AAR Committees – An Overview November 13, 2009 ACACSO Meeting New Orleans, LA Jeff Usher, AVP Business Services, AAR

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 2 AAR Mission and Vision AAR Mission To add value to the North American railroad industry by fostering improved safety, security, service, efficiency and profitability through leadership and coordination on industry issues. AAR Vision To be recognized by industry leaders and valued by public policy decision makers as the definitive voice of the North American rail industry.

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 3 AAR Full Members

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 4 AAR Structure

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 5 Structure AAR Headquarters Safety and Operations Policy and Economics Law Government Affairs Communications Administration and Finance

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 6 Committee Structure is approved by the AAR Board AAR Board of Directors Safety and Operations Management Committee (SOMC) Policy and Advocacy Management Committee (PAMC) Railinc Board of Directors TTCI Board of Directors

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 7 Who We Regularly Interact With Department of Defense (DOD) Federal Highway Administration (FHWA) Transport Canada Transportation Safety Board of Canada Secretario de Communicaciones y Transportes (SCT – Mexico) Department of Homeland Security (DHS) Federal Railroad Administration (FRA) National Transportation Safety Board (NTSB) Pipeline and Hazardous Materials Safety Administration (PHMSA) Environmental Protection Agency (EPA) Department of Energy (DOE) Surface Transportation Board (STB) Federal Communication Commission (FCC) Federal Motor Carrier Safety Administration (FMCSA) Department of Justice (DOJ) Nuclear Regulatory Commission (NRC)

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 8 AAR senior management committees report to the AAR Board of Directors. They ….. …create and prioritize AAR’s agenda within their area of responsibility; …approve policies, standards, and projects that are in the best interest of the industry; …form and manage working committees and task forces to achieve AAR’s objectives; …review and approve the work product descriptions of working committees and task forces; …provide direction to working committees and task forces; and, …ensure that adequate and appropriate industry resources are allocated to working committees and task forces.

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 9 Background  AAR Board of Directors at its June 2, 2009 meeting directed the AAR to prepare a comprehensive transition plan to decommission the Network Efficiency Management Committee (NEMC) that included the realignment of the reporting relationships of the NEMC subordinate committees.  The AAR Board of Directors will consider this plan at its September 21, 2009 meeting.

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 10 Business Services Working Committee (BSWC) is a new key committee supported by AAR and Railinc To develop and implement strategies that integrate industry and individual railroad business processes into quality services that deliver continuous improvements in customer satisfaction. Consists of Committee Chairs for Customer Service, Equipment Assets, Railinc Project Support, Umler and Shortline Information Improvement Current Priorities Customer Satisfaction Equipment Asset Management Interline Service Management Interline Revenue Back-shop Improvements Transborder Initiatives

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 11 Committee Governance - Continued  BSWC to oversee subordinate committees  Customer Service Committee (CSC)  Equipment Assets Management Committee (EAMC)  UMLER – EMIS Committee (UMLER)  Railinc Project Support Committee (RPSC)  Shortline Information Improvement Committee (SLIIC)  North American Box Car Pool Executive Committee (NABPEC) and Multilevel Pool Executive Committee (MPEC) retain “update” relationship with BSWC

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 12 Committee Governance  Create Business Services Working Committee (BSWC)  BSWC to report to SOMC  BSWC to be Chaired by Class I member of the Committee on Compensation  Remaining BSWC membership comprised of BSWC subordinate committee Chairpersons.

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 13 BSWC Subordinate Committees Customer Service Committee Addresses customer and customer support issues from an industry perspective Interline Revenue Committee Manage data quality and promote business processes to permit accurate communication of price, billing, collection and settlement information Transborder Committee Expedite movement of import/export traffic through the promotion of uniform process definitions and simplification of reporting requirements Electronic Commerce Committee Facilitate the exchange of information among customers, transportation providers and partners using the best available technology

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 14 A Number of BSWC Subordinate Committees are Supported by Railinc Resources EDI Committee Provides an Information technology interface to the “user” community Equipment Assets Committee Responsible for maximizing inter- railroad car utilization Railinc Project Support Committee – NEW Provides critical oversight, communication and Railinc development project status between Railinc and SOMC business process owners

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 15 Safety and Operations Management Committee (SOMC) Provides overall authority for industry standards (interchange, safety, environmental, hazmat and communications and signal) and develops strategy and provides direction for new initiatives. Consists of chief operating officers from AAR Member Roads Current Priorities Interline Service Management Interoperable Communications Strategy Chicago Project North American Joint PTC Project Reducing stress and service state of the industry

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 16 SOMC Subordinate Committees Technical Services Working Committee Responsible for matters relating to the physical assets of the railroad industry. Open Top Loading Rules Committee Quality Assurance Committee Arbitration & Rules Committee Equipment Engineering Committee Wheels, Axles, Bearings & Lubrication Committee Braking Systems Specially Equipped Freight Car Committee Car Repair Billing Committee Locomotive Committee Damage Prevention & Freight Claims Intermodal Committee

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 17 SOMC Subordinate Committees (Cont) Risk Management Working Committee Develop and guide industry efforts to reduce environmental and safety risks of rail transportation. The following committees report to Risk Management : –Hazardous Materials Committee –Non-Accident Release Reduction Task Force –Environmental Affairs Committee –Tank Car Committee –Nuclear Waste Transportation Task Force –Grade Crossing & Trespass Prevention Committee –Committee on Locomotive Emissions & Energy –Railroad Geographic Information Systems Committee

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 18 Policy and Advocacy Management Committee (PAMC) Consists of legal and policy representatives from AAR Member Roads Issues –Coordinate rail opposition to re-regulation U.S. Freight Railroads –Investment Tax Credit –Clear Skies Initiative –Truck Size and Weight

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 19 PAMC Subordinate Committees - Antitrust Working Committee - Border Policy Committee - Chief Legal Officers - Communications Committee - Economic Regulation Working Committee - Environmental Working Committee - Safety Regulation Working Committee - Spectrum Legal Working Committee - Tax Policy Working Committee - Tort Matters Working Committee - Truck Size and Weight Committee - Washington Representatives

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 20 Working Committees and their Subordinate Committees: (Working committees report directly to management committees.) They develop positions, standards, and data in support of AAR’s objectives In doing so, they must ensure that the policies, standards, projects, and activities they engage in conform to the expectations of their parent committee; and are consistent and coordinated with other working committees and task forces. Committees report to working and standing committees

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 21 So, what’s a TAG and what’s a Task Force? Technical Advisory Groups (TAG) are commissioned by and report to committees or task forces they exist to provide technical advice and guidance on a specific project or activity once the project is completed, the TAG will disband Task Forces (TF) are formed to progress segments of a working committees or subordinate committee docket items formation must be approved by AAR division head (e.g. Jeff Usher) can exist until dissolved by the chair or AAR division head

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 22 SOMC Organization Chart 1 MPEC and NABPEC set policy and operate procedurally in accordance with the ICC-approved pooling agreements under which they were established and continue to operate under authority transferred to the Surface Transportation Board (STB) as a result of the enactment of the ICC Termination Act. 2 The Committee on Compensation is prescribed in the April 16, 1986 Section Agreement and relates to procedures for the establishment and modification compensation for the use of freight cars and other transportation equipment furnished by shippers, and rules and regulations pertaining thereto. The dotted line connector represents an informational relationship.

NOVEMBER 13, 2009© ASSOCIATION OF AMERICAN RAILROADSPAGE 23 Conclusion Thank you! Questions? Contact Information: Jeff Usher