cfr_sections
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| section_id ▼ | title_number | title_name | chapter | subchapter | part_number | part_name | subpart | subpart_name | section_number | section_heading | agency | authority | source_citation | amendment_citations | full_text |
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| 17:17:5.0.1.1.6.1.9.1 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | A | Subpart A—Authority, Purpose, Scope and Definitions | § 246.1 Purpose, scope, and authority. | SEC | [79 FR 77766, Dec. 24, 2014] | (a) Authority and purpose. This part (Regulation RR) is issued by the Securities and Exchange Commission (“Commission”) jointly with the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and, in the case of the securitization of any residential mortgage asset, together with the Secretary of Housing and Urban Development and the Federal Housing Finance Agency, pursuant to Section 15G of the Securities Exchange Act of 1934 (15 U.S.C. 78o-11). The Commission also is issuing this part pursuant to its authority under Sections 7, 10, 19(a), and 28 of the Securities Act and Sections 3, 13, 15, 23, and 36 of the Exchange Act. This part requires securitizers to retain an economic interest in a portion of the credit risk for any asset that the securitizer, through the issuance of an asset-backed security, transfers, sells, or conveys to a third party. This part specifies the permissible types, forms, and amounts of credit risk retention, and establishes certain exemptions for securitizations collateralized by assets that meet specified underwriting standards or otherwise qualify for an exemption. (b) The authority of the Commission under this part shall be in addition to the authority of the Commission to otherwise enforce the federal securities laws, including, without limitation, the antifraud provisions of the securities laws. | ||||
| 17:17:5.0.1.1.6.1.9.2 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | A | Subpart A—Authority, Purpose, Scope and Definitions | § 246.2 Definitions. | SEC | For purposes of this part, the following definitions apply: ABS interest means: (1) Any type of interest or obligation issued by an issuing entity, whether or not in certificated form, including a security, obligation, beneficial interest or residual interest (other than an uncertificated regular interest in a REMIC that is held by another REMIC, where both REMICs are part of the same structure and a single REMIC in that structure issues ABS interests to investors, or a non-economic residual interest issued by a REMIC), payments on which are primarily dependent on the cash flows of the collateral owned or held by the issuing entity; and (2) Does not include common or preferred stock, limited liability interests, partnership interests, trust certificates, or similar interests that: (i) Are issued primarily to evidence ownership of the issuing entity; and (ii) The payments, if any, on which are not primarily dependent on the cash flows of the collateral held by the issuing entity; and (3) Does not include the right to receive payments for services provided by the holder of such right, including servicing, trustee services and custodial services. Affiliate of, or a person affiliated with, a specified person means a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the person specified. Appropriate Federal banking agency has the same meaning as in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813). Asset means a self-liquidating financial asset (including but not limited to a loan, lease, mortgage, or receivable). Asset-backed security has the same meaning as in section 3(a)(79) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(79)). Collateral means, with respect to any issuance of ABS interests, the assets that provide the cash flow and the servicing assets that support such cash flow for the ABS interests irrespective of the legal structure of issuance, including security interests in assets… | |||||
| 17:17:5.0.1.1.6.2.9.1 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | B | Subpart B—Credit Risk Retention | § 246.3 Base risk retention requirement. | SEC | (a) Base risk retention requirement. Except as otherwise provided in this part, the sponsor of a securitization transaction (or majority-owned affiliate of the sponsor) shall retain an economic interest in the credit risk of the securitized assets in accordance with any one of §§ 246.4 through 246.10. Credit risk in securitized assets required to be retained and held by any person for purposes of compliance with this part, whether a sponsor, an originator, an originator-seller, or a third-party purchaser, except as otherwise provided in this part, may be acquired and held by any of such person's majority-owned affiliates (other than an issuing entity). (b) Multiple sponsors. If there is more than one sponsor of a securitization transaction, it shall be the responsibility of each sponsor to ensure that at least one of the sponsors of the securitization transaction (or at least one of their majority-owned or wholly-owned affiliates, as applicable) retains an economic interest in the credit risk of the securitized assets in accordance with any one of §§ 246.4, 246.5, 246.8, 246.9, or 246.10. | |||||
| 17:17:5.0.1.1.6.2.9.2 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | B | Subpart B—Credit Risk Retention | § 246.4 Standard risk retention. | SEC | (a) General requirement. Except as provided in §§ 246.5 through 246.10, the sponsor of a securitization transaction must retain an eligible vertical interest or eligible horizontal residual interest, or any combination thereof, in accordance with the requirements of this section. (1) If the sponsor retains only an eligible vertical interest as its required risk retention, the sponsor must retain an eligible vertical interest in a percentage of not less than 5 percent. (2) If the sponsor retains only an eligible horizontal residual interest as its required risk retention, the amount of the interest must equal at least 5 percent of the fair value of all ABS interests in the issuing entity issued as a part of the securitization transaction, determined using a fair value measurement framework under GAAP. (3) If the sponsor retains both an eligible vertical interest and an eligible horizontal residual interest as its required risk retention, the percentage of the fair value of the eligible horizontal residual interest and the percentage of the eligible vertical interest must equal at least five. (4) The percentage of the eligible vertical interest, eligible horizontal residual interest, or combination thereof retained by the sponsor must be determined as of the closing date of the securitization transaction. (b) Option to hold base amount in eligible horizontal cash reserve account. In lieu of retaining all or any part of an eligible horizontal residual interest under paragraph (a) of this section, the sponsor may, at closing of the securitization transaction, cause to be established and funded, in cash, an eligible horizontal cash reserve account in the amount equal to the fair value of such eligible horizontal residual interest or part thereof, provided that the account meets all of the following conditions: (1) The account is held by the trustee (or person performing similar functions) in the name and for the benefit of the issuing entity; (2) Amounts in the account are invested only in cash and cash equ… | |||||
| 17:17:5.0.1.1.6.2.9.3 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | B | Subpart B—Credit Risk Retention | § 246.5 Revolving pool securitizations. | SEC | (a) Definitions. For purposes of this section, the following definitions apply: Revolving pool securitization means an issuing entity that is established to issue on multiple issuance dates more than one series, class, subclass, or tranche of asset-backed securities that are collateralized by a common pool of securitized assets that will change in composition over time, and that does not monetize excess interest and fees from its securitized assets. Seller's interest means an ABS interest or ABS interests: (1) Collateralized by the securitized assets and servicing assets owned or held by the issuing entity, other than the following that are not considered a component of seller's interest: (i) Servicing assets that have been allocated as collateral only for a specific series in connection with administering the revolving pool securitization, such as a principal accumulation or interest reserve account; and (ii) Assets that are not eligible under the terms of the securitization transaction to be included when determining whether the revolving pool securitization holds aggregate securitized assets in specified proportions to aggregate outstanding investor ABS interests issued; and (2) That is pari passu with each series of investor ABS interests issued, or partially or fully subordinated to one or more series in identical or varying amounts, with respect to the allocation of all distributions and losses with respect to the securitized assets prior to early amortization of the revolving securitization (as specified in the securitization transaction documents); and (3) That adjusts for fluctuations in the outstanding principal balance of the securitized assets in the pool. (b) General requirement. A sponsor satisfies the risk retention requirements of § 246.3 with respect to a securitization transaction for which the issuing entity is a revolving pool securitization if the sponsor maintains a seller's interest of not less than 5 percent of the aggregate unpaid principal balance of all outstanding inves… | |||||
| 17:17:5.0.1.1.6.2.9.4 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | B | Subpart B—Credit Risk Retention | § 246.6 Eligible ABCP conduits. | SEC | (a) Definitions. For purposes of this section, the following additional definitions apply: 100 percent liquidity coverage means an amount equal to the outstanding balance of all ABCP issued by the conduit plus any accrued and unpaid interest without regard to the performance of the ABS interests held by the ABCP conduit and without regard to any credit enhancement. ABCP means asset-backed commercial paper that has a maturity at the time of issuance not exceeding 397 days, exclusive of days of grace, or any renewal thereof the maturity of which is likewise limited. ABCP conduit means an issuing entity with respect to ABCP. Eligible ABCP conduit means an ABCP conduit, provided that: (1) The ABCP conduit is bankruptcy remote or otherwise isolated for insolvency purposes from the sponsor of the ABCP conduit and from any intermediate SPV; (2) The ABS interests acquired by the ABCP conduit are: (i) ABS interests collateralized solely by assets originated by an originator-seller and by servicing assets; (ii) Special units of beneficial interest (or similar ABS interests) in a trust or special purpose vehicle that retains legal title to leased property underlying leases originated by an originator-seller that were transferred to an intermediate SPV in connection with a securitization collateralized solely by such leases and by servicing assets; (iii) ABS interests in a revolving pool securitization collateralized solely by assets originated by an originator-seller and by servicing assets; or (iv) ABS interests described in paragraph (2)(i), (ii), or (iii) of this definition that are collateralized, in whole or in part, by assets acquired by an originator-seller in a business combination that qualifies for business combination accounting under GAAP, and, if collateralized in part, the remainder of such assets are assets described in paragraph (2)(i), (ii), or (iii) of this definition; and (v) Acquired by the ABCP conduit in an initial issuance by or on behalf of an intermediate SPV: (A) Directly from th… | |||||
| 17:17:5.0.1.1.6.2.9.5 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | B | Subpart B—Credit Risk Retention | § 246.7 Commercial mortgage-backed securities. | SEC | (a) Definitions. For purposes of this section, the following definition shall apply: Special servicer means, with respect to any securitization of commercial real estate loans, any servicer that, upon the occurrence of one or more specified conditions in the servicing agreement, has the right to service one or more assets in the transaction. (b) Third-party purchaser. A sponsor may satisfy some or all of its risk retention requirements under § 246.3 with respect to a securitization transaction if a third party (or any majority-owned affiliate thereof) purchases and holds for its own account an eligible horizontal residual interest in the issuing entity in the same form, amount, and manner as would be held by the sponsor under § 246.4 and all of the following conditions are met: (1) Number of third-party purchasers. At any time, there are no more than two third-party purchasers of an eligible horizontal residual interest. If there are two third-party purchasers, each third-party purchaser's interest must be pari passu with the other third-party purchaser's interest. (2) Composition of collateral. The securitization transaction is collateralized solely by commercial real estate loans and servicing assets. (3) Source of funds. (i) Each third-party purchaser pays for the eligible horizontal residual interest in cash at the closing of the securitization transaction. (ii) No third-party purchaser obtains financing, directly or indirectly, for the purchase of such interest from any other person that is a party to, or an affiliate of a party to, the securitization transaction (including, but not limited to, the sponsor, depositor, or servicer other than a special servicer affiliated with the third-party purchaser), other than a person that is a party to the transaction solely by reason of being an investor. (4) Third-party review. Each third-party purchaser conducts an independent review of the credit risk of each securitized asset prior to the sale of the asset-backed securities in the securitizati… | |||||
| 17:17:5.0.1.1.6.2.9.6 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | B | Subpart B—Credit Risk Retention | § 246.8 Federal National Mortgage Association and Federal Home Loan Mortgage Corporation ABS. | SEC | (a) In general. A sponsor satisfies its risk retention requirement under this part if the sponsor fully guarantees the timely payment of principal and interest on all ABS interests issued by the issuing entity in the securitization transaction and is: (1) The Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation operating under the conservatorship or receivership of the Federal Housing Finance Agency pursuant to section 1367 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4617) with capital support from the United States; or (2) Any limited-life regulated entity succeeding to the charter of either the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation pursuant to section 1367(i) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4617(i)), provided that the entity is operating with capital support from the United States. (b) Certain provisions not applicable. The provisions of § 246.12(b), (c), and (d) shall not apply to a sponsor described in paragraph (a)(1) or (2) of this section, its affiliates, or the issuing entity with respect to a securitization transaction for which the sponsor has retained credit risk in accordance with the requirements of this section. (c) Disclosure. A sponsor relying on this section shall provide to investors, in written form under the caption “Credit Risk Retention” and, upon request, to the Federal Housing Finance Agency and the Commission, a description of the manner in which it has met the credit risk retention requirements of this part. | |||||
| 17:17:5.0.1.1.6.2.9.7 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | B | Subpart B—Credit Risk Retention | § 246.9 Open market CLOs. | SEC | (a) Definitions. For purposes of this section, the following definitions shall apply: CLO means a special purpose entity that: (i) Issues debt and equity interests, and (ii) Whose assets consist primarily of loans that are securitized assets and servicing assets. CLO-eligible loan tranche means a term loan of a syndicated facility that meets the criteria set forth in paragraph (c) of this section. CLO manager means an entity that manages a CLO, which entity is registered as an investment adviser under the Investment Advisers Act of 1940, as amended (15 U.S.C. 80b-1 et seq. ), or is an affiliate of such a registered investment adviser and itself is managed by such registered investment adviser. Commercial borrower means an obligor under a corporate credit obligation (including a loan). Initial loan syndication transaction means a transaction in which a loan is syndicated to a group of lenders. Lead arranger means, with respect to a CLO-eligible loan tranche, an institution that: (i) Is active in the origination, structuring and syndication of commercial loan transactions (as defined in § 246.14) and has played a primary role in the structuring, underwriting and distribution on the primary market of the CLO-eligible loan tranche. (ii) Has taken an allocation of the funded portion of the syndicated credit facility under the terms of the transaction that includes the CLO-eligible loan tranche of at least 20 percent of the aggregate principal balance at origination, and no other member (or members affiliated with each other) of the syndication group that funded at origination has taken a greater allocation; and (iii) Is identified in the applicable agreement governing the CLO-eligible loan tranche; represents therein to the holders of the CLO-eligible loan tranche and to any holders of participation interests in such CLO-eligible loan tranche that such lead arranger satisfies the requirements of paragraph (i) of this definition and, at the time of initial funding of the CLO-eligible tranche, will s… | |||||
| 17:17:5.0.1.1.6.2.9.8 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | B | Subpart B—Credit Risk Retention | § 246.10 Qualified tender option bonds. | SEC | (a) Definitions. For purposes of this section, the following definitions shall apply: Municipal security or municipal securities shall have the same meaning as the term “municipal securities” in Section 3(a)(29) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(29)) and any rules promulgated pursuant to such section. Qualified tender option bond entity means an issuing entity with respect to tender option bonds for which each of the following applies: (i) Such entity is collateralized solely by servicing assets and by municipal securities that have the same municipal issuer and the same underlying obligor or source of payment (determined without regard to any third-party credit enhancement), and such municipal securities are not subject to substitution. (ii) Such entity issues no securities other than: (A) A single class of tender option bonds with a preferred variable return payable out of capital that meets the requirements of paragraph (b) of this section, and (B) One or more residual equity interests that, in the aggregate, are entitled to all remaining income of the issuing entity. (C) The types of securities referred to in paragraphs (ii)(A) and (B) of this definition must constitute asset-backed securities. (iii) The municipal securities held as assets by such entity are issued in compliance with Section 103 of the Internal Revenue Code of 1986, as amended (the “IRS Code”, 26 U.S.C. 103), such that the interest payments made on those securities are excludable from the gross income of the owners under Section 103 of the IRS Code. (iv) The terms of all of the securities issued by the entity are structured so that all holders of such securities who are eligible to exclude interest received on such securities will be able to exclude that interest from gross income pursuant to Section 103 of the IRS Code or as “exempt-interest dividends” pursuant to Section 852(b)(5) of the IRS Code (26 U.S.C. 852(b)(5)) in the case of regulated investment companies under the Investment Company Act of 1940… | |||||
| 17:17:5.0.1.1.6.3.9.1 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | C | Subpart C—Transfer of Risk Retention | § 246.11 Allocation of risk retention to an originator. | SEC | (a) In general. A sponsor choosing to retain an eligible vertical interest or an eligible horizontal residual interest (including an eligible horizontal cash reserve account), or combination thereof under § 246.4, with respect to a securitization transaction may offset the amount of its risk retention requirements under § 246.4 by the amount of the eligible interests, respectively, acquired by an originator of one or more of the securitized assets if: (1) At the closing of the securitization transaction: (i) The originator acquires the eligible interest from the sponsor and retains such interest in the same manner and proportion (as between horizontal and vertical interests) as the sponsor under § 246.4, as such interest was held prior to the acquisition by the originator; (ii) The ratio of the percentage of eligible interests acquired and retained by the originator to the percentage of eligible interests otherwise required to be retained by the sponsor pursuant to § 246.4, does not exceed the ratio of: (A) The unpaid principal balance of all the securitized assets originated by the originator; to (B) The unpaid principal balance of all the securitized assets in the securitization transaction; (iii) The originator acquires and retains at least 20 percent of the aggregate risk retention amount otherwise required to be retained by the sponsor pursuant to § 246.4; and (iv) The originator purchases the eligible interests from the sponsor at a price that is equal, on a dollar-for-dollar basis, to the amount by which the sponsor's required risk retention is reduced in accordance with this section, by payment to the sponsor in the form of: (A) Cash; or (B) A reduction in the price received by the originator from the sponsor or depositor for the assets sold by the originator to the sponsor or depositor for inclusion in the pool of securitized assets. (2) Disclosures. In addition to the disclosures required pursuant to § 246.4(c), the sponsor provides, or causes to be provided, to potential investors a reaso… | |||||
| 17:17:5.0.1.1.6.3.9.2 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | C | Subpart C—Transfer of Risk Retention | § 246.12 Hedging, transfer and financing prohibitions. | SEC | (a) Transfer. Except as permitted by § 246.7(b)(8), and subject to § 246.5, a retaining sponsor may not sell or otherwise transfer any interest or assets that the sponsor is required to retain pursuant to subpart B of this part to any person other than an entity that is and remains a majority-owned affiliate of the sponsor and each such majority-owned affiliate shall be subject to the same restrictions. (b) Prohibited hedging by sponsor and affiliates. A retaining sponsor and its affiliates may not purchase or sell a security, or other financial instrument, or enter into an agreement, derivative or other position, with any other person if: (1) Payments on the security or other financial instrument or under the agreement, derivative, or position are materially related to the credit risk of one or more particular ABS interests that the retaining sponsor (or any of its majority-owned affiliates) is required to retain with respect to a securitization transaction pursuant to subpart B of this part or one or more of the particular securitized assets that collateralize the asset-backed securities issued in the securitization transaction; and (2) The security, instrument, agreement, derivative, or position in any way reduces or limits the financial exposure of the sponsor (or any of its majority-owned affiliates) to the credit risk of one or more of the particular ABS interests that the retaining sponsor (or any of its majority-owned affiliates) is required to retain with respect to a securitization transaction pursuant to subpart B of this part or one or more of the particular securitized assets that collateralize the asset-backed securities issued in the securitization transaction. (c) Prohibited hedging by issuing entity. The issuing entity in a securitization transaction may not purchase or sell a security or other financial instrument, or enter into an agreement, derivative or position, with any other person if: (1) Payments on the security or other financial instrument or under the agreement, derivative … | |||||
| 17:17:5.0.1.1.6.4.9.1 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | D | Subpart D—Exceptions and Exemptions | § 246.13 Exemption for qualified residential mortgages. | SEC | (a) Definitions. For purposes of this section, the following definitions shall apply: Currently performing means the borrower in the mortgage transaction is not currently thirty (30) days or more past due, in whole or in part, on the mortgage transaction. Qualified residential mortgage means a “qualified mortgage” as defined in section 129C of the Truth in Lending Act (15 U.S.C.1639c) and regulations issued thereunder, as amended from time to time. (b) Exemption. A sponsor shall be exempt from the risk retention requirements in subpart B of this part with respect to any securitization transaction, if: (1) All of the assets that collateralize the asset-backed securities are qualified residential mortgages or servicing assets; (2) None of the assets that collateralize the asset-backed securities are asset-backed securities; (3) As of the cut-off date or similar date for establishing the composition of the securitized assets collateralizing the asset-backed securities issued pursuant to the securitization transaction, each qualified residential mortgage collateralizing the asset-backed securities is currently performing; and (4)(i) The depositor with respect to the securitization transaction certifies that it has evaluated the effectiveness of its internal supervisory controls with respect to the process for ensuring that all assets that collateralize the asset-backed security are qualified residential mortgages or servicing assets and has concluded that its internal supervisory controls are effective; and (ii) The evaluation of the effectiveness of the depositor's internal supervisory controls must be performed, for each issuance of an asset-backed security in reliance on this section, as of a date within 60 days of the cut-off date or similar date for establishing the composition of the asset pool collateralizing such asset-backed security; and (iii) The sponsor provides, or causes to be provided, a copy of the certification described in paragraph (b)(4)(i) of this section to potential investors a r… | |||||
| 17:17:5.0.1.1.6.4.9.10 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | D | Subpart D—Exceptions and Exemptions | § 246.22 Periodic review of the QRM definition, exempted three-to-four unit residential mortgage loans, and community-focused residential mortgage exemption | SEC | (a) The Federal banking agencies and the Commission, in consultation with the Federal Housing Finance Agency and the Department of Housing and Urban Development, shall commence a review of the definition of qualified residential mortgage in § 246.13, a review of the community-focused residential mortgage exemption in § 246.19(f), and a review of the exemption for qualifying three-to-four unit residential mortgage loans in § 246.19(g): (1) No later than four years after the effective date of the rule (as it relates to securitizers and originators of asset-backed securities collateralized by residential mortgages), five years following the completion of such initial review, and every five years thereafter; and (2) At any time, upon the request of any Federal banking agency, the Commission, the Federal Housing Finance Agency or the Department of Housing and Urban Development, specifying the reason for such request, including as a result of any amendment to the definition of qualified mortgage or changes in the residential housing market. (b) The Federal banking agencies, the Commission, the Federal Housing Finance Agency and the Department of Housing and Urban Development shall publish in the Federal Register notice of the commencement of a review and, in the case of a review commenced under paragraph (a)(2) of this section, the reason an agency is requesting such review. After completion of any review, but no later than six months after the publication of the notice announcing the review, unless extended by the agencies, the agencies shall jointly publish a notice disclosing the determination of their review. If the agencies determine to amend the definition of qualified residential mortgage, the agencies shall complete any required rulemaking within 12 months of publication in the Federal Register of such notice disclosing the determination of their review, unless extended by the agencies. | |||||
| 17:17:5.0.1.1.6.4.9.2 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | D | Subpart D—Exceptions and Exemptions | § 246.14 Definitions applicable to qualifying commercial loans, qualifying commercial real estate loans, and qualifying automobile loans. | SEC | The following definitions apply for purposes of §§ 246.15 through 246.18: Appraisal Standards Board means the board of the Appraisal Foundation that develops, interprets, and amends the Uniform Standards of Professional Appraisal Practice (USPAP), establishing generally accepted standards for the appraisal profession. Automobile loan: (1) Means any loan to an individual to finance the purchase of, and that is secured by a first lien on, a passenger car or other passenger vehicle, such as a minivan, van, sport-utility vehicle, pickup truck, or similar light truck for personal, family, or household use; and (2) Does not include any: (i) Loan to finance fleet sales; (ii) Personal cash loan secured by a previously purchased automobile; (iii) Loan to finance the purchase of a commercial vehicle or farm equipment that is not used for personal, family, or household purposes; (iv) Lease financing; (v) Loan to finance the purchase of a vehicle with a salvage title; or (vi) Loan to finance the purchase of a vehicle intended to be used for scrap or parts. Combined loan-to-value (CLTV) ratio means, at the time of origination, the sum of the principal balance of a first-lien mortgage loan on the property, plus the principal balance of any junior-lien mortgage loan that, to the creditor's knowledge, would exist at the closing of the transaction and that is secured by the same property, divided by: (1) For acquisition funding, the lesser of the purchase price or the estimated market value of the real property based on an appraisal that meets the requirements set forth in § 246.17(a)(2)(ii); or (2) For refinancing, the estimated market value of the real property based on an appraisal that meets the requirements set forth in § 246.17(a)(2)(ii). Commercial loan means a secured or unsecured loan to a company or an individual for business purposes, other than any: (1) Loan to purchase or refinance a one-to-four family residential property; (2) Commercial real estate loan. Commercial real estate (CRE) loan means:… | |||||
| 17:17:5.0.1.1.6.4.9.3 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | D | Subpart D—Exceptions and Exemptions | § 246.15 Qualifying commercial loans, commercial real estate loans, and automobile loans. | SEC | (a) General exception for qualifying assets. Commercial loans, commercial real estate loans, and automobile loans that are securitized through a securitization transaction shall be subject to a 0 percent risk retention requirement under subpart B, provided that the following conditions are met: (1) The assets meet the underwriting standards set forth in §§ 246.16 (qualifying commercial loans), 246.17 (qualifying CRE loans), or 246.18 (qualifying automobile loans) of this part, as applicable; (2) The securitization transaction is collateralized solely by loans of the same asset class and by servicing assets; (3) The securitization transaction does not permit reinvestment periods; and (4) The sponsor provides, or causes to be provided, to potential investors a reasonable period of time prior to the sale of asset-backed securities of the issuing entity, and, upon request, to the Commission, and to its appropriate Federal banking agency, if any, in written form under the caption “Credit Risk Retention”, a description of the manner in which the sponsor determined the aggregate risk retention requirement for the securitization transaction after including qualifying commercial loans, qualifying CRE loans, or qualifying automobile loans with 0 percent risk retention. (b) Risk retention requirement. For any securitization transaction described in paragraph (a) of this section, the percentage of risk retention required under § 246.3(a) is reduced by the percentage evidenced by the ratio of the unpaid principal balance of the qualifying commercial loans, qualifying CRE loans, or qualifying automobile loans (as applicable) to the total unpaid principal balance of commercial loans, CRE loans, or automobile loans (as applicable) that are included in the pool of assets collateralizing the asset-backed securities issued pursuant to the securitization transaction (the qualifying asset ratio); provided that: (1) The qualifying asset ratio is measured as of the cut-off date or similar date for establishing the composition… | |||||
| 17:17:5.0.1.1.6.4.9.4 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | D | Subpart D—Exceptions and Exemptions | § 246.16 Underwriting standards for qualifying commercial loans. | SEC | (a) Underwriting, product and other standards. (1) Prior to origination of the commercial loan, the originator: (i) Verified and documented the financial condition of the borrower: (A) As of the end of the borrower's two most recently completed fiscal years; and (B) During the period, if any, since the end of its most recently completed fiscal year; (ii) Conducted an analysis of the borrower's ability to service its overall debt obligations during the next two years, based on reasonable projections; (iii) Determined that, based on the previous two years' actual performance, the borrower had: (A) A total liabilities ratio of 50 percent or less; (B) A leverage ratio of 3.0 or less; and (C) A DSC ratio of 1.5 or greater; (iv) Determined that, based on the two years of projections, which include the new debt obligation, following the closing date of the loan, the borrower will have: (A) A total liabilities ratio of 50 percent or less; (B) A leverage ratio of 3.0 or less; and (C) A DSC ratio of 1.5 or greater. (2) Prior to, upon or promptly following the inception of the loan, the originator: (i) If the loan is originated on a secured basis, obtains a perfected security interest (by filing, title notation or otherwise) or, in the case of real property, a recorded lien, on all of the property pledged to collateralize the loan; and (ii) If the loan documents indicate the purpose of the loan is to finance the purchase of tangible or intangible property, or to refinance such a loan, obtains a first lien on the property. (3) The loan documentation for the commercial loan includes covenants that: (i) Require the borrower to provide to the servicer of the commercial loan the borrower's financial statements and supporting schedules on an ongoing basis, but not less frequently than quarterly; (ii) Prohibit the borrower from retaining or entering into a debt arrangement that permits payments-in-kind; (iii) Impose limits on: (A) The creation or existence of any other security interest or lien with respect t… | |||||
| 17:17:5.0.1.1.6.4.9.5 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | D | Subpart D—Exceptions and Exemptions | § 246.17 Underwriting standards for qualifying CRE loans. | SEC | (a) Underwriting, product and other standards. (1) The CRE loan must be secured by the following: (i) An enforceable first lien, documented and recorded appropriately pursuant to applicable law, on the commercial real estate and improvements; (ii)(A) An assignment of: ( 1 ) Leases and rents and other occupancy agreements related to the commercial real estate or improvements or the operation thereof for which the borrower or an operating affiliate is a lessor or similar party and all payments under such leases and occupancy agreements; and ( 2 ) All franchise, license and concession agreements related to the commercial real estate or improvements or the operation thereof for which the borrower or an operating affiliate is a lessor, licensor, concession granter or similar party and all payments under such other agreements, whether the assignments described in this paragraph (a)(1)(ii)(A)( 2 ) are absolute or are stated to be made to the extent permitted by the agreements governing the applicable franchise, license or concession agreements; (B) An assignment of all other payments due to the borrower or due to any operating affiliate in connection with the operation of the property described in paragraph (a)(1)(i) of this section; and (C) The right to enforce the agreements described in paragraph (a)(1)(ii)(A) of this section and the agreements under which payments under paragraph (a)(1)(ii)(B) of this section are due against, and collect amounts due from, each lessee, occupant or other obligor whose payments were assigned pursuant to paragraphs (a)(1)(ii)(A) or (B) of this section upon a breach by the borrower of any of the terms of, or the occurrence of any other event of default (however denominated) under, the loan documents relating to such CRE loan; and (iii) A security interest: (A) In all interests of the borrower and any applicable operating affiliate in all tangible and intangible personal property of any kind, in or used in the operation of or in connection with, pertaining to, arising from, or c… | |||||
| 17:17:5.0.1.1.6.4.9.6 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | D | Subpart D—Exceptions and Exemptions | § 246.18 Underwriting standards for qualifying automobile loans. | SEC | (a) Underwriting, product and other standards. (1) Prior to origination of the automobile loan, the originator: (i) Verified and documented that within 30 days of the date of origination: (A) The borrower was not currently 30 days or more past due, in whole or in part, on any debt obligation; (B) Within the previous 24 months, the borrower has not been 60 days or more past due, in whole or in part, on any debt obligation; (C) Within the previous 36 months, the borrower has not: ( 1 ) Been a debtor in a proceeding commenced under Chapter 7 (Liquidation), Chapter 11 (Reorganization), Chapter 12 (Family Farmer or Family Fisherman plan), or Chapter 13 (Individual Debt Adjustment) of the U.S. Bankruptcy Code; or ( 2 ) Been the subject of any federal or State judicial judgment for the collection of any unpaid debt; (D) Within the previous 36 months, no one-to-four family property owned by the borrower has been the subject of any foreclosure, deed in lieu of foreclosure, or short sale; or (E) Within the previous 36 months, the borrower has not had any personal property repossessed; (ii) Determined and documented that the borrower has at least 24 months of credit history; and (iii) Determined and documented that, upon the origination of the loan, the borrower's DTI ratio is less than or equal to 36 percent. (A) For the purpose of making the determination under paragraph (a)(1)(iii) of this section, the originator must: ( 1 ) Verify and document all income of the borrower that the originator includes in the borrower's effective monthly income (using payroll stubs, tax returns, profit and loss statements, or other similar documentation); and ( 2 ) On or after the date of the borrower's written application and prior to origination, obtain a credit report regarding the borrower from a consumer reporting agency that compiles and maintain files on consumers on a nationwide basis (within the meaning of 15 U.S.C. 1681a(p)) and verify that all outstanding debts reported in the borrower's credit report are incorpora… | |||||
| 17:17:5.0.1.1.6.4.9.7 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | D | Subpart D—Exceptions and Exemptions | § 246.19 General exemptions. | SEC | (a) Definitions. For purposes of this section, the following definitions shall apply: Community-focused residential mortgage means a residential mortgage exempt from the definition of “covered transaction” under § 1026.43(a)(3)(iv) and (v) of the CFPB's Regulation Z (12 CFR 1026.43(a)). First pay class means a class of ABS interests for which all interests in the class are entitled to the same priority of payment and that, at the time of closing of the transaction, is entitled to repayments of principal and payments of interest prior to or pro-rata with all other classes of securities collateralized by the same pool of first-lien residential mortgages, until such class has no principal or notional balance remaining. Inverse floater means an ABS interest issued as part of a securitization transaction for which interest or other income is payable to the holder based on a rate or formula that varies inversely to a reference rate of interest. Qualifying three-to-four unit residential mortgage loan means a mortgage loan that is: (i) Secured by a dwelling (as defined in 12 CFR 1026.2(a)(19)) that is owner occupied and contains three-to-four housing units; (ii) Is deemed to be for business purposes for purposes of Regulation Z under 12 CFR part 1026, Supplement I, paragraph 3(a)(5)(i); and (iii) Otherwise meets all of the requirements to qualify as a qualified mortgage under § 1026.43(e) and (f) of Regulation Z (12 CFR 1026.43(e) and (f)) as if the loan were a covered transaction under that section. (b) This part shall not apply to: (1) U.S. Government-backed securitizations. Any securitization transaction that: (i) Is collateralized solely by residential, multifamily, or health care facility mortgage loan assets that are insured or guaranteed (in whole or in part) as to the payment of principal and interest by the United States or an agency of the United States, and servicing assets; or (ii) Involves the issuance of asset-backed securities that: (A) Are insured or guaranteed as to the payment of pri… | |||||
| 17:17:5.0.1.1.6.4.9.8 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | D | Subpart D—Exceptions and Exemptions | § 246.20 Safe harbor for certain foreign-related transactions. | SEC | (a) Definitions. For purposes of this section, the following definition shall apply: U.S. person means: (i) Any of the following: (A) Any natural person resident in the United States; (B) Any partnership, corporation, limited liability company, or other organization or entity organized or incorporated under the laws of any State or of the United States; (C) Any estate of which any executor or administrator is a U.S. person (as defined under any other clause of this definition); (D) Any trust of which any trustee is a U.S. person (as defined under any other clause of this definition); (E) Any agency or branch of a foreign entity located in the United States; (F) Any non-discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary for the benefit or account of a U.S. person (as defined under any other clause of this definition); (G) Any discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary organized, incorporated, or (if an individual) resident in the United States; and (H) Any partnership, corporation, limited liability company, or other organization or entity if: ( 1 ) Organized or incorporated under the laws of any foreign jurisdiction; and ( 2 ) Formed by a U.S. person (as defined under any other clause of this definition) principally for the purpose of investing in securities not registered under the Act; and (ii) “U.S. person(s)” does not include: (A) Any discretionary account or similar account (other than an estate or trust) held for the benefit or account of a person not constituting a U.S. person (as defined in paragraph (i) of this section) by a dealer or other professional fiduciary organized, incorporated, or (if an individual) resident in the United States; (B) Any estate of which any professional fiduciary acting as executor or administrator is a U.S. person (as defined in paragraph (i) of this section) if: ( 1 ) An executor or administrator of the estate who is not a U.S. person … | |||||
| 17:17:5.0.1.1.6.4.9.9 | 17 | Commodity and Securities Exchanges | II | 246 | PART 246—CREDIT RISK RETENTION | D | Subpart D—Exceptions and Exemptions | § 246.21 Additional exemptions. | SEC | (a) Securitization transactions. The federal agencies with rulewriting authority under section 15G(b) of the Exchange Act (15 U.S.C. 78o-11(b)) with respect to the type of assets involved may jointly provide a total or partial exemption of any securitization transaction as such agencies determine may be appropriate in the public interest and for the protection of investors. (b) Exceptions, exemptions, and adjustments. The Federal banking agencies and the Commission, in consultation with the Federal Housing Finance Agency and the Department of Housing and Urban Development, may jointly adopt or issue exemptions, exceptions or adjustments to the requirements of this part, including exemptions, exceptions or adjustments for classes of institutions or assets in accordance with section 15G(e) of the Exchange Act (15 U.S.C. 78o-11(e)). | |||||
| 24:24:2.1.1.2.22.1.211.1 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | A | Subpart A—General Provisions | § 246.1 Scope and effect of regulations. | HUD | [40 FR 49318, Oct. 22, 1975. Redesignated at 49 FR 6713, Feb. 23, 1984, and amended at 58 FR 64038, Dec. 3, 1993; 59 FR 62524, Dec. 5, 1994] | (a) The regulation of rents for a project coming within the scope of “Subpart B—Unsubsidized Insured Projects” is preempted under these regulations only when the Department determines that the delay or decision of the local rent control board, or other authority regulating rents pursuant to state or local law (hereinafter referred to as board) jeopardizes the Department's economic interest in a project covered by that subpart. The regulation of rents for projects coming within the scope of “Subpart C—Subsidized Insured Projects” is preempted in its entirety by the promulgation of these regulations. The regulation of rents for projects coming within the scope of “Subpart D—HUD-Owned Projects” rests within the exclusive jurisdiction of the Department. (b) Any state or local law, ordinance, or regulation is without force and effect insofar as it purports to regulate rents of: (1) Projects for which a determination of preemption has been made pursuant to subpart B, or (2) projects coming within the scope of subpart C or D. Compliance with such law, ordinance, or regulation shall not be required as a condition of, or prerequisite to, the remedy of eviction, and any law, ordinance, or regulation which purports to require such compliance is similarly without force and effect. (c) It is the purpose of the Department that these regulations shall bar all actions of a board that would in any way frustrate the purpose or effect of these regulations or that would in any way delay, prevent or interfere with the implementation of any increase in rental charges approved by HUD. (d) These regulations may be offered as a defense to a proceeding by whomever initiated, which may be brought or threatened to be brought against any owner, mortgagor or managing agent of a project subject to these regulations who demands, receives or retains, or seeks to demand, receive or retain, rental charges approved by HUD, or as a basis for declaratory, injunctive or other relief against any person or agency, public or private, who attempts to e… | |||
| 24:24:2.1.1.2.22.2.211.1 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | B | Subpart B—Unsubsidized Insured Projects | § 246.4 Applicability. | HUD | [40 FR 49318, Oct. 22, 1975. Redesignated at 49 FR 6713, Feb. 23, 1984] | This subpart applies to all projects with mortgages insured or held by HUD, except those to which subpart C applies. | |||
| 24:24:2.1.1.2.22.2.211.2 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | B | Subpart B—Unsubsidized Insured Projects | § 246.5 Rental charges. | HUD | The Department will generally not interfere in the regulation of rents by a rent control board or agency constituted under State or local laws (hereinafter referred to as board) for unsubsidized projects with mortgages insured or held by HUD. However, HUD will preempt the regulation of rents, together with any board regulations which require the mortgagor to offer a lease for a term in excess of one year, under certain conditions. This preemption may occur for such a project when the Department determines that the delay or decision of a board prevents the mortgagor from achieving a level of residential income necessary to maintain and operate adequately the project, which includes sufficient funds to meet the financial obligations under the mortgage.” | ||||
| 24:24:2.1.1.2.22.2.211.3 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | B | Subpart B—Unsubsidized Insured Projects | § 246.6 Initiation. | HUD | When a mortgagor determines that the permitted increase in rents as prescribed by the board will not provide a rent level necessary to maintain and operate adequately the project, and the mortgagor elects to request preemption under this subpart, it shall: (a) File an application for whatever relief or redetermination is permitted under the State or local law and; (b) Notify: (1) The tenants in accordance with § 246.7 of this subpart, (2) the appropriate HUD office pursuant to § 246.8, and (3) the board of the mortgagor's intention to file a request for preemption of local rent control regulation pursuant to the provisions of regulations in this subpart. This action may be taken if either the board's written decision is unacceptable to the mortgagor or no written decision is received from the board within 30 days of the mortgagor's request under paragraph (a) of this section. | ||||
| 24:24:2.1.1.2.22.2.211.4 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | B | Subpart B—Unsubsidized Insured Projects | § 246.7 Notice to tenants. | HUD | At least 30 days before filing a formal request to HUD for preemption of local rent control regulations, the mortgagor shall notify the tenants of its intention to so file. Copies of the Notice shall be: (a) Delivered directly or by mail to each tenant; and (b) Posted in at least 3 conspicuous places within each structure or building in which the affected dwelling units are located. The Notice shall contain the addresses where the materials, which constitute a complete submission as required by § 246.8 in support of the proposed preemption request, are to be made available to tenants as well as the required information in the following equivalent format: Notice to Tenants of Intention To File a Request to HUD for Preemption of Local Rent Control Regulations Date of Notice Take notice that on (Date) we requested the (Name) board to review our application for redetermination of permitted rents. Take further notice that on (Date), if the (Name) board fails to approve an income level necessary to maintain and operate adequately the project, or to act upon our request, we plan to file a request for preemption of local rent control regulations for (Name of Apartment Complex) with the United States Department of Housing and Urban Development (HUD) which will result in an increase in your rental rate as provided within the terms of your lease. The requested preemption action is supported by the following: (1) HUD approved Gross Potential Income: Year approved, __, $_____. (2) Current Total Residential Rents Allowed by Local Rent Control Board, $_____. (3) Projected Total Annual Residential Rents Allowable Under Local Board Regulations 6 Months After Date of this Notice, $_____. (4) Income Required to Operate Project as Supported by Profit and Loss Statement Being Submitted to HUD, $_____. Copies of the materials that we intend to submit to HUD in support of our request will be available during normal business hours as well as one evening a week after business hours which will be (Day) a… | ||||
| 24:24:2.1.1.2.22.2.211.5 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | B | Subpart B—Unsubsidized Insured Projects | § 246.8 Materials to be submitted to HUD in support of preemption request. | HUD | (a) After posting or delivery of the Notice as required by § 246.7, the mortgagor shall immediately send HUD notification of its intention to file a preemption request, to include: (1) The written Notice to the tenants, which will state the date of its posting and distribution. (2) An annual Statement of Profit and Loss, on a form prescribed by the Commissioner, audited by an independent public accountant and covering the most recently ended accounting year, and if more than four months have elapsed since the date of the Profit and Loss Statement, an unaudited accrual Profit and Loss Statement on a form prescribed by the Commissioner for the intervening period since the date of the annual statement, with the mortgagor's certification as to its accuracy. (3) A certified statement which provides a separate breakdown for the percentage of vacancies for the present and previous year. (4) A certified statement which provides a separate breakdown of the actual rent loss due to nonpayment of rent for the past 2 years. (5) A certified statement which provides a separate breakdown of rent loss due to tenant turnover for the past 2 years. (6) A certified statement covering known approved rate or cost increases not yet experienced by the project which can be documented by the following: (i) Tax rates or appraisals, (ii) Utility rates, (iii) Contracts for employees or services, (iv) Insurance, and (7) A certified statement covering known decreases of rates or costs not yet experienced by the project which have been approved and can be documented as follows: (i) Tax rates or appraisals, (ii) Utility rates, (iii) Contracts for employees or services, (iv) Insurance. If there are none, the mortgagor must so certify. (8) A copy of the full application to the board with supporting documentation. (b) The local HUD office shall review the mortgagor's submission promptly upon receipt, to ascertain that it is complete as required by paragraph (a) of this section. Should the submission be found to be incomplete, the l… | ||||
| 24:24:2.1.1.2.22.2.211.6 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | B | Subpart B—Unsubsidized Insured Projects | § 246.9 Request for preemption. | HUD | (a) Upon expiration of the period for tenant comments required by this rule and after review of the comments submitted to it, the mortgagor may submit its request for preemption. That request must include the following: (1) A certification by the mortgagor following the requirements specified in paragraph (b) of this section; (2) Copies of all written comments submitted by the tenants to the mortgagor; (3) The mortgagor's evaluation of the tenant's comments with respect to the request; and (4) The board's decision or a statement from the mortgagor certifying that a decision from the board has not been received. (b) The certification of the mortgagor as required by paragraph (a)(1) of this section shall include the following: (1) That the Notice required by § 246.7 was given pursuant to the provisions of that section; (2) That the mortgagor has taken reasonable steps to assure that the substance of the Notice has been conveyed to each resident household, and that the mortgagor exercised its best efforts to assure that the posted Notices were maintained intact and in legible form for the specified thirty (30) days; (3) That: (i) The copies of the materials submitted in support of the preemption request were located in a place reasonably convenient to tenants in the project during normal business hours and at least one evening a week after business hours, and (ii) that requests by tenants to inspect such materials, as provided for in the Notice, were honored; (4) That copies of all comments received from the tenants were considered and are being transmitted to HUD together with the certifications; and (5) A statement that “under the penalties and provisions of title 18 U.S.C., section 1001, the statements contained in this application and its attachments have been examined by me and, to the best of my knowledge and belief, are true, correct, and complete.” (c) Should the mortgagor receive a delayed decision from the board after filing its preemption request, HUD shall be informed immediately and furnished… | ||||
| 24:24:2.1.1.2.22.2.211.7 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | B | Subpart B—Unsubsidized Insured Projects | § 246.10 HUD procedures. | HUD | (a) The local HUD office will review the information submitted by the mortgagor together with the decision of the board, if any. The local HUD office will, if it finds that the delay or decision of the board fails to provide adequate residential income to protect the Department's economic interest in the projects and the board will not modify its position to the satisfaction of the local HUD office, make a report with appropriate recommendations concerning the actions that should be taken by HUD to the Office of Multifamily Housing Management and Occupancy, Headquarters. The report shall be sent to the Office of Multifamily Housing Management and Occupancy, Headquarters, and shall include appropriate recommendations concerning the action that should be taken by HUD. (b) The Office of Multifamily Housing Management and Occupancy will review the report and will consider whether to preempt the board's regulation. If it finds that the income level permitted by the board is inadequate to maintain the project as described in § 246.5, it shall issue a formal certification to the board that its authority has been preempted as to such rents. Copies of the certification shall be transmitted to the mortgagor, the local HUD office, and the board. | ||||
| 24:24:2.1.1.2.22.2.211.8 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | B | Subpart B—Unsubsidized Insured Projects | § 246.11 Notification of action on preemption request. | HUD | (a) After HUD has considered the preemption request which meets the requirements of § 246.9 and has made its determination to approve or disapprove the request, it will furnish the mortgagor with a written statement of the reasons for approval or disapproval. The mortgagor shall make known to tenants, by posting or delivery in the manner outlined in § 246.7, the reasons for approval or disapproval. (b) The mortgagor may effect collection of the HUD-approved income level which is set at the time of the preemption determination after the expiration of 30-days notice to the tenants, subject to the terms and rights a tenant may have under the existing lease. (c) Once the project reaches the income level approved under these procedures, the project will be returned to the control of the local rent control board covering both the rents and the terms of prospective leases. | ||||
| 24:24:2.1.1.2.22.2.211.9 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | B | Subpart B—Unsubsidized Insured Projects | § 246.12 Preemption of prospective term of lease. | HUD | (a) In those instances where it will take more than 60 days (2 months) for the project to reach the new income levels, HUD preemption of prospective lease terms shall be effective for those new or renewed leases which by regulation of a local rent control board would require the mortgagor to offer a lease for a term in excess of one year. (b) As a condition for HUD preemption, the mortgagor must give only one-year leases to tenants whose leases expire during the preemption period. | ||||
| 24:24:2.1.1.2.22.3.211.1 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | C | Subpart C—Subsidized Insured Projects | § 246.20 Applicability. | HUD | [63 FR 64803, Nov. 23, 1998] | This subpart applies to all projects with mortgages insured or held by HUD that receive a subsidy in the form of: (a) Interest reduction payments under section 236 of the National Housing Act; (b) Below-market interest rates under section 221(d)(3) and (5) of the National Housing Act; (c) Direct loans at below-market interest rates under section 202 of the Housing Act of 1959 (as in effect immediately before October 1, 1991); (d) Rent supplement payments under section 101 of the Housing and Urban Development Act of 1965; (e) Housing assistance payments under 24 CFR part 886, subpart A (Section 8 Loan Management Set Aside), for projects that converted their rent supplement contracts under section 101 of the Housing and Urban Development Act of 1965 to such assistance for the term of the HAP contract; or (f) Housing assistance payments pursuant to a contract under section 8 of the United States Housing Act of 1937 or section 23 of that Act (as in effect immediately before January 1, 1975), except that this subpart will only apply with respect to units occupied by tenants receiving housing assistance thereunder if the contract covers fewer than all units in the project. | |||
| 24:24:2.1.1.2.22.3.211.2 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | C | Subpart C—Subsidized Insured Projects | § 246.21 Rental charges. | HUD | [40 FR 49318, Oct. 22, 1975. Redesignated at 44 FR 58506, Oct. 10, 1979, and at 49 FR 6713, Feb. 23, 1984] | The Department finds that it is necessary and desirable to minimize defaults by the mortgagor in its financial obligations with regard to projects covered by this subpart, and to assist mortgagors to preserve the continued viability of those projects as a housing resource for low-income families. The Department also finds that it is necessary and desirable to protect the substantial economic interest of the Federal Government in those projects. Therefore, the Department concludes that it is in the national interest to preempt, and it does hereby preempt, the entire field of rent regulation by local rent control boards, (hereinafter referred to as board), or other authority, acting pursuant to state or local law as it affects projects covered by this subpart. | |||
| 24:24:2.1.1.2.22.3.211.3 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | C | Subpart C—Subsidized Insured Projects | § 246.22 Procedures. | HUD | [40 FR 49318, Oct. 22, 1975. Redesignated at 44 FR 58506, Oct. 10, 1979, and at 49 FR 6713, Feb. 23, 1984] | (a) The mortgagor shall file its application for approval of increases in rental charges with the appropriate local office of HUD. (b) The local HUD office will process the application for increases in rental charges in accordance with HUD's regulations, including part 245 of this chapter, and instructions and procedures, all adopted pursuant to the statutory authority described in § 246.8, and shall notify in writing any board in the area in which the project is located that it is processing the application and, that, pursuant to this subpart, HUD has preempted the entire field of rent regulation by a board acting pursuant to state or local law as it affects the project. (c) The mortgagor may effect collection of the new rents in accordance with the procedures described in part 245, subpart D of this chapter. The mortgagor shall furnish the board a schedule of any new rents approved by HUD within ten (10) days after the approved rents have become effective. Notice to the board of the approved increases in rents does not confer upon the board a right to approve or disapprove the Department's action or to exercise jurisdiction over the implementation of the rent increases by the mortgagor. The sole purpose of the notice is to inform the board of the lawful rents that may be charged for projects covered by this subpart. | |||
| 24:24:2.1.1.2.22.4.211.1 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | D | Subpart D—HUD-Owned Projects | § 246.30 Rental charges. | HUD | [40 FR 49318, Oct. 22, 1975. Redesignated at 44 FR 58506, Oct. 10, 1979, and at 49 FR 6713, Feb. 23, 1984] | The Department has exclusive jurisdiction over the rents of all projects which it owns, irrespective of the existence, or the provisions, of any State or local rent control law or ordinance. | |||
| 24:24:2.1.1.2.22.4.211.2 | 24 | Housing and Urban Development | II | B | 246 | PART 246—LOCAL RENT CONTROL | D | Subpart D—HUD-Owned Projects | § 246.31 Procedures. | HUD | [40 FR 49318, Oct. 22, 1975. Redesignated at 44 FR 58506, Oct. 10, 1979, and at 49 FR 6713, Feb. 23, 1984] | (a) The local HUD office will notify in writing any local rent control board (hereinafter referred to as board) in the area in which the project is located that it is considering increasing the rents for a project within the scope of this subpart, and that the increases are expected to become effective after the expiration of thirty (30) days' notice to the tenants, subject to whatever rights a tenant may have under a lease. The local HUD office will also notify the board that, pursuant to this subpart, the Department has exclusive jurisdiction over the rents for the project. (b) After the increases have become effective, the local HUD office will furnish the board a schedule of the new rents that are being charged by HUD. Notice to the board of the increased rents does not confer upon the board a right to approve or disapprove of the Department's action, or to exercise jurisdiction over the implementation of the rent increases by the Department. The sole purpose of the notice is to inform the board of the lawful rents that may be charged for projects covered by this subpart. | |||
| 40:40:27.0.1.4.33.1.17.1 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | A | Subpart A—General Provisions | § 246.100 Scope. | EPA | [41 FR 16952, Apr. 23, 1976, as amended at 47 FR 36603, Aug. 20, 1982] | (a) These guidelines are applicable to the source separation of residential, commercial, and institutional solid wastes. Explicitly excluded are mining, agricultural, and industrial solid wastes; hazardous wastes; sludges; construction and demolition wastes; infectious wastes; classified waste. (b) The “Requirement” sections contained herein delineate minimum actions for Federal agencies for the recovery of resources from solid waste through source separation. Pursuant to section 211 of the Solid Waste Disposal Act, as amended, and Executive Order 11752 section 4(a), the “Requirement” sections of these guidelines are mandatory for all Federal agencies that generate solid waste. In addition, they are recommended to State, interstate, regional, and local governments for use in their activities. (c) The “Recommended Procedures” sections are presented to suggest actions or preferred methods by which the objectives of the requirements can be realized. The “Recommended Procedures” are not mandatory for Federal agencies. (d) The Environmental Protection Agency will render technical assistance in the form of sample cost analysis formats, sample bid specifications, implementation guidance documents and other guidance to Federal agencies when requested to do so, pursuant to section 3(d)1 of Executive Order 11752. (e) Within one year after the effective date of these guidelines, agencies shall make a final determination as to what actions shall be taken to adopt the requirements of these guidelines and shall, within two months of such determination, submit to the Administrator a schedule of such actions. (f) Federal agencies that make the determination not to source separate as described in §§ 246.200-1, 246.201-1, and 246.202-1, for whatever reason, shall make available to the Administrator the analysis and rationale used in making that determination. The Administrator shall publish notice of the availability of this report to the general public in the Federal Register. The following are considered to be valid reaso… | |||
| 40:40:27.0.1.4.33.1.17.2 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | A | Subpart A—General Provisions | § 246.101 Definitions. | EPA | As used in these guidelines: (a) Agricultural solid waste means the solid waste that is generated by the rearing of animals, and the producing and harvesting of crops or trees. (b) Baler means a machine used to compress solid wastes, primary materials, or recoverable materials, with or without binding, to a density or from which will support handling and transportation as a material unit rather than requiring a disposable or reuseable container. This specifically excludes briquetters and stationary compaction equipment which is used to compact materials into disposable or reuseable containers. (c) Bulk container means a large container that can either be pulled or lifted mechanically onto a service vehicle or emptied mechanically into a service vehicle. (d) Classified Waste means waste material that has been given security classification in accordance with 50 U.S.C. 401 and Executive Order 11652. (e) Collection means the act of removing solid waste (or materials which have been separated for the purpose of recycling) from a central storage point. (f) Commercial establishment means stores, offices, restaurants, warehouses and other non-manufacturing activities. (g) Commercial solid waste means all types of solid wastes generated by stores, offices, restaurants, warehouses and other non-manufacturing activities, and non-processing wastes such as office and packing wastes generated at industrial facilities. (h) Construction and demolition waste means the waste building materials, packaging, and rubble resulting from construction, remodeling, repair, and demolition operations on pavements, houses, commercial buildings and other structures. (i) Compartmentalized vehicle means a collection vehicle which has two or more compartments for placement of solid wastes or recyclable materials. The compartments may be within the main truck body or on the outside of that body as in the form of metal racks. (j) Corrugated container waste means discarded corrugated boxes. (k) Corrugated box means a… | ||||
| 40:40:27.0.1.4.33.2.17.1 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200 High-grade paper recovery. | EPA | |||||
| 40:40:27.0.1.4.33.2.17.10 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200-9 Recommended procedures: Contracts. | EPA | Formal bids should be requested for purchase of the recovered materials, such bids being solicited in conformance with bidding procedures established for the responsible agency. Contracts should include the buyer's quality specifications, quantity and transportation agreements, a guarantee that the material will be accepted for one year or more, and a guaranteed minimum purchase price. | ||||
| 40:40:27.0.1.4.33.2.17.11 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200-10 Recommended procedures: Public information and education. | EPA | A well-organized and well-executed public information and education program explaining the justification, goals, methods and level of separation should be conducted to inform and motivate office personnel and secure their cooperation in separating their waste. This public information and education program should precede the program and continue on a regular basis for its duration. | ||||
| 40:40:27.0.1.4.33.2.17.12 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.201 Residential materials recovery. | EPA | |||||
| 40:40:27.0.1.4.33.2.17.13 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.201-1 Requirement. | EPA | Separation of used newspapers at the source of residential generation in conjunction with separate collection shall be carried out at all facilities in which more than 500 families reside, and the newspapers shall be sold for the purpose of recycling. | ||||
| 40:40:27.0.1.4.33.2.17.14 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.201-2 Recommended procedures: Newsprint recovery from smaller residential facilities. | EPA | The recovery of newsprint generated by residential facilities of less than 500 families should be investigated in conformance with the following recommended procedures and implemented where feasible. | ||||
| 40:40:27.0.1.4.33.2.17.15 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.201-3 Recommended procedures: Glass, can, and mixed paper separation. | EPA | In areas where markets are available, it is recommended that glass, cans, and mixed paper be separated at the source of generation and separately collected for the purpose of recycling. | ||||
| 40:40:27.0.1.4.33.2.17.16 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.201-4 Recommended procedures: Market study. | EPA | An investigation of markets should be made for each material by the organization responsible for sale of recyclable materials in each agency and should include at a minimum: (a) Identifying potential purchasers of the recovered material through standard market research techniques. (b) Directly contacting buyers and determining the buyers' quality specifications, potential transportation agreements and any minimum quantity criteria. (c) Determining the prices that the buyer will pay for the recovered material and the willingness of the buyer to sign a contract for the purchase of the material at guaranteed minimum prices. | ||||
| 40:40:27.0.1.4.33.2.17.17 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.201-5 Recommended procedures: Methods of separation and collection. | EPA | Following separation within the home, any of the following methods of collection may be used: (a) Materials may be placed at the curbside by the resident and may be collected from each household using separate trucks or compartmentalized vehicles. (b) For multi-family dwellings, separated materials may be placed in bulk containers located outside of the building and collected by trucks dispatched to collect recyclables. (c) Collection stations may be set up at convenient locations to which residents bring recyclables. These stations should provide separate bulk containers for each item to be recycled. The size and type of container will depend on the volume and type of material collected, the method of transportation to be used in hauling the materials to market and the frequency of removal. | ||||
| 40:40:27.0.1.4.33.2.17.18 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.201-6 Recommended procedures: Transportation to market. | EPA | Transportation to market may be supplied by the facility or the community generating the waste, by a private hauler, or by the purchaser. | ||||
| 40:40:27.0.1.4.33.2.17.19 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.201-7 Recommended procedures: Cost analysis. | EPA | After potential markets have been located (but prior to initiation of formal bidding procedures), preliminary determinations of various separation methods, storage and transportation costs have been made, and estimated tonnages of both recoverable materials and residual solid waste have been established, an analysis should be conducted which compares the costs of the present waste collection and disposal system with the proposed segregated systems. At a minimum this study should include all capital, operating and overhead costs and take into account credits for revenue from paper sales and savings from diverting recycled materials from disposal. Potential costs to upgrade collection and disposal practices to comply with EPA's Guidelines for the Storage and Collection of Residential, Commercial and Institutional Solid Wastes (40 CFR part 243) and Thermal Processing and Land Disposal Guidelines (40 CFR parts 240 and 241) should be included in the analysis. In formulating a separate collection system and evaluating its costs, every effort should be made to use idle equipment and underutilized collection manpower to reduce separate collection costs. This cost analysis should enable the facility to determine the most cost effective method if implementing the requirements of this part. | ||||
| 40:40:27.0.1.4.33.2.17.2 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200-1 Requirements. | EPA | High-grade paper generated by office facilities of over 100 office workers shall be separated at the source of generation, separately collected, and sold for the purpose of recycling. | ||||
| 40:40:27.0.1.4.33.2.17.20 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.201-8 Recommended procedures: Contracts. | EPA | Formal bids should be requested for purchase of the recovered materials, such bids being solicited in conformance with bidding procedures established for the responsible jurisdiction. Contracts should include the buyer's quality specifications, quantity and transportation agreements, a guarantee that the material will be accepted for one year or more and a guaranteed minimum purchase price. | ||||
| 40:40:27.0.1.4.33.2.17.21 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.201-9 Recommended procedures: Public information and education. | EPA | A well organized and well executed public information and education program explaining the justification, goals, methods and level of separation should be conducted to inform and motivate householders and to secure their cooperation in separating their waste. This public information and education program should precede the program and continue on a regular basis for its duration. | ||||
| 40:40:27.0.1.4.33.2.17.22 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.202 Corrugated container recovery. | EPA | |||||
| 40:40:27.0.1.4.33.2.17.23 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.202-1 Requirement. | EPA | Any commercial establishment generating 10 or more tons of waste corrugated containers per month shall separately collect and sell this material for the purpose of recycling. | ||||
| 40:40:27.0.1.4.33.2.17.24 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.202-2 Recommended procedures: Corrugated container recovery from smaller commercial facilities. | EPA | The recovery of corrugated containers from commercial facilities generating less than 10 tons per month should be investigated in conformance with the following recommended procedures and implemented where feasible. | ||||
| 40:40:27.0.1.4.33.2.17.25 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.202-3 Recommended procedures: Market study. | EPA | An investigation of markets should be made by the organization responsible for sale of recyclable material in each Federal agency and should include at a minimum: (a) Identifying potential purchasers of the recovered corrugated through standard market research techniques. (b) Directly contacting buyers and determining the buyers' quality specifications, potential transportation agreements and any minimum quantity criteria. (c) Determining the price that the buyer will pay for the recovered corrugated and the willingness of the buyer to sign a contract for purchase of the paper at a guaranteed minimum price. | ||||
| 40:40:27.0.1.4.33.2.17.26 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.202-4 Recommended procedures: Methods of separation and storage. | EPA | The method selected will depend upon such variables as the physical layout of the individual generating facility, the rate at which the corrugated accumulates, the storage capacity of the facility, and the projected cost-effectiveness of using the various methods. All of the following suggested modes of separation and storage presuppose that the corrugated boxes will be accumulated at a central location in the facility after their contents are removed and that the boxes are flattened. (a) Balers of various sizes: Corrugated boxes are placed in balers and compacted into bales. These bales may be stored inside or outside of the facility. The bales should be protected from fire, inclement weather, theft, and vandalism. (b) Stationary compactors or bulk containers: Corrugated boxes are placed in a stationary compactor or bulk containers outside of the facility. The containers should be protected from fire, inclement weather, theft and vandalism. | ||||
| 40:40:27.0.1.4.33.2.17.27 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.202-5 Recommended procedures: Transportation. | EPA | Transportation to market may be supplied by either the facility, a private hauler or the purchaser. In facilities to which goods are delivered from a central warehouse, corrugated may be backhauled by delivery trucks to the central facility and baled there for delivery to a user. | ||||
| 40:40:27.0.1.4.33.2.17.28 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.202-6 Recommended procedures: Cost analysis. | EPA | After potential markets have been identified (but prior to initiation of formal bidding), preliminary determinations of various separation methods, storage and transportation costs have been made, and estimated tonnages of both recoverable material and residual solid waste have been established, an analysis should be conducted which compares the costs of the present waste collection and disposal system with the proposed segregated systems. At a minimum, the study should include all capital, operating and overhead costs and take into account credits for revenue from paper sales and savings from diverting recycled materials from disposal. Potential costs to upgrade collection and disposal practices to comply with EPA's Guidelines for the Storage and Collection of Residential, Commercial and Institutional Solid Wastes (40 CFR part 243) and Thermal Processing and Land Disposal Guidelines (40 CFR parts 240 and 241) should be included in the analysis. This cost analysis should enable the facility to determine the most cost effective method of implementing these guidelines. | ||||
| 40:40:27.0.1.4.33.2.17.29 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.202-7 Recommended procedures: Establishment of purchase contract. | EPA | Formal bids should be requested for purchase of the recovered materials, such bids being solicited in conformance with bidding procedures established for the responsible agency. Contracts should include the buyer's quality specifications, transportation agreements, a guarantee that the material will be accepted for one year or more and a guaranteed minimum purchase price. | ||||
| 40:40:27.0.1.4.33.2.17.3 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200-2 Recommended procedures: High-grade paper recovery from smaller offices. | EPA | The recovery of high-grade paper generated by office facilities of less than 100 office workers should be investigated in conformance with the following recommended procedures and implemented where feasible. | ||||
| 40:40:27.0.1.4.33.2.17.30 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.203 Reevaluation. | EPA | |||||
| 40:40:27.0.1.4.33.2.17.4 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200-3 Recommended procedures: Market study. | EPA | An investigation of markets should be made by the organization responsible for the sale of recyclable materials in each Federal agency and should include at a minimum: (a) Identifying potential purchasers of the recovered paper through standard market research techniques; (b) Directly contacting buyers, and determining the buyers' quality specifications, the exact types of paper to be recycled, potential transportation agreements and any minimum quantity criteria; and (c) Determining the price that the buyer will pay for the recovered paper and the willingness of the buyer to sign a contract for purchase of the paper at a guaranteed minimum price. | ||||
| 40:40:27.0.1.4.33.2.17.5 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200-4 Recommended procedures: Levels of separation. | EPA | A two-level separation is recommended for most facilities. This separation should consist of (a) high-grade wastepaper and (b) all other waste. Facilities that produce large enough quantities of waste computer paper and cards to make their separation into a separate category cost effective may choose to implement three levels of separation: (1) Computer papers, (2) other high-grade papers, (3) all other wastes. | ||||
| 40:40:27.0.1.4.33.2.17.6 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200-5 Recommended procedures: Methods of separation and collection. | EPA | (a) Systems designed to recover high grades of office paper at the source of generation, i.e., the desk, are the desktop system, the two-wastebasket system, and the office centralized container system. (b) With the desk-top system, recyclable paper is placed by the generator in a container on his desk, while other waste is placed in a wastebasket. With the two-wastebasket system, recyclable paper is placed by the generator in one desk-side wastebasket, and all other waste is placed in another. In the centralized container system, large containers for the collection of recyclables are placed in centralized locations within the office areas of the building. Nonrecyclable waste is placed in desk-side wastebaskets. (c) The recommended system is the desk-top system because it is designed to maximize recovery of high value material in an economically feasible manner. While the two-wastebasket system and centralized container system have been implemented with success in isolated instances, data indicate that, on the whole, these systems have experienced high levels of contamination, low levels of participation, and low revenues. The desk-top system has been designed to minimize these problems. (d) The precise method of separation and collection used to implement the desk-top system will depend upon such things as the physical layout of the individual facility, the ease of collection, and the projected cost effectiveness of using various methods. The recommended desk-top system is carried out in the following manner: (1) Workers are to deposit high-grade paper into a desk-top tray or other small desk-top holder to be supplied by the agency. This holder should be designed in such a way as to prevent it holding contaminants, such as food or beverage containers. (2) At the office worker's convenience or when the tray is filled, the worker carries the paper to a conveniently located bulk container within the office area. This large container should be located in an area the worker frequents in the normal course of busin… | ||||
| 40:40:27.0.1.4.33.2.17.7 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200-6 Recommended procedures: Storage. | EPA | Among the alternatives for paper storage are on-site bailing, the use of stationary compactors, or storage in corrugated boxes or normal waste containers. Stored paper should be protected from fire, inclement weather, theft, and vandalism. | ||||
| 40:40:27.0.1.4.33.2.17.8 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200-7 Recommended procedures: Transportation. | EPA | Transportation to market may be supplied by the facility, by a private hauler, or by the purchaser. Collection of the recyclable paper should be on a regular, established schedule. | ||||
| 40:40:27.0.1.4.33.2.17.9 | 40 | Protection of Environment | I | I | 246 | PART 246—SOURCE SEPARATION FOR MATERIALS RECOVERY GUIDELINES | B | Subpart B—Requirements and Recommended Procedures | § 246.200-8 Recommended procedures: Cost analysis. | EPA | After potential markets have been located (but prior to initiation of formal bidding procedures), preliminary determinations of various separation methods, storage, and transportation costs have been made, and estimated tonnages of both recoverable high-grade paper and residual solid waste have been established, an analysis should be conducted which compares the costs of the present waste collection and disposal system with the proposed segregated systems. At a minimum, the study should include all capital, operating and overhead costs and take into account credits for revenue from paper sales and savings from diverting recycled materials from disposal. Potential costs to upgrade collection and disposal practices to comply with EPA's Guidelines for the Storage and Collection of Residential, Commercial and Institutional Solid Wastes (40 CFR part 243) and Thermal Processing and Land Disposal Guidelines (40 CFR parts 240 and 241) should be included in the analysis. In formulating a separation system and evaluating its costs, every effort should be made to use janitorial and waste collection resources efficiently. This cost analysis should enable the facility to determine the most cost effective method of implementing the requirement of this part. | ||||
| 49:49:4.1.1.1.40.1.137.1 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | A | Subpart A—General | § 246.1 Purpose and scope. | FRA | (a) The purpose of this part is to ensure that only those persons who meet minimum Federal safety standards serve as certified signal employees, to reduce the rate and number of accidents and incidents, and to improve railroad safety. (b) This part prescribes minimum Federal safety standards for the eligibility, training, testing, certification and monitoring of all signal employees to whom it applies. This part does not restrict a railroad from adopting and enforcing additional or more stringent requirements consistent with this part. (c) The signal employee certification requirements prescribed in this part apply to any person who meets the definition of signal employee contained in § 246.7, regardless of the fact that the person may have a job classification title other than that of signal employee. | |||||
| 49:49:4.1.1.1.40.1.137.2 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | A | Subpart A—General | § 246.3 Application and responsibility for compliance. | FRA | (a) This part applies to all railroads, except: (1) Railroads that do not have a signal system as defined in § 246.7; (2) Railroads that operate only on track inside an installation that is not part of the general railroad system of transportation ( i.e., plant railroads, as defined in § 246.7); (3) Tourist, scenic, historic, or excursion operations that are not part of the general railroad system of transportation as defined in § 246.7; or (4) Rapid transit operations in an urban area that are not connected to the general railroad system of transportation. (b) Although the duties imposed by this part are generally stated in terms of the duty of a railroad, each person, as defined in § 246.7, who performs any function required by this part must perform that function in accordance with this part. | |||||
| 49:49:4.1.1.1.40.1.137.3 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | A | Subpart A—General | § 246.5 Effect and construction. | FRA | (a) FRA does not intend, by use of the term signal employee in this part, to alter the terms, conditions, or interpretation of existing collective bargaining agreements that employ other job classification titles when identifying a person who is engaged in installing, troubleshooting, testing, repair, or maintenance of railroad signal systems and signal-related technology. (b) FRA does not intend by issuance of these regulations to alter the authority of a railroad to initiate disciplinary sanctions against its employees, including managers and supervisors, in the normal and customary manner, including those contained in its collective bargaining agreements. (c) Except as provided in § 246.213, nothing in this part shall be construed to create or prohibit an eligibility or entitlement to employment in other service for the railroad as a result of denial, suspension, or revocation of certification under this part. (d) Nothing in this part shall be deemed to abridge any additional procedural rights or remedies not inconsistent with this part that are available to the employee under a collective bargaining agreement, the Railway Labor Act, or (with respect to employment at will) at common law with respect to removal from service or other adverse action taken as a consequence of this part. | |||||
| 49:49:4.1.1.1.40.1.137.4 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | A | Subpart A—General | § 246.7 Definitions. | FRA | [89 FR 44873, May 21, 2024, as amended at 90 FR 28128, July 1, 2025] | As used in this part: Administrator means the Administrator of the FRA or the Administrator's delegate. Alcohol means ethyl alcohol (ethanol) and includes use or possession of any beverage, mixture, or preparation containing ethyl alcohol. Contractor means a person under contract with a railroad, including but not limited to, a prime contractor or a subcontractor. Controlled substance has the meaning assigned by 21 U.S.C. 802 and includes all substances listed on Schedules I through V as they may be revised from time to time (21 CFR parts 1301 through 1316). Disable means to render a device or system incapable of proper and effective action or to materially impair the functioning of that device or system. Drug means any substance (other than alcohol) that has known mind or function-altering effects on a human subject, specifically including any psychoactive substance and including, but not limited to, controlled substances. Drug and alcohol counselor (DAC) means a person who meets the credentialing and qualification requirements of a “Substance Abuse Professional” (SAP), as provided in 49 CFR part 40. File, filed, and filing mean submission of a document under this part on the date when the Docket Clerk receives it, or if sent by mail, the date mailing was completed. FRA means the Federal Railroad Administration. FRA representative means the FRA Associate Administrator for Railroad Safety/Chief Safety Officer and the Associate Administrator's delegate, including any safety inspector employed by the Federal Railroad Administration and any qualified State railroad safety inspector acting under part 212 of this chapter. Ineligible or ineligibility means that a person is legally disqualified from serving as a certified signal employee. The term covers a number of circumstances in which a person may not serve as a certified signal employee. Revocation of certification pursuant to § 246.307 and denial of certification pursuant to § 246.301 are two examples in which a person would be ineligible… | ||||
| 49:49:4.1.1.1.40.1.137.5 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | A | Subpart A—General | § 246.9 Waivers. | FRA | (a) A person subject to a requirement of this part may petition FRA for a waiver of compliance with such requirement. The filing of such a petition does not affect that person's responsibility for compliance with that requirement while the petition is being considered. (b) Each petition for a waiver under this section must be filed in the manner and contain the information required by part 211 of this chapter. (c) If FRA finds that a waiver of compliance is in the public interest and is consistent with railroad safety, FRA may grant the waiver subject to any conditions FRA deems necessary. | |||||
| 49:49:4.1.1.1.40.1.137.6 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | A | Subpart A—General | § 246.11 Penalties and consequences for noncompliance. | FRA | (a) Any person, as defined in § 246.7, who violates any requirement of this part or causes the violation of any such requirement is subject to a civil penalty of at least the minimum civil monetary penalty and not more than the ordinary maximum civil monetary penalty per violation. However, penalties may be assessed against individuals only for willful violations, and a penalty not to exceed the aggravated maximum civil monetary penalty per violation may be assessed, where: (1) A grossly negligent violation, or a pattern of repeated violations, has created an imminent hazard of death or injury to persons, or (2) A death or injury has occurred. See 49 CFR part 209, appendix A. (b) Each day a violation continues constitutes a separate offense. (c) A person who violates any requirement of this part or causes the violation of any such requirement may be subject to disqualification from all safety-sensitive service in accordance with part 209 of this chapter. (d) A person who knowingly and willfully falsifies a record or report required by this part may be subject to criminal penalties under 49 U.S.C. 21311. (e) In addition to the enforcement methods referred to in paragraphs (a) through (d) of this section, FRA may address violations of this part by use of the emergency order, compliance order, and/or injunctive provisions of the Federal rail safety laws. (f) FRA's website at https://railroads.dot.gov/ contains a schedule of civil penalty amounts used in connection with this part. | |||||
| 49:49:4.1.1.1.40.2.137.1 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.101 Certification program required. | FRA | (a) Each railroad subject to this part shall have a written signal employee certification program. (b) Each certification program shall include all of the following: (1) If applicable, an explanation and discussion of the occupational categories and subcategories of certified signal service that comply with the requirements in § 246.107; (2) A procedure for evaluating prior safety conduct as a motor vehicle operator that complies with the criteria established in § 246.111; (3) A procedure for evaluating prior safety conduct as an employee or certified signal employee with other railroads that complies with the criteria established in § 246.113; (4) A procedure for evaluating potential substance abuse disorders and compliance with railroad alcohol and drug rules that complies with the criteria established in § 246.115; (5) A procedure for evaluating visual and hearing acuity that complies with the criteria established in §§ 246.117 and 246.118; (6) A procedure for training that complies with the criteria established in § 246.119; (7) A procedure for qualifying persons on its signal system and signal-related technology that complies with the criteria established in § 246.120; (8) A procedure for knowledge testing that complies with the criteria established in § 246.121; (9) A procedure for monitoring operational performance that complies with the criteria established in § 246.123; and (10) A procedure for mentoring uncertified signal employees that complies with the criteria established in § 246.124. (c) Each certification program shall be version controlled. Any change from the previous FRA-approved version of the certification program must be tracked. | |||||
| 49:49:4.1.1.1.40.2.137.10 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.117 Visual acuity. | FRA | (a) After FRA has approved a railroad's signal employee certification program, the railroad shall determine, prior to issuing any person a signal employee certificate, that the person meets the standards for visual acuity prescribed in this section and appendix B to this part. (b) Any examination required under this section shall be performed by or under the supervision of a medical examiner or a licensed physician's assistant. (c) Except as provided in paragraph (d) of this section, each certified signal employee shall have visual acuity that meets or exceeds the following thresholds: (1) For distant viewing, either: (i) Distant visual acuity of at least 20/40 (Snellen) in each eye without corrective lenses; or (ii) Distant visual acuity separately corrected to at least 20/40 (Snellen) with corrective lenses and distant binocular acuity of at least 20/40 (Snellen) in both eyes with or without corrective lenses; (2) A field of vision of at least 70 degrees in the horizontal meridian in each eye; and (3) The ability to recognize and distinguish between the colors of railroad signals as demonstrated by successfully completing one of the tests in appendix B to this part. (d) A person not meeting the thresholds in paragraph (c) of this section shall, upon request of the certification candidate, be subject to further medical evaluation by a railroad's medical examiner to determine that person's ability to safely perform as a certified signal employee. In such cases, the following procedures will apply: (1) In accordance with the guidance prescribed in appendix B to this part, a person is entitled to: (i) One retest without making any showing; and (ii) An additional retest if the person provides evidence that circumstances have changed since the last test to the extent that the person may now be able to safely perform as a certified signal employee. (2) The railroad shall provide its medical examiner with a copy of this part, including all appendices. (3) If, after consultation with a railroad officer, the… | |||||
| 49:49:4.1.1.1.40.2.137.11 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.118 Hearing acuity. | FRA | (a) After FRA has approved a railroad's signal employee certification program, the railroad shall determine, prior to issuing any person a signal employee certificate, that the person meets the standards for hearing acuity prescribed in this section and appendix B to this part. (b) Any examination required under this section shall be performed by or under the supervision of a medical examiner or a licensed physician's assistant. (c) Except as provided in paragraph (d) of this section, each certified signal employee shall have hearing acuity that meets or exceeds the following thresholds with or without use of a hearing aid: The person does not have an average hearing loss in the better ear greater than 40 decibels at 500 hertz (Hz), 1,000 Hz, and 2,000 Hz. The hearing test or audiogram used to show a person's hearing acuity shall meet the requirements of one of the following: (1) As required in 29 CFR 1910.95(h) (Occupational Safety and Health Administration); (2) As required in § 227.111 of this chapter; or (3) Conducted using an audiometer that meets the specifications of, and is maintained and used in accordance with, a formal industry standard such as American National Standards Institute (ANSI) S3.6, “Specifications for Audiometers.” (d) A person not meeting the thresholds in paragraph (c) of this section shall, upon request of the certification candidate, be subject to further medical evaluation by a railroad's medical examiner to determine that person's ability to safely perform as a certified signal employee. In such cases, the following procedures will apply: (1) In accordance with the guidance prescribed in appendix B to this part, a person is entitled to: (i) One retest without making any showing; and (ii) An additional retest if the person provides evidence that circumstances have changed since the last test to the extent that the person may now be able to safely perform as a certified signal employee. (2) The railroad shall provide its medical examiner with a copy of this part, including al… | |||||
| 49:49:4.1.1.1.40.2.137.12 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.119 Training requirements. | FRA | (a) After FRA has approved a railroad or parent company's certification program, the railroad or parent company shall determine, prior to issuing any person a signal employee certificate, that the person has successfully completed training, in accordance with the requirements of this section. (b) A railroad or parent company that elects to accept responsibility to provide initial signal employee training to persons who have not been previously certified as signal employees shall state in its certification program whether it will conduct the training or authorize another railroad or non-railroad entity to provide the training. (c) A railroad or parent company that elects to accept responsibility to provide initial signal employee training to persons not previously certified as signal employees shall submit a training program which, at a minimum, includes the following: (1) An explanation of how training will be structured, developed, and delivered, including an appropriate combination of classroom, simulator, computer-based, correspondence, practical demonstration, on-the-job training, or other formal training. The curriculum shall be designed to impart knowledge of, and ability to comply with, applicable Federal railroad safety laws, regulations, and orders, as well as any relevant railroad rules and procedures promulgated to implement those Federal railroad safety laws, regulations, and orders. The training shall document a person's knowledge of, and ability to comply with, Federal railroad safety laws, regulations, and orders, as well as railroad rules and procedures. (2) An on-the-job training component which shall include the following: (i) A syllabus describing content, required tasks, and related steps the person learning the job shall be able to perform within a specified timeframe. If the railroad or parent company has elected to classify its certified signal employees into more than one occupational category or subcategory, this syllabus shall include all safety-related tasks and subtasks performed … | |||||
| 49:49:4.1.1.1.40.2.137.13 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.120 Requirements for qualification. | FRA | (a) After FRA has approved a railroad's certification program, a railroad shall not permit or require a person to serve as a signal employee, as defined in § 246.7, unless that railroad determines that: (1) The person is a certified signal employee; and (2) The person either: (i) Is qualified, as defined in § 246.7, on the signal system equipment and signal-related technology (whether existing or new) and therefore may reasonably be expected to be proficient on all safety related tasks the person is assigned to perform; or (ii) Is working under the direct and immediate supervision of a mentor or qualified instructor. (b) If a person is called to perform work on signal system equipment or signal-related technology that they are not qualified on, the person must immediately notify the railroad that they are not qualified on the signal system equipment or signal-related technology. (c) A person shall no longer be considered qualified on signal system equipment or signal-related technology if they have not performed work that requires certification pursuant to this part on signal system equipment or signal-related technology in the previous 12 months. (d) Each railroad shall adopt and comply with a program meeting the requirements of this section. When any person (including but not limited to a railroad; any manager, supervisor, official, or agent of a railroad; any owner, manufacturer, lessor, or lessee of railroad equipment, track, or facilities; any employee of such owner, manufacturer, lessor, lessee, or independent contractor or subcontractor) violates any requirement of a program which complies with the requirements of this section, that person shall be considered to have violated the requirements of this section. | |||||
| 49:49:4.1.1.1.40.2.137.14 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.121 Knowledge testing. | FRA | (a) After FRA has approved a railroad's signal employee certification program, the railroad shall determine, prior to issuing any person a signal employee certificate and in accordance with the requirements of this section, that the person has demonstrated sufficient knowledge of the railroad's signal standards, test procedures, and instructions for the installation, operation, testing, maintenance, troubleshooting, and repair of the railroad's signal system equipment and signal-related technology. (b) To make the knowledge determination required by paragraph (a) of this section, a railroad shall have procedures for testing a person being evaluated for certification as a signal employee that: (1) Are designed to examine a person's knowledge of: (i) All applicable Federal railroad safety laws, regulations, and orders governing signal systems and signal-related technology; (ii) All applicable railroad safety and operating rules; and (iii) All applicable railroad standards, procedures, and instructions for the installation, operation, testing, maintenance, troubleshooting, and repair of the railroad's signal systems and signal-related technology, including: (A) The railroad's rules and standards for disabling and removing signal systems from service; and (B) The railroad's rules and standards for placing signal systems back in service; (2) Are objective in nature; (3) Include a practical demonstration component; (4) Are in written or electronic form; (5) Are sufficient to accurately measure the person's knowledge of the subjects listed in paragraph (b)(1) of this section; and (6) Allow for testing conducted with reference to books and other written materials, as addressed in the railroad's certification program. (c) The railroad shall provide the certification candidate with an opportunity to consult with a mentor, signal instructor or qualified instructor to explain one or more test questions. (d) If a person fails the test, no railroad shall permit or require that person to work as a certified signal… | |||||
| 49:49:4.1.1.1.40.2.137.15 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.123 Monitoring operational performance. | FRA | (a) Each railroad's certification program shall describe how it will monitor the operational performance of its certified signal employees by including procedures for: (1) Giving each certified signal employee at least one unannounced compliance test each calendar year in one of the following areas: the railroad's signal system standards and test procedures, or Federal regulations concerning signal systems, except as provided for in paragraph (d) of this section; (2) Giving unannounced compliance tests to certified signal employees who return to signal work that requires certification pursuant to this part, as described in paragraph (d) of this section; (3) What actions the railroad will take if it finds deficiencies in a certified signal employee's performance during an unannounced compliance test; and (4) Monitoring the performance of signal-related tasks. (b) An unannounced compliance test shall: (1) Be performed by a certified signal employee; and (2) Be given to each certified signal employee at least once each calendar year, except as provided for in paragraph (d) of this section. (c) If the railroad's certification program classifies signal employees pursuant to § 246.107, the unannounced compliance test shall be within scope of the certified signal employee's classification. (d) A certified signal employee who is not performing signal work that requires certification pursuant to this part does not need to be given an unannounced compliance test. However, when the certified signal employee returns to signal work that requires certification pursuant to this part, the railroad shall: (1) Give the certified signal employee an unannounced compliance test within 30 days of their return to signal work that requires certification; and (2) Retain a written record that includes the following information: (i) The date the certified signal employee stopped performing work that required certification pursuant to this part; (ii) The date the certified signal employee returned to signal work that required c… | |||||
| 49:49:4.1.1.1.40.2.137.16 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.124 Mentoring. | FRA | (a) Each railroad's certification program shall include procedures for the mentoring of persons who have not been certified by the railroad. Each railroad shall identify potential scenarios in which mentoring of non-certified persons will be provided. (b) After FRA has approved a railroad's certification program pursuant to this part, the railroad shall not permit or require any person to perform work on a signal system or signal-related technology on its territory that requires certification unless the railroad first determines that: (1) The person is a certified signal employee who has been certified by the railroad and qualified on all applicable signal system equipment and signal-related technology deployed on the railroad; or (2) The person is working under the direct and immediate supervision of a mentor or qualified instructor. (c) If the railroad elects to classify its certified signal employees into more than one occupational category or subcategory pursuant to § 246.107: (1) The railroad shall address in its certification program how mentoring will be provided for certified signal employees who move into a different occupational category or subcategory of certified signal service; and (2) Mentors shall be certified within the occupational category or subcategory of the task being performed by the person or persons working under their direct and immediate supervision. (d) If allowed by the railroad's certification program, any work on a signal system performed by a person whose signal employee certification has been revoked shall be performed under the direct and immediate supervision of a mentor or qualified instructor. (e) Each railroad's certification program shall address how mentoring will be provided to ensure that mentors are located in close proximity to each person or persons they are mentoring to allow the mentor to take immediate action to prevent a violation of § 246.303(e) from occurring. Each railroad's certification program shall also address how mentors will be held accountable fo… | |||||
| 49:49:4.1.1.1.40.2.137.17 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.125 Certification determinations made by other railroads. | FRA | (a) A railroad or parent company that is considering certification of a person as a signal employee (“certifying railroad or parent company”) may rely on certain determinations made by another railroad or parent company concerning that person's certification. (b) A certifying railroad or parent company that relies on the certification determinations made by another railroad shall be responsible for making the following determinations: (1) The person's signal employee certification is still valid under §§ 246.201 and 246.307; (2) The person has been qualified on the signal system equipment and signal-related technology deployed on the railroad territory on which the person is expected to work in accordance with § 246.119; and (3) The person has demonstrated the necessary knowledge concerning the certifying railroad or parent company's signal standards, test procedures, and instructions for the installation, operation, testing, maintenance, troubleshooting, and repair of the certifying railroad or parent company's signal system equipment and signal-related technology in accordance with § 246.121. | |||||
| 49:49:4.1.1.1.40.2.137.2 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.103 FRA review of certification programs. | FRA | (a) Certification program submission schedule for railroads with signal systems in operation. With the exception of railroads exempted by § 246.3(a), each railroad with a signal system in operation as of July 22, 2024, shall submit its signal employee certification program to FRA, in accordance with the procedures and requirements contained in § 246.106, according to the following schedule: (1) All Class I railroads (including the National Railroad Passenger Corporation) and railroads providing commuter service shall submit their programs to FRA no later than March 17, 2025. (2) All Class II railroads and Class III railroads (including a switching, terminal, or other railroad not otherwise classified) shall submit their programs to FRA no later than November 12, 2025. (b) Certification program submission for new railroads. Each railroad that commences operations after July 22, 2024 shall submit to FRA, and obtain FRA approval of, its written signal employee certification program, in accordance with the procedures and requirements contained in § 246.106, prior to installing, implementing, or operating a signal system subject to this part. (c) Method for submitting certification programs to FRA. (1) Railroads must submit their written certification programs and their requests for FRA approval (described in § 246.106(a)) by emailing the program and the request for FRA approval to FRASIGNALCERTPROG@dot.gov. (2) A parent company may submit a written certification program on behalf of one or more subsidiary railroads in accordance with § 246.106(a). (d) Notification requirements. Each railroad or parent company that submits a certification program to FRA must: (1) Simultaneously with its submission, provide a copy of the program and the request for FRA approval to the president of each labor organization that represents the railroad's signal employees and to all of the railroad's signal employees who are subject to this part; and (2) Include in its submission to FRA, a statement affirming that the rail… | |||||
| 49:49:4.1.1.1.40.2.137.3 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.105 Implementation schedule for certification programs. | FRA | (a) Each railroad that submits its signal employee certification program to FRA in accordance with § 246.103(a), may continue rail operations while it awaits approval of its program by FRA. However, if FRA disapproves a railroad's program on two occasions and the railroad continues rail operations, FRA may consider such actions to be a failure to implement a program. (b) Each railroad that submits its signal employee certification program to FRA in accordance with § 246.103(b), must have its program approved by FRA prior to installing, implementing, or operating signal systems subject to this part. If a railroad installs, implements, or operates a signal system before its program is approved by FRA, FRA may consider such actions to be a failure to implement a program. (c) By March 17, 2025, each railroad shall: (1) In writing, designate as certified signal employees all persons authorized by the railroad to perform the duties of a certified signal employee as of March 17, 2025; and (2) Issue a certificate that complies with § 246.207 to each person that it designates. (d) Between March 17, 2025 and the date FRA approves the railroad's certification program, each railroad shall: (1) In writing, designate as a certified signal employee any person who has been authorized by the railroad to perform the duties of a certified signal employee between March 17, 2025 and the date FRA approves the railroad's certification program; and (2) Issue a certificate that complies with § 246.207 to each person that it designates. (e) After March 17, 2025, no railroad shall permit or require a person to perform service as a certified signal employee unless that person is a certified signal employee. (f) No railroad shall permit or require a person, designated as a certified signal employee under the provisions of paragraph (c) or (d) of this section, to perform service as a certified signal employee for more than three years after the date FRA approves the railroad's certification program unless that person has been tested … | |||||
| 49:49:4.1.1.1.40.2.137.4 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.106 Requirements for certification programs. | FRA | (a) Railroad and parent company certification program submission. (1)(i) A railroad's certification program submission must include a copy of its certification program and a request for FRA approval. (ii) Any parent company that submits a single certification program for one or more subsidiary railroads shall provide a list of its railroads that will utilize the program. (iii) If a parent company submits a certification program on behalf of one or more of its subsidiary railroads, the parent company shall assume responsibility for compliance with this part for all railroads identified on the list required by paragraph (a)(1)(ii) of this section. (2) For a railroad or parent company's initial certification program submission, the request for FRA approval can be in letter or narrative format and shall include a statement that the railroad or parent company is seeking approval of its program from FRA. (3) If a railroad or parent company is making a material modification to a program that has been previously approved by FRA, the request for FRA approval can be in letter or narrative format and shall include a copy of the modified certification program that identifies all proposed changes from the last FRA-approved version of the program. (4) A railroad or parent company will receive approval or disapproval notices from FRA by email. (5) FRA may electronically store any materials required by this part. (b) Organization of the certification program. Each certification program must be organized to present the required information in paragraphs (b)(1) through (6) of this section. Each section of the certification program must begin with the name, title, telephone number, and email address of the person to be contacted concerning the matters addressed by that section. If a person is identified in a prior section, it is sufficient to merely repeat the person's name in a subsequent section. (1) Section One of the certification program: General information and elections. (i) The first section of the certificati… | |||||
| 49:49:4.1.1.1.40.2.137.5 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.107 Signal service classifications. | FRA | (a) A railroad may classify its certified signal employees in occupational categories or subcategories by class, task, location, or other suitable terminology, in accordance with an FRA-approved certification program that complies with the requirements of this part. (b) Any person called to work on a signal system or signal-related technology on which they have not been certified shall immediately notify the railroad or their employer that they are not certified to work on the signal system or signal-related technology. (c) After FRA has approved a railroad's certification program pursuant to this part, no railroad shall permit a person to work on a signal system or signal-related technology on which the person has not been certified and qualified, unless the person works under the direct and immediate supervision of a mentor or qualified instructor in accordance with § 246.124. | |||||
| 49:49:4.1.1.1.40.2.137.6 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.109 Determinations required for certification and recertification. | FRA | (a) After FRA has approved a railroad's signal employee certification program, the railroad, prior to initially certifying or recertifying any person as a signal employee, shall, in accordance with its FRA-approved program, determine in writing that: (1) The individual meets the prior safety conduct eligibility requirements of §§ 246.111 and 246.113; (2) The individual meets the eligibility requirements of §§ 246.115 and 246.303; (3) The individual meets the visual and hearing acuity standards of §§ 246.117 and 246.118; (4) If applicable, the individual has completed a training program that meets the requirements of § 246.119; (5) The individual meets the qualification requirements of § 246.120; and (6) The individual has the necessary knowledge, as demonstrated by successfully completing testing and practical demonstration that meet the requirements of § 246.121. (b) Nothing in this section, § 246.111, or § 246.113 shall be construed to prevent persons subject to this part from entering into an agreement that results in a railroad obtaining the information needed for compliance with this subpart in a different manner than that prescribed in § 246.111 or § 246.113. | |||||
| 49:49:4.1.1.1.40.2.137.7 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.111 Prior safety conduct as motor vehicle operator. | FRA | (a) Except as provided in paragraphs (b) through (e) of this section, after FRA has approved a railroad's signal employee certification program, the railroad, prior to certifying or recertifying any person as a signal employee, shall determine that the person meets the eligibility requirements of this section involving prior conduct as a motor vehicle operator. (b) A railroad shall certify a person as a signal employee for 60 days if the person: (1) Requested the information required by paragraph (g) of this section at least 60 days prior to the date of the decision to certify that person; and (2) Otherwise meets the eligibility requirements provided in § 246.109(a)(1) through (6). (c) A railroad shall recertify a person as a signal employee for 60 days from the expiration date of that person's certification if the person: (1) Requested the information required by paragraph (g) of this section at least 60 days prior to the date of the decision to recertify that person; and (2) Otherwise meets the eligibility requirements provided in § 246.109(a)(1) through (6). (d) Except as provided in paragraph (e) of this section, if a railroad who certified or recertified a person for 60 days pursuant to paragraph (b) or (c) of this section does not obtain and evaluate the information requested pursuant to paragraph (g) of this section within those 60 days, that person will be ineligible to perform as a certified signal employee until the information can be evaluated by the railroad. (e) If a person requests the information required pursuant to paragraph (g) of this section but is unable to obtain it, that person or the railroad certifying or recertifying that person may petition for a waiver of the requirements of paragraph (a) of this section in accordance with the provisions of part 211 of this chapter. A railroad shall certify or recertify a person during the pendency of the waiver request if the person otherwise meets the eligibility requirements provided in § 246.109(a)(1) through (6). (f) Except for persons de… | |||||
| 49:49:4.1.1.1.40.2.137.8 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.113 Prior safety conduct with other railroads. | FRA | (a) After FRA has approved a railroad's signal employee certification program, the railroad shall determine, prior to issuing any person a signal employee certificate, that the certification candidate meets the eligibility requirements of this section. (b) If the certification candidate has not been employed or certified by any other railroad in the previous five years, they do not have to submit a request in accordance with paragraph (c) of this section, but they must notify the railroad of this fact in accordance with procedures established by the railroad in its certification program. (c) Except as provided for in paragraph (b) of this section, each person seeking certification or recertification under this part shall submit a written request to each railroad that employed or certified the person within the previous five years to provide the following information to the railroad that is considering whether to certify or recertify that person as a signal employee: (1) Information about that person's compliance with § 246.111 within the three years preceding the date of the request; (2) Information about that person's compliance with § 246.115 within the five years preceding the date of the request; and (3) Information about that person's compliance with § 246.303 within the five years preceding the date of the request. (d) Each person submitting a written request required by paragraph (c) of this section shall: (1) Submit the request no more than one year before the date of the railroad's decision on certification or recertification; and (2) Take any additional actions, including providing any necessary consent required by State or Federal law to make information concerning their service record available to the railroad. (e) Within 30 days after receipt of a written request that complies with paragraph (c) of this section, a railroad shall provide the information requested to the railroad designated in the written request. (f) If a railroad is unable to provide the information requested within 30 days… | |||||
| 49:49:4.1.1.1.40.2.137.9 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | B | Subpart B—Program and Eligibility Requirements | § 246.115 Substance abuse disorders and alcohol drug rules compliance. | FRA | (a) Eligibility determination. After FRA has approved a railroad's signal employee certification program, the railroad shall determine, prior to issuing any person a signal employee certificate, that the person meets the eligibility requirements of this section. (b) Documentation. In order to make the determination required under paragraph (c) of this section, a railroad shall have on file documents pertinent to that determination, including a written document from its DAC which states their professional opinion that the person has been evaluated as not currently affected by a substance abuse disorder or that the person has been evaluated as affected by an active substance abuse disorder. (c) Fitness requirement. (1) A person who has an active substance abuse disorder shall be denied certification or recertification as a signal employee. (2) Except as provided in paragraph (e) of this section, a certified signal employee who is determined to have an active substance abuse disorder shall be ineligible to hold certification. Consistent with other provisions of this part, certification may be reinstated as provided in paragraph (e) of this section. (3) In the case of a current employee of a railroad evaluated as having an active substance abuse disorder (including a person identified under the procedures of § 246.111), the employee may, if otherwise eligible, voluntarily self-refer for substance abuse counseling or treatment under the policy required by § 219.1001(b)(1) of this chapter; and the railroad shall then treat the substance abuse evaluation as confidential except with respect to ineligibility for certification. (d) Prior alcohol/drug conduct; Federal rule compliance. (1) In determining whether a person may be or remain certified as a signal employee, a railroad shall consider conduct described in paragraph (d)(2) of this section that occurred within a period of five consecutive years prior to the review. A review of certification shall be initiated promptly upon the occurrence and documentatio… | |||||
| 49:49:4.1.1.1.40.3.137.1 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | C | Subpart C—Administration of the Certification Program | § 246.201 Time limitations for certification. | FRA | (a) After FRA approves a railroad's signal employee certification program, that railroad shall not certify or recertify a person as a signal employee if the railroad is making: (1) A determination concerning eligibility under §§ 246.111, 246.113, 246.115, and 246.303 and the eligibility data being relied on was furnished more than one year before the date of the railroad's certification decision; (2) A determination concerning vision or hearing acuity and the medical examination being relied on was conducted more than 450 days before the date of the railroad's certification decision; or (3) A determination concerning demonstrated knowledge and the knowledge examination being relied on was conducted more than one year before the date of the railroad's certification decision, or more than two years before the date of the railroad's certification decision if the railroad administers knowledge testing pursuant to § 246.121 at intervals that do not exceed two years. (b) The time limitations of paragraph (a) of this section do not apply to a railroad that is making a certification decision in reliance on determinations made by another railroad in accordance with § 246.125. (c) Except if a person is designated as a certified signal employee under § 246.105(c) or (d), no railroad shall certify a person as a signal employee for an interval of more than three years. (d) Each railroad shall issue each certified signal employee a certificate that complies with § 246.207 no later than 30 days from the date of its decision to certify or recertify that person. | |||||
| 49:49:4.1.1.1.40.3.137.2 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | C | Subpart C—Administration of the Certification Program | § 246.203 Retaining information supporting determinations. | FRA | (a) After FRA approves a railroad's signal employee certification program, any time the railroad issues, denies, or revokes a certificate after making the determinations required under § 246.109, it shall maintain a record for each certified signal employee and certification candidate. Each record shall contain the information, described in paragraph (b) of this section, that the railroad relied on in making the determinations required under § 246.109. (b) A railroad shall retain the following information: (1) Relevant data from the railroad's records concerning the person's prior safety conduct and eligibility; (2) Relevant data furnished by another railroad; (3) Relevant data furnished by a governmental agency concerning the person's motor vehicle driving record; (4) Relevant data furnished by the person seeking certification concerning their eligibility; (5) The relevant test results data concerning visual and hearing acuity; (6) If applicable, the relevant data concerning the professional opinion of the railroad's medical examiner on the adequacy of the person's visual or hearing acuity; (7) Relevant data from the railroad's records concerning the person's success or failure on knowledge test(s) under § 246.121; (8) A sample copy of the written knowledge test or tests administered; and (9) The relevant data from the railroad's records concerning the person's success or failure on unannounced tests the railroad performed to monitor the person's performance in accordance with § 246.123. (c) If a railroad is relying on successful completion of a training program conducted by another entity, the relying railroad shall maintain a record for each certification candidate that contains the relevant data furnished by the training entity concerning the person's demonstration of knowledge relied on by the railroad in making its determinations. (d) If a railroad is relying on a certification decision initially made by another railroad, the relying railroad shall maintain a record for each certification candid… | |||||
| 49:49:4.1.1.1.40.3.137.3 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | C | Subpart C—Administration of the Certification Program | § 246.205 List of certified signal employees and recordkeeping. | FRA | (a) After a railroad's certification program has received its initial approval from FRA, pursuant to § 246.103(f)(1), the railroad must maintain a list of each person who is currently certified as a signal employee by the railroad. The list must include the date of the railroad's certification decision and the date the person's signal employee certification expires. If a railroad classifies its certified signal employees into occupational categories or subcategories by class, task, location, or other suitable terminology, the list must indicate the occupational categories and subcategories in which each certified signal employee is certified to perform service. (b) The list shall: (1) Be updated at least annually; (2) Be made available, upon request, to FRA representatives in a timely manner; and (3) Be available either: (i) In electronic format pursuant to paragraph (c) of this section; or (ii) At the divisional or regional headquarters of the railroad. (c) If a railroad elects to maintain its list in an electronic format, it must: (1) Maintain an information technology security program adequate to ensure the integrity of the electronic data storage system, including the prevention of unauthorized access to the program logic or the list; (2) Have its program and data storage system protected by a security system that utilizes an employee identification number and password, or a comparable method, to establish appropriate levels of program access meeting all of the following standards: (i) No two individuals have the same electronic identity; and (ii) An entry on the list cannot be deleted or altered by any individual after the entry is certified by the employee who created the entry; (3) Have any amendment to the list either: (i) Electronically stored apart from the entry on the list that it amends; or (ii) Electronically attached to the entry on the list as information without changing the original entry; (4) Ensure that each amendment to the list uniquely identifies the person making the amendme… | |||||
| 49:49:4.1.1.1.40.3.137.4 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | C | Subpart C—Administration of the Certification Program | § 246.207 Certificate requirements. | FRA | (a) Each person who becomes a certified signal employee in accordance with this part shall be issued a paper or electronic certificate that: (1)(i) Identifies the railroad issuing the certificate; or (ii) Identifies the parent company issuing the certificate, if a parent company submits a certification program for one or more of its subsidiary railroads. The certificate issued by the parent company shall also list each subsidiary railroad on which the person is certified to work as a signal employee; (2) Indicates it is a signal employee certificate and, if applicable, lists all signal employee occupational categories or subcategories developed pursuant to § 246.107 in which the person is certified; (3) Provides the following information about the certified signal employee: (i) Name; (ii) Employee identification number; and (iii) Either a physical description or photograph of the person; (4) Identifies any conditions or limitations, including conditions to ameliorate vision or hearing acuity deficiencies, that restrict, limit, or alter the person's abilities to work as a certified signal employee; (5) Shows the effective date of the certification; (6) Shows the expiration date of the certification unless the certificate was issued pursuant to § 246.105(c) or (d); (7) Has been signed by an individual designated in accordance with paragraph (b) of this section; and (8) Is electronic or of sufficiently small size to permit being carried in an ordinary pocket wallet. (b) Each railroad or parent company shall designate in writing any person it authorizes to sign the certificates described in this section. The designation shall identify such persons by name or job title. (c) Nothing in this section shall prohibit any railroad or parent company from including additional information on the certificate or supplementing the certificate through other documents. (d) It shall be unlawful for any railroad or parent company to knowingly or any individual to willfully: (1) Make, cause to be made, or participate i… | |||||
| 49:49:4.1.1.1.40.3.137.5 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | C | Subpart C—Administration of the Certification Program | § 246.213 Multiple certifications. | FRA | (a) A person who holds a signal employee certificate may: (1) Hold a signal employee certificate for multiple types of signal service; and (2) Be certified in other crafts, such as a locomotive engineer or conductor. (b) A railroad that issues multiple certificates to a person, shall, to the extent possible, coordinate the expiration date of those certificates. (c) Paragraphs (c)(1) through (3) of this section apply to persons who are currently certified as a signal employee for multiple railroads or are seeking to become certified signal employees for multiple railroads. (1) A person who holds a current signal employee certificate from more than one railroad shall immediately notify the other certifying railroad(s) if they are denied signal employee certification or recertification under § 246.301 by a railroad or have their signal employee certification suspended or revoked under § 246.307 by a railroad. (2) If a person has their signal employee certification suspended or revoked by a railroad under § 246.307, they shall not work as a certified signal employee for any railroad during the period that their certification is suspended or revoked, except as provided for in § 246.124(d). (3) If a person has their signal employee certification suspended or revoked by a railroad under § 246.307, they shall notify any railroad from whom they are seeking signal employee certification that their signal employee certification is currently suspended or revoked by another railroad. (d) Paragraphs (d)(1) through (3) of this section apply to persons who are currently certified as a signal employee and also currently certified in another railroad craft, such as a locomotive engineer or conductor: (1) If a person's signal employee certification is revoked under § 246.307 for a violation of § 246.303(e)(11), they shall not work in another certified railroad craft, such as a locomotive engineer or conductor, during the period of revocation. (2) If a person's signal employee certification is revoked under § 246.307 for a… | |||||
| 49:49:4.1.1.1.40.3.137.6 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | C | Subpart C—Administration of the Certification Program | § 246.215 Railroad oversight responsibilities. | FRA | (a) No later than March 31 of each year (beginning in calendar year 2027), each Class I railroad (including the National Railroad Passenger Corporation), each railroad providing commuter service, and each Class II railroad shall conduct a formal annual review and analysis concerning the administration of its program for responding to detected instances of poor safety conduct by certified signal employees during the prior calendar year. (b) Each review and analysis shall involve: (1) The number and nature of the instances of detected poor safety conduct including the nature of the remedial action taken in response thereto; (2) The number and nature of FRA reported accidents/incidents attributed to poor safety performance by signal employees; and (3) The number and type of operational monitoring test failures recorded by certified signal employees conducting compliance tests pursuant to § 246.123. (c) Based on that review and analysis, each railroad shall determine what action(s) it will take to improve the safety of railroad operations to reduce or eliminate future accidents/incidents of that nature. (d) If requested in writing by FRA, by the president of a labor organization that represents the railroad's signal employees, or by a railroad's certified signal employee who is not represented by a labor organization, the railroad shall provide a report of the findings and conclusions reached during such annual review and analysis effort. (e) For reporting purposes, information about the nature of detected poor safety conduct shall be capable of segregation for study and evaluation purposes into the following categories: (1) Incidents involving noncompliance with railroad rules and procedures governing the removal from service of: (i) Highway-rail and pathway grade crossing warning devices and systems; and (ii) Wayside signal devices and systems; (iii) Other devices or signal systems subject to this part. (2) Incidents involving noncompliance with railroad rules and procedures governing the restoration of… | |||||
| 49:49:4.1.1.1.40.4.137.1 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | D | Subpart D—Denial and Revocation of Certification | § 246.301 Process for denying certification. | FRA | (a) A railroad shall notify a candidate for certification or recertification of information known to the railroad that forms the basis for denying the person certification and provide the candidate a reasonable opportunity to explain or rebut that adverse information in writing prior to denying certification. A railroad shall provide the candidate with any documents or records, including written statements, related to failure to meet a requirement of this part that support its pending denial decision. (b) If a railroad denies a person certification or recertification, it shall issue a decision that complies with all of the following requirements: (1) It must be in writing. (2) It must explain the basis for the railroad's denial decision. (3) It must address any explanation or rebuttal information that the candidate provides pursuant to paragraph (a) of this section. (4) It must include the date of the railroad's decision. (5) It must be served on the person no later than 10 days after the railroad's decision. (c) A railroad shall not deny the person's certification for failing to comply with a railroad test procedure, signal standard, or practice which constitutes a violation under § 246.303(e)(1) through (10) if sufficient evidence exists to establish that an intervening cause prevented or materially impaired the person's ability to comply with that railroad test procedure, signal standard, or practice. | |||||
| 49:49:4.1.1.1.40.4.137.2 | 49 | Transportation | II | 246 | PART 246—CERTIFICATION OF SIGNAL EMPLOYEES | D | Subpart D—Denial and Revocation of Certification | § 246.303 Criteria for revoking certification. | FRA | (a) It shall be unlawful to fail to comply with any of the railroad rules or practices described in paragraph (e) of this section. (b) A certified signal employee who fails to comply with a railroad test procedure, signal standard or practice described in paragraph (e) of this section shall have their certification revoked. (c) A certified signal employee who is assigned to monitor, mentor, or instruct a signal employee and fails to take appropriate action to prevent a violation of paragraph (e) of this section shall have their certification revoked. (d) A certified signal employee who is called by a railroad to perform a duty other than that of a signal employee shall not have their signal employee certification revoked based on actions taken or not taken while performing that duty except for violations described in paragraph (e)(11) of this section. (e) When determining whether to revoke a person's signal employee certification, a railroad shall only consider violations of Federal regulatory provisions or railroad rules, procedures, signal standards, and practices that involve: (1) Interfering with the normal functioning of a highway-rail grade crossing warning system under § 234.209 of this chapter, or signal system under § 236.4 of this chapter, without providing an alternative means of protection. (Railroads shall only consider those violations that result in an activation failure or false proceed signal.) (2) Failure to comply with a railroad rule or procedure when removing from service: (i) Highway-rail or pathway grade crossing warning devices and systems; (ii) Wayside signal devices or signal systems; or (iii) Other devices or signal systems subject to this part. (3) Failure to comply with railroad rule or procedure when placing in service or restoring to service: (i) Highway-rail and pathway grade crossing warning devices and systems; (ii) Wayside signal devices or signal systems; or (iii) Other devices or signal systems subject to this part. (4) Failure to perform an inspection or test to… |
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