[Code of Federal Regulations] [Title 49, Volume 4] [Revised as of October 1, 2002] From the U.S. Government Printing Office via GPO Access [CITE: 49CFR266.17] [Page 719-724] TITLE 49--TRANSPORTATION CHAPTER II--FEDERAL RAILROAD ADMINISTRATION, DEPARTMENT OF TRANSPORTATION PART 266--ASSISTANCE TO STATES FOR LOCAL RAIL SERVICE UNDER SECTION 5 OF THE DEPARTMENT OF TRANSPORTATION ACT--Table of Contents Sec. 266.17 Applications. (a) General. (1) Applications for planning assistance shall comply with paragraphs (b), (c) and (e) of this section. (2) Applications for rail service continuation assistance shall comply with paragraphs (b), (c), (d) and (f) of this section. (3) Applications for acquisition assistance shall comply with paragraphs (b), (c), (d) and (g) of this section. (4) Applications for rehabilitation or improvement assistance and rail facility construction assistance shall comply with paragraphs (b), (c), (d) and (h) of this section. (5) Applications for substitute service assistance shall comply with paragraphs (b), (c), (d) and (i) of this section. (b) Submission. (1) Applications shall be submitted by the designated State agency using the standard forms contained in Attachment M of Office of Management and Budget Circular No. A-102 (``OMB Circular A-102''). Each item submitted in response to a requirement of this section shall reference that requirement by subsection, paragraph, and subparagraph. Each application shall be consistent with the current State Rail Plan and analyzed in it. (2) A State may apply for planning assistance to cover prospective costs at any time during the planning process. (3) Exhibits previously filed with the Administrator need not be refiled unless the prior filing has been rendered obsolete by changed circumstances. Such prior filing shall be appropriately referenced by source, location of data and date of submittal. (c) Contents. Each application shall include: (1) Full name and principal business address of the applicant; (2) Name, title, address and phone number of the person to whom correspondence regarding the application should be addressed; (3) Budget estimates for the total amount of assistance required for projects or planning; (4) Applicant's proposed means of furnishing its share of the total costs of the projects, as well as copies of executed agreements between the agency [[Page 720]] and any third party which may be providing the non-Federal share or a portion thereof; (5) Assurance by the chief executive officer of the applicant that the Federal funds provided under the Act will be used solely for the purpose for which the assistance will be provided and in conformity with limitations on expenditures under the Act and applicable regulations; (6) Evidence that the applicant has established in accordance with Attachment G of OMB Circular A-102, adequate procedures for financial control, accounting and performance evaluation in order to assure proper use of the Federal funds; (7) Assurance by applicant's chief executive officer that the timing of all advances by the applicant will comply with the Department of Treasury advance financing regulations (31 CFR part 205); (8) Statement as to whether the applicant prefers to receive disbursement of Federal funds by advance payment or reimbursement; (9) Opinion of applicant's legal counsel showing that counsel is familiar with the corporate or other organizational powers of the applicant, that the applicant is authorized to make the application, that the applicant is eligible to participate in the Rail Service Assistance Program in accordance with the provisions of the Act and this part, and that the applicant has the requisite authority to carry out actions proposed in the application and to assume the responsibilities and obligations created thereby; (10) Assurances that the applicant will comply with and that the program will be conducted in accordance with the following Federal laws, policies, regulations and pertinent directives: (i) Title VI of the Civil Rights Act of 1964, 42 U.S.C. 2000d et seq., and 49 CFR part 21; (ii) Section 905 of the Railroad Revitalization and Regulatory Reform Act of 1976, 45 U.S.C. 803, and 49 CFR part 265; (iii) The Rehabilitation Act of 1973, 29 U.S.C. 794 and 49 CFR part 27 (44 FR 31442, May 31, 1979) relating to non-discrimination on the basis of handicap; and (iv) The State and Local Fiscal Assistance Act of 1972, 31 U.S.C. 1221 et seq. and 31 CFR part 51; and (11) When two or more States desire to combine their entitlements or any portion of them for the purpose of funding a project, certification of the Governor or the Governor's delegate of each State involved that it is a party to an interstate agreement as required under section 5(h)(4) of the Act (49 U.S.C. 1654(h)(4)). Such certification shall include the amount of money to be used from each State's entitlement and which State is to enter into a grant for the project. (d) Additional contents. In addition to meeting the requirements of paragraphs (b) and (c) of this section each application except when planning assistance is requested, shall include evidence that the agency submitting the application has the statutory authority and administrative jurisdiction to develop, promote, supervise and support safe, adequate, and efficient rail services; that it employs or will employ, directly or indirectly, sufficient trained and qualified personnel; that it maintains or will maintain adequate programs of investigation, research, promotion, and development with provision for public participation; and that it is designated and directed solely, or in cooperation with other State agencies, to take all practicable steps to improve transportation safety and to reduce transportation related energy utilization and pollution. (e) Planning assistance. In addition to meeting the requirements of paragraphs (b) and (c) of this section, each application for planning assistance shall include a Planning Work Program which, together with such other information the State may choose to submit, demonstrates to the satisfaction of the Administrator that the State's proposed use of planning assistance will produce a State Rail Plan, or an update, amendment or revision which meets the requirements of Sec. 266.15 of this part. The Planning Work Program shall include the following information: (1) An explanation of how the State Rail Plan will be related to the overall planning process for transportation within the State. This explanation [[Page 721]] shall concentrate on the expectations of the State for the future of local rail freight services and consider such factors as likelihood of profitability of existing rail lines, necessity of rail service continuation payments, State acquisition of rail lines, use of alternate modes of transportaion in lieu of rail freight service, and other long- term alternatives; (2) A description of the methods by which the State will involve local and regional governmental bodies and the public generally in its rail planning process, including its methods of providing for equitable distribution of resources; (3) An identification of the data to be obtained on the rail network and rail services in the State, the sources of this data, and the methodology to be employed in the collection of the data; (4) A description of the method by which the State will develop the State Rail Plan, including a brief description of discrete tasks or activities to be accomplished; and (5) A list of the individuals responsible for the planning, a work schedule and a budget. (f) Rail service continuation assistance. In addition to meeting the requirements of paragraphs (b), (c), and (d) of this section, each application for rail service continuation assistance shall include the following: (1) The amount of the estimated rail service continuation payment for each line; and (2) A description of the arrangements which the applicant has made for operation of the rail services to be subsidized including copies of the proposed operating agreements, leases, or other compensation agreements under which service is to be provided, and the results of the application's preaward audit of proposed operators and equipment leasing companies if the equipment to be used in providing the rail service is to be leased by the proposed operator. (g) Acquisition assistance. In addition to meeting the requirements of paragraphs (b), (c), and (d) of this section, each application for acquisition assistance shall include the following: (1) Copies of the results of a title search, and the basis for the proposed acquisition price including two independent valuation appraisals by qualified appraisers. Such appraisals shall be performed in accordance with the ``Uniform Appraisal Standards for Federal Land Acquisition'' proposed by the Interagency Land Acquisition Conference and shall be based on the results of a title search and comparable sales and shall take cognizance of all easements, encumbrances and restrictions that may affect the value of the property. Such appraisals shall be reviewed by a State Review appraiser to establish just compensation; (2) Written assurance that the acquisition is being undertaken in accordance with 49 CFR 25.253, 25.255, 25.257, and 25.259 to the greatest extent practicable under State law and fully in compliance with 49 CFR 25.261(a) and 25.263; (3) Written assurance that the owner of the property to be acquired has been advised of the requirements of 49 CFR 25.259 or will be advised of such requirements prior to the consummation of the acquisition; (4) A description of the necessary steps, and timing for completion of the acquisition; (5) When rail service is to be immediately provided over the line, a description of the arrangements which the applicant has made for operation of the rail service, including copies of the proposed operating agreements, leases, and other compensation agreements under which the service is to be provided, and a description of the means by which the State will continue rail service on the property to be acquired once assistance under the Act is terminated; (6) For applications regarding rail banking, evidence that the properties for which assistance is requested have potential for rail freight service such as plans for agricultural development or existence of fossil fuel reserves, the State's anticipated timetable for returning the line to service, and its proposed use of the property while it is out of service including its maintenance plans; and (7) Evidence that the anticipated benefits and costs of the proposed acquisition have been analyzed in accordance with the methodology established by [[Page 722]] the State under Sec. 266.15(c)(5) of this part. (h) Rehabilitation or improvement assistance and rail facility construction assistance. (1) In addition to meeting the requirements of paragraphs (b), (c), and (d) of this section, each application for rehabilitation or improvement assistance and rail facility construction assistance shall include the following: (i) A detailed estimate of the materials and labor required to complete the work, the total estimated costs of the work, the estimated numbers and kinds of ties and other material, the milepost termini involved, and a schedule for completion of the work; (ii) Evidence that the anticipated benefits and costs of the proposed acquisition have been analyzed in accordance with the methodology established by the State under Sec. 266.15(c)(5) of this part; (iii) When rehabilitation assistance is requested-- (A) A copy of the document by which funds will be granted or loaned (at an interest rate determined by the State) to the owner of the rail properties or the operator of the rail service related to the project; and (B) An assurance by the chief executive officer of the applicant that: (1) Repaid loan funds and interest accumulated with respect to such funds will not be loaned or granted without the prior written approval of the Administrator; (2) The Federal share of repaid loan funds will be placed in an interest-bearing account or with the prior written approval of the Administrator will be deposited by the borrower, for the benefit and use of the State, in a bank which has been designated by the Secretary of Treasury in accordance with 12 U.S.C. 265; and (3) If the rehabilitated or improved facilities are not used for rail freight service during the useful life of the improvement the Federal share of the fair market value of the improvement or facility will be placed in an interest-bearing account or with the prior written approval of the Administrator will be deposited by the owner of the rail properties, for the benefit and use of the State, in a bank which has been designated by the Secretary of the Treasury in accordance with 12 U.S.C. 265; (iv) An assurance by chief executive officer of the applicant that rehabilitated or improved facilities or newly constructed facilities will be maintained to prevent deterioration below the speed at which the line could be operated upon completion of the project during the period of time established as the payback period in the benefit-cost analysis of the project; (2) In addition to meeting the requirements of paragraphs (b), (c), and (d) and (h)(1) of this section, each application for a project eligible under Sec. 266.7(b)(2)(i) (if the Commission has made a finding granting the application for abandonment and discontinuance) (ii), (3) or (4) shall also include the following: (i) An indication of which of the following methods will be used to complete the work, including proposed contracts unless the work will be performed under method (A): (A) On an actual cost basis by the operator or the applicant; (B) By contracting for the work in accordance with Attachment O to OMB Circular A-102; or (C) Under an existing continuing contract between the operator and another firm provided that the applicant can demonstrate the the costs are comparable to those under paragraph (h)(2)(i) (A) or (B) of this section; and (ii) A description of the plans for inspection of the work including identification and qualifications of the staff to be responsible for the inspection and a proposed schedule of inspections; and (iii) A description of the arrangements made for the operation of rail service over the property including copies of the proposed operating agreements, leases or other compensation agreements under which service is to be provided, and the proposed method of financing the operation of such rail service; (3) In addition to meeting the requirements of paragraphs (b), (c), (d), and (h)(1) of this section, each application for a project eligible under Sec. 266.7 (b)(1) or (2)(i) (if the Commission has not made a finding granting the application for abandonment discontinuance) shall include an assurance by the [[Page 723]] common carrier which operates service on or owns the line related to the project that if an application for a certificate of abandonment or discontinuance has been filed with the Commission the application will be withdrawn within a reasonable period following execution of a grant agreement and before Federal funds are disbursed for the project; and (4) When rail facility construction assistance is requested an assurance by the chief executive officer of the applicant that if the facility is abandoned, sold, or converted to non-rail freight use during its useful life, FRA will be compensated an amount computed by applying FRA's participation in the cost of constructing the facility to the fair market value of the facility at the time it is abandoned, sold, or converted to non-rail use. (i) Substitute service assistance. In addition to meeting the requirements of paragraphs (b), (c), and (d) of this section, each application for substitute service assistance shall include: (1) A detailed description of the substitute service project, including evidence that the cost and scope of the project are limited to that necessary to replace the rail service being discontinued; (2) Evidence that the anticipated benefits and costs of the proposed acquistion have been analyzed in accordance with the methodology established by the State under Sec. 266.15(c)(5) of this part; (3) For construction or improvement of fixed facilities, a description of the proposed work, including: (i) The cost and timing of the work; and (ii) An assurance by the chief executive officer of the applicant that the Federal share of the project will be repaid in accordance with Attachment N of OMB Circular A-102, if the properties are not used for rail freight service during the useful life of the project properties; (4) For relocation costs, the following assurances by the chief executive officer of the applicant: (i) When the rail line related to the project is eligible under section 5(k)(4)(A) of the Act (49 U.S.C. 1654(k)(4)(A)), an assurance that the applicant is requesting only such assistance as is needed to relocate the shippers which were receiving rail service on the line at the time the Commission found that the public convenience and necessity would permit discontinuance or abandonment of the rail service; (ii) When the rail line related to the project is eligible under section 5(k)(4)(B) of the Act (49 U.S.C. 1654(k)(4)(B)), an assurance that assistance is being requested to relocate only the shippers who received rail service on the line as of April 1, 1976; and (iii) An assurance, and the basis therefor, that the shippers will not be relocated to a line with respect to which an application for a certificate of abandonment or discontinuance has been filed with the Commission or that if an application has been filed it will be withdrawn within a reasonable period following execution of a grant agreement and before Federal funds are disbursed for the project; (5) An assurance by the chief executive officer of the applicant that after completion of the substitute service project, additional Federal assistance will not be requested for the continuation of the rail freight service that the substitute service is designed to replace, unless the Administrator determines that circumstances have changed so that continuation of rail freight service is more cost-effective than continued use of the substitute service project; (6) A description of the arrangements made for operation of service where rail service is to be provided in conjunction with a substitute service project, including copies of proposed operating agreements, leases, or other compensation agreements under which service is to be provided; and (7) An assurance by the chief executive officer of the applicant that assistance provided will not be used to pay the non-Federal share under any Federal program. (j) Execution and filing of applications. (1) Each original application shall bear the date of execution and be signed by the chief executive officer of the agency submitting the application; (2) Each application for planning assistance, and two (2) copies thereof, shall be filed with the Administrator [[Page 724]] through the appropriate Federal Highway Administration Division Office; (3) Each application (excluding requests for planning assistance), and two (2) copies thereof, shall be filed with the Administrator through the appropriate Regional Director of Federal Assistance. A current list of the appropriate mailing addresses of the above officials will be provided by FRA to each State.