FRA Proposes Changes to Freight Car Safety Standards (UPDATED 2/9)
Written by Marybeth Luczak, Executive EditorThe Federal Railroad Administration (FRA) in December 2023 proposed to amend the Freight Car Safety Standards (FCSS) to advance a freight rail safety provision of the Bipartisan Infrastructure Law (BIL). Manufacturers of newly built freight cars placed into U.S. service will face restrictions. The Railway Supply Institute (RSI) weighed in this month, as did the Rail Security Alliance, which represents North American freight railcar manufacturers and component suppliers.
BIL, also known as the Infrastructure Investment and Jobs Act (IIJA), was signed into law Nov. 15, 2021. It places certain restrictions such cars’ manufacture, “including limiting content that originates from a country of concern (COC) or is sourced from a state-owned enterprise (SOE) and prohibiting the use of sensitive technology that originates from a COC or SOE,” according to FRA. BIL requires “regulations to be issued to implement its mandate and for freight car manufacturers to certify that freight cars covered by the [Infrastructure Investment and Jobs] Act [also known as BIL] are in compliance.” FRA said its proposed amendments to the FCSS “will facilitate the implementation” of BIL requirements.
FRA explained in its Dec. 7 proposal announcement that BIL “places great importance on strengthening the nation’s rail equipment infrastructure and safeguarding it against potential vulnerabilities,” and “provides safety and security standards aimed at preventing the exploitation of freight cars for illicit purposes and the potential compromise of sensitive technologies within the industry.”
“The safety and security of our nation’s freight rail system are paramount,” FRA Administrator Amit Bose said. “By amending the Freight Car Safety Standards in accordance with BIL section 22425, we are taking a significant step forward in ensuring that our rail infrastructure remains resilient and safe for the transportation of vital goods and commodities.”
According to FRA’s Notice of Proposed Rulemaking that outlines its proposed amendments to FCSS (download below), BIL “provides that a railroad freight car, wholly manufactured on or after the date that is 1 year after the date of issuance of regulations, may only operate on the U.S. general railroad system if: (1) the railroad freight car is manufactured, assembled, and substantially transformed, as applicable, by a qualified manufacturer in a qualified facility; (2) none of the sensitive technology located on the railroad freight car, including components necessary to the functionality of the sensitive technology, originates from a COC or is sourced from a SOE; and (3) none of the content of the railroad freight car, excluding sensitive technology, originates from a COC or is sourced from a SOE that has been determined by a recognized court or administrative agency of competent jurisdiction and legal authority to have violated or infringed valid United States intellectual property rights of another including such a finding by a Federal district court under title 35 or the U.S. International Trade Commission under section 337 of the Tariff Act of 1930 (19 U.S.C. 1337).
“The Act [BIL] further provides percentage limitations on freight car contents so that not later than one year after the date of issuance of regulations, a railroad freight car, even if complying with the requirements in the preceding paragraph, may not operate on the U.S. general railroad system if more than 20 percent of the content of the railroad freight car, calculated by the net cost of all components of the car and excluding the cost of sensitive technology, originates from a COC or is sourced from a SOE. After three years from the date of issuance of regulations, the percentage may not be more than 15 percent.”
Additionally, to carry out BIL’s certification requirement, FRA said it “is proposing to require railroad freight car manufacturers to electronically certify to FRA that each freight car complies with the Act [BIL] before it operates on the U.S. general railroad system of transportation. The certification would be required to identify each car being offered for operation, and include the manufacturer’s name and the name of the individual responsible for certifying compliance with the Act.” The manufacturers would also be required “to maintain all records showing information to support certification, including content calculations, and such records would be made available to FRA upon request,” FRA reported.
According to FRA, BIL’s “content limitations apply only at the time of manufacture”; after-manufacture changes to a railroad freight car are not covered by BIL; railroad freight cars already placed in service in the U.S. are not subject to BIL; and BIL’s requirements “apply only to manufacturers, not railroads.”
Comments on FRA’s proposed amendments to FCSS were due by Feb. 6, 2024.
RSI Voices Support
RSI has submitted comments to the FRA’s Notice of Proposed Rulemaking (NPRM; download below). In a statement released Feb. 8, association President Patty Long voiced her support of the NPRM. “The Railway Supply Institute is pleased with the FRA’s proposed rule to protect the U.S. freight rolling stock supply chain and ensure our freight rail network is secure from bad actors and unfair competition,” she said. “I applaud Congress and the FRA for prioritizing our domestic rail supply industry and American competitiveness.”
In its comments, RSI said it agreed with the need for the “regulation given Congress’ intent to afford the freight railcar industry protections against an influx of state-subsidized rolling stock or components,” and with “FRA’s determination that China is the only country that meets the statutory definition of a ‘country of concern’ at this time.” Additionally, the association noted that elements of the proposed regulation warrant clarification for “effective implementation.” Among them: a revision of FRA’s definition of “‘sensitive technology’ to expressly include only those devices that are physically located on a railroad freight car consistent with the plain language of the Act.” Additionally, RSI said it understands that the proposal would “require railcar manufacturers to certify compliance with the Act after the railcar is built, but before it is first placed into service,” and noted that it “expects that railcar manufacturers will submit their certifications to FRA at the time the railcar is registered in Umler, but will not be able to pre-certify compliance before the railcar is fully built (e.g., at the time of a sample car inspection).” RSI said it supports the use of a standardized compliance certification form. RSI also said that it agrees with FRA’s interpretation of the Act to require manufacturers to maintain all record to support certification, which includes content calculations, and “urges the agency to include an explicit recordkeeping requirement in the final regulation, which requires manufacturers to maintain copies of the annual certifications and supporting documents for a period of 5 years.”
RSA Weighs In
The Rail Security Alliance (RSA), which represents North American freight railcar manufacturers and suppliers, submitted comments in support of the NPRM.
“The constant movement on the U.S. freight rail interchange is vital to America’s security, which makes the freight railcar sector worth safeguarding,” RSA Executive Director Erik Olson said. “The proposed rule that FRA has issued helps ensure that foreign adversaries like China cannot exploit our freight rail infrastructure or make inroads into this critical industry. While Buy America requirements and the FY 2020 National Defense Authorization Act take steps to protect some aspects of domestic freight railcar manufacturing and supply, they do not afford the freight railcar industry protections against an influx of state-subsidized rolling stock or components. The Act, which FRA seeks to implement in this NPRM, closes that gap and is critical to ensuring the continued security of the U.S. general railroad system of transportation.
“RSA joins other American railcar manufacturers and suppliers in support for the proposed rule to protect U.S. companies against China Railway Rolling Stock Corporation Limited (CRRC), including the Steel Manufacturers Association, American Iron and Steel Institute, Foundry Society, Alliance for American Manufacturing, Railway Supply Institute, United Steelworkers and Brotherhood of Locomotive Engineers & Trainmen — Teamsters Rail Conference. The Canadian Association of Railcar Suppliers also commented in support of the draft rule.”
On CRRC, RSA noted: “As it pursues its goal of displacing those same U.S. companies and dominating railcar manufacturing in the United States and around the world. This $35 billion SOE has made aggressive and alarming inroads into the U.S. by using state-backed financing, direct government subsidization ($1.8 billion since 2015), below-market pricing, and other anti-competitive tactics to infiltrate domestic railcar manufacturing and with the single end goal of producing all railcars in the People’s Republic of China—wiping out American manufacturing in the process.”
In 2021, RSA supported the SAFE TRAINS Act, which was meant to prohibit procurement of freight rail rolling stock for the U.S. interchange rail system from SOEs.
