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Section 5: Project Agreements

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Master Agreements

TxDOT has Master Agreements with all of the Class 1 railroad companies and some of the shortline railroad companies to facilitate individual project agreements for work on Replanking Program projects. These agreements typically cover:

  • the process for adding and deleting crossings for the program each year
  • the program and project documents and required approvals
  • construction and maintenance responsibilities of TxDOT and the railroad company
  • if TxDOT will pay the railroad company on an actual cost basis or fixed cost per track foot of replanking (sometimes broken down by daytime or night/weekend installation rates)
  • the process of approving cost per track foot each program year
  • Work Orders
  • inspection of materials
  • conditions for reimbursement
  • the statement of materials the State will not pay for (rails, tie plates, rail anchors, track spikes, and other material or labor intrinsic to maintenance of the railroad tracks).
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Reimbursement Methods

There are three methods for reimbursing a railroad company. The appropriate method depends on whether the railroad company uses its own forces or a contractor to perform the work. These methods are discussed in the subsections below.

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Railroad Company Uses Own Forces

If the railroad company uses its own forces to perform the work, reimbursement is usually made on a lump sum basis. The reimbursement for an individual crossing will be determined by multiplying the length of crossing surface panels along the track by the cost per track foot agreed upon with the railroad company. Lump sum reimbursements typically occur when a Master Agreement exists with the railroad company.

Actual cost reimbursement to the railroad company may also be used. In these scenarios, a cost estimate is developed prior to construction by the railroad company and approved by TRF-RSS. Actual cost reimbursement is typically used when a Master Agreement does not exist with the railroad company.

Project costs and method of reimbursement (actual or lump sum) are approved in the individual project agreement.

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Railroad Company Uses a Contractor on Continuing Contract

The railroad company may use a contractor to perform the work under a continuous agreement with the railroad company. The continuous agreement must be for a minimum of three years. A copy of this agreement must be provided to TRF-RSS.

The contractor’s costs are included in the project estimate and reimbursed at actual cost during construction unless a lump sum arrangement with the railroad company is shown in the individual project agreement. The railroad company directly invoices TxDOT and reimburses their contractor separately.

The railroad company may also provide labor (inspection, etc.) and include estimated costs in the individual project agreement. Reimbursement to the railroad company will be at actual cost.

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Railroad Company Uses a Contractor for Individual Project

The railroad company may choose to solicit bids for the project from a minimum of three contractors. The lowest qualified bid will be accepted and reimbursed at actual cost not to exceed the original bid. A Form 1891 (Detailed Estimate for Railroad Solicitation of Bids) is filled out for each bidding contractor, which breaks down various costs on the project and helps to ensure balanced bids. If three bids are not received, TRF-RSS may still accept the lowest qualified bidder if at least three contractors were contacted and one or more chose not to bid the project.

Any additional costs incurred by the contractor beyond the original bid will be reimbursed to the contractor by:

  • TxDOT, only after receiving written explanation that work was performed out of the scope of the work in the individual project agreement and was previously approved in writing by TxDOT
  • the railroad company.

The railroad company directly invoices TxDOT and reimburses their contractor separately.

The railroad company may also provide labor (inspection, etc.) and include estimated costs in the individual project agreement. Reimbursement to the railroad company will be at actual cost.

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Individual Project Agreement

Typically, there are two separate paths Replanking Program projects will follow after Exhibit A’s and cost estimates have been completed and approved:

  • Project Notice
  • Force Account Agreement.
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Project Notice

If a Master Agreement exists with the railroad company, TRF-RSS will prepare a Project Notice. The Project Notice normally consists of:

  • a signed cover page providing TxDOT’s approval of work, cost estimates, and selection of contractor (if the railroad company solicited bids from contractors)
  • an Exhibit A
  • cost estimates from the railroad company or the railroad company’s continuing contractor (if applicable)
  • Cost estimates from bidding contractors (if applicable).

Depending on the terms in the Master Agreement, the Project Notice may or may not need to be executed by the railroad company.

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Force Account Agreement

If a Master Agreement does not exist with the railroad company, TRF-RSS prepares and negotiates a Force Account Agreement for the crossing project. The Force Account Agreement will typically include the items listed above shown in both the Master Agreement and Project Notice.

TRF-RSS will issue the Force Account Agreement to the railroad company for comments. Once comments are resolved, the railroad company will execute the agreement and return it to TRF-RSS for final execution.

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After Project Agreement is Executed

TRF-RSS distributes a copy of the executed Project Notice or Force Account Agreement to:

  • the District
  • FIN
  • the railroad company (original copy as needed).

The fully executed Project Notice or Force Account Agreement is uploaded into the TRIMS Project Management Module by TRF-RSS.

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