
    Repairs by others--DR.........        39-11-19   Do.
    Repairs for others--CR........        40-11-19   Do.
    Purchased services............        41-11-19   Do.
    Other expenses................        61-11-19   Do.
      Signals and interlockers--
       switching
    Salaries and wages............        11-12-19   Do.
    Materials.....................        21-12-19   Do.
    Repairs by others--DR.........        39-12-19   Do.
    Repairs for others--CR........        40-12-19   Do.
    Purchased services............        41-12-19   Do.
    Other expenses................        61-12-19   Do.
      Communications systems
    Salaries and wages............        11-13-20   Do.
    Materials.....................        21-13-20   Do.
    Repairs by others--DR.........        39-13-20   Do.
    Repairs for others--CR........        40-13-20   Do.
    Purchased services............        41-13-20   Do.
    Other expenses................        61-13-20   Do.
      Electric power systems
    Salaries and wages............        11-13-21   Do.
    Materials.....................        21-13-21   Do.
    Repairs by others--DR.........        39-13-21   Do.
    Repairs for others--CR........        40-13-21   Do.
    Purchased services............        41-13-21   Do.
    Other expenses................        61-13-21   Do.
      Highway grade crossings--
       running
    Salaries and wages............        11-11-22   Do.
    Materials.....................        21-11-22   Do.
    Repairs by others--DR.........        39-11-22   Do.
    Repairs for others--CR........        40-11-22   Do.
    Purchased services............        41-11-22   Do.
    Other expenses................        61-11-22   Do.
      Highway grade crossings--
       switching
    Salaries and wages............        11-12-22   Do.
    Materials.....................        21-12-22   Do.
    Repairs by others--DR.........        39-12-22   Do.
    Repairs for others--CR........        40-12-22   Do.
    Purchased services............        41-12-22   Do.
    Other expenses................        61-12-22   Do.
      Station and office buildings
    Salaries and wages............        11-13-23   Do.
    Materials.....................        21-13-23   Do.
    Repairs by others--DR.........        39-13-23   Do.
    Repairs for others--CR........        40-13-23   Do.
    Purchased services............        41-13-23   Do.

[[Page 224]]


    Other expenses................        61-13-23   Do.
      Station buildings--
       locomotives
    Salaries and wages............        11-13-24   Do.
    Materials.....................        21-13-24   Do.
    Repairs by others--DR.........        39-13-24   Do.
    Repairs for others--CR........        40-13-24   Do.
    Purchased services............        41-13-24   Do.
    Other expenses................        61-13-24   Do.
      Shop buildings--freight cars
    Salaries and wages............        11-13-25   Do.
    Materials.....................        21-13-25   Do.
    Repairs by others--DR.........        39-13-25   Do.
    Repairs for others--CR........        40-13-25   Do.
    Purchased services............        41-13-25   Do.
    Other expenses................        61-13-25   Do.
      Shop buildings--other
       equipment
    Salaries and wages............        11-13-26   Do.
    Materials.....................        21-13-26   Do.
    Repairs by others--DR.........        39-13-26   Do.
    Repairs for others--CR........        40-13-26   Do.
    Purchased services............        41-13-26   Do.
    Other expenses................        61-13-26   Do.
      Locomotive servicing
       facilities
    Salaries and wages............        11-13-27   Do.
    Materials.....................        21-13-27   Do.
    Repairs by others--DR.........        39-13-27   Do.
    Repairs for others--CR........        40-13-27   Do.
    Purchased services............        41-13-27   Do.
    Other expenses................        61-13-27   Do.
      Miscellaneous buildings and
       structures
    Salaries and wages............        11-13-28   Do.
    Materials.....................        21-13-28   Do.
    Repairs by others--DR.........        39-13-28   Do.
    Repairs for others--CR........        40-13-28   Do.
    Purchased services............        41-13-28   Do.
    Other expenses................        61-13-28   Do.
      Coal terminals
    Salaries and wages............        11-13-29   Do.
    Materials.....................        21-13-29   Do.
    Repairs by others--DR.........        39-13-29   Do.
    Repairs for others--CR........        40-13-29   Do.
    Purchased services............        41-13-29   Do.
    Other expenses................        61-13-29   Do.
      Ore terminals
    Salaries and wages............        11-13-30   Do.
    Materials.....................        21-13-30   Do.
    Repairs by others--DR.........        39-13-30   Do.
    Repairs for others--CR........        40-13-30   Do.
    Purchased services............        41-13-30   Do.
    Other expenses................        61-13-30   Do.
      TOFC/COFC terminals
    Salaries and wages............        11-13-31   Do.
    Materials.....................        21-13-31   Do.
    Repairs by others--DR.........        39-13-31   Do.
    Repairs for others--CR........        40-13-31   Do.
    Purchased services............        41-13-21   Do.
    Other expenses................        61-13-31   Do.
      Other marine terminals
    Salaries and wages............        11-13-32   Do.
    Materials.....................        21-13-32   Do.
    Repairs by others--DR.........        39-13-32   Do.
    Repairs for others--CR........        40-13-32   Do.
    Purchased services............        41-13-32   Do.
    Other expenses................        61-13-32   Do.
      Motor vehicle loading and
       distribution facilities
    Salaries and wages............        11-13-33   Do.
    Materials.....................        21-13-33   Do.
    Repairs by others--DR.........        39-13-33   Do.
    Repairs for others--CR........        40-13-33   Do.
    Purchased services............        41-13-33   Do.
    Other expenses................        61-13-33   Do.
      Facilities for other
       specialized service
       operations
    Salaries and wages............        11-13-35   Do.

[[Page 225]]


    Materials.....................        21-13-35   Do.
    Repairs by others--DR.........        39-13-35   Do.
    Repairs for others--CR........        40-13-35   Do.
    Purchased services............        41-13-35   Do.
    Other expenses................        61-13-35   Do.
      Roadway machines
    Salaries and wages............        11-13-36  Daily repair costs
                                                     per GMA, for each
                                                     type of machine
                                                     used on the branch
                                                     line sec.
                                                     1152.33(a)(1).
    Materials.....................        21-13-36   Do.
    Repairs by others--DR.........        39-13-36   Do.
    Repairs for others--CR........        40-13-36   Do.
    Purchased services............        41-13-36   Do.
    Other expenses................        61-13-36   Do.
      Small tools and supplies
    Other expenses................        11-13-37  Assign supplies on
                                                     the daily costs per
                                                     GMA, for each type
                                                     of machine used on
                                                     the branch; small
                                                     tool assign to
                                                     maintenance of way
                                                     11- 11/12-10
                                                     through 17, and 48,
                                                     sec. 1152.33(a)(2).
    Materials.....................        21-13-37   Do.
    Repairs by others--DR.........        39-13-37   Do.
    Repairs for others--CR........        40-13-37   Do.
    Purchased services............        41-13-37   Do.
    Other expenses................        61-13-37   Do.
      Snow removal
    Salaries and wages............        11-13-38  Actual.
    Materials.....................        21-13-38   Do.
    Repairs by others--DR.........        39-13-38   Do.
    Repairs for others--CR........        40-13-38   Do.
    Purchased Services............        41-13-38   Do.
    Other expenses................        61-13-38   Do.
Fringe benefits--running..........        12-11-00  11-11-XX, sec.
                                                     1152.33(a)(3)(i).
Fringe benefits--switching........        12-12-00  11-12-XX, sec.
                                                     1152.33(a)(3)(ii).
Fringe benefits--other............        12-13-00  11-13-XX, sec.
                                                     1152.33(a)(3)(iii).
      Casualties and insurance--
       running
    Other casualties..............        52-11-00  Actual.
    Insurance.....................        53-11-00   Do.
      Casualties and insurance--
       switching
    Other casualties..............        52-12-00   Do.
    Insurance.....................        53-12-00   Do.
Lease rentals--debit--running.....        31-11-00   Do.
Lease rentals--debit--switching...        31-12-00   Do.
Lease rentals--debit--other.......        31-13-00   Do.
Lease rentals--credit--running....        32-11-00   Do.
Lease rentals--credit--switching..        32-12-00   Do.
Lease rentals--credit--other......        32-13-00   Do.
Joint facility rent--debit--              33-11-00   Do.
 running.
Joint facility rent--debit--              33-12-00   Do.
 switching.
      Casualties and insurance--
       other
    Other casualties..............        52-13-00   Do.
    Insurance.....................        53-13-00   Do.
Joint facility--debit--other......        33-13-00   Do.
Joint facility rent--credit--             34-11-00   Do.
 running.
Joint facility rent--credit--             34-12-00   Do.
 switching.
Joint facility rent--credit--other        34-13-00   Do.
Other rents--debit--running.......        35-11-00   Do.
Other rents--debit--switching.....        35-12-00   Do.
Other rents--debit--other.........        35-13-00   Do.
Other rents--credit--running......        36-11-00   Do.
Other rents--credit--switching....        36-12-00   Do.
Other rents--credit--other........        36-13-00   Do.
Depreciation--running.............        62-11-00   Do.
Depreciation--switching...........        62-12-00   Do.
Depreciation--other...............        62-13-00   Do.
Joint facility--debit--running....        37-11-00   Do.
Joint facility--debit--switching..        37-12-00   Do.
Joint facility--debit--other......        37-13-00   Do.
Joint facility--credit--running...        38-11-00   Do.
Joint facility--credit--switching.        38-12-00   Do.
Joint facility--credit--other.....        38-13-00   Do.
      Dismantling retired road
       property--running
    Salaries and wages............        11-11-39   Do.
    Materials.....................        21-11-39   Do.
    Purchased services............        41-11-39   Do.
    Other expenses................        61-11-39   Do.

[[Page 226]]


      Dismantling retired road
       property--switching
    Salaries and wages............        11-12-39   Do.
    Materials.....................        21-12-39   Do.
    Purchased services............        41-12-39   Do.
    Other expenses................        61-12-39   Do.
      Dismantling retired road
       property--other
    Salaries and wages............        11-13-39   Do.
    Materials.....................        21-13-39   Do.
    Purchased services............        41-13-39   Do.
    Other expenses................        61-13-39   Do.
      Other--running
    Salaries and wages............        11-11-99   Do.
    Materials.....................        21-11-99   Do.
    Purchased services............        41-11-99   Do.
    Other expenses................        61-11-99   Do.
      Other--switching
    Salaries and wages............        11-12-99   Do.
    Materials.....................        21-12-99   Do.
    Purchased Services............        41-12-99   Do.
    Other Expenses................        61-12-99   Do.
      Other--other
    Salaries and wages............        11-13-99   Do.
    Materials.....................        21-13-99   Do.
    Purchased services............        41-13-99   Do.
    Other expenses................        61-13-99   Do.
(b) Maintenance of equipment:
  (1) Locomotives: Administration
    Salaries and wages............        11-21-01   Do.
    Materials.....................        21-21-01   Do.
    Purchased services............        41-21-01   Do.
    Other expenses................        61-21-01   Do.
      Repairs and maintenance
    Salaries and wages............        11-21-41  Road diesel and road
                                                     electric locomotive
                                                     gross ton miles.
                                                     Yard diesel and
                                                     yard electric
                                                     locomotive unit
                                                     hours,
                                                     Sec.1152.33(b)(1).
    Materials.....................        21-21-41   Do.
    Repairs by others--DR.........        39-21-41   Do.
    Repairs for others--CR........        40-21-41   Do.
    Purchased services............        41-21-41   Do.
    Other expenses................        61-21-41   Do.
      Machinery repair
    Salaries and wages............        11-21-40  Actual.
    Materials.....................        21-21-40   Do.
    Repairs by others--DR.........        39-21-40   Do.
    Repairs for others--CR........        40-21-40   Do.
    Purchased services............        41-21-40   Do.
    Other expenses................        61-21-40   Do.
      Equipment damaged
    Salaries and wages............        11-21-48   Do.
    Materials.....................        21-21-48   Do.
    Repairs by others--DR.........        39-21-48   Do.
    Repairs for others--CR........        40-21-48   Do.
    Purchased services............        41-21-48   Do.
    Other expenses................        61-21-48   Do.
      Equipment damaged
Fringe benefits...................        12-21-00  11-21-XX, sec.
                                                     1152.33(b)(3)(i).
      Other casualties and
       insurance
    Other casualties..............        52-21-00  Actual.
    Insurance.....................        53-21-00   Do.
Lease rentals--debit..............        31-21-00   Do.
Lease rentals--credit.............        32-21-00   Do.
Joint facility rent--debit........        33-21-00   Do.
Joint facility rent--credit.......        34-21-00   Do.
Other rents--debit................        35-21-00   Do.
Other rents--credit...............        36-21-00   Do.
Joint facility--debit.............        37-21-00   Do.
Joint facility--credit............        38-21-00   Do.
Depreciation......................        62-21-00  All locomotives,
                                                     locomotive unit
                                                     hours, sec.
                                                     1152.33(b)(2).
      Dismantling retired property
    Salaries and wages............        11-21-39  Actual.
    Materials.....................        21-21-39   Do.
    Purchased services............        41-21-39   Do.
    Other expenses................        61-21-39   Do.

[[Page 227]]


      Other
    Salaries and wages............        11-21-99   Do.
    Materials.....................        21-21-99   Do.
    Purchased services............        41-21-99   Do.
    Other expenses................        61-21-99   Do.
  (2) Freight cars:
   Administration:
    Salaries and wages............        11-22-01   Do.
    Materials.....................        21-22-01   Do.
    Purchased services............        41-22-01   Do.
    Other expenses................        61-22-01   Do.
      Machinery repair
    Salaries and wages............        11-22-40   Do.
    Materials.....................        21-22-40   Do.
    Repairs by others--DR.........        39-22-40   Do.
    Repairs for others--CR........        40-22-40   Do.
    Purchased services............        41-22-40   Do.
    Other expenses................        61-22-40   Do.
      Equipment damage
    Salaries and wages............        11-22-48   Do.
    Materials.....................        21-22-48   Do.
    Repairs by others--DR.........        39-22-48   Do.
    Repairs for others--CR........        40-22-48   Do.
    Purchased services............        41-22-48   Do.
    Other expenses................        61-22-48   Do.
Fringe benefits...................        12-22-00  11-22-XX, sec.
                                                     1152.33-
                                                     (b)(3)(iii).
      Other casualties and
       insurance
    Other casualties..............        52-22-00  Actual.
    Insurance.....................        53-22-00   Do.
Joint facility rent--DR...........        33-22-00   Do.
Joint facility rent--CR...........        34-22-00   Do.
Joint facility--DR................        37-22-00   Do.
Joint facility--CR................        38-22-00   Do.
      Dismantling retired property
    Salaries and wages............        11-22-39   Do.
    Materials.....................        21-22-39   Do.
    Purchased services............        41-22-39   Do.
    Other expenses................        61-22-39   Do.
      Other
    Salaries and wages............        11-22-99   Do.
    Materials.....................        21-22-99   Do.
    Purchased services............        41-22-99   Do.
    Other expenses................        61-22-99   Do.
Freight car costs per day and per
 mile:
      Repair and maintenance
    Salaries and wages............        11-22-42  These accounts are
                                                     used to develop the
                                                     cost per car day
                                                     and per car mile
                                                     for each type of
                                                     car, sec.
                                                     1152.32(g).
    Materials.....................        21-22-42   Do.
    Repairs by others--DR.........        39-22-42   Do.
    Repairs for others--CR........        40-22-42   Do.
    Purchased services............        41-22-42   Do.
    Other expenses................        61-22-42   Do.
Lease rentals--DR.................        31-22-00  ....................
Lease rentals--CR.................        32-22-00  ....................
Depreciation......................        62-22-00  ....................
Other rents--DR...................        35-22-00  ....................
Other rents--CR...................        36-22-00  ....................
  (3) Other equipment:
   Administration
    Salaries and wages............        11-23-01  Actual.
    Materials.....................        21-23-01   Do.
    Purchased services............        41-23-01   Do.
    Other expenses................        61-23-01   Do.
Repair and maintenance: Trucks,
 trailers and containers--revenue
 service
    Salaries and wages............        11-23-43   Do.
    Materials.....................        21-23-43   Do.
    Repairs by others--DR.........        39-23-43   Do.
    Repairs for others--CR........        40-23-43   Do.
    Purchased services............        41-23-43   Do.
    Other expenses................        61-23-43   Do.
      Floating equipment--revenue
       service
    Salaries and wages............        11-23-44   Do.
    Materials.....................        21-23-44   Do.
    Repairs by others--DR.........        39-23-44   Do.

[[Page 228]]


    Repairs for others--CR........        40-23-44   Do.
    Purchased services............        41-23-44   Do.
    Other expenses................        61-23-44   Do.
      Computer and data processing
    Salaries and wages............        11-23-46   Do.
    Materials.....................        21-23-46   Do.
    Repairs by others--DR.........        39-23-46   Do.
    Repairs for others--CR........        40-23-46   Do.
    Purchased services............        41-23-46   Do.
    Other expenses................        61-23-46   Do.
      Machinery
    Salaries and wages............        11-23-40   Do.
    Materials.....................        21-23-40   Do.
    Repairs by others--DR.........        39-23-40   Do.
    Repairs for others--CR........        40-23-40   Do.
    Purchased services............        41-23-40   Do.
    Other expenses................        61-23-40   Do.
      Work and other non revenue
       equipment
    Salaries and wages............        11-23-47   Do.
    Materials.....................        21-23-47   Do.
    Repairs by others--DR.........        39-23-47   Do.
    Repairs for others--CR........        40-23-47   Do.
    Purchased services............        41-23-47   Do.
    Other expenses................        61-23-47   Do.
      Equipment damaged
    Salaries and wages............        11-23-48   Do.
    Materials.....................        21-23-48   Do.
    Repairs by others--DR.........        39-23-48   Do.
    Repairs for others--CR........        40-23-38   Do.
    Purchased services............        41-23-48   Do.
    Other expenses................        61-23-48   Do.
      Equipment damaged
Fringe benefits...................        12-23-00  11-23-XX, sec.
                                                     1152.33(b)(3)(ii).
      Other casualties and
       insurance
    Other casualties..............        52-23-00  Actual.
      Insurance...................        53-23-00   Do.
    Lease rentals--DR.............        31-23-00   Do.
    Lease rentals--CR.............        32-23-00   Do.
    Joint facility rent--DR.......        33-23-00   Do.
    Joint facility rent--CR.......        34-23-00   Do.
    Other rents--DR...............        35-23-00   Do.
    Other rents--CR...............        36-23-00   Do.
    Depreciation..................        62-23-00   Do.
    Joint facility--DR............        37-23-00   Do.
    Joint facility--CR............        38-23-00   Do.
      Dismantling retired property
    Salaries and wages............        11-23-39   Do.
    Materials.....................        21-23-39   Do.
    Purchased services............        41-23-39   Do.
    Other expenses................        61-23-39   Do.
      Other
    Salaries and wages............        11-23-99   Do.
    Materials.....................        21-23-99   Do.
    Purchased services............        41-23-99   Do.
    Other expenses................        61-23-99   Do.
(c) Transportation:
  (1) Train operations:
   Administration:
    Salaries and wages............        11-31-01   Do.
    Materials.....................        21-31-01   Do.
    Purchased services............        41-31-01   Do.
    Other expenses................        61-31-01   Do.
      Engine crews
    Salaries and wages............        11-31-56   Do.
    Materials.....................        21-31-56  Train hours, sec.
                                                     1152.33(c)(1)(i).
    Purchased services............        41-31-56  Actual.
    Other expenses................        61-31-56   Do.
      Train crews
    Salaries and wages............        11-31-57   Do.
    Materials.....................        21-31-57  Train hours, sec.
                                                     1152.33(c)(1)(i).
    Purchased services............        41-31-57  Actual.
    Other expenses................        61-31-57   Do.
      Dispatching trains
    Salaries and wages............        11-31-58   Do.
    Materials.....................        21-31-58   Do.

[[Page 229]]


    Purchased services............        41-31-58   Do.
    Other expenses................        61-31-58   Do.
      Operating signals and
       interlockers
    Salaries and wages............        11-31-59   Do.
    Materials.....................        21-31-59   Do.
    Purchased services............        41-31-59   Do.
    Other expenses................        61-31-59   Do.
      Operating drawbridges
    Salaries and wages............        11-31-60   Do.
    Materials.....................        21-31-60   Do.
    Purchased services............        41-31-60   Do.
    Other expenses................        61-31-60   Do.
      Highway crossing protection
    Salaries and wages............        11-31-61   Do.
    Materials.....................        21-31-61   Do.
    Purchased services............        41-31-61   Do.
    Other expenses................        61-31-61   Do.
      Train and inspection and
       lubrication
    Salaries and wages............        11-31-62  Train hours, Sec.
                                                     1152.33(c)(1)(i).
    Materials.....................        21-31-62   Do.
    Purchased services............        41-31-62  Actual.
    Other expenses................        61-31-62   Do.
      Locomotive fuel
    Salaries and wages............        11-31-67  Diesel locomotive
                                                     unit hours, Sec.
                                                     1152.33(c)(1)(ii).
    Materials.....................        21-31-67   Do.
    Purchased services............        41-31-67   Do.
    Other expenses................        61-31-67   Do.
      Electric power purchased or
       produced for motive power
    Salaries and wages............        11-31-68  Electric locomotive
                                                     unit hours, sec.
                                                     1152.33(c)(1)(iii).
    Materials.....................        21-31-68   Do.
    Purchased services............        41-31-68   Do.
    Other expenses................        61-31-68   Do.
      Servicing locomotives
    Salaries and wages............        11-31-69  Locomotive unit
                                                     miles, sec.
                                                     1152.33(c)(1)(iv).
    Materials.....................        21-31-69   Do.
    Purchased services............        41-31-69   Do.
    Other expenses................        61-31-69   Do.
Freight lost or damaged--solely           51-31-00  Actual.
 related.
      Clearing wrecks
    Salaries and wages............        11-31-63   Do.
    Materials.....................        21-31-63   Do.
    Purchased services............        41-31-63   Do.
    Other expenses................        61-31-63   Do.
Fringe benefits...................        12-31-00   11-31-XX, sec.
                                                     1152.33 (c)(4)(i).
      Other casualties and
       insurance
    Other casualties..............        52-31-00  Actual.
    Insurance.....................        53-31-00   Do.
    Joint facility--DR............        37-31-00   Do.
    Joint facility--CR............        38-31-00   Do.
      Other
    Salaries and wages............        11-31-99   Do.
    Materials.....................        21-31-99   Do.
    Purchased services............        41-31-99   Do.
    Other expenses................        61-31-99   Do.
  (2) Yard operations:
   Administration:
    Salaries and wages............        11-32-01   Do.
    Materials.....................        21-32-01   Do.
    Purchased services............        41-32-01   Do.
    Other expenses................        61-32-01   Do.
      Switch crews
    Salaries and wages............        11-32-64   Do.
    Materials.....................        21-32-64  Locomotive unit
                                                     hours, sec.
                                                     1152.33(c)(2)(i)
    Purchased services............        41-32-64  Actual.
    Other expenses................        61-32-64   Do.
      Controlling operations
    Salaries and wages............        11-32-65   Do.
    Materials.....................        21-32-65   Do.
    Purchased services............        41-32-65   Do.
    Other expenses................        61-32-65   Do.
      Yard and terminal clerical
    Salaries and wages............        11-32-66   Do.
    Materials.....................        21-32-66   Do.
    Purchased services............        41-32-66   Do.

[[Page 230]]


    Other expenses................        61-32-66   Do.
      Operating switches, signals,
       retarders and humps
    Salaries and wages............        11-32-59   Do.
    Materials.....................        21-32-59   Do.
    Purchased services............        41-32-59   Do.
    Other expenses................        61-32-59   Do.
      Locomotive fuel
    Salaries and wages............        11-32-67  Dieselloco motive
                                                     unit hours, sec.
                                                     1152.33(c)(2)(ii)
    Materials.....................        21-32-67   Do.
    Purchased services............        41-32-67   Do.
    Other expenses................        61-32-67   Do.
      Electric power purchased or
       produced for motive power
    Salaries and wages............        11-32-68  Electric locomotive
                                                     unit hours, sec.
                                                     1152.33(c)(2)(iii).
    Materials.....................        21-32-68   Do.
    Purchased services............        41-32-68   Do.
    Other expenses................        61-32-68   Do.
      Servicing locomotives
    Salaries and wages............        11-32-69  Locomotive unit
                                                     hours, sec.
                                                     1152.33(c)(2)(i).
    Materials.....................        21-32-69   Do.
    Purchased services............        41-32-69   Do.
    Other expenses................        61-32-69   Do.
Freight lost or damaged--solely           51-32-00  Actual.
 related.
      Clearing wrecks
    Salaries and wages............        11-32-63   Do.
    Materials.....................        21-32-63   Do.
    Purchased services............        41-32-63   Do.
    Other expenses................        61-32-63   Do.
    Fringe benefits...............        12-32-00  11-32-XX, sec.
                                                     1152.33(c)(4)(ii).
      Other casualties and
       insurance
    Other casualties..............        52-32-00  Actual.
    Insurance.....................        53-32-00   Do.
    Joint facility--DR............        37-32-00   Do.
    Joint facility--CR............        38-32-00   Do.
      Other
    Salaries and wages............        11-32-99   Do.
    Materials.....................        21-32-99   Do.
    Purchased services............        41-32-99   Do.
    Other expenses................        61-32-99   Do.
  (3) Train and yard operations
   common:
      Cleaning car interiors
    Salaries and wages............        11-33-70   Do.
    Materials.....................        21-33-70   Do.
    Purchased services............        41-33-70   Do.
      Adjusting and transferring
       loads
    Salaries and wages............        11-33-71   Do.
    Materials.....................        21-33-71   Do.
    Purchased services............        41-33-71   Do.
      Carloading devices and grain
       doors
    Salaries and wages............        11-33-72   Do.
    Materials.....................        21-33-72   Do.
    Purchased services............        41-33-72   Do.
Freight lost or damaged--all other        51-33-00   Do.
Fringe benefits...................        12-33-00  11-33-XX, sec.
                                                     1152.33(c)(4)(iii).
  (4) Specialized service
   operations: Administration:
    Salaries and wages............        11-34-01  Actual.
    Materials.....................        21-34-01   Do.
    Purchased services............        41-34-01   Do.
    Other expenses................        61-34-01   Do.
      Pick-up and delivery, marine
       line haul, and rail
       substitute service
    Salaries and wages............        11-34-73   Do.
    Materials.....................        21-34-73   Do.
    Purchased services............        41-34-73   Do.
    Other expenses................        61-34-73   Do.
      Loading and unloading and
       local marine
    Salaries and wages............        11-34-74   Do.
    Materials.....................        21-34-74   Do.
    Purchased services............        41-34-74   Do.
    Other expenses................        61-34-74   Do.
      Protective services
    Salaries and wages............        11-34-75   Do.
    Materials.....................        21-34-75   Do.

[[Page 231]]


    Purchased services............        41-34-75   Do.
    Other expenses................        61-34-75   Do.
Freight lost or damaged--Solely           51-34-00   Do.
 related.
Fringe benefits...................        12-34-00  11-34-XX, sec.
                                                     1152.33(c)(4)(iv).
      Casualties and insurance
    Other casualties..............        52-34-00  Actual.
    Insurance.....................        53-34-00   Do.
    Joint facility--DR............        37-34-00   Do.
    Joint facility--CR............        38-34-00   Do.
      Other
    Salaries and wages............        11-34-99   Do.
    Materials.....................        21-34-99   Do.
    Purchased services............        41-34-99   Do.
    Other expenses................        61-34-99   Do.
  (5) Administrative support
   operations: Administration :
    Salaries and wages............        11-35-01   Do.
    Materials.....................        21-35-01   Do.
    Purchased services............        41-35-01   Do.
    Other expenses................        61-35-01   Do.
      Employees performing
       clerical and accounting
       functions
    Salaries and wages............        11-35-76   Do.
    Materials.....................        21-35-76   Do.
    Purchased services............        41-35-76   Do.
    Other expenses................        61-35-76   Do.
      Communication systems
       operation
    Salaries and wages............        11-35-77   Do.
    Materials.....................        21-35-77   Do.
    Purchased services............        41-35-77   Do.
    Other expenses................        61-35-77   Do.
      Loss and damage claims
       processing
    Salaries and wages............        11-35-78  Number of claims,
                                                     sec.
                                                     1152.33(c)(3)(i).
    Materials.....................        21-35-78   Do.
    Purchased services............        41-35-78   Do.
    Other expenses................        61-35-78   Do.
Fringe benefits...................        12-35-00  11-35-XX. sec.
                                                     1152.33(c)(4)(v).
Joint facility--DR................        37-35-00  Actual.
Joint facility--CR................        38-35-00   Do.
    Casualties and insurance......
    Other casualties..............        52-35-00   Do.
    Insurance.....................        53-35-00   Do.
      Other
    Salaries and wages............        11-35-99   Do.
    Materials.....................        21-35-99   Do.
    Purchased services............        41-35-99   Do.
    Other expenses................        61-35-99   Do.
(d) General Administrative
 Officers--general administration:
    Salaries and wages............        11-61-01   Do.
    Materials.....................        21-61-01   Do.
    Purchased services............        41-61-01   Do.
    Other expenses................        61-61-01   Do.
      Accounting, auditing and
       finance
    Salaries and wages............        11-61-86   Do.
    Materials.....................        21-61-86   Do.
    Purchased services............        41-61-86   Do.
    Other expenses................        61-61-86   Do.
      Management services and data
       processing
    Salaries and wages............        11-61-87   Do.
    Materials.....................        21-61-87   Do.
    Purchased services............        41-61-87   Do.
    Other expenses................        61-61-87   Do.
      Marketing:
    Salaries and wages............        11-61-88   Do.
    Materials.....................        21-61-88   Do.
    Purchased services............        41-61-88   Do.
    Other expenses................        61-61-88   Do.
      Sales
    Salaries and wages............        11-61-89   Do.
    Materials.....................        21-61-89   Do.
    Purchased services............        41-61-89   Do.
    Other expenses................        61-61-89   Do.
      Industrial development
    Salaries and wages............        11-61-90   Do.

[[Page 232]]


    Materials.....................        21-61-90   Do.
    Purchased services............        41-61-90   Do.
    Other expenses................        61-61-90   Do.
      Personnel and labor
       relations
    Salaries and wages............        11-61-91   Do.
    Materials.....................        21-61-91   Do.
    Purchased services............        41-61-91   Do.
    Other expenses................        61-61-91   Do.
      Legal and secretarial
    Salaries and wages............        11-61-92   Do.
    Materials.....................        21-61-92   Do.
    Purchased services............        41-61-92   Do.
    Other expenses................        61-61-92   Do.
      Public relations and
       advertising
    Salaries and wages............        11-61-93   Do.
    Materials.....................        21-61-93   Do.
    Purchased services............        41-61-93   Do.
    Other expenses................        61-61-93   Do.
      Research and development
    Salaries and wages............        11-61-94   Do.
    Materials.....................        21-61-94   Do.
    Purchased services............        41-61-94   Do.
    Other expenses................        61-61-94   Do.
Fringe benefits...................        12-61-00  11-61-XX, sec.
                                                     1152.33(d)(1).
      Casualties and insurance
    Other casualties..............        52-61-00  Actual
    Insurance.....................        53-61-00   Do.
Writedown of uncollectible                63-61-00   Do.
 accounts.
Other taxes except on corporate           65-61-00   Do.
 income or payroll.
Joint facility--DR................        37-61-00   Do.
Joint facility--CR................        38-61-00   Do.
      Other
    Salaries and wages............        11-61-99   Do.
    Materials.....................        21-61-99   Do.
    Purchased services............        41-61-99   Do.
    Other expenses................        61-61-99   Do.
------------------------------------------------------------------------

    (e) Deadheading, taxi, and hotel costs. The costs assigned under 
this subsection shall be the actual costs incurred as a result of 
providing service to the branch line for deadheading, taxi, and hotel 
costs. The amounts included under this subsection shall not be included 
under other subsections of these regulations.
    (f) Overhead movement costs. The costs assigned under this 
subsection shall be the actual costs incurred in moving over any other 
rail line solely to reach and provide service to the branch. The amounts 
shown under this subsection shall not be included under other 
subsections of these regulations.
    (g) Freight car costs. For Class I railroads, the on-segment costs 
for time-mileage freight cars shall be calculated on the basis of the 
carrier's average cost per day and per mile. Those freight cars that are 
rented on a straight mileage basis are to be costed on the carrier's 
average cost per mile for each type of car rented on this basis. No 
costs are to be included in the calculation for private line (shipper 
owned) or other cars for which the railroad does not make payments. The 
cost per day and per mile shall be calculated separately for each type 
of car specified in Ex Parte No. 334, Car Service Compensation--Basic 
Per Diem Charges, 362 I.C.C. 884 (1980). The freight car costs shall be 
separated between ``return on value-freight cars'' and ``freight car 
costs other than return on freight cars''. The costs assigned to a line 
under this subsection are to be derived from the accounts listed below.

------------------------------------------------------------------------
      Operating expense group--Repair and maintenance        Account No.
------------------------------------------------------------------------
Salaries and wages........................................      11-22-42
Materials.................................................      21-22-42
Repairs by others--DR.....................................      39-22-42
Repairs for others--CR....................................      40-22-42
Purchased services........................................      41-22-42
Other expenses............................................      61-22-42
Lease rentals--DR.........................................      31-22-00
Lease rentals--CR.........................................      32-22-00
Depreciation
  Other rents--DR.........................................      35-22-00
  Other rents--CR.........................................      36-22-00
------------------------------------------------------------------------


[[Page 233]]

    The system total of the repair and maintenance accounts, all 
accounts designated XX-XX-42, and depreciation shall be divided into 
time-related costs and mileage-related costs on the basis of 50 percent 
time and 50 percent mileage for repairs, and 60 percent time and 40 
percent mileage for depreciation. Freight car costs shall not include 
depreciation as determined in Account No. 62-22-00. Freight car 
depreciation shall be calculated in the manner set forth in paragraph 
(g)(3)(i) of this section. The system total receipts and payments for 
the hire of time-mileage cars, and the basic data used in the 
development of the car-day and car-mile factors, shall be taken from the 
carrier's latest Form R-1 and company records. The specific steps to 
complete the calculation are as follows:
    (1) The total system car days by car type shall be calculated by:
    (i) Averaging the carrier's freight car ownership at the beginning 
and end of the year (Form R-1, schedule 710, columns (b) and (k);
    (ii) Multiplying the average by the standard active number of car 
days (346) as developed in ICC Docket No. 31358;
    (iii) Subtracting car days on foreign lines (source: Company 
records); and
    (iv) Adding the foreign car days on home line (source: Company 
records). This procedure shall be followed for each car type specified 
in Ex Parte No. 334, supra.
    (2) The total railroad car miles shall be calculated by adding the 
loaded car miles for the railroad owned and leased cars (R-1, Schedule 
755) to empty car miles for the railroad owned or leased cars (R-1, 
Schedule 755). The total car miles, loaded and empty, shall be 
calculated for each car type specified in Ex Parte No. 334, supra.
    (3) The cost per car day shall be calculated for each type of time-
mileage car by adding 50 percent of total freight car repair costs for 
each type (Form R-1, schedule 415, column (b)), and 60 percent of the 
depreciation shall be developed as follows:
    (i) The current value for each type of car shall be calculated by 
first arriving at the current cost per car using the most recent 
purchase of this type by the railroad indexed to the midpoint of the 
year or a price quote from the manufacturer. This unit price shall be 
applied to the average number of this type of car owned by the carrier 
during the year. The current value developed for each car type is then 
multiplied by the composite depreciation rate for that type of car as 
shown in the latest annual report filed with the Board or company 
records.
    (ii) Add 100 percent of the return on investment. Return on 
investment shall be determined by multiplying the current value of each 
type of car, developed in paragraph (g)(3)(i) of this section, by 1 
minus the ratio of accumulated depreciation to the total original cost 
investment. This will determine the net current value for each type of 
car. The net current value for each type of car shall then be multiplied 
by the nominal rate of return calculated in Sec.1152.34(d) to obtain 
nominal return on investment for each type of car. The total return on 
investment shall then be calculated by deducting the projected holding 
gain (loss) for the forecast and/or subsidy year from the nominal return 
on investment for each type of car. In any instance where the holding 
gain is not specifically determined for freight cars, the Gross Domestic 
Product deflator calculated by the U.S. Department of Commerce shall be 
used. The total return on investment for each type of car shall then be 
divided by total car-days for each car-type developed in paragraph 
(g)(1) of this section.
    (iii) To the amounts for repairs and depreciation, add the time 
portion of the railroad's payment for hire of time-mileage freight cars 
(Form R-1, schedule 414, column (g)), and subtract the time portion of 
the railroad's receipts for hire of time mileage freight cars (Form R-1, 
schedule 414, column (d)). The total of these costs is divided by the 
total car days for each type developed in paragraph (g)(1) of this 
section.
    (4) The cost per mile shall be calculated for each type of time-
mileage car as follows. First, add:
    (i) 50 percent of the total freight train car repair cost for each 
car type (Form R-1, schedule 415, column (b));
    (ii) 40 percent of the total depreciation costs for each car type 
developed

[[Page 234]]

in paragraph (g)(3)(i) of this section; and
    (iii) The mileage portion of the carrier's payments for the hire of 
time-mileage freight cars (Form R-1, schedule 414, column (f)).


Second, subtract the mileage portion of the carrier's receipts for hire 
of time-mileage freight cars (Form R-1, schedule 414, column (c)). 
Finally, divide the result by the total car-miles for each car-type 
developed in paragraph (g)(2) of this section.
    (5) The costs per car day and per car mile developed in paragraphs 
(g) (3) and (4) of this section shall be applied to the total car days 
and total car miles for each car type accumulated on the line segment 
for all traffic originated and/or terminated on the segment plus those 
freight cars that bridge the line segment which are attributed to time-
mileage freight train cars. The on-segment costs for freight cars rented 
on a straight mileage basis shall be the railroad's total payments for 
mileage cars (Form R-1, schedule 414, column (e)) for each car type 
divided by the total miles on which the charges were based.
    (6) For Class II and III railroads, the on-segment costs for time-
mileage and straight mileage freight cars shall be calculated in the 
same manner prescribed for Class I railroads, using the latest data 
available.
    (h) Return on investment--locomotive (line). The return on 
investment shall be calculated for each type of classification of 
locomotive that is actually used to provide service to the line segment. 
The return for the locomotive(s) used shall be calculated in accordance 
with the following procedure:
    (1) The current replacement cost for each type of locomotive used to 
serve the line segment shall be based on the most recent purchase of 
that particular type and size locomotive by the carrier, indexed to the 
midpoint of the forecast and/or subsidy year, or on an amount quoted by 
the manufacturer. The amount must be substantiated. This unit cost shall 
be multiplied by 1 minus the ratio of total accumulated depreciation to 
original total cost of that type of equipment owned by applicant-
carrier, as shown by company records.
    (2) The current nominal cost of capital shall be used in the 
calculation of return on investment for locomotives and shall be 
calculated as provided in Sec.1152.34(d).
    (3) The return on investment for each category or type of locomotive 
shall be the nominal return less the holding gain (loss). The nominal 
return is calculated by multiplying the replacement cost determined in 
paragraph (h)(1) of this section by the nominal rate of return 
determined in paragraph (h)(2) of this section. The holding gain (loss) 
shall be the gain (loss) projected to occur during the forecast and/or 
subsidy year. In any instance where the holding gain is not specifically 
determined for locomotives, the Gross Domestic Product deflator 
calculated by the U.S. Department of Commerce shall be used.
    (4) The return on investment for each type of locomotive shall be 
assigned to the line segment on a ratio of the locomotive unit hours on 
the segment to average locomotive unit hours per unit for each type of 
locomotive in the system. This ratio will be developed as follows:
    (i) The carrier shall keep and maintain records of the number of 
hours that each type of locomotive incurred in serving the segment 
during the subsidy period.
    (ii) The railroad shall develop the system average locomotive unit 
hours per unit for each of the following types of locomotives; yard 
diesel; yard-other; road diesel; and road-other.
    (iii) The ratio applied to the return on investment is calculated by 
dividing the hours that each type or class of locomotive is used to 
serve the segment, as developed in paragraph (h)(4)(i) of this section, 
by the system average locomotive unit hours per unit for the applicable 
type developed in paragraph (h)(4)(ii) of this section.
    (5) The cost assigned to the segment for each type of locomotive 
shall be calculated by multiplying the annual return on investment 
developed in paragraph (h)(3) of this section by the ratio(s) developed 
in paragraph (h)(4) of this section.
    (i) Revenue taxes. The amount of revenue taxes shall be computed 
based on the amounts directly paid in those

[[Page 235]]

states that subject the railroad to a revenue tax.
    (j) Property taxes (Line). (1) The assigned costs under this 
subsection shall be the net systemwide property tax savings resulting 
from the abandonment, calculated as set out below, if the applicant-
carrier intends subsequently to sell or otherwise dispose of the 
abandoned properties. If the applicant-carrier expresses an intent to 
dispose of the properties, it will be presumed that the properties will 
ultimately be sold or otherwise disposed of after abandonment. 
Protestants may rebut this presumption by showing that it would be 
financially beneficial to retain ownership of the property for 
investment purposes.
    (2) In states where a true ad valorem tax is levied on real property 
(such as track, land, buildings, and other facilities), applicant must 
affirm that the ad valorem method applies and must substantiate the 
amount of property taxes levied against the property on the line 
segment.
    (3) In states where the ad valorem method is not employed, applicant 
must describe the applicable property tax methodology if it is claiming 
the local property tax as an avoidable cost of operations. Additionally, 
it must substantiate with evidence and computations the actual statewide 
tax savings attributable to the abandonment.
    (4) Any property tax properly substantiated under paragraphs (f)(2) 
or (3) of this section shall be presumed to represent systemwide savings 
to the carrier. Protestants may rebut this presumption by presenting 
evidence:
    (i) That property taxes in those states where the carrier operates 
that are not involved in the abandonment will increase significantly 
because of reassessments attributable to the abandonment; or
    (ii) That a significantly higher property tax will be levied against 
a retained portion of the abandoned property. If applicant does not 
refute protestant's evidence, it may claim avoidable property taxes only 
if, and to the extent, it proves systemwide property tax savings.
    (5) In states where real property taxes are assessed and levied 
against the owner of the property but the tax on rolling stock is 
assessed to the railroad operating the service on the basis of a formula 
of a statewide valuation of property, the tax on rolling stock 
attributable to each line segment shall be determined as follows:
    (i) Using ratio of the cost of equipment (as used in the formula) to 
the total of all property costs (as used in formula);
    (ii) Apply that ratio to the total state assessment to determine the 
portion of the assessment attributable to rolling stock;
    (iii) Allocate the rolling stock assessment thus determined to each 
line segment on the basis of car and locomotive unit miles on the 
segment to total car and locomotive unit miles in the state; and
    (iv) Apply the appropriate tax rate or rates to the allocated 
assessment thus determined.
    (k) Administrative costs. The costs assigned under this account 
shall be the actual costs directly attributable to the administration of 
the subsidy program or at the option of the carrier, one percent of the 
total annual revenues attributed to the branch shall be allowable to 
cover all costs of administering the subsidy program. Either method may 
be used, but not both.
    (l) Casualty reserve account. The costs assigned under this account 
shall be any payments mutually agreed to by the person offering the 
subsidy and the railroad for the purpose of holding the subsidizer 
harmless from any liability under those accounts that are used to record 
any costs incurred by the railroad as a result of an accident.
    (m) Rehabilitation. (1) For abandonment purposes the applicant 
carrier shall project the amounts necessary to permit efficient 
operations over the line segment. The carrier shall indicate the level 
of FRA class safety standard to be attained with the amount of 
expenditure. See 49 CFR part 213. Applicant, in making its projection of 
rehabilitation costs, shall give consideration to:
    (i) The cost to attain the lowest operationally feasible track 
level;
    (ii) The cost to attain the rehabilitation level resulting in the 
lowest operating and rehabilitation expenditures; or

[[Page 236]]

    (iii) The cost to attain the rehabilitation level resulting in the 
lowest loss, or highest profit, from operations.
    (2) For subsidy purposes rehabilitation costs shall not be included 
unless:
    (i) The track fails to meet minimum Federal Railroad Administrative 
class 1 safety standards (49 CFR part 213), in which case the railroad 
will furnish, with the abandonment application, a detailed estimate of 
the costs to rehabilitate the track to the minimum level; or
    (ii) The potential subsidizer requests a level of service which 
requires expenditures for rehabilitation.
    (n) Off-branch costs. The off-branch costs developed in this section 
shall be separated between ``off-branch costs other than return on 
freight cars'' and ``return on value-freight cars''. The off-branch 
costs shall be developed in the following manner:
    (1) Terminal costs, line-haul costs, interchange costs, and modified 
terminal costs shall be considered as the off-branch avoidable costs of 
providing service over the remainder of the railroad's system. These 
costs shall be computed by applying the variable unit costs to the 
service units attributed to the branch line's traffic for the time 
periods specified in Sec.1152.22(d) of this part.
    (2) The procedure for determining the off-branch costs shall be 
based upon the URCS cost formula. This formula shall be applied to the 
latest Annual Report Form R-1 filed by the railroad, with two 
exceptions. First, the amount used in the formula for freight car 
depreciation shall be calculated using the procedure discussed in 
paragraph (g)(3)(iii) of this section applied to the average total car 
fleet of the railroad. Second, the return on investment in freight cars 
shall be computed using the procedure set forth in paragraph (g)(3)(ii) 
of this section. In addition, the application of URCS shall include the 
use of the nominal cost of capital for all return on investment 
determinations.
    (3) The Class I Procedure: A Class I railroad shall calculate its 
off-branch costs using the Class I procedure as set forth below in this 
paragraph.
    (i) The unit costs developed by applying URCS in the manner 
specified in paragraph (n)(2) of this section shall be applied to the 
service characteristics of each movement of traffic that is attributed 
to the branch line. This application shall result in the total off-
branch cost associated with this traffic for normal terminal handlings, 
line-haul mileage, and interchange events.
    (ii) The modified terminal cost per carload shall be calculated 
separately for each type of freight car and applied to each car that is 
attributed to the branch line. The modified terminal cost shall consist 
of clerical costs, two days of freight car cost, and an inter-intra 
train switching cost (locomotive engine minute cost only). The clerical 
cost and inter-intra train switching cost shall be calculated from unit 
costs developed within the individual URCS application.
    (A) The unit costs for the clerical cost per carload calculation are 
located in URCS Worktable E1, Part 1: Line 106, columns 1, 2, and 3; 
line 107, column 1; line 108, column 1; line 109, column 1; and line 
110, column 1.
    (B) The inter-intra train switching cost shall be calculated by 
multiplying the total switch engine minute cost from URCS Worktable E1, 
Part 1, line 111, columns 1, 2, and 3 by the total minutes specified in 
the next sentence. The total minutes specified in this sentence shall 
equal the sum of:
    (1) The minutes per switch event from Worktable E2, Part 1, line 
118, column 29; and
    (2) The product of the minutes per switch event from Worktable E2, 
Part 1, line 118, column 29 and the ratio of loaded to total car miles 
for the particular type of freight car being costed.
    (C) The freight car cost shall be the car ownership costs per car 
day for 2 days developed in accordance with the procedures set forth in 
paragraph (g)(3) of this section for the type of freight car being 
costed.
    (iii) For a Class I railroad, the total costs calculated using the 
procedures set forth in paragraphs (n)(3)(i) and (n)(3)(ii) of this 
section shall constitute the off-branch costs attributable to the branch 
line's traffic.
    (4) A Class II or Class III railroad shall calculate its off-branch 
costs using any one of three different procedures. The Class I 
Procedure: A Class II

[[Page 237]]

or Class III railroad may calculate its off-branch costs using the Class 
I procedure set forth in paragraph (n)(3) of this section, if the 
necessary data are available from the railroad's own records. If the 
data necessary to complete the Class I procedure set forth in paragraph 
(n)(3) of this section are not available from the railroad's own 
records, the Class II or Class III railroad shall calculate its off-
branch costs using either one of the following procedures based on the 
latest regional URCS data and the railroad's own records. The Class II/
III Simplified Costing Procedure: A Class II or Class III railroad may 
calculate its off-branch costs using the Class I procedure set forth in 
paragraph (n)(3) of this section, with regional URCS data of the Class I 
railroads used in lieu of individual URCS data of the Class II or Class 
III railroad. Costs developed through the use of the Class II/III 
simplified costing procedure shall enjoy a rebuttable presumption of 
correctness. The Class II/III Standard Costing Procedure: A Class II or 
Class III railroad may calculate its off-branch costs using the Class 
II/III standard costing procedure set forth in paragraphs (n)(4)(i) 
through (n)(4)(xiv) of this section. Costs developed through the use of 
the Class II/III standard costing procedure shall be given preference 
over costs developed through the use of the Class II/III simplified 
costing procedure. The Class II/III standard costing procedure is set 
forth in paragraphs (n)(4)(i) through (n)(4)(xiv) of this section.
    (i) The Class II or Class III railroad shall first determine which 
URCS regional application will be used based on its geographical 
location. The railroad's total estimated system variable expenses are 
calculated by multiplying its total operating expenses by the ratio of 
variable expenses to total expenses; this ratio is located in Worktable 
D8, Part 6, line 615, column 1 of the URCS printout for the appropriate 
region. If a railroad has passenger and freight service, the freight 
portion of the total estimated system variable expenses shall be 
calculated by multiplying the total estimated system variable expenses, 
calculated as above, by the ratio of freight related operating expenses 
to total railway operating expenses.
    (ii) The total number of revenue carload terminal handlings, as 
determined from the railroad's records, shall be calculated as the sum 
of:
    (A) Originated and terminated (local) revenue carloads multiplied by 
2; plus
    (B) Interchanged and either originated or terminated (interline) 
revenue carloads.
    (iii) The total number of revenue carload interchange handlings, as 
determined from the railroad's records, shall be calculated as the sum 
of:
    (A) Bridge (interchange to interchange) revenue carloads multiplied 
by 2; plus
    (B) Revenue carloads that are interchanged and either originated or 
terminated (interline).
    (iv) The system average shipment weight per car, as determined from 
the railroad's records, shall be calculated by dividing:
    (A) Ton-miles-revenue freight by
    (B) Loaded freight car miles.
    (v) The system average loaded car miles per car, as determined from 
the railroad's records, shall be calculated by dividing:
    (A) Revenue ton-miles by
    (B) Revenue tons.
    (vi) The railroad shall complete a URCS Phase III ``Movement Costing 
Program'' based on the application of URCS data for the appropriate 
region. The following data shall be inputs to the Phase III program 
application.
    (A) The carrier code, either ``REG 4'' or ``REG 7'', shall 
correspond to the appropriate region.
    (B) The type of shipment shall be designated as ``OD'' in order for 
the movement to be costed as an interline movement.
    (C) The distance shall be the system average loaded car miles per 
car as developed in paragraph (n)(4)(v) of this section.
    (D) The type of freight car shall be identified as a Box, General 
Service Equipped, which has an input user code of ``3''. If all of the 
traffic on the branch line is transported in a single type of car, and 
it is not a Box, General Service Equipped, the code for that type of car 
may be substituted.

[[Page 238]]

    (E) The number of freight cars shall be ``1''.
    (F) The car ownership factor shall be designated as ``R'' for 
railroad owned cars unless all of the branch line traffic is moved in 
privately owned cars, in which case the code ``P'' for privately owned 
cars would be the input.
    (G) The program requires a loss and damage input. The code ``48'', 
representing the average of all commodities, shall be used.
    (H) The input for shipment weight shall be the system average 
shipment weight per car developed in paragraph (n)(4)(iv) of this 
section.
    (I) The input for type of movement shall be ``1'', representing an 
individual car movement.
    (vii) The ratios employed to separate the total estimated system 
variable expenses, as determined in paragraph (n)(4)(i) of this section, 
among terminal, interchange, and line-haul operations shall be based on 
the procedures outlined in this paragraph (n)(4)(vii). This separation 
shall reflect the variable costs resulting from the application of the 
URCS Phase III program based on the input factors specified in paragraph 
(n)(4)(vi) of this section. The ratios shall be calculated in the 
following manner:
    (A) The terminal expenses calculated by the application of the Phase 
III program shall consist of the following:
    (1) ``Carload and Clerical Costs'' shall be calculated as the sum of 
lines 256, 258, 260, 262, 264, 266, and 268.
    (2) Switching expenses based on ``Total SEM-Industry'' shall be 
calculated by multiplying:
    (i) The sum of lines 315, 317, and 319, by
    (ii) Line 311.
    (3) Car mile yard cost ``CM(Y)-Industry'' shall be calculated by 
multiplying:
    (i) The sum of lines 426, 428, and 430, by
    (ii) Line 422.
    (4) Car day yard cost ``CD(Y)-Industry'' and ``CD(Y)-L&UL'' shall be 
calculated by multiplying:
    (i) The sum of lines 452, 454, and 456, by
    (ii) The sum of lines 446 and 450.
    (5) The expenses for accessorial services for railroad owned cars 
shall be calculated as the sum of:
    (i) The product of line 422 and the sum of lines 464, 466, and 468; 
plus
    (ii) The product of the sum of lines 446 and 450 and the sum of 
lines 476, 478, and 480.
    (B) The interchange expenses calculated by the application of the 
Phase III program shall consist of the following:
    (1) Switching expenses based on ``Total SEM-Interchange'' shall be 
calculated by multiplying
    (i) The sum of lines 315, 317, and 319, by
    (ii) Line 312.
    (2) Car mile cost in interchange ``CM(Y)-Interchange'' shall be 
calculated by multiplying:
    (i) The sum of lines 426, 428, and 430, by
    (ii) Line 423.
    (3) Car day cost in interchange ``CD(Y)-Interchange (L&E)'' shall be 
calculated by multiplying:
    (i) The sum of lines 452, 454, and 456, by
    (ii) Line 447.
    (4) The expenses for accessorial services for railroad owned cars 
shall be calculated as the sum of:
    (i) The product of line 423 and the sum of lines 464, 466, and 468; 
plus.
    (ii) The product of line 447 and the sum of lines 476, 478, and 480.
    (C) The line-haul expenses resulting from the application of the 
Phase III program shall be calculated by subtracting the sum of:
    (1) The terminal expenses as determined in paragraph (n)(4)(vii)(A) 
of this section, and
    (2) The interchange expenses as determined in paragraph 
(n)(4)(vii)(B) of this section, from
    (3) The total variable cost excluding loss and damage as calculated 
in the Phase III program at line 696.
    (D) The ratio for terminal expenses shall be calculated by dividing 
the terminal expenses as determined in paragraph (n)(4)(vii)(A) of this 
section by the total variable cost excluding loss and damage as 
calculated in the Phase III program at line 696.
    (E) The ratio for interchange expenses shall be calculated by 
dividing

[[Page 239]]

the interchange expenses as determined in paragraph (n)(4)(vii)(B) of 
this section by the total variable cost excluding loss and damage as 
calculated in the Phase III program at line 696.
    (F) The ratio for line-haul expenses shall be calculated by dividing 
the line-haul expenses as determined in paragraph (n)(4)(vii)(C) of this 
section by the total variable cost excluding loss and damage as 
calculated in the Phase III program at line 696.
    (viii) The railroad's total estimated system variable expenses shall 
be separated as follows:
    (A) The total terminal variable expenses shall be calculated by 
multiplying the total estimated system variable expenses as determined 
in paragraph (n)(4)(i) of this section by the ratio for terminal 
expenses as determined in paragraph (n)(4)(vii)(D) of this section.
    (B) The total interchange variable expenses shall be calculated by 
multiplying the total estimated system variable expenses as determined 
in paragraph (n)(4)(i) of this section by the ratio for interchange 
expenses as determined in paragraph (n)(4)(vii)(E) of this section.
    (C) The total line-haul variable expenses shall be calculated by 
multiplying the total estimated system variable expenses as determined 
in paragraph (n)(4)(i) of this section by the ratio for line-haul 
expenses as determined in paragraph (n)(4)(vii)(F) of this section.
    (ix) The railroad's unit costs shall be determined for terminal, 
interchange, and line-haul operations as follows:
    (A) The terminal cost per carload shall be calculated by dividing 
the total terminal variable expenses as determined in paragraph 
(n)(4)(viii)(A) of this section by the total number of revenue carload 
terminal handlings as determined in paragraph (n)(4)(ii) of this 
section.
    (B) The interchange cost per carload shall be calculated by dividing 
the total interchange variable expenses as determined in paragraph 
(n)(4)(viii)(B) of this section by the total number of revenue carload 
interchange handlings as determined in paragraph (n)(4)(iii) of this 
section.
    (C) The line-haul cost per car mile shall be calculated by dividing 
the total line-haul variable expenses as determined in paragraph 
(n)(4)(viii)(C) of this section by the total system freight car miles, 
loaded and empty, as determined from the railroad's records.
    (x) The modified terminal cost per carload is a composite of costs 
developed in the Phase III program and costs determined in accordance 
with paragraph (g) of this section and this paragraph. The modified 
terminal cost per carload shall be calculated for each type of car as 
follows:
    (A) The station clerical cost per carload shall be developed in the 
following manner:
    (1) The station clerical expense ratio shall be calculated by 
dividing the total clerical cost (the sum of lines 256, 258, 260, 262, 
264, 266, and 268) by the terminal expenses as determined in paragraph 
(n)(4)(vii)(A) of this section.
    (2) The station clerical cost per carload shall be calculated by 
multiplying the terminal cost per carload as determined in paragraph 
(n)(4)(ix)(A) of this section by the station clerical expense ratio.
    (B) The interchange switching cost per carload shall be developed in 
the following manner:
    (1) The total interchange switching expense shall be calculated by 
multiplying the sum of lines 315, 317, and 319 by line 312.
    (2) The interchange switching ratio shall be calculated by dividing 
the total interchange switching expense by the interchange expenses as 
determined in paragraph (n)(4)(vii)(B) of this section.
    (3) The interchange switching cost per carload shall be calculated 
by multiplying the interchange cost per carload as determined in 
paragraph (n)(4)(ix)(B) of this section by the interchange switching 
ratio.
    (C) The freight car cost element shall be the freight car cost per 
car day for 2 days as developed for each car type in paragraph (g)(3) of 
this section.
    (D) The modified terminal cost per carload shall be the total of the 
costs developed in paragraphs (n)(4)(x)(A), (n)(4)(x)(B), and 
(n)(4)(x)(C) of this section.

[[Page 240]]

    (xi) The terminal costs shall be calculated by multiplying the 
terminal cost per carload as determined in paragraph (n)(4)(ix)(A) of 
this section by the number of carloads that both:
    (A) Originated or terminated on the branch, and
    (B) Are local to the railroad serving the branch.
    (xii) The interchange costs shall be calculated by multiplying the 
interchange cost per carload as determined in paragraph (n)(4)(ix)(B) of 
this section by the number of carloads that both:
    (A) Originated or terminated on the branch; and
    (B) Are received in or forwarded through interchange with other 
railroads.
    (xiii) The line-haul costs shall be calculated by multiplying the 
line-haul cost per car mile as determined in paragraph (n)(4)(ix)(C) of 
this section by the total loaded and empty car miles generated on the 
railroad's system off the branch by cars that originated or terminated 
on the branch.
    (xiv) The modified terminal costs shall be calculated by multiplying 
the modified terminal cost per carload as determined in paragraph 
(n)(4)(x)(D) of this section by the number of carloads that originated 
or terminated on the branch.
    (o) Locomotive depreciation. The depreciation cost for locomotives 
used on the line shall be calculated using the following procedure:
    (1) The current replacement cost for each type of locomotive used to 
serve the line will be based on the most recent purchase of that 
particular type and size locomotive by the carrier indexed to the 
midpoint of the year or on an amount quoted by the manufacturer.
    (2) The depreciation rate that will be applied to the replacement 
cost shall be the carrier's component rate for each type of locomotive 
as reported in the latest Annual Report Form R-1 submitted to the Board 
or from the company records. Carriers using depreciation rates based on 
company records must explain why composite rates are inappropriate; 
provide a detailed explanation of the methodology used to compute the 
alternate depreciation rate; and demonstrate that these rates have been 
used consistently.
    (3) The annual depreciation cost for each type of locomotive shall 
be calculated by multiplying the replacement cost(s) developed in 
paragraph (o)(1) of this section by the rate from paragraph (o)(2) of 
this section.
    (4) The depreciation expense for each type of locomotive shall be 
assigned to the line on the ratio of the hours incurred serving the line 
to the average system locomotive unit hours in service by each of the 
following categories of locomotives: yard-diesel; yard-other; road-
diesel; and road-other. The ratio for each type of locomotive used to 
serve the line shall be the same as that developed in paragraph (h)(4) 
of this section.
    (5) The depreciation shall be calculated by multiplying the annual 
depreciation expense for each type of locomotive developed in paragraph 
(o)(3) of this section by the ratio(s) developed in paragraph (o)(4) of 
this section.
    (p) Opportunity costs. Applicant-carrier may, at its discretion, 
present evidence of its opportunity costs, if the assets engaged in the 
line proposed to be abandoned could be used more profitably in some 
other capacity.
    Opportunity costs may be calculated in accordance with the 
methodology established in Sec.1152.34 of this part, or by using any 
other reasonable, fully explained method. Opportunity costs are not 
included as costs on Exhibit 1 described at Sec.1152.36. These costs 
should be submitted as a separate exhibit to the application.
    (q) Labor costs. (1) The salaries, wages and fringe benefits of 
personnel exclusively assigned to the line segment shall be deemed 
attributable costs of the segment. The salaries, wages, and fringe 
benefits of personnel not exclusively assigned to the line segment shall 
be deemed attributable costs of the segment to the extent they are shown 
to be apportionable to the segment to be abandoned.
    (2) These costs shall be deemed attributable notwithstanding any 
obligation of applicant to provide employee protection for employees 
after the abandonment.

[[Page 241]]

Sec.1152.33  Apportionment rules for the assignment of expenses to on-
          branch costs.

    The accounts specified under Sec.1152.32 (a), (b), (c), and (d) as 
having an assignment basis other than ``Actual'' shall be apportioned 
according to the rules contained in this section.
    (a) Maintenance of way and structures--(1) Roadway machines. All 
accounts designated XX-13-36 shall be assigned to the branch on the 
basis of the average repair costs, for each type of machine, included in 
the daily rental fees charged by the operating railroad or as published 
by the General Manager's Association of Chicago (GMA), based on the 
actual number of days each type of machine is used on the branch.
    (2) Small tools and supplies. All accounts designated XX-13-37 shall 
be assigned to the branch as follows:
    (i) The costs of supplies, consumed in the operation of roadway 
machines, shall be assigned to the branch on the basis of the average 
costs of supplies per day, included in the daily rental fees charged by 
the operating railroad or as published by the GMA, multiplied by the 
actual number of days that the machine is used on the branch;
    (ii) The costs of small tools shall be assigned to the branch on the 
basis of the ratio that the branch amounts in Accounts 11-11-10 through 
11-11-17 and 11-11-48, plus 11-12-10 through 11-12-17 and 11-12-48, bear 
to the railroad's system total for the same accounts.
    (3) Fringe benefits. Fringe benefits shall be assigned to the branch 
separated between running, switching and other, on the ratio that the 
total branch salary and wages bear to the total system salaries and 
wages for each activity as follows:
    (i) Fringe benefits--Running, Account 12-11-00, total of all 11-11-
XX accounts branch to system;
    (ii) Fringe benefits--Switching, Account 12-12-00, total of all 11-
12-XX accounts branch to system; and
    (iii) Fringe benefits--Other, Account 12-13-00, total of all 11-13-
XX accounts branch to system.
    (b) Maintenance of equipment--(1) Locomotive repairs and 
maintenance. All accounts designated XX-21-41 shall be separated between 
yard and road with a further separation between diesel and other 
(electric). The costs for these accounts for yard locomotives shall be 
assigned to the branch separately for diesel and electric locomotives on 
the basis of the ratio of branch diesel and electric yard locomotive 
unit-hours to the total system diesel and electric yard locomotive unit-
hours. The costs for these accounts for road locomotives shall be 
assigned to the branch separately for diesel and electric locomotives on 
the basis of the ratio of branch diesel and electric locomotive gross 
ton-miles in road service to the total system diesel and electric 
locomotive gross ton-miles in road service. The costs assigned under 
these accounts for specialized equipment devoted exclusively to branch 
line service shall be theactual costs for the specific equipment used.
    (2) Locomotive depreciation. Locomotive depreciation shall be 
calculated and assigned in accordance with the procedures set forth in 
Sec.1152.32(o).
    (3) Fringe Benefits. Fringe benefits for locomotives and other 
equipment shall be assigned to the branch on the ratio that the total 
branch salary and wages bear to the system total salaries and wages for 
each type of equipment as follows:
    (i) Locomotives--Account 12-21-00, total of all 11-21-XX accounts 
branch to system.
    (ii) Other Equipment--Account 12-23-00, total of all 11-23-XX 
accounts branch to system.
    (iii) Fringe benefits for freight cars shall be calculated by first 
estimating the total in Account 11-22-42, Freight car repairs--salaries 
and wages, that is included in the total on branch costs for freight 
cars as determined from the car-day and car-mile cost calculations in 
Sec.1152.32(g) of these regulations. To this amount is added the branch 
totals in the balance of all 11-22-XX accounts. The ratio of this total 
branch account to the system total for all 11-22-XX accounts is applied 
to Account 12-22-00, Fringe Benefits--Freight Cars.
    (c) Transportation--(1) Train operations--(i) Engine Crews-
Materials. Account 21-31-56; Train Crews-Materials, Account 21-31-57; 
Train Inspection and Lubrication-Salaries and Wages, Account

[[Page 242]]

11-31-62; and Train Inspection and Lubrication-Materials, Account 21-31-
62. If the branch is served by a local/way or through train, the costs 
in these accounts shall be assigned to the branch on the weighted ratio 
of the loaded freight train cars on the branch to the total system 
loaded freight train cars, and the loaded and empty car-miles on the 
branch to the total system loaded and empty car-miles. This shall be 
calculated as follows:
    (A) To determine the car-mile portion of these accounts:
    (1) Multiply the total amounts in these accounts (from the R-1 
Annual Report, Schedule 410) by 69 percent, which is the ratio of train-
mile and running expenses;
    (2) Divide the amount in paragraph (c)(1)(i)(A)(1) of this section 
by the total system loaded and empty car-miles; and
    (3) Multiply the car-mile unit cost factor from paragraph 
(c)(1)(i)(A)(2) of this section by the on-branch car-miles (loaded and 
empty).
    (B) To determine the carload portion of these accounts:
    (1) Multiply the total amounts in these accounts by 31 percent, 
which is the ratio of terminal expenses;
    (2) Divide the amount in paragraph (c)(1)(i)(B)(1) of this section 
by the total system carloads; and
    (3) Multiply the carload unit cost factor from paragraph 
(c)(1)(i)(B)(2) of this section by the on-branch carloads.
    (C) To determine the total costs assignable to the branch for these 
accounts, add the amounts developed in paragraphs (c)(1)(i)(A)(3) and 
(c)(1)(i)(B)(3) of this section.
    (ii) All accounts designated xx-31-67 shall be assigned to the 
branch in accordance with the following procedure. The dollar amounts 
used in the determination of locomotive fuel costs shall be based on 
data contained in the most recent publication issued by the General 
Managers Association (GMA) relating to the rental of locomotives. The 
total number of locomotive unit hours incurred by the locomotive(s) 
shall then be categorized according to the applicable GMA horsepower 
classification group. The fuel cost is derived from the Repairs and 
Supplies Expenses element of the locomotive rental rates published by 
the GMA. The fuel cost per locomotive unit hour shall be determined for 
each GMA horsepower classification group by multiplying the latest GMA 
fuel cost percentage by the Repairs and Supplies Expense per hour 
included in each group. The fuel cost update ratio is determined by 
using the indices for fuel from the Association of American Railroad's 
(AAR's) Railroad Cost Recovery Index (RCR). The indices shall be taken 
from the district to which the railroad is assigned by the Board. The 
index for the current period is divided by the index of the period 
representative of the GMA publication to develop the fuel update ratio. 
The fuel cost per locomotive unit hour developed for each GMA horsepower 
group shall be multiplied by the fuel update ratio to determine the fuel 
cost per locomotive hour for each horsepower group. The updated fuel 
cost per locomotive unit hour for each applicable GMA group shall be 
multiplied by the number of locomotive unit hours incurred in serving 
the branch by locomotives of that GMA horsepower classification group. 
The total cost developed under this procedure for each horsepower 
classification shall be the locomotive fuel cost assignable to the 
branch line.
    (iii) Electric power purchased or produced for motive power--All 
accounts designated XX-31-68 shall be assigned to the branch on the 
ratio of road electric locomotive unit hours on the branch to the total 
system road electric locomotive unit hours.
    (iv) Servicing locomotives--All accounts designated XX-31-69 shall 
be assigned to the branch on the ratio of road locomotive unit miles on 
the branch to the total system road locomotive unit miles.
    (2) Yard operations--(i) Switch Crews--Materials, Account 21-32-64, 
and Servicing Locomotives, all accounts designated XX-32-69. The costs 
for these accounts shall be assigned to the branch on the ratio of yard 
locomotive unit hours on the branch to the system total yard locomotive 
unit hours.
    (ii) Locomotive fuel--All accounts designated XX-32-67 shall be 
assigned to the branch on the ratio of yard diesel locomotive unit hours 
on the branch to

[[Page 243]]

the total system yard diesel locomotive unit hours.
    (iii) Electric power purchased or produced for motive power--All 
accounts designated XX-32-68 shall be assigned to the branch on the 
ratio of yard electric locomotive unit hours on the branch to the total 
system yard electric locomotive unit hours.
    (3) Administrative support operations--(i) Loss and damage claims 
processing--All accounts designated XX-35-78 shall be assigned to the 
branch on the ratio of the number of claims processed for loss or damage 
occurring on the branch to the total number of claims processed by the 
railroad.
    (ii) [Reserved]
    (4) Transportation fringe benefits. Fringe benefits shall be 
assigned to the branch separated between train operations, yard 
operations, train and yard operations common, specialized service 
operations, and administrative support operations. The costs for each 
activity shall be assigned to the branch on the ratio that the total 
branch salary and wages bear to the total system salary and wages for 
each activity shown below.
    (i) Train Operations, Account 12-31-00, total of all 11-31-XX 
accounts branch to system.
    (ii) Yard Operations, Account 12-32-00, total of all 11-32-XX 
accounts branch to system.
    (iii) Train and Yard Operations Common, Account 12-33-00, total of 
all 11-33-XX accounts branch to system.
    (iv) Specialized Service Operations, Account 12-34-00, total of all 
11-34-XX accounts branch to system.
    (v) Administrative Support, Account 12-35-00, total of all 11-35-XX 
accounts branch to system.
    (d) General administrative. (1) Fringe Benefits, Account 12-61-00, 
shall be assigned to the branch on the ratio that the total branch 
salary and wages in all 11-61-XX accounts bear to the system total 
salary and wages in all 11-61-XX accounts.
    (2) [Reserved]

Sec.1152.34  Return on investment.

    Return on investment for road property shall be computed according 
to the procedures set forth in this section.
    (a)-(b) [Reserved]
    (c) Return on investment--road properties. Return on investment--
road properties shall be computed according to the following procedures:
    (1) The investment base to which the nominal return element shall 
apply shall be the sum of:
    (i) The allowable working capital computed at 15 days on-branch cash 
avoidable costs (on branch avoidable costs less depreciation).
    (ii) The amount of current income tax benefits resulting from 
abandonment of the line which would have been applicable to the period 
of the subsidy agreement. (Conversely, if the railroad would incur an 
income tax liability from abandonment, the liability should be deducted 
from the investment base.) This information is to be furnished by the 
railroad and subject to audit by the person offering the subsidy.
    (iii) The net liquidation value for the highest and best use for 
non-rail purposes of the rail properties on the line to be subsidized 
which are used and required for performance of the services requested by 
the persons offering the subsidy. This value shall be determined by 
computing the current appraised market value of such properties for 
other than rail transportation purposes, less all costs of dismantling 
and disposition of improvements necessary to make the remaining 
properties available for their highest and best use and complying with 
applicable zoning, land use, and environmental regulations. If 
rehabilitation has been performed along the line during a subsidy year 
and rehabilitation expenses have been paid by the subsidizer under 49 
CFR 1152.32(m)(2), the investment base shall exclude the increment to 
the net liquidation value of the line caused by the rehabilitation 
project. For these purposes:
    (A) In calculating the net liquidation values for the Forecast Year, 
no asset on the line shall be excluded from the determination of net 
liquidation value because it contributes negatively to that value, i.e., 
the removal costs exceed the market value after removal. All such assets 
shall be included in the net liquidation value determination if the 
carrier is required by law to remove them or if the carrier intends to 
remove them, even if it is not required

[[Page 244]]

to do so. The parties shall fully support and explain the exclusion for 
net liquidation purposes of all assets having a negative salvage value.
    (1) In calculating the net liquidation value of railroad properties 
for the purpose of determining the operating subsidy under an offer of 
financial assistance, any asset with a negative salvage value shall be 
included at a value of zero (0).
    (2) Determination of the net liquidation value of rail properties 
for the purpose of purchasing the rail properties under an offer of 
financial assistance shall include any asset with a negative salvage 
value at a value of zero (0).
    (B) All adjustments to the appraised fair market value of right-of-
way land, including a downward adjustment to reflect an imputed real 
estate Board or selling expense, shall be fully supported and explained.
    (C) Parties shall fully support and explain their use of unadjusted 
across-the-fence (ATF) values as a surrogate for the value of railroad 
right-of-way land, given that the physical and economic characteristics 
(grading and elevation) usually are different from those of surrounding 
parcels. All adjustments to ATF values to arrive at the right-of-way 
values shall also be supported and explained.
    (2) [Reserved]
    (d) Reasonable return. A rail carrier shall furnish to the Board, 
and to any financially responsible person considering making an offer of 
a rail service continuation payment, a substantiated statement showing 
its current nominal cost of capital. The railroad's nominal cost of 
capital shall be the current before tax cost of capital, weighted to the 
capital structure, and adjusted for the effects of the combined 
statutory Federal and state income tax rates. This rate of return 
expressed as a percent, shall be calculated as follows:
    (1) The railroad shall determine its permanent capital structure 
ratio for debt and equity capital such that the two numbers total 100 
percent. This capital structure will be the actual capital structure of 
the railroad. If this calculation is not possible or also not 
representative because the railroad is part of a conglomerate, the debt-
equity ratio from the Board's latest Determination of Adequate Railroad 
Revenues will be used. However, if the debt-equity ratio for the 
railroad industry is used then the industry average equity and debt rate 
from the Board's latest revenue adequacy finding must also be used in 
paragraphs (d)(2) and (d)(3) of this section.
    (2) The current nominal cost of debt shall be determined by taking 
the average of all debt instruments (including bonds, equipment trust 
certificates, financial lease arrangements, et cetera) issued by the 
carrier in the most recent 12-month period. The debt cost calculated by 
this procedure is a before-tax rate and is not adjusted for inflation or 
income taxes.
    (3) The current nominal after tax cost of equity shall be an amount 
equal to that which a prudent investor would expect to earn through 
investment in the market place. The current after tax nominal cost of 
equity is divided by 1 minus the combined statutory Federal and state 
income tax rates. This will develop the nominal cost of equity on a 
before tax basis.
    (4) The current nominal before-tax cost of debt is multiplied by the 
current percentage of debt to total capital to obtain a weighted before-
tax nominal cost of current debt.
    (5) The current nominal before-tax cost of equity is multiplied by 
the current percentage of equity to total capital to obtain a weighted 
nominal before-tax cost of current equity.
    (6) The results of paragraphs (d)(4) and (d)(5) of this section are 
added together to determine the current nominal cost of capital.
    (e) Holding gain (loss)-road properties. The railroad shall 
determine the holding gain (loss) that is projected to occur during the 
forecast and/or subsidy year. In any instance where the holding gain is 
not specifically determined for road properties, the Gross Domestic 
Product deflator calculated by the U.S. Department of Commerce shall be 
used.

[[Page 245]]

Sec.1152.35   [Reserved]

Sec.1152.36   Submission of revenue and cost data.

    The following information shall be submitted by applicant as Exhibit 
1 to an abandonment or discontinuance application (Sec.1152.22(d)) and 
shall be developed in accordance with the methodology established in 
Sec.Sec.1152.31 through 1152.35, as applicable. Such information, form 
and methodology shall also be used by an offeror of financial assistance 
to formulate a Proposed Subsidy Payment (Sec.1152.27).

----------------------------------------------------------------------------------------------------------------
                                                                      Forecast year       Projected subsidy year
                                          Base year operations          operations              operations
----------------------------------------------------------------------------------------------------------------
Revenues attributable for:
    1. Freight originated and/or
     terminated on branch
    2. Bridge traffic
    3. All other revenue and income
    4. Total revenues attributable
     (lines 1 through 3)
Avoidable costs for:
    5. On-branch costs (lines 5a
     through 5k)
        a. Maintenance of way and
         structures
        b. Maintenance of equipment
        c. Transportation
        d. General administrative
        e. Deadheading, taxi, and
         hotel
        f. Overhead movement
        g. Freight car costs (other
         than return on freight cars)
        h. Return on value-locomotives
        i. Return on value-freight
         cars
        j. Revenue taxes
        k. Property taxes
    6. Off-branch costs
        a. Off-branch costs (other
         than return on freight cars)
        b. Return on value-freight
         cars
    7. Total avoidable costs (line 5
     plus line 6)
Subsidization costs for:
    8. Rehabilitation \1\
    9. Administration costs (subsidy
     year only) \2\
    10. Casualty reserve account \2\
    11. Total subsidization costs
     (lines 8 through 10)
Return on value:
    12. Valuation of property (lines
     12a through 12c)
        a. Working capital............  XXXX...................
        b. Income tax consequences....  XXXX...................
        c. Net liquidation value......  XXXX...................
    13. Nominal rate of return........  XXXX...................
    14. Nominal return on value (line   XXXX...................
     12 times line 13) \3\.
    15. Holding gain (loss)...........  XXXX...................
    16. Total return on value (line 14  XXXX...................
     minus 15) \3\.
    17. Avoidable loss from operations
     (line 4 minus line 7)
    18. Estimated forecast year loss
     from operations (line 4 minus
     lines 7 and 16)
    19. Estimated subsidy (line 4
     minus lines 7, 11 and 16)
----------------------------------------------------------------------------------------------------------------
\1\ This projection shall be computed in accordance with Sec.1152.32(m).
\2\ Omit in applications pursuant to Sec.Sec.1152.22 and 1152.23.
\3\ If the amount in line 12c is a negative for the ``Forecast Year operations'' insert ``0'' in this line.

Sec.1152.37   Financial status reports.

    Within 30 days after the end of each quarter of the subsidy year, 
each carrier which is party to the financial assistance agreement shall 
submit to the subsidizer a Financial Status Report for each line 
operated under subsidy. Such Financial Status Report shall be in the 
form prescribed below. Significant deviations from the negotiated 
estimates must be explained. All data shall be developed in accordance 
with the methodology set forth in Sec.Sec.1152.31 through 1152.35. In 
the quarterly reports, the actual data for the year to date and a 
projection to the end of the subsidy year shall be shown for each item.

[[Page 246]]



----------------------------------------------------------------------------------------------------------------
                                                       Actual                            Projected
----------------------------------------------------------------------------------------------------------------
Revenues for:
    1. Freight originated and/or
     terminated on branch
    2. Bridge traffic
    3. All other revenue and income
    4. Total revenues (lines 1 through 3)
Avoidable costs for:
    5. On-branch costs (lines 5a through
     5j)
        a. Maintenance of way and
         structures
        b. Maintenance of equipment
        c. Transportation
        d. General administrative
        e. Deadheading, taxi, and hotel
        f. Overhead movement
        g. Freight car costs
        h. Return on investment--
         locomotives
        i. Revenue taxes
        j. Property taxes
    6. Off-branch costs
    7. Total avoidable costs (line 5 plus
     line 6)
Subsidization costs for:
    8. Rehabilitation
    9. Administrative costs
    10. Casualty
    11. Total subsidization costs (lines
     8 through 10)
Return on value:
    12. Valuation of property (lines 12a
     through 12c)
        a. Working capital
        b. Income tax consequences
        c. Net liquidation value
    13. Rate of return
    14. Total return on value (line 12
     times line 13)
Subsidy payment:
    15. Subsidy payment (line 4 minus
     lines 7, 11, and 14)
----------------------------------------------------------------------------------------------------------------

Subpart E [Reserved]

   Subpart F--Exempt Abandonments and Discontinuances of Service and 
                             Trackage Rights

Sec.1152.50  Exempt abandonments and discontinuances of service and 
          trackage rights.

    (a)(1) A proposed abandonment or discontinuance of service or 
trackage rights over a railroad line is exempt from the provisions of 49 
U.S.C. 10903 if the criteria in this section are satisfied.
    (2) Whenever the Board determines a proposed abandonment to be 
exempt from the requirements of 49 U.S.C. 10903, whether under this 
section or on the basis of the merits of an individual petition, the 
provisions of Sec.Sec.1152.27, 1152.28, and 1152.29 as they relate to 
exemption proceedings shall be applicable.
    (b) An abandonment or discontinuance of service or trackage rights 
is exempt if the carrier certifies that no local traffic has moved over 
the line for at least 2 years and any overhead traffic on the line can 
be rerouted over other lines and that no formal complaint filed by a 
user of rail service on the line (or a state or local government entity 
acting on behalf of such user) regarding cessation of service over the 
line either is pending with the Board or any U.S. District Court or has 
been decided in favor of the complainant within the 2-year period. The 
complaint must allege (if pending), or prove (if decided) that the 
carrier has imposed an illegal embargo or other unlawful impediment to 
service.
    (c) The Board has found:
    (1) That its prior review and approval of these abandonments and 
discontinuances is not necessary to carry out the rail transportation 
policy of 49 U.S.C. 10101; and
    (2) That these transactions are of limited scope and continued 
regulation is unnecessary to protect shippers from abuse of market 
power. 49 U.S.C. 10502. A notice must be filed to use this class 
exemption. The procedures are set out in Sec.1152.50(d). This class 
exemption does not relieve a carrier of its statutory obligation to 
protect the interests of

[[Page 247]]

employees. 49 U.S.C. 10502(g) and 10903(b)(2). This also does not 
preclude a carrier from seeking an exemption of a specific abandonment 
or discontinuance that does not fall within this class.
    (d) Notice of exemption. (1) At least 10 days prior to filing a 
notice of exemption with the Board, the railroad seeking the exemption 
must notify in writing:
    (i) The Public Service Commission (or equivalent agency) in the 
state(s) where the line will be abandoned or the service or trackage 
rights discontinued;
    (ii) Department of Defense (Military Traffic Management Command, 
Transportation Engineering Agency, Railroads for National Defense 
Program);
    (iii) The National Park Service, Recreation Resources Assistance 
Division; and
    (iv) The U.S. Department of Agriculture, Chief of the Forest 
Service.
    The notice shall name the railroad, describe the line involved, 
including United States Postal Service ZIP Codes, indicate that the 
exemption procedure is being used, and include the approximate date that 
the notice of exemption will be filed with the Board. The notice shall 
include the following statement ``Based on information in our 
possession, the line (does) (does not) contain federally granted rights-
of-way. Any documentation in the railroad's possession will be made 
available promptly to those requesting it.''
    (2) The railroad must file a verified notice using its appropriate 
abandonment docket number and subnumber (followed by the letter ``X'') 
with the Board at least 50 days before the abandonment or discontinuance 
is to be consummated. The notice shall include the proposed consummation 
date, the certification required in Sec.1152.50(b), the information 
required in Sec.Sec.1152.22(a) (1) through (4), (7) and (8), and (e)(4), 
the level of labor protection, and a certificate that the notice 
requirements of Sec.Sec.1152.50(d)(1) and 1105.11 have been complied 
with.
    (3) The Board, through the Director of the Office of Proceedings, 
shall publish a notice in the Federal Register within 20 days after the 
filing of the notice of exemption. The notice shall include a statement 
to alert the public that following any abandonment of rail service and 
salvage of the line, the line may be suitable for other public use, 
including interim trail use. Petitions to stay the effective date of the 
notice on other than environmental or historic preservation grounds must 
be filed within 10 days of the publication. Petitions to stay the 
effective date of the notice on environmental or historic preservation 
grounds may be filed at any time but must be filed sufficiently in 
advance of the effective date in order to allow the Board to consider 
and act on the petition before the notice becomes effective. Petitions 
for reconsideration, comments regarding environmental, energy and 
historic preservation matters, and requests for public use conditions 
under 49 U.S.C. 10905 and 49 CFR 1152.28(a)(2) must be filed within 20 
days after publication. Requests for a trail use condition under 16 
U.S.C. 1247(d) and 49 CFR 1152.29 must be filed within 10 days after 
publication. The exemption will be effective 30 days after publication, 
unless stayed. If the notice of exemption contains false or misleading 
information, the use of the exemption is void ab initio and the Board 
shall summarily reject the exemption notice.
    (4) In out-of-service rail line exemption proceedings under 49 CFR 
1152.50, the Board, on its own motion, will stay the effective date of 
individual notices of exemption when an informed decision on pending 
environmental and historic preservation issues cannot be made prior to 
the date that the exemption authority would otherwise become effective.
    (5) A notice or decision to all parties will be issued if use of the 
exemption is made subject to environmental, energy, historic 
preservation, public use and/or interim trail use and rail banking 
conditions.
    (6) To address whether the standard labor protective conditions set 
forth in Oregon Short Line R. Co.--Abandonment--Goshen, 360 I.C.C. 91 
(1979), adequately protect affected employees, a petition for partial 
revocation of the exemption under 49 U.S.C. 10502(d) must be filed.

[[Page 248]]

    (e) Consummation notice. As provided in Sec.1152.29(e)(2), rail 
carriers that receive authority to abandon a line under Sec.1152.50 must 
file with the Board a notice that abandonment has been consummated.

[61 FR 67883, Dec. 24, 1996, as amended at 62 FR 34670, June 27, 1997]

  Subpart G--Special Rules Applicable to Petitions for Abandonments or 
Discontinuances of Service or Trackage Rights Filed Under the 49 U.S.C. 
                        10502 Exemption Procedure

Sec.1152.60  Special rules.

    (a) This section contains special rules applicable to any proceeding 
instituted under the 49 U.S.C. 10502 exemption procedure for either the 
abandonment of a rail line or the discontinuance of service or trackage 
rights over a rail line. General rules applicable to any proceeding 
filed under the 49 U.S.C. 10502 exemption procedure may be found at 49 
CFR part 1121, but the rules in part 1152 control in case of any 
conflict with the general exemption rules. In the case of petitions for 
exemption for abandonment, notice of the filing of the petition will be 
published by the Board, through the Director of the Office of 
Proceedings, in the Federal Register 20 days after the petition is 
filed. There will be no further Federal Register publication later if 
and when a petition is granted.
    (b) Any petition filed under the 49 U.S.C. 10502 exemption procedure 
for either the abandonment of a rail line or the discontinuance of 
service or trackage rights over a rail line must be accompanied by a map 
that meets the requirements of Sec.1152.22(a)(4) of this part.
    (c) A petitioner for an abandonment exemption shall submit, with its 
petition, a draft Federal Register notice of its petition according to 
the form prescribed below:

    Draft Federal Register Notice. The petitioner shall submit a draft 
notice of its petition to be published by the Board within 20 days of 
the petition's filing with the Board. The petitioner must submit a copy 
of the draft notice as data contained on a computer diskette compatible 
with the Board's current word processing capabilities. The draft notice 
shall be in the form set forth below:

                    STB No. AB------- (Sub-No.------)

  Notice of Petition for Exemption to Abandon or to Discontinue Service

    On (insert date petition was filed with the Board) (name of 
petitioner) filed with the Surface Transportation Board, Washington, 
D.C. 20423, a petition for exemption for the abandonment of (the 
discontinuance of service on) a line of railroad known as------, 
extending from railroad milepost near (station name) to (the end of line 
or rail milepost) near (station name), which traverses through ------ 
(ZIP Codes) United States Postal Service ZIP Codes, a distance of ------ 
miles, in [County(ies), State(s)]. The line for which the abandonment 
(or discontinuance) exemption request was filed includes the stations of 
(list all stations on the line in order of milepost number, indicating 
milepost location).
    The line (does) (does not) contain federally granted rights-of-way. 
Any documentation in the railroad's possession will be made available 
promptly to those requesting it.
    The interest of railroad employees will be protected by (specify the 
appropriate conditions).
    Any offer of financial assistance will be due no later than 10 days 
after service of a decision granting the petition for exemption.
    All interested persons should be aware that following abandonment of 
rail service and salvage of the line, the line may be suitable for other 
public use, including interim trail use.
    Any request for a public use condition and any request for trail 
use/rail banking will be due no later than 20 days after notice of the 
filing of the petition for exemption is published in the Federal 
Register.
    Persons seeking further information concerning abandonment 
procedures may contact the Surface Transportation Board or refer to the 
full abandonment or discontinuance regulations at 49 CFR part 1152. 
Questions concerning environmental issues may be directed to the Board's 
Section of Environmental Analysis.
    An environmental assessment (EA) (or environmental impact statement 
(EIS), if necessary) prepared by the Section of Environmental Analysis 
will be served upon all parties of record and upon any agencies or other 
persons who commented during its preparation. Any other persons who 
would like to obtain a copy of the EA (or EIS) may contact the Section 
of Environmental Analysis. EAs in these abandonment proceedings normally 
will be made available within 60 days of the filing of the petition. The 
deadline for submission of comments on the EA will generally be within 
30 days of its service.


[[Page 249]]


    (d) A petitioner for an abandonment exemption must serve a copy of 
the petition on the persons receiving notices of exemption under 
Sec.1152.50(d). The petition must include the following statement: 
``Based on information in our possession, the line (does) (does not) 
contain federally granted right-of-way. Any documentation in 
petitioner's possession will be made available promptly to those 
requesting it.''
    (e) As Provided in Sec.1152.29(e)(2), rail carriers that receive 
authority to abandon a line by individual exemption under 49 U.S.C. 
10502 must file with the Board a notice that abandonment has been 
consummated.

[61 FR 67883, Dec. 24, 1996, as amended at 62 FR 34670, June 27, 1997]





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