The SMART Voluntary Short Term Disability Plan (VSTD) has temporarily suspended the elimination period for COVID-19 disabilities. Previously, the waiver of the elimination period began in the month of March and extended through May of this year and then was once again extended until November 2020.
SMART, in conjunction with Southern Benefit Administrators, is pleased to announce that the waiver of the elimination period is being extended through February 28, 2021. Effective with all diagnosed COVID-19 disabilities beginning in the months of March 2020 through February 2021, the Plan’s elimination period will be waived. A member must usually be disabled for 21 days before benefits will begin on the 22nd day. With the waiver of the elimination period, members who have tested positive for COVID-19 will have earlier access to benefits.
The waiting period will be reinstated for COVID-19 disabilities beginning on or after March 1, 2021.
Click here for a pdf of this announcement.
Author: amyr
Brothers and Sisters,
It has been one challenging year for us all and many of you have been hit extremely hard by COVID-19 – if not by the virus itself, by the impact it has had on the railroad industry. As you may have heard, Congress recently enacted legislation to provide some financial relief.
In the legislation entitled the Continued Assistance to Rail Workers Act of 2020, as outlined below, Congress essentially extended the benefits created by the CARES Act. In addition, Congress has finally granted some relief from sequestration – though not permanent. The legislation grants temporary relief from sequestration beginning 10 days from enactment through 30 days after the date on which the Presidential declaration of emergency for COVID terminates. This means that railroad employees will no longer have their regular unemployment and sickness benefits reduced for sequestration during the specified time period. In addition, the temporary relief is not retroactive to any earlier period of time.
Similar to the CARES Act, this legislation provides for the following benefits:
- A recovery benefit of $600 per two-week unemployment registration period. The duration is for registration periods from December 26, 2020, to March 14, 2021. This amount is down from $1,200 per registration period in the CARES Act.
- Extended unemployment benefits for employees who have otherwise exhausted benefits. These are payable for claims starting after enactment and on or before March 14, 2021. No extended benefits are payable after April 5, 2021.
- Waiver of the seven-day waiting period for unemployment and sickness benefits. This was also extended to March 14, 2021.
As with previous legislation, the RRB will update the information on its website with the details regarding these benefits.
In addition, the Railroad Retirement Board’s (RRB)’s budget for fiscal year (FY) 2021 has been finalized. In the annual funding legislation, Congress provided for $123.5 million in appropriations for the RRB, which includes $9M for IT investment initiatives. Unfortunately, the total amount provided remains the same as FY 2020, but there was a change of allocation. The amount allocated for IT investment initiatives was decreased from $10M for FY 2020 to $9M for FY 2021, which translates to an increase in the agency’s general administrative budget from $113.5M for FY 2020 to $114.5M for FY 2021. This $1M increase in the general administrative budget will help cover some of the annual cost increases that the agency anticipates.
As a reminder, the agency is still facing pressure from short-staffing in field service offices and at RRB headquarters. RRB is still experiencing high call volume due to COVID-19 related issues, and anticipates the annual spike in calls that generates through January of each year. Those calling the agency’s toll-free number in January commonly ask about income tax statements, which will be mailed out by January 19, 2021. The RRB will not accept requests for duplicate tax statements until February 1, 2021.
With most RRB field offices still closed to the public because of the pandemic, the agency is again reminding customers of the self-service options available to them to help avoid lengthy wait times. I encourage all railroaders to set up a myRRB.gov account on the RRB.gov website to help avoid any possible delays. Customers can request the following documents online by visiting RRB.gov/myRRB:
- Letters verifying income and monthly benefit rates
- Service and compensation statement
- Replacement Medicare card
- Duplicate tax statement (CY 2021 available after January 31, 2021)
In addition, railroad employees who have established myRRB accounts can log in and:
- Apply for and claim unemployment benefits
- Claim sickness benefits
- Check the status of their unemployment or sickness benefit claims
- View their railroad service and compensation history
- Get an estimate of retirement benefits
To establish an account, employees should go to RRB.gov/myRRB and click on the button labeled SIGN IN WITH LOGIN.GOV at the top of the page. This directs them to login.gov where they will be guided through the process of creating an account and verifying their identity — which takes about 20 minutes to complete. Once an employee’s identity is verified, they will be prompted to sign in to their account and then return to myRRB.
In closing, I would like to wish everyone in the rail community a healthy and happy 2021!
Over the past 1.5 weeks, the Federal Railroad Administration has published several notices in the Federal Register. Below are portions of those postings, including: Drug and alcohol testing: Determination of minimum random testing rates for 2021 (notification of determination); Qualification and certification of locomotive engineers – miscellaneous revisions (final rule); Positive train control systems (notice of proposed rulemaking); and Fatigue risk management programs for certain passenger and freight railroads (notice of proposed rulemaking).
Drug and alcohol testing: Determination of minimum random testing rates for 2021 (notification of determination) – (published 12/15/2020)
Supplementary information:
FRA is announcing the 2021 minimum annual random drug and alcohol testing rates for covered service and MOW employees. For calendar year 2021, the minimum annual random testing rates for covered service employees will continue to be 25% for drugs and 10% for alcohol, while the minimum annual random testing rates for MOW employees will continue to be 50% for drugs and will be lowered to 10% for alcohol. Because these rates represent minimums, railroads and contractors may conduct FRA random testing at higher rates.
Discussion:
To set its minimum annual random testing rates for each year, FRA examines the last two complete calendar years of railroad industry drug and alcohol program data submitted to its Management Information System (MIS). FRA has also, however, reserved the right to consider factors other than MIS-reported data before deciding whether to lower annual minimum random testing rates. See 63 FR 71789 (Dec. 30, 1998).
Random testing rates for covered service employees
The rail industry’s random drug testing positive rate for covered service employees (employees subject to the Federal hours of service laws and regulations) remained below 1.0% for 2018 and 2019. The administrator has therefore determined the minimum annual random drug testing rate for the period January 1, 2021, through December 31, 2021, will remain at 25% for covered service employees. The industry-wide random alcohol testing violation rate for covered service employees remained below 0.5% for 2018 and 2019. Therefore, the administrator has determined the minimum random alcohol testing rate will remain at 10% for covered service employees for the period January 1, 2021, through December 31, 2021.
Random testing rates for MOW employees
MOW employees became subject to FRA random drug and alcohol testing in June 2017. See 81 FR 37894 (June 10, 2016). FRA now has MIS data for two full consecutive years of the industry-wide performance rates for MOW employees, 2018 and 2019. While FRA may lower the minimum random drug testing rate to 25% whenever the industry-wide random drug positive rate is less than 1.0 percent for two consecutive calendar years while testing at the 50% rate, FRA has reserved the right to consider other factors before deciding whether to lower annual minimum random testing rates. See 63 FR 71789 (Dec. 30, 1998).
As illustrated in the figures in the appendix below, in contrast to the drug testing positive rate for covered service employees that remained substantially below 1.0% for 2018 and 2019, the random drug testing positive rate for MOW employees is not only trending upwards, but also approaching the 1.0% positive rate threshold at which point the administrator will raise the drug testing rate under 49 CFR 219.625(d)(2). Specifically, the industry-wide random drug testing violation rate for MOW employees increased from 0.69% in 2018 to 0.8% in 2019, and MOW employees continue to have a higher positive testing rate than covered service employees.[1] The Administrator further notes that MOW employees who were performing duties for a railroad before June 12, 2017, were exempted from the pre-employment drug testing requirement. See 49 CFR 219.501(e). As such, some MOW employees may remain who have never been subject to FRA drug testing because they have not yet been randomly selected.
Taking these factors into consideration, the administrator finds it is currently not in the interest of railroad safety to lower the random drug testing rate for MOW employees. Therefore, for the period January 1, 2021, through December 31, 2021, the administrator has determined that the minimum annual random drug testing rate will continue to be 50% for MOW employees.
Because the random alcohol testing violation rate for MOW employees remained substantially below 0.5% for 2018 and 2019, and has been trending downwards, the administrator has determined that the minimum annual random alcohol testing rate will be lowered to 10% for MOW employees for the period January 1, 2021, through December 31, 2021.
Click here to read the full notice as published in the Federal Register.
Qualification and certification of locomotive engineers; miscellaneous revisions (final rule) – published 12/15/2020
Summary:
FRA is revising its regulation governing the qualification and certification of locomotive engineers to make it consistent with its regulation for the qualification and certification of conductors. The changes include: Amending the program submission process; handling engineer and conductor petitions for review with a single FRA review board (Operating Crew Review Board or OCRB); and revising the filing requirements for petitions to the OCRB. To ensure consistency throughout its regulations, FRA is also making conforming amendments to its regulations governing the control of alcohol and drug use, and the qualification and certification of conductors. The changes would reduce regulatory burdens on the railroad industry while maintaining the existing level of safety.
Dates:
This regulation is effective January 14, 2021.
Executive Summary
On May 9, 2019, FRA issued a notice of proposed rulemaking (NPRM) to amend title 49 Code of Federal Regulations (CFR) part 240, Qualification and Certification of Locomotive Engineers (part 240).[1] In response to that NPRM, FRA received three written comments.
This final rule responds to those comments and amends part 240 by: Making part 240 more consistent with the language in 49 CFR part 242, Qualification and Certification of Conductors (part 242); creating two provisions under which railroads may issue temporary locomotive engineer certifications; merging FRA’s locomotive engineer and conductor review boards; adopting aspects of part 242 for locomotive engineer certification; providing labor representatives with the ability to provide input on a railroad’s part 240 program; and allowing for and encouraging the use of electronic document submission of a railroad’s part 240 program. This final rule also makes technical amendments to part 242 to: (1) Make the requirement for calibration of audiometers used during hearing tests for conductors the same as the requirement in part 240 for locomotive engineers; and (2) conform the definition of “main track” in part 242 to the definition of “main track” in part 240.
Additionally, this final rule makes conforming amendments to title 49 CFR part 219, Control of Alcohol and Drug Use (part 219) to update two cross-references to part 240. Updating these references is necessary to ensure consistency between part 219 and part 240, as amended.
The final rule will create new costs. First, each locomotive engineer certification manager will need to review the amendments made to part 240 to ensure compliance is maintained. Second, amendments to part 240 will require each railroad to provide a copy of its part 240 plan to the president of each labor organization whenever the railroad files a submission, resubmission, or makes a material modification to its plan. Third, a railroad will need to maintain service records for certified locomotive engineers who are not performing service that requires locomotive engineer certification. For the 20-year period of analysis, the cost of the final rule will be $233,779 (undiscounted), $171,764 (PV 7%), and $200,775 (PV 3%).
The final rule will also create cost savings. First, adding clarity in part 240 and conforming language in part 240 to part 242 will reduce stakeholder burden related to review and compliance with part 240. Second, it will reduce the burden on a railroad when providing another railroad with information about a former employee’s prior service records. Third, it will update the program submission process to allow for electronic document submission, which will reduce stakeholder paperwork and submission costs related to part 240 program submissions and locomotive engineer certification petitions. Fourth, it will remove the requirement for railroads to obtain a waiver from the annual testing requirements for certified locomotive engineers who are not performing service that requires certification. For the 20-year period of analysis, the cost savings of the final rule will be $12.3 million (undiscounted), $6.9 million (PV 7%), and $9.4 million (PV 3%).
As shown in Table ES.1, the regulatory evaluation quantifies the economic impact of the final rule in terms of cost savings and new costs accruing to stakeholders. For the 20-year period of analysis, the final rule will result in a net cost savings of $12.0 million (undiscounted), $6.8 million (PV 7%), and $9.2 million (PV 3%). This final rule is an Executive Order (E.O.) 13771 deregulatory action. Details on the estimated costs of this final rule can be found in the rule’s economic analysis.
The final rule will create benefits. First, the final rule will amend the part 240 program submission process to require railroads to solicit labor input, providing for fully informed decisions by railroads. Second, it affords railroads additional time and flexibility to comply with some regulatory requirements. Third, it creates certain provisions that allow for temporary locomotive engineer certificates. Fourth, electronic filing will make information more accessible to interested stakeholders and the public. Because FRA lacks sufficient information related to these four benefits, this analysis could not accurately quantify these benefits. Therefore, the rule’s economic analysis qualitatively explains benefits.
The final rule will also reduce Governmental administrative costs, including mailing, filing, and storing costs related to amendments to part 240, by allowing the Government and stakeholders to transmit and store documents electronically.
This is just a small portion of the actual notice in the Federal Register. Click here to read the full final rule as published in the Federal Register.
Positive train control systems (notice of proposed rulemaking) – published 12/18/2020
Summary:
FRA is proposing to revise its regulations governing changes to positive train control (PTC) systems and reporting on PTC system functioning. First, recognizing that the railroad industry intends to enhance further FRA-certified PTC systems to continue improving rail safety and PTC technology’s reliability and operability, FRA proposes to modify the process by which a host railroad must submit a request for amendment (RFA) to FRA before making certain changes to its PTC Safety Plan (PTCSP) and FRA-certified PTC system. Second, to enable more effective FRA oversight, FRA proposes to: Expand an existing reporting requirement by increasing the frequency from annual to biannual; broaden the reporting requirement to encompass positive performance-related information, not just failure-related information; and require host railroads to utilize a new, standardized Biannual Report of PTC System Performance (Form FRA F 6180.152). Overall, the proposed amendments would benefit the railroad industry, the public, and FRA, by reducing unnecessary costs, facilitating innovation, and improving FRA’s ability to oversee PTC system performance and reliability, while not negatively affecting rail safety.
Dates:
Written comments must be received by February 16, 2021. FRA believes a 60-day comment period is appropriate to allow the public to comment on this proposed rule. FRA will consider comments received after that date to the extent practicable.
Addresses:
Comments: Comments related to Docket No. FRA-2019-0075 may be submitted by going to http://www.regulations.gov and following the online instructions for submitting comments.
Instructions: All submissions must include the agency name, docket number (FRA-2019-0075), and Regulation Identifier Number (RIN) for this rulemaking (2130-AC75). All comments received will be posted without change to https://www.regulations.gov; this includes any personal information. Please see the Privacy Act heading in the SUPPLEMENTARY INFORMATION section of this document for Privacy Act information related to any submitted comments or materials.
Docket: For access to the docket to read background documents or comments received, go to https://www.regulations.gov and follow the online instructions for accessing the docket.
This is just a small portion of the actual notice in the Federal Register. Click here to read the full notice of proposed rulemaking as published in the Federal Register.
Fatigue risk management programs for certain passenger and freight railroads (notice of proposed rulemaking) – published 12/22/2020
Summary:
Pursuant to the Rail Safety Improvement Act of 2008, FRA proposes to issue regulations requiring certain railroads to develop and implement a Fatigue Risk Management Program, as one component of the railroads’ larger railroad safety risk reduction programs.
Dates:
Written comments must be received by February 22, 2021. Comments received after that date will be considered to the extent practicable without incurring additional expense or delay.
Addresses:
Comments related to Docket No. FRA-2015-0122 may be submitted by going to http://www.regulations.gov and follow the online instructions for submitting comments.
Instructions: All submissions must include the agency name, docket name and docket number or Regulatory Identification Number (RIN) for this rulemaking (2130-AC54). Note that all comments received will be posted without change to http://www.regulations.gov, including any personal information provided. Please see the Privacy Act heading in the SUPPLEMENTARY INFORMATION section of this document for Privacy Act information on any submitted comments or materials.
Docket: For access to the docket to read background documents or comments received, go to http://www.regulations.gov.
Introduction and Executive Summary:
Purpose of Rulemaking
This proposed rule is part of FRA’s efforts to improve rail safety continually and to satisfy the statutory mandate of Section 103 of the Rail Safety Improvement Act of 2008 (RSIA).[1] That section, codified at 49 U.S.C. 20156, requires Class I railroads; railroad carriers with inadequate safety performance (ISP), as determined by the Secretary; and railroad carriers that provide intercity rail passenger or commuter rail passenger transportation to develop and implement a safety risk reduction program to improve the safety of their operations. The section further requires a railroad’s safety risk reduction program to include a “fatigue management plan” meeting certain requirements.
This proposed rule, if finalized, would fulfill RSIA’s mandate for railroads to include fatigue management plans in their safety risk reduction programs by requiring railroads to develop and implement Fatigue Risk Management Programs (FRMPs).[2] As proposed, a railroad would implement its FRMP through an FRMP plan.
Under this proposed rule, consistent with the mandate of Section 20156, an FRMP is a comprehensive, system-oriented approach to safety in which a railroad determines its fatigue risk by identifying and analyzing applicable hazards and takes action to mitigate, if not eliminate, that fatigue risk.[3] As proposed, a railroad would be required to prepare a written FRMP plan and submit it to FRA for review and approval. A railroad’s written FRMP plan would become part of its existing safety risk reduction program plan. A railroad would also be required to implement its FRA-approved FRMP plan, conduct an internal annual assessment of its FRMP, and consistent with Section 20156’s mandate, update its FRMP plan periodically. As part of a railroad safety risk reduction program, a railroad’s FRMP would also be subject to assessments by FRA.
This is just a small portion of the actual notice in the Federal Register. Click here to read the full notice of proposed rulemaking as published in the Federal Register.
The lifetime maximum benefit for the Railroad Employees National Early Retirement Major Medical Benefit (ERMA or GA-46000) Plan will increase from $171,100 to $175,700 beginning Jan. 1, 2021.
At the end of 2001, labor and management had agreed on various procedures to administer the annual changes in the amount of the lifetime maximum benefit under the ERMA Plan.
In conjunction with the formula established in 2001, a new lifetime maximum was calculated by utilizing the October 2020 consumer price index (CPI) data for Hospital and Related Services and Physician Services. The result is a lifetime maximum for 2021 of $175,700.
For individuals who have reached the lifetime maximum, the incremental maximum available is applied to eligible expenses submitted for dates of service on or after the effective date of the new maximum. For 2021, this amount will be $4,600.
This change will apply to all railroads and crafts participating in ERMA.
December 18, 2020
Brothers and Sisters:
As we find ourselves amid what is historically the most dangerous season of the year, I must unfortunately caution you of new additional intensified dangers borne from the Federal Railroad Administration’s (FRA) most recent Final Rulemaking. On Friday, December 11, 2020, the FRA granted an extensive and exhaustive list of regulation changes, the vast majority of which served to lower the bar of safety and increase the profit margin for this nation’s rail carriers. This is evidenced in the no less than two dozen references of cost savings to the carriers as a result of this rulemaking. Not only has the FRA once again vacated its role as the country’s chief safety regulator, but it has also failed in its own mission statement, vision, and purpose.
As you are aware, a known unsafe condition exists with the DB-10 brake valves in cold weather conditions. In fact your Union, on December 15, 2019, petitioned the FRA to issue an Emergency Order that would prioritize safety over productivity by requiring the replacement of the defective valves and disallow the railroads’ attempts to apply stopgap procedures that only camouflage and exacerbate the seriousness of the situation. That petition was unfortunately denied by the FRA muzzling our request for the safest course of action.
Due to the FRA’s reckless action, rolling stock is now permitted to be off-air for 24 hours before requiring a new brake inspection. This means that the only true method of identifying the faulty brake valves has been reduced immeasurably, if not eliminated altogether on certain properties. As a result, the regularity of brake inspections has now been reduced to a fraction of the previous standard, and, thus defective brake valves will be permitted to remain in service longer and be more apt to adversely affect a train’s braking capabilities. Given the consequence of these faulty valves remaining in place is that they render a train’s emergency brake feature inoperative, I am asking all to please remain diligent in your daily duties and to take nothing for granted. This includes railroad workarounds designed to mask flawed brake valves like drawing the brake pipe pressure down to zero before making a separation. Should a carrier official ask you to perform such a task, please notify my office as soon as it is safe and proper to do so, so that we may address it with the carrier and applicable government agencies.
The railroads have historically had trouble maintaining an accurate record of when a train or car(s) initiates its “off air” status (and that was with the four-hour limit). I highly anticipate major complications regarding the determination of actual time off air when going on-duty or making a pick-up. If you feel as though you are being instructed to move equipment that has been off air greater than twenty-four hours, please report it to your supervisor and to my office. Do not be insubordinate, but also do not allow the instance to go unreported or undocumented. We will progress the report accordingly.
In addition to the time off-air regulation, the FRA has also made changes to regulations regarding single-car air brake tests, end-of-train devices, helper service, brake maintenance, additional brake-related items, utility employee duties, and various other rules and/or processes.
It is clear the intent of these changes was not to improve safety, but rather to widen the avenue in which railroads can operate without oversight or guidance – a devastating scenario we just experienced with the Boeing 737 Max. As such, please rest assured that our legal department is currently in the process of filing a formal appeal and petition of reconsideration to overturn this extremely dangerous and egregious action. However, until a recourse can be achieved, it is on all of us to have our brothers’ and sisters’ backs. It is clear that the FRA and carriers do not.
Fraternally yours,
Jeremy R. Ferguson
President – Transportation Division
Click here to view this letter as a PDF.
WASHINGTON – The U.S. Department of Transportation’s Federal Railroad Administration (FRA) published a final rule requiring 40 states and the District of Columbia to develop and implement highway-rail grade crossing action plans to improve public safety. In addition, the rule requires 10 states that have already developed grade crossing action plans, as required by the Rail Safety Improvement Act of 2008 (RSIA) and FRA’s implementing regulation, to update their plans and submit reports describing the actions they have taken to implement them.
“Grade crossing accidents and incidents are the second-leading cause of rail-related deaths in the United States, but nearly every one of them is preventable,” said FRA Administrator Ronald L. Batory. “The action plans give states a tool to engage with federal and local partners, railroads, and rail safety advocates to identify high-risk crossings and develop strategies to save lives.”
“Safety is imperative to FHWA, especially where roads and rails meet,” said Federal Highway Administration (FHWA) Administrator Nicole R. Nason. “These action plans can help states make highway-rail grade crossings safer for the traveling public.”
The final rule responds to a Fixing America’s Surface Transportation (FAST) Act mandate requiring states to develop and implement (or update, if applicable) action plans. Each plan must identify crossings that have experienced at least one accident or incident in the previous three years, multiple accidents or incidents in the previous five years, or that are determined by the state to be at high-risk for accidents or incidents. Furthermore, each action plan must identify specific strategies for improving safety at crossings, including crossing closures or re-aligning roadways over or under railways.
Under RSIA, FRA identified 10 states as having the most highway-rail grade crossing collisions, on average, over the three-year period from 2006 through 2008. In June 2010, FRA issued a final rule requiring these states to develop action plans and submit them to FRA for approval. The states are Alabama, California, Florida, Georgia, Illinois, Indiana, Iowa, Louisiana, Ohio and Texas. The FAST Act now requires each of them to submit an updated action plan and a report to FRA describing what it did to implement its previous action plan and how it will continue to reduce crossing safety risks.
All 50 states and the District of Columbia are required to submit individual highway-rail grade crossing action plans to FRA for review and approval no later than 14 months after the final rule’s publication date of December 14, 2020. FRA will provide technical assistance to help them develop (or update) their action plans. The states may also use federal funds allocated through FHWA’s Railway-Highway Crossing (Section 130) Program to develop and update their action plans.
Further information on the final rule for State Highway-Rail Grade Crossing Action Plans is published in the Federal Register here.
The amounts of compensation subject to Railroad Retirement Tier I and Tier II payroll taxes will increase in 2021, while the tax rates on employers and employees will stay the same. In addition, unemployment insurance contribution rates paid by railroad employers will include a surcharge of 2.5 percent, partially reflecting increased unemployment claims due to the pandemic.
Tier I and Medicare Tax.–The Railroad Retirement Tier I payroll tax rate on covered rail employers and employees for 2021 remains at 7.65%. The Railroad Retirement Tier I tax rate is the same as the Social Security tax, and for withholding and reporting purposes is divided into 6.20% for retirement and 1.45% for Medicare hospital insurance. The maximum amount of an employee’s earnings subject to the 6.20% rate increases from $137,700 to $142,800 in 2021, with no maximum on earnings subject to the 1.45% Medicare rate.
An additional Medicare payroll tax of 0.9% applies to an individual’s income exceeding $200,000, or $250,000 for a married couple filing a joint tax return. While employers will begin withholding the additional Medicare tax as soon as an individual’s wages exceed the $200,000 threshold, the final amount owed or refunded will be calculated as part of the individual’s Federal income tax return.
Tier II Tax.–The Railroad Retirement Tier II tax rates in 2021 will remain at 4.9% for employees and 13.1% for employers. The maximum amount of earnings subject to Railroad Retirement Tier II taxes in 2021 will increase from $102,300 to $106,200. Tier II tax rates are based on an average account benefits ratio reflecting railroad retirement fund levels. Depending on this ratio, the Tier II tax rate for employees can be between 0% and 4.9%, while the Tier II rate for employers can range between 8.2% and 22.1%.
Unemployment Insurance Contributions.–Employers, but not employees, pay railroad unemployment insurance contributions, which are experience-rated by employer. The Railroad Unemployment Insurance Act also provides for a surcharge in the event the Railroad Unemployment Insurance Account balance falls below an indexed threshold amount. The accrual balance of the Railroad Unemployment Insurance Account was $53.7 million on June 30, 2020. This was below the indexed threshold of $73.7 million, triggering a 2.5% surcharge in 2021. There was no surcharge imposed in 2020, following five consecutive years of a 1.5% surcharge.
As a result, the unemployment insurance contribution rates on railroad employers in 2021 will range from the minimum rate of 3.15% to the maximum of 12 percent on monthly compensation up to $1,710, an increase from $1,655 in 2020.
In 2021, the minimum rate of 3.15% will apply to about 87% of covered employers, with almost 5% paying the maximum rate of 12%. New employers will pay an unemployment insurance contribution rate of 3.15%, which represents the average rate paid by all employers in the period 2017-2019.
Click here to view a pdf of 2021 tax rates.
WASHINGTON (Dec. 10, 2020) — The National Transportation Safety Board issued Rail Accident Report 20/04 Thursday for its investigation of the Aug. 2, 2017, CSX Transportation, Inc. freight train derailment and release of hazardous materials near Hyndman, Pennsylvania.
No injuries were reported in connection with the derailment of 33 of 178 rail cars but three homes were damaged and about 1,000 residents were within the 1-mile radius evacuation zone. CSX estimated damages at $1.8M.
The accident train consisted of five locomotives and 178 cars, 128 of which were loaded, and 50 rail cars were empty.
NTSB investigators determined the probable cause of the derailment was the inappropriate use of hand brakes on empty rail cars to control train speed, and the placement of blocks of empty rail cars at the front of the train consist. Investigators also determined CSX operating practices contributed to the derailment.
Safety issues addressed in the investigation include:
- CSX operational practices for building train consists that allowed for excessive longitudinal and lateral forces to be exerted on empty cars
- Use of hand brakes to control train movement
- Assessment and response to fires involving jacketed rail tank cars
Based on its investigation the NTSB issued a total of six safety recommendations, including one to the Federal Railroad Administration, three to CSX, one to the Association of American Railroads and one to the Security and Emergency Response Training Center. The recommendations seek:
- Guidance for railroads to use in developing required risk reduction programs
- Revision of rules for building train consists
- Prohibiting use of hand brakes on empty rails cars for controlling train movement in grade territory
- Incorporation of the lessons learned from this derailment about fire-exposed jacketed pressure tank cars in first responder training programs
Rail Accident Report 20/04 is available online at https://go.usa.gov/xA3Bb and the docket for the investigation is available at https://go.usa.gov/xA3ZE.
The U.S. Department of Transportation’s Federal Railroad Administration (FRA) today issued a final rule, extending the amount of time freight rail equipment can be left off-air (meaning parked with its air brake system depressurized) before requiring a new brake inspection, which is expected to reduce the number of idling locomotives. The final rule incorporates longstanding waivers for brake inspections, tests and equipment, while clarifying existing regulations and removing outdated provisions.
These revisions contemporize Brake System Safety requirements by incorporating safer, newer technologies, reduce unnecessary costs and increase consistency between U.S. and Canadian regulations.
“Incorporating technologies and safety practices, this final rule improves freight rail efficiency and will make our freight rail system competitive for the future,” said FRA Administrator Ronald L. Batory. “Issuing waivers permitting railroads to test these practices gave us an opportunity to verify the safety benefits. Modernization no longer has to happen by waiver; it’s permanent, and the economic impact to freight rail couldn’t come at a more pressing time.”
Canada has allowed trains to be off air for 24 hours since 2008, and Canada’s operational safety data supports FRA’s action. FRA’s final rule permits trains to be off air for as long as 24 hours, bringing the U.S. in line with our neighbors to the north.
The regulatory cost savings is estimated to be over $500 million over the next decade, adding to the over $93 billion in regulatory savings accomplished under the leadership of Secretary Elaine L. Chao and the current administration at the U.S. Department of Transportation.
With this change, FRA estimates the industry will perform 110,000 fewer Class I brake inspections annually. The change reduces the cost and time needed for inspections while permitting more flexibility to turn off locomotives, which is expected to result in fewer locomotives idling in rail yards. FRA will continue to require a Class III brake inspection when adding freight cars to trains.
The final rule incorporates new technology to test brakes on each freight car, permitting two types of automated tests for individual freight cars. “In the more than four years since FRA began issuing waivers for this procedure, we’ve seen it used on more than 800,000 rail cars and have observed remarkable safety improvements,” Batory added.
Cars tested with an automated single car test device showed an 18% reduction in repeat freight car brake failures. Cars tested with the four pressure method showed a 58% reduction in repeat freight car brake failures. These demonstrated improvements permit FRA to increase the testing intervals for freight cars from one year to 24- or 48-month intervals, depending on the automated test method a railroad uses.
FRA is also changing the required height for end-of-train (EOT) marking device displays, reducing it from 48 inches to 40 inches above the top of the rail. This change will permit the manufacture and use of smaller and lighter EOT devices, making them easier and safer for rail workers to carry.
“Issuing test waivers allows our teams to set conditions for railroads to try new technologies,” Batory said. “We only approve waiver requests when we’re certain the changes maintain or improve safety. We’re confident that the changes outlined in this final rule will meet or exceed current safety standards while saving the industry money.”
This final rule addresses several technical issues. To learn more, click here to read the final rule on FRA’s website.
Private rail pensions may reduce supplemental annuities
Railroad Retirement beneficiaries are reminded that receipt of a private railroad pension may reduce the amount of a supplemental annuity payable by the Railroad Retirement Board (RRB). The following questions and answers provide information on this subject and how 401(k) plans are affected by the Railroad Retirement Act (RRA).
1. What are the eligibility requirements for a supplemental annuity?
Monthly supplemental annuities are payable to employee annuitants with 25 or more years of rail service, a “current connection” with the railroad industry, and at least one month of creditable rail service before October 1981. Individuals with 30 years or more of rail service may begin receiving a supplemental annuity at age 60, whereas individuals with 25-29 years of service may do so at age 65. (Disabled annuitants under full retirement age, which is gradually rising to age 67 for those born in 1960 or later, must relinquish employment rights in order for a supplemental annuity to be paid by the RRB.) Monthly supplemental annuity rates vary based on an annuitant’s years of rail service. The maximum monthly supplemental annuity rate is $43.
2. How does the receipt of a private railroad pension affect payment of a supplemental annuity?
If a retired employee also receives a private pension funded entirely, or in part, by a railroad employer, the supplemental annuity is permanently reduced by the amount of the monthly pension that is based on the railroad employer’s contributions. However, if the employer reduces the pension for the employee’s entitlement to a supplemental annuity, the amount by which the pension is reduced is restored to the supplemental annuity (but does not raise it over the $43 maximum). There is no reduction for a pension paid by a railroad labor organization.
3. What if an employee elects to receive the pension in a lump-sum payment instead of as a monthly benefit?
If a retired employee elects to receive his or her pension in a lump-sum payment instead of as a monthly benefit, the supplemental annuity is reduced in the same way as it would be if the employee was receiving the monthly benefit. (If the lump sum is paid in installments, the installment payments are not considered monthly benefit payments, but part of the single lump-sum payment.)
4. Does the receipt of a 401(k) plan distribution reduce the amount of a supplemental annuity?
No. In Legal Opinion L-2014-2, issued January 13, 2014, the RRB’s general counsel determined that 401(k) plans should not be considered supplemental pension plans as defined by the Railroad Retirement Act and, therefore, employee supplemental annuities should not be reduced due to the receipt of 401(k) distributions.
5. Are employee contributions to a 401(k) plan subject to Railroad Retirement Tier I and Tier II payroll taxes?
Yes. Federal budget legislation enacted in 1989 and effective January 1, 1990, provided that employee contributions to 401(k) plans are subject to Railroad Retirement payroll taxes and brought the treatment of 401(k) plans under Railroad Retirement law into conformity with the treatment of such plans under Social Security law. Consequently, employee contributions to a 401(k) plan are also treated as creditable compensation for Railroad Retirement benefit purposes. (For example, an employee earning $40,000 a year, but who has 10% of his earnings deferred under a 401(k) plan, would have only $36,000 reported to the IRS as earnings subject to federal income tax. However, the entire $40,000 would be subject to Railroad Retirement payroll taxes and therefore creditable as compensation under the Railroad Retirement Act.)
6. How can a person get more information about how private rail pensions and 401(k) plan payments affect supplemental annuities?
More information is available on RRB.gov or by contacting an RRB field office. It is important to know that while nearly all of the RRB’s 53 field offices are physically closed to the public until further notice because of the COVID-19 outbreak, they remain accessible by email and phone. Customers are encouraged to send a secure email to their local office by accessing the Field Office Locator and clicking on the link at the bottom of their local office’s page. Customers who prefer talking to an RRB employee can call the agency’s toll-free number (1-877-772-5772); however, they may experience lengthy wait times due to increased call volume caused by COVID-19 related issues.
Medicare Part B premiums for 2021
The Centers for Medicare & Medicaid Services (CMS) has announced that the standard monthly Part B premium will be $148.50 in 2021, an increase of $3.90 from $144.60 in 2020. Some Medicare beneficiaries will pay less than this amount because, by law, Part B premiums for current enrollees cannot increase by more than the amount of the cost-of-living adjustment for Social Security (Railroad Retirement Tier I) benefits.
Since the cost-of-living adjustment is 1.3% in 2021, some Medicare beneficiaries will see an increase in their Part B premiums but still pay less than $148.50. The standard premium amount will also apply to new enrollees in the program. However, certain beneficiaries will continue to pay higher premiums based on their modified adjusted gross income.
The monthly Part B premiums that include income-related adjustments for 2021 will range from $207.90 to $504.90, depending on the extent to which an individual beneficiary’s modified adjusted gross income exceeds $88,000 (or $176,000 for a married couple). The highest rate applies to beneficiaries whose incomes exceed $500,000 (or $750,000 for a married couple). CMS estimates that about 7% of Medicare beneficiaries pay the larger income-adjusted premiums.
Beneficiaries in Medicare Part D prescription drug coverage plans pay premiums that vary from plan to plan. Part D beneficiaries whose modified adjusted gross income exceeds the same income thresholds that apply to Part B premiums also pay a monthly adjustment amount. In 2021, the adjustment amount ranges from $12.30 to $77.10.
The Railroad Retirement Board withholds Part B premiums, Part B income-related adjustments and Part D income-related adjustments from benefit payments it processes. The agency can also withhold Part C and D premiums from benefit payments if an individual submits a request to his or her Part C or D insurance plan.
The following tables show the income-related Part B premium adjustments for 2021. The Social Security Administration (SSA) is responsible for all income-related monthly adjustment amount determinations. To make the determinations, SSA uses the most recent tax return information available from the Internal Revenue Service. For 2021, that will usually be the beneficiary’s 2019 tax return information. If that information is not available, SSA will use information from the 2018 tax return.
Railroad Retirement and Social Security Medicare beneficiaries affected by the 2021 Part B and D income-related premiums will receive a notice from SSA by the end of the year. The notice will include an explanation of the circumstances when a beneficiary may request a new determination. Persons who have questions or would like to request a new determination should contact SSA after receiving their notice.
Additional information about Medicare coverage, including specific benefits and deductibles, can be found at www.medicare.gov.
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2021 PART B PREMIUMS
The monthly premium rates paid by beneficiaries who are married, but file a separate return from their spouses and who lived with their spouses at some time during the taxable year, are different. Those rates are as follows:
| Beneficiaries who file an individual tax return with income: | Beneficiaries who file a joint tax return with income: | Income related monthly adjustment amount | Total monthly Part B premium amount |
|---|---|---|---|
| Less than or equal to $88,000 | Less than or equal to $176,000 | $0.00 | $148.50 |
| Greater than $88,000 and less than or equal to $111,000 | Greater than $176,000 and less than or equal to $222,000 | $59.40 | $207.90 |
| Greater than $111,000 and less than or equal to $138,000 | Greater than $222,000 and less than or equal to $276,000 | $148.50 | $297.00 |
| Greater than $138,000 and less than or equal to $165,000 | Greater than $276,000 and less than or equal to $330,000 | $237.60 | $386.10 |
| Greater than $165,000 and less than or equal to $500,000 | Greater than $330,000 and less than or equal to $750,000 | $326.70 | $475.20 |
| $500,000 and above | $750,000 and above | $356.40 | $504.90 |
The monthly premium rates paid by beneficiaries who are married, but file a separate return from their spouses and who lived with their spouses at some time during the taxable year, are different. Those rates are as follows:
| Beneficiaries who are married, but file a separate tax return, with income: | Income-related monthly adjustment amount | Total monthly Part B premium amount |
|---|---|---|
| Less than or equal to $88,000 | $0.00 | $148.50 |
| Greater than $88,000 and less than or equal to $412,000 | $326.70 | $475.20 |
| $412,000 and above | $356.40 | $504.90 |