Summary
Requires Class I and Class II railroads to file and obtain FRA approval for a detailed Safety Integration Plan before consolidating, merging, or acquiring control of another railroad. The plan must comprehensively address safety aspects including corporate culture integration, employee training, operating practices, equipment, signaling, track safety, hazardous materials, dispatching, grade crossings, staffing, capital investment, and information systems. FRA reviews the plan for 'reasonable assurance of safety' and must approve it. The regulation preempts state law except for certain local safety hazards, and imposes civil and criminal penalties for violations.
Reason
Imposes significant compliance costs and bureaucratic delays on railroad mergers that would otherwise be disciplined by market forces, liability, and insurance. Railroads have strong inherent incentives to maintain safety during integration—accidents cause massive financial losses, reputational damage, and legal liability. The requirement for pre-approval of detailed plans creates barriers to beneficial consolidations, raises costs for consumers, and preempts state/local oversight. The unseen costs include stifled efficiency gains from mergers, delayed improvements, and regulatory capture risks where incumbents use safety rules to protect market share.