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[Code of Federal Regulations]
[Title 49, Volume 4]
[Revised as of October 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 49CFR265]

[Page 715-726]
 

TITLE 49--TRANSPORTATION
CHAPTER II--FEDERAL RAILROAD ADMINISTRATION, DEPARTMENT OF TRANSPORTATION
PART 265--NONDISCRIMINATION IN FEDERALLY ASSISTED RAILROAD PROGRAMS



                           Subpart A--General

Sec.
265.1 Purpose.
265.3 Applicability.
265.5 Definitions.

                         Subpart B--Requirements

265.7 Nondiscrimination clauses.
265.9 Affirmative action program--General.
265.11 Submission of affirmative action program.
265.13 Contents of affirmative action program.
265.14 Determining the MBE status of a business.
265.14-1 Appeals of determination of MBE status.
265.15 Implementation and maintenance of affirmative action program.
265.17 Review of affirmative action program.

                          Subpart C--Compliance

265.19 Compliance information.
265.21 Conduct of investigations.
265.23 Procedures for effecting compliance.
265.25 Other information.

Appendix A to Part 265

    Authority: Sec. 905 of the Railroad Revitalization and Regulatory 
Reform Act of 1976, Pub. L. 94-210, 90 Stat. 31; regulations of the 
Office of the Secretary of Transportation, 49 CFR 1.49(u).

    Source: 42 FR 4286, Jan. 24, 1977, unless otherwise noted.

                           Subpart A--General

Sec. 265.1  Purpose.

    The purpose of this part is to effectuate the provisions of section 
905 of the Railroad Revitalization and Regulatory Reform Act of 1976 
(hereinafter

[[Page 716]]

referred to as the ``Act'') to ensure that no person in the United 
States shall on the grounds of race, color, national origin, or sex be 
excluded from participation in, or denied the benefits of, or be 
subjected to discrimination under, any project, program or activity 
funded in whole or in part through financial assistance under the Act, 
or any provision of law amended by the Act. Nothing contained in these 
regulations is intended todiminish or supersede the obligations made 
applicable by either title VI of the Civil Rights Act of 1964, (42 
U.S.C. 2000d), or Executive Order No. 11246, (42 U.S.C. 2000e (note)). 
Subsection (d) of section 905 of the Act authorizes the Secretary to 
prescribe such regulations and take such actions as are necessary to 
monitor, enforce, and affirmatively carry out the purposes of that 
section. This authority coupled with the provisions of section 906 of 
the Act, which requires the establishment of a Minority Resource Center 
which is authorized to encourage, promote and assist in the 
participation by MBE enterprises in the restructuring, improvement, 
revitalization and maintenance of our Nation's railroads, provides the 
basis for requirements for the development of affirmative action 
programs by recipients of Federal financial assistance and certain of 
their contractors to insure that minorities and MBEs are afforded ample 
consideration with respect to employment and contractual opportunities 
produced as a result of the implementation of the Act and other 
provisions of law amended by the Act.

Sec. 265.3  Applicability.

    This part applies to any project, program, or activity funded in 
whole or in part through financial assistance provided under the Act, 
and to any activity funded under any provision of the Regional Rail 
Reorganization Act of 1973, as amended (45 U.S.C. 701 et seq.) or the 
Rail Passenger Service Act, as amended (45 U.S.C. 501 et seq.) amended 
by the Act including the financial assistance programs listed in 
appendix A. It applies to contracts awarded to implement the Northeast 
Corridor Project and to financial assistance programs administered by 
the United States Railway Association.

Sec. 265.5  Definitions.

    As used in this part, unless the context indicates otherwise:
    (a) Act means the Railroad Revitalization and Regulatory Reform Act 
of 1976 (Pub. L. No. 94-210).
    (b) Administrator means the Federal Railroad Administrator or his 
delegate.
    (c) Affirmative action program means the program described in 
Sec. 265.9 through Sec. 265.15 of this part.
    (d) Agency means the Federal Railroad Administration.
    (e) Applicant means persons applying for financial assistance under 
any of the Rail Acts.
    (f) Contractor means a prime contractor or a subcontractor who will 
be paid in whole or in part directly or indirectly from financial 
assistance provided under the Rail Acts.
    (g) [Reserved]
    (h) Includes means includes but not limited to.
    (i) Minority means women, Blacks, Hispanic Americans, American 
Indians, American Eskimos, American Orientals and American Aleuts.
    (j) MBE means a business concern which is owned and controlled by a 
minority. For the purpose of this part, owned and controlled means a 
business:
    (1) Which is at least 51 per centum owned by one or more minority 
individuals; or, in the case of a publicly owned business, at least 51 
per centum of the stock of which is owned by one or more minority 
individuals; and
    (2) Whose management and daily operations are controlled by one or 
more such individuals.
    (k) MBE Resource Center means the Minority Resource Center 
established in the Department of Transportation pursuant to section 906 
of the Act.
    (l) Rail Acts means the Railroad Revitalization and Regulatory 
Reform Act of 1976, the Regional Rail Reorganization Act of 1973, as 
amended (45 U.S.C. 701 et seq.) and the Rail Passenger Service Act, as 
amended (45 U.S.C. 501 et seq.).
    (m) Recipient means a person who receives financial assistance under 
any of the Rail Acts except under section 602 of the Rail Passenger 
Service Act, as amended (45 U.S.C. 501 et seq.).

[[Page 717]]

    (n) Underutilization means the condition of having fewer minority 
employees in a particular job group or fewer awards of contracts to MBEs 
than would reasonably be expected by their availability for such jobs or 
awards.

[42 FR 4286, Jan. 24, 1977, as amended at 44 FR 36339, June 21, 1979]

                         Subpart B--Requirements

Sec. 265.7  Nondiscrimination clauses.

    (a) Each agreement for financial assistance made under any provision 
of the Rail Acts shall include, or in the case of agreements made prior 
to the effective date of this part, shall be amended to include, the 
following clauses:
    (1) As a condition to receiving Federal financial assistance under 
the Railroad Revitalization and Regulatory Reform Act of 1976 (``Act''), 
or the provisions of the Regional Rail Reorganization Act of 1973, as 
amended (45 U.S.C. 701 et seq.), or the Rail Passenger Service Act of 
1970, as amended (45 U.S.C. 501 et seq.) amended by the Act 
(collectively called, together with the Act, the ``Rail Acts''), the 
recipient hereby agrees to observe and comply with the following:
    (i) No person in the United States shall on the ground of race, 
color, national origin or sex be excluded from participation in, or 
denied the benefits of, or be subjected to discrimination under, any 
project, program, or activity funded in whole or in part through such 
assistance.
    (2) The following specific discriminatory actions are prohibited:
    (i) A recipient under any project, program or activity to which 
these clauses apply shall not, directly or through contractual or other 
arrangements, on the ground of race, color, national origin, or sex:
    (A) Deny a person any service, financial aid, or other benefit 
provided under such project, program or activity;
    (B) Provide any service, financial aid, or other benefit to a person 
which is different, or is provided in a different manner, from that 
provided to others under such project, program or activity;
    (C) Subject a person to segregation or separate treatment in any 
matter related to his receipt of any service, financial aid or other 
benefit under such project, program or activity;
    (D) Restrict a person in any way in the enjoyment of any advantage 
or privilege enjoyed by others receiving any service, financial aid or 
other benefit under such project, program or activity; or
    (E) Deny a person an opportunity to participate in such project, 
program or activity through the provision of services or otherwise or 
afford him an opportunity to do so which is different from that afforded 
others under such project, program or activity.
    (ii) A recipient, in determining the types of services, financial 
aid, or other benefits, or facilities which will be provided under any 
such project, program or activity or the class of persons to whom, or 
the situations in which such services, financial aid, other benefits, or 
facilities will be provided under any such project, program or activity, 
or the class of persons to be afforded an opportunity to participate in 
any such project, program or activity shall not, directly or through 
contractual or other arrangements, utilize criteria or methods of 
administration which have the effect of subjecting persons to 
discrimination because of their race, color, national origin, or sex, or 
have the effect of defeating or substantially impairing accomplishment 
of the objectives of the project, program or activity, with respect to 
individuals of a particular race, color, national origin or sex.
    (iii) In determining the site or location of facilities, a recipient 
shall not make selections with the purpose or effect of excluding 
persons from, de- nying them the benefits of, or subjecting them to 
discrimination under any project, program or activity to which these 
clauses apply on the grounds of race, color, national origin or sex, or 
with the purpose or effect of defeating or substantially impairing the 
accomplishment of the objectives of these clauses.
    (iv) The recipient shall not discriminate against any employee or 
applicant for employment because of race, color,

[[Page 718]]

national origin or sex. Except as otherwise required by the regulations 
or orders of the Administrator, the recipient shall take affirmative 
action to insure that applicants for employment are employed, and that 
employees are treated during employment, without regard to their race, 
color, national origin or sex. Such action shall include but not be 
limited to the following: Employment, promotion, demotion, transfer, 
recruitment or recruitment advertising, layoff or termination, rates of 
pay or other forms of compensation, and selection for training, 
including apprenticeship. The recipient agrees to post in conspicuous 
places, available to employees and applicants for employment, notices to 
be provided by the agency's representative setting forth the provisions 
of these nondiscrimination clauses. The recipient understands and agrees 
that it shall not be an excuse for the recipient's failure to provide 
affirmative actionthat the labor organizations with which the recipient 
has a collective bargaining agreement failed or refused to admit or 
qualify minorities for admission to the union, or that the provisions of 
such agreements otherwise prevent recipient from implementing its 
affirmative action program.
    (v) The recipient shall not discriminate against any business 
organization in the award of any contract because of race, color, 
national origin or sex of its employees, managers or owners. Except as 
otherwise required by the regulations or orders of the Administrator, 
the recipient shall take affirmative action to insure that business 
organizations are permitted to compete and are considered for awards of 
contracts without regard to race, color, national origin or sex.
    (3) As used in these clauses, the services, financial aid, or other 
benefits provided under a project, program, or activity receiving 
financial assistance under the Rail Acts include any service, financial 
aid, or other benefit provided in or through a facility funded through 
financial assistance provided under the Rail Acts.
    (4) The enumeration of specific forms of prohibited discrimination 
does not limit the generality of the prohibition in paragraph (a)(1)(i) 
of this section.
    (5) These clauses do not prohibit the consideration of race, color, 
national origin or sex if the purpose and effect are to remove or 
overcome the consequences of practices or impediments which have 
restricted the availability of, or participation in, recipient's 
operations or activities on the grounds of race, color, national origin 
or sex. Where prior discriminatory or other practice or usage tends, on 
the grounds of race, color, national origin or sex, to exclude 
individuals or businesses from participation in, to deny them the 
benefits of, or to subject them to discrimination under any project, 
program or activity to which these clauses apply, the recipient must 
take affirmative action to remove or overcome the effects of the prior 
discriminatory practice or usage. Even in the absence of prior 
discriminatory practice or usage to which this partapplies, the 
recipient is expected to take affirmative action to insure that no 
person is excluded from participation in or denied the benefits of the 
project, program or activity on the grounds of race, color, national 
origin or sex, and that minorities and MBEs are afforded a reasonable 
opportunity to participate in employment and procurement opportunities 
that will result from financial assistance provided under the Rail Acts.
    (6) The recipient agrees to take such actions as are necessary to 
monitor its activities and those of its contractors who will be paid in 
whole or in part with funds provided by the Rail Acts, or from 
obligations guaranteed by the Administrator pursuant to the Rail Acts, 
except obligations guaranteed under section 602 of the Rail Passenger 
Service Act, in order to carry out affirmatively the purposes of 
paragraph (a)(1) of this section, and to implement the affirmative 
action program developed and implemented pursuant to 49 CFR part 265.
    (7) The recipient shall, in all advertisements for employees, or 
solicitations for services or materials from business organizations 
placed by or on behalf of the recipient, in connection with any project, 
program or activity funded in whole or in part with financial assistance 
under the Rail Acts,

[[Page 719]]

state that all applicants for employment will receive consideration for 
employment, and all business organizations will receive consideration 
for an award of a contract, without regard to race, color, national 
origin or sex.
    (8) The recipient shall send to each labor organization or 
representative of workers with which it has a collective bargaining 
agreement or other contract or understanding a notice to be provided by 
the agency's representative, advising the labor organization or workers' 
representative of the recipient's commitments under section 905 of the 
Act, and shall post copies of the notice in conspicuous places available 
to employees and applicants for employment.
    (9) The recipient shall comply with all provisions of section 905 of 
the Act, the Civil Rights Act of 1964, any other Federal civil rights 
act, and with the rules, regulations, and orders issued under such acts.
    (10) The recipient shall furnish all information and reports 
required by the rules, regulations, and orders of the Administrator, and 
will permit access to its books, records, and accounts by the 
Administrator for purposes of investigation to ascertain compliance with 
rules, regulations, and orders referred to in paragraph (a)(9) of this 
section.
    (11) Recipient shall furnish such relevant procurement information, 
not included in its affirmative action program as may be requested by 
the MBE Resource Center. Upon the request of the recipient, the Center 
shall keep such information confidential to the extent necessary to 
protect commercial or financial information or trade secrets to the 
extent permitted by law.
    (12) In the event of the recipient's noncompliance with the 
nondiscrimination clauses of this agreement, or with the provisions of 
section 905 of the Act, the Civil Rights Act of 1964, or with any other 
Federal civil rights act, or with any rules, regulations, or orders 
issued under such acts, this contract will, after notice of such 
noncompliance, and after affording a reasonable opportunity for 
compliance, be canceled, terminated, or suspended in whole or in part 
and the recipient may be declared ineligible for further Federal 
financial assistance in accordance with procedures authorized in section 
905 of the Act, or as otherwise provided by law.
    (13) The recipient shall not enter into any contract or contract 
modification whether for the furnishing of supplies or services or for 
the use of real or personal property, including lease arrangements, or 
for construction, in connection with a project, program or activity 
which receives financial assistance under the Rail Acts with a 
contractor debarred from or who has not demonstrated eligibility for 
Federal or federally assisted contracts, and will carry out such 
sanctions and penalties for violation of this part as may be imposed 
upon contractors and subcontractors by the Administrator or any other 
authorized Federal official. The recipient shall insure that the clauses 
required by 41 CFR 60-1.46 implementing Executive Order 11246 will be 
placed in each non-exempt federally assisted construction contract.
    (14) The recipient agrees to comply with and implement the written 
affirmative action program as approved by the Administrator pursuant to 
Sec. 265.17 of title 49 CFR.
    (15) The recipient agrees to notify the Administrator promptly of 
any law suit or complaint filed against the recipient alleging 
discrimination on the basis of race, color, national origin or sex.
    (16) The recipient shall include the preceding provisions of 
paragraphs (a) (1) through (15) of this section in every contract or 
purchase order, whether for the furnishing of supplies or services or 
for the use of real or personal property, including lease arrangements, 
or for construction relating to projects, programs or activities 
financed in whole or in part under the Rail Acts. The recipient shall 
cause each such contractor or vendor to include the provisions of 
paragraphs (a) (1) through (15) of this section in every subcontract. 
The recipient will take such action with respect to any such contract or 
purchase order as the Administrator may direct as a means of enforcing 
such provisions including sanctions for noncompliance; provided, 
however, that in the event the recipient becomes

[[Page 720]]

involved in, or is threatened with, litigation with a contractor or 
vendor as a result of such direction by the Administrator, the recipient 
may request the United States to enter into such litigation.

Sec. 265.9  Affirmative action program--General.

    Recipients of financial assistance under the Rail Acts and their 
contractors, as specified herein, shall develop and maintain an 
affirmative action program to insure that persons and businesses are not 
discriminated against because of race, color, national origin or sex in 
programs, projects and activities financed in whole or in part through 
financial assistance provided under the Rail Acts, and that minorities 
and MBEs receive a fair proportion of employment and contractual 
opportunities which will result from such programs, projects and 
activities.

Sec. 265.11  Submission of affirmative action program.

    (a) Each application for financial assistance under any of the Rail 
Acts shall, as a condition to its approval and the extension of any 
financial assistance pursuant to the application, contain or be 
accompanied by two copies of a written affirmative action program for 
review by and approval of the Administrator. Recipients that have 
already entered into an agreement or other arrangement providing for 
such assistance shall, within 60 days after the effective date of this 
part, develop and submit to the Administrator two copies of a written 
affirmative action program for review by and approval of the 
Administrator and thereafter maintain such program.
    (b)(1) Beginning 30 days after the effective date of this part, and 
until 120 days after such date, each recipient shall require any 
contractor, as a condition to an award of a contract, for $50,000 or 
more for services or products on a project receiving federal financial 
assistance under a program covered by section 905 of the Act:
    (i) To furnish to the recipient a written assurance that it will, 
within 90 days after the date of the award, develop and maintain a 
written affirmative action program meeting the requirements of this part 
for the project, program or activity covered by the contract,
    (ii) To require each of its subcontractors receiving an award of a 
subcontract for $50,000 or more within 120 days after the effective date 
of this part, to furnish to the contractor as a condition to such an 
award the written assurance described in paragraph (b)(1)(i) of this 
section.
    (2) Beginning 120 days after the effective date of this part, each 
recipient shall require as a condition to the award of a contract or 
subcontract of $50,000 or more that the contractor or subcontractor 
furnish a certificate to the recipient or contractor as appropriate that 
a written affirmative action program meeting the requirements of this 
part has been developed and is being maintained.
    (3) Notwithstanding paragraphs (b) (1) and (2) of this section, each 
contractor or subcontractor having a contract or $50,000 or more but 
less than 50 employees shall be required to develop and maintain a 
written affirmative action program only for contracts in accordance with 
Sec. 265.13(c) of this part.
    (4) A recipient or contractor shall not procure supplies or services 
in less than usual quantities or in a manner which is intended to have 
the effect of avoiding the applicability of this paragraph.

Sec. 265.13  Contents of affirmative action program.

    (a) General. A prerequisite to the development of a satisfactory 
affirmative action program is the identification and analysis of problem 
areas inherent in minority employment and utilization of MBEs, and an 
evaluation of opportunities for utilization of minority group personnel 
and MBEs. Therefore, an affirmative action program to guarantee 
employment and contractual opportunities shall provide for specific 
actions keyed to the problems and needs of minority persons and MBEs 
including, where there are deficiencies based on past practices, and 
with respect to future plans for hiring and promoting employees or 
awarding contracts, the development of specific goals and timetables for 
the prompt achievement and maintenance of full

[[Page 721]]

opportunities for minority persons and MBEs with respect to programs, 
projects and activities subject to this part.
    (b) Employment practices. (1) The affirmative action program for 
employment showing the level of utilization of minority employees, and 
establishing a plan to insure representative opportunities for 
employment for minority persons shall be developed in accordance with 
the regulations of the Department of Labor at 41 CFR 60-2.
    (2) Railroad applicants or recipients shall develop their program 
for each establishment in their organization and by job categories in 
accordance with the requirements of the Joint Reporting Committee of the 
Equal Employment Opportunity Commission and the Department of Labor. 
Other applicants, recipients or contractors may use any program format 
or organization which has been approved for use by other Federal 
agencies enforcing equal opportunity laws.
    (3) The affirmative action program shall show the source of 
statistical data used.
    (4) The affirmative action program shall include a listing by job 
category of all jobs which may be established or filled by the 
applicant, recipient or contractor as a result of the project, program 
or activity funded by federal financial assistance under the Rail Acts 
for the first five years of such project, program or activity or the 
period during which such project, program or activity will be 
undertaken, whichever is the lesser (``program period'').
    (5) The affirmative action program shall set forth in detail a plan 
to insure that with respect to the project, program or activity financed 
in whole or in part through financial assistance under the Rail Acts, 
minority persons have an opportunity to participate in employment in 
proportion to the percentage of the minority work force in the area 
where the applicant's, recipient's or contractor's operations are 
located as compared to the total work force, and that such minority 
persons have an equal opportunity for promotion or upgrading. Where 
appropriate because of prior underutilization of minority employees, the 
program shall establish specific goals and timetables to utilize 
minority employees in such projects, programs or activities in the 
above-mentioned proportion.
    (c) Contracts. (1) The affirmative action program shall include 
details of proposed contracts in excess of $10,000 to be awarded in 
connection with projects, programs and activities funded in whole or in 
part through financial assistance under the Rail Acts, including 
contracts for professional and financial services, for the program 
period. The details shall include a description of the services or 
products which will be sought including estimated quantities, the 
location where the services are to be provided, the manner in which 
proposals will be solicited (e.g., cost plus fixed fee, fixed price), 
the manner in which contracts will be awarded (e.g., competitive or sole 
source). The plan shall also give details as to bidding procedures, and 
information as to other qualifications for doing business with the 
applicant, recipient or contractor. Upon request by the applicant, 
recipient or contractor, any information submitted to the Administrator 
shall be kept confidential to the extent permitted by law.
    (2) The affirmative action program shall review the procurement 
practices of the applicant, recipient or contractor for the full year 
preceding the date of the submission of the affirmative action program 
and evaluate the utilization of MBE in its procurement activities. Such 
evaluation of utilization of MBEs shall include the following:
    (i) An analysis of awards of contracts to MBEs during such year 
describing the nature of goods and services purchased and the dollar 
amount involved; and
    (ii) A comparison of the percentage of awards of contracts to MBEs 
(by number of contracts and by total dollar amount involved) to the 
total procurement activity of the applicant, recipient or contractor for 
said year.
    (3) The affirmative action program shall set forth in detail 
applicant's, recipient's or contractor's plan to insure that MBEs are 
afforded a fair and representative opportunity to do business with 
applicant, recipient or contractor

[[Page 722]]

(both in terms of number of contracts and dollar amount involved) for 
the program period. Such plan shall identify specific actions to be 
taken to:
    (i) Designate a liaison officer who will administer the MBE program;
    (ii) Provide for adequate and timely consideration of the 
availability and potential of MBEs in all procurement decisions;
    (iii) Assure that MBEs will have an equitable opportunity to compete 
for contracts, by arranging solicitation time for the preparation of 
bids, quantities, specifications, and delivery schedules so as to 
facilitate the participation of MBEs and by assisting MBEs who are 
potential contractors in preparing bid materials and in obtaining and 
maintaining suitable bonding coverage in those instances where bonds are 
required;
    (iv) Maintain records showing that the policies set forth in this 
part are being complied with;
    (v) Submit quarterly reports of the records referred to in paragraph 
(c)(3)(iv) of this section in such form and manner as the Administrator 
may prescribe; and
    (vi) Where appropriate because of prior underutilization of MBEs, 
establish specific goals and timetables to utilize MBEs in the 
performance of contracts awarded.
    (d) Successor organizations. Where applicant, recipient or 
contractor is a successor organization, its affirmative action program 
shall review the hiring and procurement practices of its predecessor 
organization or organizations.

Sec. 265.14  Determining the MBE status of a business.

    FRA or a recipient may, on the basis of available information, 
determine that a business is not an MBE within the meaning of this part. 
This determination shall be final, except as provided in Sec. 265.14-1, 
for that contract and other contracts being let by that contracting 
agency at the time of the determination. Businesses may correct 
deficiencies in their ownership and control and apply as MBEs only for 
future contracts.

[44 FR 36339, June 21, 1979]

Sec. 265.14-1  Appeals of determination of MBE status.

    (a) Filing. Any firm who believes that it has been wrongly 
determined not to be an MBE under Sec. 265.14 by the FRA or a recipient 
may file an appeal in writing with the Administrator. The appeal shall 
be filed no later than 30 days after the date of the determination. The 
Administrator may extend the time for filing or waive the time limit in 
the interest of justice, specifying in writing the reasons for so doing. 
Third parties who have reason to believe that a business has been 
wrongly denied or granted status as an MBE may advise the Administrator. 
This information is not considered an appeal pursuant to this section.
    (b) Decision to investigate. The Administrator ensures that a prompt 
investigation is made of those cases with investigative merit (except 
those being reviewed on the merits by the Comptroller General), pursuant 
to prescribed DOT Title VI (49 CFR part 21) investigation procedures.
    (c) Status during the investigation. The Administrator may deny the 
business in question eligibility to participate as an MBE in direct or 
FRA-assisted contracts let during the pendancy of the investigation, 
after providing the business in question an opportunity to show cause by 
written statement to the Administrator why this should not occur.
    (d) Cooperation in investigation. All parties shall cooperate fully 
with the investigation. Failure or refusal to furnish relevant 
information or other failure to cooperate is a violation of this part.
    (e) Determinations. The Administrator will make one of the following 
determinations and so inform the business in writing of the reasons for 
the determination:
    (1) The business is considered to be an MBE within the meaning of 
this part; or
    (2) The business is not considered to be an MBE within the meaning 
of this part and is denied eligibility to participate as an MBE in any 
direct or FRA-assisted contract until a further determination is made by 
FRA that the

[[Page 723]]

business is an MBE within the meaning of this part.

[44 FR 36339, June 21, 1979]

Sec. 265.15  Implementation and maintenance of affirmative action 
          program.

    The affirmative action program with respect to employment and 
procurement practices shall set forth in detail applicant's recipient's 
or contractor's program to implement and maintain its recommended action 
program to insure that persons and businesses are not discriminated 
against because of race, color, national origin or sex, and that 
minorities and MBEs have equal employment and contractual opportunities 
with applicant, recipient or contractor. In developing its maintenance 
program for employment, applicants, recipients and contractors shall 
follow the applicable regulations of the Department of Labor 
implementing Executive Order 11246 at 41 CFR 60-2, subpart C, which 
provisions may also be helpful in implementing and maintaining 
applicant's recipient's or contractor's procurement program.

Sec. 265.17  Review of affirmative action program.

    (a) Except as provided for contractors and subcontractors in 
Sec. 265.11(b), each affirmative action program to be acceptable must 
have the written approval of the Administrator.
    (b) The Administrator recognizes that there may be some exceptional 
situations where the requirements of Sec. 265.13 through Sec. 265.15 may 
not fulfill the affirmative action objectives sought or that those 
objectives may be better achieved through modified or different 
requirements. Accordingly, the applicant, recipient or contractor may 
request approval for modified or different requirements that embody the 
objectives of Secs. 265.13 through 265.15. Such a request must include 
detailed showings that the particular situation is exceptional and that 
the modified or different proposals substantially comply with the 
objectives of this part. If the Administrator determines that the 
requirements for a detailed justification have been met, he may waive or 
modify these requirements or impose different requirements as he deems 
necessary to further the objectives sought herein.

                          Subpart C--Compliance

Sec. 265.19  Compliance information.

    (a) Each recipient and contractor shall keep such records and submit 
to the Administrator complete and accurate reports, at such times, and 
in such form, and containing such information as the Administrator may 
determine to be necessary to enable him to ascertain whether the 
recipient or contractor has complied or is complying with this part. 
These records shall show in connection with the project, program or 
activity funded in whole or in part through financial assistance under 
the Rail Acts:
    (1) Procedures which have been adopted to comply with the policies 
set forth in this part, including the establishment of a source list of 
MBEs;
    (2) Specific efforts to identify and award contracts to MBEs; and
    (3) Awards to MBEs on the source list required in paragraph (a)(1) 
of this section.
    (b) Each recipient and contractor shall permit access by the 
Administrator during normal business hours to such of its books, 
records, accounts and other sources of information and its facilities as 
may in the opinion of the Administrator be necessary to ascertain 
compliance with this part.
    (c) Each recipient and contractor shall make available to 
participants, beneficiaries and other interested persons, such 
information regarding the provisions of this part and the applicability 
to the program, project or activity under which the recipient received 
financial assistance from the Rail Acts or under which the contractor is 
awarded a contract and make such information available to them in such 
manner as the Administrator finds necessary to apprise such persons of 
the protections against discrimination assured them by the Act and this 
part.

Sec. 265.21  Conduct of investigations.

    (a) The Administrator shall from time to time review the practices 
of recipients and contractors to determine whether they are complying 
with this part. The Administrator shall to the

[[Page 724]]

fullest extent practicable seek the cooperation of recipients and 
contractors in obtaining compliance with this part and shall provide 
assistance and guidance to recipients and contractors to help them 
comply voluntarily with this part. As required by Sec. 265.7(a)(6) of 
this part recipients and contractors shall from time to time review the 
practices of their contractors and subcontractors to determine whether 
they are complying with this part.
    (b) Any person who believes himself or herself or any other person 
to be subjected to discrimination prohibited by this part, may file with 
the Administrator a written complaint. A complaint must be filed not 
later than sixty (60) days after the date complainant discovers the 
alleged discrimination, unless the time for filing is extended by the 
Administrator.
    (c) The Administrator will make a prompt investigation in cases 
where a compliance review, report, complaint or other information 
indicates a possible failure to comply with this part.
    (d)(1) If an investigation pursuant to paragraph (c) of this section 
indicates a failure to comply with this part, the Administrator shall 
within ten (10) days after such determination so inform the recipient or 
contractor in writing of the specific grounds for alleging noncompliance 
and the matter shall be resolved by informal means whenever possible. 
The notice shall provide that, if it has been determined that the matter 
is not resolved by informal means within thirty (30) days after the 
delivery of the notice, action will be taken as provided for in 
Sec. 265.23.
    (2) If an investigation does not warrant action pursuant to 
paragraph (d)(1) of this section, the Administrator shall within ten 
(10) days after such determination so inform the recipient, or 
contractor and the complainant, if any, in writing.
    (e) No recipient, contractor or other person shall intimidate, 
threaten, coerce or discriminate against any individual for the purpose 
of interfering with any right or privilege secured by section 905 of the 
Act or this part, or because he or she made a complaint, testified, 
assisted or participated in any manner in an investigation, proceeding 
or hearing under this part. The identity of complainants shall be kept 
confidential at their election during the conduct of any investigation, 
proceeding or hearing under this part. But when such confidentiality is 
likely to hinder the investigation the complainant will be advised for 
the purpose of waiving the privilege.

Sec. 265.23  Procedures for effecting compliance.

    (a) Whenever the Administrator determines that any recipient, or 
contractor has failed to comply with the provisions of this part, or 
with any Federal civil rights statute, or with any order or regulation 
issued under such a statute, and such failure has not been resolved by 
informal means pursuant to Sec. 265.21 of this part, the Administrator 
shall within ten (10) days after such determination notify such 
recipient or contractor, and the appropriate labor organization if the 
matter may appear to affect a person who is covered by a collective 
bargaining agreement, in writing of the specific grounds for alleging 
noncompliance, and the right of such persons to respond to such 
determination in writing or to request an informal hearing. Where the 
Administrator determines that substantial noncompliance exists and it is 
unlikely that compliance will be obtained, or that lack of good 
faithexists, or that other good cause exists, he may order that further 
financial assistance be suspended in whole or in part pending a final 
decision in the matter. Subject to the provisions of paragraphs (b) 
through (e) of this section, the recipient or contractor shall have 
sixty (60) days from the date of delivery of the notice within which to 
comply. The recipient or contractor may be entitled to additional time 
if it is demonstrated that compliance is not possible within the sixty 
day period and that the necessary initial curative actions were 
undertaken promptly and have been diligently prosecuted toward 
completion. The Administrator shall specify the last day upon which 
curative action must be completed to his satisfaction. Unless the 
Administrator determines that compliance cannot be reasonably attained, 
failure to take curative action shall be grounds for the Administrator 
to:

[[Page 725]]

    (1) Direct that no further Federal financial assistance be provided 
to the recipient;
    (2) Refer the matter to the Attorney General with a recommendation 
that an appropriate civil action be instituted;
    (3) Exercise the powers and functions provided by title VI of the 
Civil Rights Act of 1964 (42 U.S.C. 2000d et seq.); or
    (4) Take such other actions as may be provided by law or this part.
    (b) Persons receiving notification and a directive pursuant to 
paragraph (a) of this section may within thirty (30) days after receipt 
respond to the notice in writing in lieu of requesting an informal 
hearing as specified in paragraph (c) of this section. The Administrator 
will make a determination as to compliance within thirty (30) days after 
receipt of such written response, and advise the person in writing of 
his determination. If the Administrator determines that compliance is 
reasonably attainable and that such person has failed to comply with the 
provisions of this part or with his determination within 30 days after 
receipt of his determination, the Administrator shall pursue the 
remedies set forth in the last sentence of paragraph (a) of this 
section.
    (c) Persons receiving notification and a directive pursuant to 
paragraph (a) of this section may within ten (10) days after receipt 
request an informal hearing in lieu of filing a written response as 
specified in paragraph (b) of this section. The Administrator may, in 
his discretion, grant a request for an informal hearing for the purpose 
of inquiring into the status of compliance of such person. The 
Administrator will advise persons subject to his directive in writing as 
to the time and place of the informal hearings and may direct such 
persons to bring specific documents and records, or furnish other 
relevant information concerning their compliance status. When so 
requested, such person shall attend and bring the requested information. 
The time and place so fixed shall be reasonable and shall be subject to 
change for cause. The complainant, if any, shall be advised of the time 
and place of the hearing. The failure of such person to request a 
hearing or to appear at a hearing for which a date has been set shall be 
deemed to be a consent to the applicability of the procedures set forth 
in paragraph (a) of this section.
    (d) The hearing shall be conducted by a hearing officer appointed by 
the Administrator. Such hearings shall commence within twenty (20) days 
from the date the hearing is granted and shall be concluded no later 
than thirty (30) days from the commencement date. Parties to informal 
hearings may be represented by counsel or other authorized 
representative and shall have a fair opportunity to present any relevant 
material. Formal rules of evidence will not apply to such proceedings.
    (e) Decisions and notices. (1) Within ten (10) days after the 
conclusion of such hearings, the hearing officer will advise the 
Administrator, in writing, of his views and recommendations as to 
compliance with this part and a copy of such decision shall be sent by 
registered mail, return receipt requested, to the recipient or 
contractor and participating labor organization. If the hearing officer 
in his decision determines that the recipient or contractor is in 
noncompliance with this part, he may, if he determines that it is 
unlikely that compliance will be obtained, or that a lack of good faith 
exists, or for other good cause, order that further financial assistance 
be suspended in whole or in part, pending a decision by the 
Administrator in the matter.
    (2) The recipient, contractor or labor organization may file 
exceptions to the hearing officer's decision, with his reasons therefor, 
with the Administrator within thirty (30) days of receipt of the initial 
decision. Within twenty (20) days, after the time for filing exceptions, 
the Administrator shall determine, in writing, whether or not the 
parties involved are in compliance with this part. A copy of the 
Administrator's decision will be given to the recipient, contractor, 
labor organization, if appropriate, and to the complainant, if any.
    (3) If the Administrator determines that compliance can reasonably 
be attained, his decision shall provide that

[[Page 726]]

if such person fails or refuses to comply with the decision of the 
Administrator within thirty (30) days after receipt of the decision, the 
Administrator shall:
    (i) Direct that no further Federal assistance be provided to such a 
person;
    (ii) Refer the matter to the Attorney General with a recommendation 
that an appropriate civil action be instituted;
    (iii) Exercise the powers and functions provided by title VI of the 
Civil Rights Act of 1964; and/or
    (iv) Take such other actions as may be provided by law or this part.
    (4) A recipient or contractor adversely affected by a decision of 
the Administrator issued under paragraph (a) or (b) of this section 
shall be restored to full eligibility to receive Federal assistance or 
award of a federally assisted contract if the recipient or contractor 
takes complete curative action to eliminate the noncompliance with this 
part and if the recipient or contractor provides reasonable assurance 
that the recipient or contractor will fully comply with this part.

Sec. 265.25  Other information.

    (a) Each person required to submit a written affirmative action 
program pursuant to this part shall include as an appendix thereto, the 
following information except to the extent such information is already 
provided as part of the application for financial assistance;
    (1) A brief description of other pending applications to other 
federal agencies for financial assistance, and of federal assistance 
being provided at the time of submission of the affirmative action 
program;
    (2) A statement of any civil rights compliance reviews regarding 
applicant or recipient conducted in the two year period before the 
application, or affirmative action program; the name of the agency or 
organization performing the review, and the findings of the review;
    (3) Where the project, program or activity receiving financial 
assistance will require the relocation of persons and businesses, a 
description of the requirements and steps used or proposed to guard 
against unnecessary impact on persons on the basis of race, color, or 
national origin;
    (4) Where the project, program or activity receiving financial 
assistance will result in the construction of new facilities or 
expansion of existing facilities, a description of the requirements and 
steps used or proposed to guard against unnecessary impact on persons on 
the basis of race, color or national origin;
    (5) Where paragraphs (a) (3) and (4) of this section are applicable, 
additional data such as demographic maps, racial composition of affected 
neighborhoods, or census data should be provided where necessary or 
appropriate to evaluate the impact of projects, programs and activities 
referred to in paragraphs (a) (3) and (4) of this section.

                         Appendix A to Part 265

    The following are the financial assistance programs to which this 
part applies:
    (a) Railroad Revitalization and Regulatory Reform Act of 1976, (1) 
purchase of redeemable preference shares or trustee certificates 
pursuant to section 505;
    (2) Guarantee of obligations, the proceeds of which will be used to 
acquire, or rehabilitate or improve rail facilities, or equipment, 
pursuant to section 511; and
    (3) Grants and contracts made to implement the Northeast Corridor 
project under section 704.
    (b) Regional Rail Reorganization Act of 1973, as amended, (1) loans 
made by the United States Railway Association (USRA) pursuant to section 
211;
    (2) Purchase of securities of the Consolidated Rail Corporation 
pursuant to section 216; and
    (3) Grants to States, or local or regional authorities for rail 
continuation assistance under section 402.
    (c) Department of Transportation Act, (1) grants to States for rail 
freight assistance programs under section 5 (sec. 803 of the Railroad 
Revitalization and Regulatory Reform Act of 1976); and
    (2) Grants under section 4(i) for the planning, preservation and 
conversion of rail passenger terminals of historical or architectural 
significance.
    (d) Rail Passenger Service Act, (1) grants to Amtrak under section 
601.

[[Page 727]]



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