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Summary

In July 2013, a train carrying crude oil derailed in Lac-Mégantic, Quebec, Canada, resulting in fatalities and significant damage. Due to the public safety risks that transporting hazardous materials by rail pose, we initiated this audit to assess the Federal Railroad Administration’s (FRA) use of inspections and other tools to enforce its hazardous materials regulations. 

We identified three areas of concern in FRA’s enforcement of its hazardous materials regulations. First, FRA has not conducted an evaluation of risks associated with hazardous materials transportation that includes national level risks to target inspection resources. Second, while the Agency provides guidance and training for inspectors who enforce hazardous materials regulations, the inspectors do not have easy access to inspection data from other regions. They also frequently cannot access updated information in the Pipeline and Hazardous Materials Safety Administration’s information system regarding special permits. Third, the civil penalties that FRA pursues for violations of hazardous materials regulations do not account for variations in the severity of violations. Furthermore, despite departmental requirements in several DOT Orders, FRA does not refer cases to OIG for criminal investigation.

We made seven recommendations to help FRA improve risk assessments associated with allocating inspection resources and address concerns about the use of civil penalties and lack of criminal case referrals to OIG. FRA concurred with all seven recommendations.