Federal-Aid Railroad Act

Federal-Aid Railroad Act - Title I: Findings, Purposes, and Definitions - Sets forth Congressional findings and purposes and the definition of the terms used in this Act.

Title II: Interim and Emergency Measures - States that within 90 days after enactment of this Act, the trustee or trustees of any railroad in reorganization, all owners of rail lines leased to such railroad, whether ratified or affirmed or not, and all wholly owned subsidiaries and affiliates of such railroad, upon authorization therefor from the reorganization court, may tender all lines and other transportation properties, assets, and interests of such companies to the United States for lease by the United States for a term not to exceed three years. Provides that within 30 days of the receipt of such tender, the United States shall execute a lease agreement, and shall concurrently execute an operating agreement with the trustees or companies making such tender, and the operating agreement shall be executed by such trustees or companies as of the same date.

States that as consideration for leasing the lines and other transportation properties, assets, and interests tendered for lease under this Act, and for their operation by the lessor, the United States shall pay to the lessors an amount to be negotiated between the trustee or trustees of the railroad in reorganization and the Interstate Commerce Commission, which amount shall be the least amount necessary to protect the interests of the creditors of such railroad during the period such lease is in effect and to carry out the other purposes of this Act.

States that within 30 days after the execution of a lease and operating agreement, as provided in this Act, the Commission shall enter into an investigation of the railroad service performed by the lessor railroad; whereupon the Commission may direct all railroads in the area served by the lessor railroad, including the lessor railroad, and other interested parties to submit within 30 days, unless such period is extended by the Commission, recommendations indicating steps deemed prudent to preserve essential services performed by the lessor railroad and to eliminate or reduce operating losses of the lessor railroad, including plans for restructuring railroad service in the area served by the lessor railroad.

States that in adopting a plan of restructuring the Commission shall give consideration: (1) to the effect cessation of such railroad service would have on the industries in the area involved; (2) to any plan which may have been mutually agreed to by employee unions and railroads to increase the efficiency of operations of the distressed railroad; (3) to any aid which States or other governmental agencies in the area are granting or propose to grant, and (4) the availability of alternate transportation. Provides that any plan of restructuring shall provide for reasonable protection for employees affected, subject to further relief which may be recommended to the President and Congress by the Commission.

Sets forth the penalties for the willful failure or refusal to comply with the terms of any order of the Commission pursuant to this Act.

Title III: The Federal-Aid Railroad System - States that the Federal-aid railroad system shall consist initially of those main lines, yards, and terminals, located in the Northeast region and operated by domestic railroad companies, found by the Commission to be essential to the present and future public convenience and necessity and best suited for inclusion on an integrated system of main-line, yard, and terminal facilities capable of meeting the needs of commerce of the United States and the national defense.

Provides that within one hundred twenty days after the enactment of this Act, any railroad company or railroad companies jointly may file with the Commission an application seeking the designation of any main line, yard, or terminal operated by it or them, and located in the Northeast region, as part of the System.

States that concurrently with the designation of the System under this title, the Commission shall prescribe standards for the rehabilitation and maintenance of all main-line track on the system for dependable operation of freight trains at speeds up to sixty miles an hour and passenger trains at speeds up to eighty miles an hour, and of all yards and terminals on the system for the efficient switching and classification of cars.

States that as soon as practicable after the plans, specifications, and estimates for a specific project have been approved, the Commission shall enter into a formal project agreement with the railroad concerning the construction and maintenance of such project.

States that all rehabilitation, maintenance, and improvement work performed pursuant to this Title shall be undertaken by the railroad and shall be done by railroad employees.

Provides that upon execution of a project agreement, the Commission is authorized to reimburse railroads for funds expended by them in carrying out the design and construction of projects approved by it for inclusion on the System.

Authorizes to be appropriated to the Commission such sums as may be necessary to bring all rail lines, yards, and terminals on the system into compliance with the requirements of this title and of the Rail Safety Act of 1970, and for the administration of this title, but not to exceed $400,000,000 in any fiscal year.

Imposes upon the amount paid within the United States for the transportation of property, except by air, from one point in the United States to another, beginning 60 days after the date of enactment of this Act, a tax equal to one percent of the amount so paid.

Provides that the tax imposed by this Act shall be paid by the person making the payment subject to the tax.

Title IV: Local Rail Services - Sets forth procedures to be followed regarding railroad abandonment under the Interstate Commerce Act.

Provides that any construction, operation, or abandonment contrary to the provisions of the Interstate Commerce Act may be enjoined by any United States district court of competent jurisdiction at the suit of the United States, the Commission, any commission or regulating body of the State or States affected, or any party in interest; and any carrier which, or any director, officer, receiver, operating trustee, lessee, agent, or person, acting for or employed by such carrier, who knowingly authorizes, consents to or permits any violation of the provisions of this Act shall be fined not more than $5,000 or imprisoned not more than three years, or both.

Authorizes the Commission pursuant to regulations prescribed by it to reimburse a State for 70 percent of the amount paid by such State as operating subsidy to continue service on a rail line or lines that would otherwise have been abandoned.

States that the Commission shall not reimburse a State for operating subsidy paid to a State for operating subsidy paid to a railroad unless such State has adopted legislation extending authority to the Governor or other appropriate State official or agency to perform its obligations in accordance with the terms of this title and regulation issued by the Commission.

Authorizes to be appropriated to the Commission not to exceed $50,000,000 of this title.