A bill to authorize the rail service assistance program under the Department of Transportation Act through fiscal year 1991.

Amends the Department of Transportation Act regarding local rail service assistance to authorize appropriations for FY 1989 through 1991.

Decreases the Federal share of rail service assistance program costs from 70 percent to 60 percent. Provides that the Federal share of costs to rehabilitate rail properties for the purpose of facilitating rail freight service shall be 70 percent.