Guide to Car Repair Billing Rules and Resources

When you’re new to managing railcar repairs or billing, it can be difficult to understand many of the rules and processes. However, there are three important reference materials that can provide you with important information regarding repair billing; the AAR Field Manual, the AAR Office Manual and the Railinc Car Repair Billing Procedures Manual. Together, these resources can assist in understanding, recording and reporting repairs relating to freight rail cars in interchange.

Field Manual of the AAR Interchange Rules

What is the AAR Field Manual?

The AAR Field Manual describes the mechanical requirements for inspecting, repairing and handling interchange rail cars. The Field Manual not only describes when a repair is required, but also how that repair must be completed to remain compliant with AAR interchange rules.

For example, Rule 3, Testing of Air Brakes, provides information about when a Single Car Air Brake Test is required, how the test should be performed and how the activity should be reported.

How is the Field Manual used?

The Field Manual is a book that is required to be on hand at all railroad freight car repair facilities and contract shops. Used as a reference for inspection and repair procedures, each chapter covers a specific AAR rule. While Rule 1 is the most important rule of the book as it covers the general “Care of Freight Cars,” Rules 3 – 82 provide information about specific freight car parts or repair processes. For example; Rules 36, 41, 43 and 44 cover roller bearings, wheels, axles and wheel sets respectively, while rule 82 covers welding.

Most of these rules (or chapters) include seven sections:

Section A. Cause for Attention.

This section describes when a repair is required, including wear limits and gauging. Sub-section 1 typically identifies when a repair is needed at any time, and sub-section 2 identifies when a repair is needed if the car has been placed on a shop or repair track for another reason.

Section B: Correct Repairs

This section describes the requirements of the parts applied, including what can be used to replace the part removed and any limitations on applying a part for the damage condition of the car. This section may also include a description of activities that must take place when completing the repairs. For example, Rule 41.B.1 states that the inspector or mechanic must determine if an active EHMS alert exists and close the alert if a repair is completed.

Section C: Recondition Requirements

For applicable parts, this section describes the requirements regarding the reconditioning of material. Frequently, the rule does not provide the exact requirements, but includes a reference to the document in which the reconditioning and certification requirements can be found. For example, Rule 59.C.1 states “Cushioning unit devices must be reconditioned per AAR Specification M-921C.”

Section D: Welding Requirements

Identifies if and when welding is prohibited or permissible.

Section E: General Information

This section is important to review as it provides additional information when performing or reporting the repair. This section can include information about whether an associated repair can or should be reported when repairing these parts. Section E also often includes other reporting requirements, such as submitting a Mechanical Defect (MD) report or updating an EHMS alert.

Section F: Billing Repair Data Requirements

Section F identifies what is necessary to include in billing for that repair. This section often lists information required when reporting the repair such as location, quantity, condition code, applied job code, description, why made code, removed job code, and responsibility code. An indicator regarding net applied repairs is frequently included in this section.

Job Codes

Nearly every chapter ends with a list of applicable Job Codes and reporting requirements, including Why Made Codes and Condition Codes that can be reported for that job code.

Where can I find it?

The AAR Field Manual is available for purchase directly from the AAR website.

Office Manual of the AAR Interchange Rules

What is the AAR Office Manual?

The Office Manual of the AAR Interchange Rules, often referred to as the “Office Manual,” includes those rules regarding repair billing and the sale, acquisition and settlement for interchange freight cars. The Office Manual also provides the AAR Price Master in a matrix format for easy reference. This AAR Price Master provides the labor and material prices for all AAR job codes based on the combination of the following values:

• Applied job code
• Removed job code
• Condition code
• Why made code
• Responsibility code

How is the Office Manual used?

In addition to providing the Price Master, the Office Manual should be used to reference proper office processes. These include rules around billing and the quarterly labor and material price changes.

The rules in the AAR Office Manual are important to understand when completing car repair billing, including the following rules 111 and 112.

Rule 111

Rule 111 of the Office Manual provides additional information about pricing repairs and billing for other charges. This section includes:

• How the standard labor and material prices are defined
• How to report a ‘repair’ when the wrong material must be used to allow the car to continue to another location where a correct repair can be done
• How repairs are reported when the repair is made on authority of a Defect Car or JIC
• How to bill for owner supplied material (per Rule 85)
• How to bill for destroyed or damaged cars

Rule 112

Rule 112 of the AAR Office Manual covers many of the car repair billing requirements regarding types of billing, time limits and preparing and processing the invoices. While it’s pertinent to read Rule 112 in its entirety, here are four of the main categories covered:

Rule 112 sections A through C provide information about types of repairs and types of charges including:

• A list of job codes that can be group billed.
• The Detail Source codes that should be used for different types of charges.
• Defect Card and Joint Inspection Certification Handing – When repairs completed on a system (owned) car are billed to another party who damaged the car.
• Rebuttal Charge Handling - When a repair has been billed to one party and can be rebuttal billed to another party due to a lease or maintenance agreement.

Time Limits for Invoicing

The time limits for invoicing are covered in Rule 112.E. This section describes the time limits for different types of charges. Most repairs must be invoiced within 6 months of the repair date, but the amount of time can change for other types of charges being billed. The charge type is defined when billing by the detail source code. A list of detail source codes is provided in Rule 112.A.4.

How to Prepare the Invoice

Rule 112.G covers the rules around preparing the invoice. The most important rule to remember from this section is that to be considered a valid and properly rendered invoice, you must provide both the invoice cover sheet, which provides the sub-total billed for each detail source, and the data that supports the charges billed in a file submitted to the Car Repair Billing Data Exchange. Charges outside of the interchange process are not required to be submitted to the data exchange, however, sending all billing information through that system ensures the car owner has a complete history of their repairs.

Reviewing and Paying Invoices

Rule 112.H describes the processing for reviewing and paying for car repair invoices received. Limits and time frames for rejecting invoices or taking exception to charges is defined in this section.

Where can I find the Office Manual?

The Office Manual is available for purchase directly from the AAR website.

Car Repair Billing Procedures Manual

While the above two manuals are the standard reference resources for completing and billing for repairs, it’s also helpful to review the Car Repair Billing Procedures Manual.

What is it?

The Car Repair Billing Procedures Manual is a document published and updated by Railinc that outlines the Car Repair Billing Data Exchange Process. It includes how data should be submitted to the Car Repair Billing Data Exchange, how to use the Car Repair Billing Price Master and information on edits and errors.

How do I use it?

The Car Repair Billing Procedures Manual can be used for help formatting and submitting files to the CRB Data Exchange. The Procedures Manual can help to identify what fields must be filled in for each invoice, which in turn can help identify why invoices were rejected.

Where can I find it?

The Car Repair Billing Procedures manual is publicly available here on Railinc's website.

Railinc Guide for Railroads

Although this guide is not specific to car repair or billing, we would be remiss to leave out this document for anyone new to the railroad industry. As stated in the guide’s introduction, the document is “designed to introduce new and existing railroads to valuable information for operating as a part of the North American railroad system. Each section in this document describes the uses and requirements of an application or process, outlines Railinc’s role and, where applicable, the various rules and procedures prescribed by the Association of American Railroads (AAR), Surface Transportation Board (STB), and National Motor Freight Traffic Association (NMFTA).”

Where can I find it?

The Railinc Guide for Railroads is publicly available here on Railinc's website.

Summary

While each of these resources provide different material, it is often necessary to read multiple manuals for full context. This is one of the many reasons that it is easiest for your repair management software to support your team in managing rule compliance. Learn about how CarLogix can help your team manage car repair billing and industry rules here.