2014-11-14T09:01:01-06:00 2013-12-31 420714325 MCGLADREY LLP 9737 WASHINGTONIAN BLVD 400 GAITHERSBURG MD 208787340 990 2013-01-01 536000125 ASSOCIATION OF AMERICAN RAILROADS ASSO 2026392114 425 THIRD STREET SW NO 1000 WASHINGTON DC 20024 JEFFREY D MARSH SR VP - FINANCE & CFO 2026392114 2014-11-11 1 WILLIAM E TURCO CPA P00369217 3012963600 2013 2015-11-30 17:44:51Z EDWARD HAMBERGER 425 THIRD STREET SW NO 1000 WASHINGTON DC 20024 59909298 0 X WWW.AAR.ORG X 1934 DC TO PROMOTE THE COMMON INTERESTS OF RAILROADS. 14 13 77 13 238251 19687 0 0 60517830 54038985 388150 111210 2892633 3362615 63798613 57512810 12491097 2684100 0 0 17942600 19552092 0 0 0 33700903 34465361 64134600 56701553 -335987 811257 28287159 24191920 49506350 33731054 -21219191 -9539134 AAR PROMOTES A SAFE AND EFFICIENT NORTH AMERICAN RAIL SYSTEM WITH PRINCIPAL ACTIVITIES IN AREAS SUCH AS STANDARDS, OPERATIONS, SAFETY, SECURITY, PUBLIC AFFAIRS AND PUBLIC POLICY. 0 0 STRATEGIC RESEARCH INITIATIVES (SRI):SRI PRIORITIES ARE SHARPLY FOCUSED ON CURRENT AND FUTURE FREIGHT RAILROAD INDUSTRY ISSUES ASSOCIATED WITH SAFETY, EFFICIENCY, AND RELIABILITY. THE RESEARCH PRIORITIES ARE EXPECTED TO CONTRIBUTE SIGNIFICANTLY TO INDUSTRY OBJECTIVES IN THE AREA OF OPERATING HEAVIER AXLE LOADS, AND, IN PARTICULAR, THE EFFECTS ON FREIGHT CARS, TRACK, AND THEIR INTERACTION. THE PROGRAM CONTINUED TO BE INVOLVED IN PRODUCT AND PROCESS DEVELOPMENT AND IMPLEMENTATION. INTEGRATED COMMUNICATIONS CAMPAIGN PROGRAMS:A PROGRAM OF MEDIA OUTREACH, ADVERTISING AND DIGITAL MEDIA THAT FOCUSES ON (1) HOW THE FREIGHT RAIL INDUSTRY CONSISTENTLY AND EFFICIENTLY DELIVERS ECONOMIC AND ENVIRONMENTAL BENEFITS TO AMERICANS, (2) HOW RAILROADS USE MODERN TECHNOLOGY TO IMPROVE SAFETY AND PROVIDE PUBLIC BENEFITS INCLUDING A SAFE, FUEL EFFICIENT WAY TO MOVE GOODS AND CONNECT US TO THE GLOBAL ECONOMY, AND (3) PRESERVING BALANCED REGULATION OF THE FREIGHT RAIL INDUSTRY. PRESERVING BALANCED REGULATION:A PROGRAM TO PROMOTE THE CONTINUED NEED OF THE RAIL INDUSTRY TO OPERATE UNDER A BALANCED REGULATORY STRUCTURE WHICH ALLOWS RAILROADS THE OPPORTUNITY TO ACHIEVE REVENUES FOR REINVESTMENT. SUCH REINVESTMENT IS CRITICAL IF RAILROADS ARE TO BE ABLE TO ADDRESS THE CAPACITY CHALLENGES THAT INCREASED RAIL DEMAND FOR TRANSPORTATION BRINGS. 0 0 1 1 0 0 0 1 0 1 1 0 1 1 1 0 1 0 0 1 0 0 0 0 0 0 1 0 1 0 0 0 0 0 1 0 0 0 0 0 1 1 0 0 1 63 0 1 77 1 1 1 0 0 0 0 0 X 14 13 1 0 0 0 1 0 1 1 1 0 0 1 1 1 1 1 1 1 1 0 DC X JEFFREY MARSH SVP - FINANCE ADMIN & CFO 2026392118 425 THIRD STREET SW NO 1000 WASHINGTON DC 20024 MICHAEL R HAVERTY DIRECTOR 1.00 X 0 0 0 JOHN C HELLMAN DIRECTOR 1.00 X 0 0 0 CHARLES W MOORMAN DIRECTOR 1.00 X 0 0 0 MATTHEW K ROSE DIRECTOR 1.00 X 0 0 0 MICHAEL J WARD DIRECTOR 1.00 X 0 0 0 CLAUDE MONGEAU DIRECTOR 1.00 X 0 0 0 E HUNTER HARRISON DIRECTOR 1.00 X 0 0 0 CHRISTOPHER AADNESEN DIRECTOR 1.00 X 0 0 0 KEITH CREEL DIRECTOR 1.00 X 0 0 0 DAVID L STARLING DIRECTOR 1.00 X 0 0 0 JAMES R HERTWIG DIRECTOR 1.00 X 0 0 0 JACK KORALESKI DIRECTOR 1.00 X 0 0 0 WILLIAM O'LEARY DIRECTOR 1.00 X 0 0 0 EDWARD R HAMBERGER CEO & PRESIDENT 39.00 1.00 X X 1702732 0 678358 LOUIS P WARCHOT SR. VP - GENERAL COUNSEL 39.00 1.00 X 539622 0 60216 JOHN T GRAY SR. VP - POLICY & ECONOMICS 39.00 1.00 X 525377 0 59803 LAURIE L KNIGHT SR. VP - GOV'T AFFAIRS 40.00 X 504178 0 23466 PATRICIA M REILLY SR. VP - COMMUNICATIONS 39.00 1.00 X 444263 0 55214 ROBERT C VANDERCLUTE SR. VP - SAFETY & OPERATIONS 36.00 4.00 X 424747 0 49392 JEFFREY D MARSH SR. VP - FINANCE & CFO 36.00 4.00 X 423629 0 117946 JOHN F WETZEL VP - GOVERNMENT AFFAIRS 40.00 X 924678 0 68292 JANET L BARTELMAY CORPORATE SECRETARY 39.00 1.00 X 255317 0 134073 ROBERT E FRONCZAK AVP - ENVIRONMENTAL 40.00 X 562763 0 64170 MICHAEL J RUSH ASSOCIATE GENERAL COUNSEL 40.00 X 285036 0 181809 WILLIAM C THOMPSON PROGRAM MANAGER 40.00 X 267657 0 53047 PETER W FRENCH AVP - SAFETY 40.00 X 223775 0 66822 JAMES GRADY JR AVP - TECHNICAL STANDARDS 40.00 X 220232 0 30723 7304006 0 1643331 43 0 1 0 TRANSPORTATION TECHNOLOGY CENTER INC 55500 DOT ROAD PO BOX 11130 PUEBLO CO 810010130 TESTING & RESEARCH 13745337 CALIFORNIA ENVIRONMENTAL ASSOCIATES 423 WASHINGTON ST 3RD FLOOR SAN FRANCISCO CA 94111 ENVIRONMENTAL/REGULATORY CONSULTING 1419520 STEPTOE & JOHNSON LLP 1330 CONNECTICUT AV NW WASHINGTON DC 20036 LEGAL CONSULTING 1288877 OLIVER WYMAN 200 CLAREDON ST 12TH FLOOR BOSTON MA 02116 REGULATORY/ECONOMIC CONSULTING 1157005 FTI CONSULTING INC 1101 K ST NW WASHINGTON DC 20005 REGULATORY/ECONOMIC CONSULTING 1027908 30 MEMBERSHIP DUES 900099 46004859 46004859 INDUSTRY SUPPORT 900099 4207683 4207683 USER FEES 900099 3383319 3383319 PUBLICATIONS 900099 301097 301097 MEETINGS & CONFERENCES 812900 142027 142027 54038985 32358 32358 155498 155498 67970 0 67970 67970 67970 2475340 2396488 78852 78852 78852 INTERCO COST SHARE 900099 2558561 2510531 48030 OTHER REVENUE 900099 309728 309728 ERIP/RET COST REIM 900099 222664 222664 48194 48194 3139147 57512810 56630153 238251 644406 2684100 7055272 8284147 1738054 1077702 1396917 3933154 132130 1497272 5527879 4666821 820911 140269 1703113 1086943 2849 450999 269115 INTERCOMPANY EXPENSES 13779130 OTHER EXPENSES 379132 BAD DEBT 71697 PROPERTY TAXES 3947 56701553 11342712 4692247 1048028 4011763 284126 312708 26460152 23595941 3015144 2864211 1971485 1028129 8970899 8970899 1654765 2311963 28287159 24191920 7697671 6570804 1157640 1100700 294843 642783 40356196 25416767 49506350 33731054 X -21219191 -9539134 -21219191 -9539134 28287159 24191920 X 811257 35691 10833109 X 0 1 X 1 0 2500 2500 2500 1 CHICAGO FOR RAHM EMANUEL P O BOX 101121 CHICAGO IL 60610 2500 0 0 1 46004859 6555550 -807244 5748306 6537339 -789033 PART I-A, LINE 1: CAMPAIGN CONTRIBUTION TO RAHN EMANUEL'S CHICAGO MAYORAL ELECTION. 0 1 X 3006721 792196 2214525 1158170 989344 168826 22295261 21814401 480860 2864211 8970899 C 8970899 CUSTODIAL FUNDS 642783 DEFERRED TAX ASSET 57118 INVESTMENTS RELATED TO SUPP. EMPLOYEE BENEFIT PLANS 1605475 OTHER POSTEMPLOYMENT BENEFITS 6587 2311963 CURRENT PORTION-OPEB LIABILITY 121000 ACCRUED PENSION COST 13982131 SERP OBLIGATION 3227030 DEFERRED RENT PAYABLES 3929566 CAPITAL LEASE OBLIGATIONS 24254 DUE TO SUBSIDIARIES 4132786 25416767 X PART IV, LINE 2B: CUSTODIAL FUNDS ARE CARRIED AS AN ASSET AND OFFSETTING LIABILITY IN THE ASSOCIATION'S BALANCE SHEET. THE ASSOCIATION ACTS AS CUSTODIAN AND AGENT ON BEHALF OF CERTAIN RAILROAD INDUSTRY RELATED ORGANIZATIONS FOR WHICH THE ASSOCIATION PROVIDES BOOKKEEPING SERVICES. PART X, LINE 2: AAR IS EXEMPT FROM FEDERAL INCOME TAXES UNDER SECTION 501(C)(6) OF THE IRC. HOWEVER, AAR IS SUBJECT TO FEDERAL INCOME TAXES FOR ACTIVITIES THAT ARE UNRELATED TO ITS TAX-EXEMPT FUNCTION. RRF IS INCORPORATED UNDER IRC SECTION 501(C)(3) AS A TAX-EXEMPT ORGANIZATION AND IS FURTHER CLASSIFIED AS A PUBLIC CHARITY UNDER SECTION 509(A)(1) OF THE IRC; HOWEVER, RRF IS SUBJECT TO FEDERAL INCOME TAXES FOR ACTIVITIES THAT ARE UNRELATED TO ITS TAX-EXEMPT FUNCTION. AAR AND RRF, AS TAX EXEMPT ORGANIZATIONS, FILE SEPERATE INFORMATION RETURNS, FORM 990-RETURN OF ORGANIZATION EXEMPT FROM INCOME TAX, AND TO THE EXTENT OF ANY UNRELATED ACTIVITIES TO THEIR TAX-EXEMPT FUNCTION, FILE FORM 990-T-RETURN OF ORGANIZATION BUSINESS INCOME TAX RETURN. TTCI AND RAILINC FILE SEPARATE FEDERAL AND STATE INCOME TAX RETURNS. ACCORDINGLY, AMOUNTS REPORTED IN THE ACCOMPANYING CONSOLIDATED FINANCIAL STATEMENTS REPRESENT THE COMBINED INCOME TAX ACCOUNTS OF AAR, TTCI, RAILINC, AND RRF. DEFERRED TAX ASSETS AND LIABILITIES ARE RECOGNIZED FOR THE FUTURE TAX CONSEQUENCES ATTRIBUTABLE TO DIFFERENCES BETWEEN THE FINANCIAL STATEMENT CARRYING AMOUNTS OF EXISTING ASSETS AND LIABILITIES AND THEIR RESPECTIVE TAX BASES AND OPERATING LOSS AND TAX CREDIT CARRYFORWARDS. DEFERRED TAX ASSETS AND LIABILITIES ARE MEASURED USING ENACTED TAX RATES EXPECTED TO APPLY TO TAXABLE INCOME IN THE YEARS IN WHICH THOSE TEMPORARY DIFFERENCES ARE EXPECTED TO REVERSE. IF APPROPRIATE, DEFERRED TAX ASSETS ARE REDUCED BY A VALUATION ALLOWANCE, WHICH REFLECTS EXPECTATIONS OF THE EXTENT TO WHICH SUCH ASSETS WILL BE REALIZED. THE ASSOCIATION FOLLOWS THE CODIFICATION TOPIC, INCOME TAXES, WHICH ADDRESSES THE DETERMINATION OF WHETHER TAX BENEFITS CLAIMED OR EXPECTED TO BE CLAIMED ON A TAX RETURN SHOULD BE RECORDED IN THE CONSOLIDATED FINANCIAL STATEMENTS. UNDER THIS GUIDANCE, THE ASSOCIATION MAY RECOGNIZE THE TAX BENEFIT FROM AN UNCERTAIN TAX POSITION ONLY IF IT IS MORE LIKELY THAN NOT THAT THE TAX POSITION WILL BE SUSTAINED ON EXAMINATION BY TAXING AUTHORITIES, BASED ON THE TECHNICAL MERITS OF THE POSITION. THE TAX BENEFITS RECOGNIZED IN THE CONSOLIDATED FINANCIAL STATEMENTS FROM SUCH A POSITION ARE MEASURED BASED ON THE LARGEST BENEFIT THAT HAS A GREATER THAN 50% LIKELIHOOD OF BEING REALIZED UPON ULTIMATE SETTLEMENT. THE GUIDANCE ON ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES ALSO ADDRESSES DE-RECOGNITION, CLASSIFICATION, INTEREST AND PENALTIES ON INCOME TAXES, AND ACCOUNTING IN INTERIM PERIODS. MANAGEMENT EVALUATED THE ASSOCIATION'S PRECONSOLIDATED TAX POSITIONS AND CONCLUDED THAT THE ASSOCIATION HAS TAKEN NO UNCERTAIN TAX POSITIONS THAT REQUIRE ADJUSTMENT TO THE CONSOLIDATED FINANCIAL STATEMENTS TO COMPLY WITH THE PROVISIONS OF THIS GUIDANCE. GENERALLY, THE ASSOCIATION IS NO LONGER SUBJECT TO INCOME TAX EXAMINATIONS BY THE U.S. FEDERAL, STATE, OR LOCAL TAX AUTHORITIES FOR YEARS BEFORE 2010. NORTH AMERICA 0 0 PROGRAM SERVICES TRAVEL, MEETING, LODGING, REGISTRATION FEES AND PERSONNEL COSTS 131761 EUROPE (INCLUDING ICELAND & GREENLAND) 0 0 PROGRAM SERVICES TRAVEL, MEETING, LODGING, REGISTRATION FEES AND PERSONNEL COSTS 10057 0 0 0 0 0 0 141818 0 141818 0 0 0 0 0 0 1 AMERICANS FOR TAX REFORM 722 12TH STREET NW FOURTH FLOOR WASHINGTON DC 20005 521403587 501(C)(4) 15000 PROGRAM SUPPORT ALSRRA 50 F STREET NW SUITE 7020 WASHINGTON DC 20001 536000080 501(C)(6) 10000 EVENT SUPPORT BIPAC 888 SIXTEENTH ST NW SUITE 305 WASHINGTON DC 20006 131985476 501(C)(6) 7083 PROGRAM SUPPORT CBC INSTITUTE 21ST CENTURY COUNCIL 413 NEW JERSEY AVENUE SE WASHINGTON DC 20003 522270607 501(C)(4) 23500 EVENT SPONSORSHIP, EVENT SUPPORT CONGRESSIONAL HISPANIC CAUCUS INSTITUTE 911 2ND STREET NE WASHINGTON DC 20002 521114225 501(C)(3) 7500 EVENT SUPPORT CONGRESSIONAL INSTITUTE INC 1700 DIAGONAL ROAD SUITE 730 ALEXANDRIA VA 22314 521504189 501(C)(4) 25000 PROGRAM SUPPORT COALITION AGAINST BIGGER TRUCKS LLC 901 N PITT STREET SUITE 310 ALEXANDRIA VA 22314 943229678 501(C)(4) 1232409 PROGRAM SUPPORT GORAIL 901N PITT STREET SUITE 315 ALEXANDRIA VA 22314 352226505 501(C)(4) 333091 PROGRAM SUPPORT HORATIO ALGER ASSOCIATION 99 CANAL CENTER PLAZA SUITE 320 ALEXANDRIA VA 22314 131669975 501(C)(3) 20000 EVENT SUPPORT MARCH OF DIMES FOUNDATION NATIONAL CAPITAL AREA CHAPTER 2120 WASHINGTON BLVD SUITE 425 ARLINGTON VA 222045757 131846366 501(C)(3) 7500 EVENT SUPPORT METROPOLITAN PLANNING COUNCIL 140 SOUTH DEARBORN SUITE 1400 CHICAGO IL 60603 362382849 501(C)(3) 20000 PROGRAM SUPPORT NATIONAL ASSOCIATION FOR URBAN DEBATE LEAGUES (NAUDL) 332 S MICHIGAN AVENUE SUITE 500 CHICAGO IL 60604 204323096 501(C)(3) 10000 EVENT SUPPORT NCSL FOUNDATION FOR STATE LEGISLATURES 7700 EAST FIRST PLACE DENVER CO 80230 742232576 501(C)(3) 8500 PROGRAM SUPPORT OPERATION LIFESAVER INC 1420 KING STREET SUITE 401 ALEXANDRIA VA 22314 742459189 501(C)(3) 7500 PROGRAM SUPPORT ONE DOOR FOR EDUCATION FOUNDATION 20280 SYCOLIN ROAD LEESBURG VA 20175 452261887 5250 EVENT SUPPORT RAILROAD RESEARCH FOUNDATION 425 THIRD ST SW WASHINGTON DC 20024 522344655 501(C)(3) 79614 PROGRAM SUPPORT REPUBLICAN MAIN STREET PARTNERSHIP 325 7TH STREET NW STE 610 WASHINGTON DC 20004 591828852 501(C)(4) 10000 EVENT SUPPOPRT SURFACE TRANSPORTATION POLICY PROJECT 1707 L STREET NW SUITE 1050 WASHINGTON DC 20036 521864166 501(C)(3) 75000 PROGRAM SUPPORT TRANSPORTATION RESEARCH BOARD NATIONAL ACADEMY OF SCIENCES LOCK BOX 289 WASHINGTON DC 20055 530196932 501(C)(3) 32500 PROGRAM SUPPORT UNIVERSITY OF ILLINOIS HARKER HALL 1305 WEST GREEN ST URBANA IL 61801 376006007 501(C)(3) 339400 PROGRAM SUPPORT BECAUSE OF ELIZABETH FOUNDATION PO BOX 214 MCLEAN VA 22101 300220742 501(C)(3) 7495 PROGRAM SUPPORT 12 9 PART I, LINE 2: AAR AWARDS ASSISTANCE TO ORGANIZATIONS RECOGNIZED AS TAX-EXEMPT UNDER IRC SECTION 501(C) OR AS A COLLEGE OR UNIVERSITY. X X X 1 1 X X X X X 0 1 0 EDWARD R HAMBERGER CEO & PRESIDENT 840733 0 848720 0 13279 0 622170 0 59096 0 2383998 0 0 0 LOUIS P WARCHOT SR. VP - GENERAL COUNSEL 350408 0 179060 0 10154 0 30278 0 45574 0 615474 0 0 0 JOHN T GRAY SR. VP - POLICY & ECONOMICS 366657 0 154230 0 4490 0 37867 0 29361 0 592605 0 0 0 LAURIE L KNIGHT SR. VP - GOV'T AFFAIRS 381935 0 120000 0 2243 0 14074 0 16117 0 534369 0 0 0 PATRICIA M REILLY SR. VP - COMMUNICATIONS 291554 0 149521 0 3188 0 25776 0 37074 0 507113 0 0 0 ROBERT C VANDERCLUTE SR. VP - SAFETY & OPERATIONS 275810 0 141098 0 7839 0 27456 0 28972 0 481175 0 0 0 JEFFREY D MARSH SR. VP - FINANCE & CFO 279066 0 141892 0 2671 0 94325 0 30707 0 548661 0 0 0 JOHN F WETZEL VP - GOVERNMENT AFFAIRS 233749 0 192151 0 498778 0 64412 0 8534 0 997624 0 0 0 JANET L BARTELMAY CORPORATE SECRETARY 193311 0 59245 0 2761 0 123183 0 15753 0 394253 0 0 0 ROBERT E FRONCZAK AVP - ENVIRONMENTAL 180792 0 379371 0 2600 0 44262 0 23731 0 630756 0 0 0 MICHAEL J RUSH ASSOCIATE GENERAL COUNSEL 215824 0 65340 0 3872 0 177929 0 7684 0 470649 0 0 0 WILLIAM C THOMPSON PROGRAM MANAGER 211958 0 33407 0 22292 0 31111 0 24361 0 323129 0 0 0 PETER W FRENCH AVP - SAFETY 187601 0 30500 0 5674 0 44886 0 29594 0 298255 0 0 0 JAMES GRADY JR AVP - TECHNICAL STANDARDS 178758 0 37467 0 4007 0 29900 0 3336 0 253468 0 0 0 PART I, LINE 1A TAX INDEMNIFICATION AND GROSS-UP PAYMENTS: JOHN F. WETZEL - $493,561 (AMOUNT INCLUDES SERP PAYMENT AND TAX GROSS-UP) HOUSING ALLOWANCE: WILLIAM C. THOMPSON - $12,330 - TAXABLE SOCIAL CLUB DUES: EDWARD R. HAMBERGER - $11,585 - NONTAXABLE LOUIS P. WARCHOT - $7,997 - NONTAXABLE ROBERT C. VANDERCLUTE - $75 - NONTAXABLE JOHN F. WETZEL - $720 - NONTAXABLE ROBERT E. FRONCZAK - $475 - NONTAXABLE WILLIAM C. THOMPSON - $318 - NONTAXABLE JAMES GRADY JR. - $425 - NONTAXABLE PART I, LINE 4B THE FOLLOWING INDIVIDUALS PARTICIPATE IN A SERP: EDWARD R. HAMBERGER - $570,168 JEFFREY D. MARSH - $65,420 JANET L. BARTELMAY - $59,540 MICHAEL RUSH - $104,521 SCHEDULE J, PART II, DEFERRED COMPENSATION: COMPENSATION FOR CERTAIN PERSONS INCLUDES PAYMENTS MADE IN 2013 UNDER AAR'S LONG TERM INCENTIVE COMPENSATION PLAN (DEFERRED COMPENSATION). FOLLOWING INDIVIDUALS RECEIVED PAYMENTS MADE IN 2013 UNDER THE PLAN: JOHN F. WETZEL - $121,792 ROBERT E. FRONCZAK - $350,989 LONG TERM INCENTIVE PLAN PAYMENTS ARE SHOWN IN SCHEDULE J, PART II, COLUMN (B)(II) THE FOLLOWING INDIVIDUAL RECEIVED PAYMENT FROM SERP: JOHN F. WETZEL - $493,561 SERP PAYMENTS ARE SHOWN IN SCHEDULE J, PART II, COLUMN B(III). TRANSPORTATION TECHNOLOGY CENTER INC EDWARD HAMBERGER-BOARD, JANET BARTELMAY-OFFICER, LOUIS WARCHOT-OFFICER 15382098 PROG SVCS, PERFORMANCE OF SERVICES BY THE INTERESTED ENTITY, EXPENSE REIMBURSEMENT PAID BY THE INTERESTED ENTITY, FACILITIES LEASED BY THE INTERESTED ENTITY, AND PERFORMACE OF SERVICES FOR THE INTERESTED ENTITY. 0 RAILINC CORPORATION EDWARD HAMBERGER-BOARD AND JANET BARTELMAY-OFFICER 2165481 PROG SVCS, PERFORMANCE OF SERVICES FOR THE INTERESTED ENTITY, PAYMENT OF ROYALTIES BY ENTITY, AND EXPENSE REIMBURSEMENT PAID BY THE INTERESTED ENTITY. 0 FORM 990, PART VI, SECTION A, LINE 2 EDWARD HAMBERGER, JANET BARTELMAY AND LOUIS WARCHOT - BUSINESS RELATIONSHIP FORM 990, PART VI, SECTION A, LINE 6 ORGANIZATION'S MEMBERS AAR MEMBERS INCLUDE THE MAJOR FREIGHT RAILROADS OF THE UNITED STATES, CANADA AND MEXICO, AS WELL AS SMALLER RAILROADS THAT PROVIDE FREIGHT OR PASSENGER SERVICES THROUGHOUT NORTH AMERICA IN ADDITION, AMTRAK IS A FULL MEMBER OF AAR. AAR HAS THREE CLASSES OF MEMBERSHIP: (1) FULL MEMBERSHIP IS AVAILABLE TO U.S. RAILROADS, (2) SPECIAL MEMBERSHIP IS A AVAILABLE TO CANADIAN AND MEXICAN RAILROADS, AND (3) ASSOCIATE MEMBERSHIP IS AVAILABLE TO NON-CLASS 1 RAILROADS AND RAILROAD SUPPLIERS. AAR'S FULL MEMBERS HAVE VOTING RIGHTS AS PRESCRIBED IN THE AAR BY-LAWS. FORM 990, PART VI, SECTION A, LINE 7B AAR CORPORATE DOCUMENTS ALLOW FOR DECISIONS TO BE APPROVED BY MEMBERS TO THE EXTENT PROVIDED BY LAW. ALL MATTERS ARE SUBJECT TO APPROVAL IN ACCORDANCE WITH STATE/LOCAL LAW. FORM 990, PART VI, SECTION B, LINE 11 THE FORM 990 IS REVIEWED IN DETAIL BY THE ORGANIZATION'S CFO, PRESIDENT AND GENERAL COUNSEL PRIOR TO FILING. A COPY OF THE 2013 FORM 990 WAS MADE AVAILABLE TO EACH MEMBER OF THE ORGANIZATION'S GOVERNING BODY FOR REVIEW PRIOR TO FILING WITH THE IRS. FORM 990, PART VI, SECTION B, LINE 12C AN ANNUAL WRITTEN CONFIRMATION OF COMPLIANCE WITH THE ORGANIZATION'S CONFLICT OF INTEREST POLICIES IS REQUIRED FROM ALL AAR EMPLOYEES AND DIRECTORS. THE ANNUAL CONFLICT OF INTEREST DISCLOSURES OF EMPLOYEES ARE REVIEWED BY THE DIRECTOR OF HUMAN RESOURCES OR GENERAL COUNSEL. THE DISCLOSURES OF THE OFFICERS,INCLUDING PRESIDENT, AND CEO, ARE REPORTED TO THE GENERAL COUNSEL. DISCLOSURES OF THE GENERAL COUNSEL ARE REPORTED TO THE CEO. IN THE EVENT OF AN ACTUAL OR POTENTIAL CONFLICT, AAR WOULD INVESTIGATE AND TAKE APPROPRIATE ACTION TO AVOID THE ACTUAL OR POTENTIAL CONFLICT. SUCH ACTION WOULD INCLUDE THAT THE CONFLICTED PERSON DOES NOT PARTICIPATE IN THE REVIEW, RESOLUTION PROCESS, OR ANY DELIBERATION/DECISION MAKING RELATED TO THE MATTER. FOLLOW UP ACTIONS ARE TAKEN AS NEEDED BY AAR GENERAL COUNSEL OR THE CEO. FORM 990, PART VI, SECTION B, LINE 15 COMPARABILITY DATA IS PREPARED BY AN INDEPENDENT COMPENSATION CONSULTANT FOR EXECUTIVE (CEO AND VICE PRESIDENTS) COMPENSATION. THAT INFORMATION IS PROVIDED ANNUALLY TO THE ORGANIZATION'S GOVERNANCE COMMITTEE AS PART OF ITS ANNUAL BUDGET DELIBERATIONS. EXECUTIVE SALARIES ARE REVIEWED AND ANY MERIT ADJUSTMENTS FOR THAT FISCAL YEAR ARE DETERMINED AS PART OF THE ANNUAL BUDGETARY PROCESS. CONTEMPORANEOUS MINUTES OF GOVERNANCE COMMITTEE MEETINGS ARE MAINTAINED. FORM 990, PART VI, SECTION C, LINE 19 THE ORGANIZATION MAKES ITS GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS AVAILABLE TO THE PUBLIC TO THE EXTENT REQUIRED BY LAW. FORM 990, PART XI, LINE 9: UNRECOGNIZED CHANGE, DEFINED BENEFIT PLAN OBLIGATIONS 10,833,109. RAILROAD RESEARCH FOUNDATION 425 THIRD ST SW SUITE 910 WASHINGTON DC 20024 522344655 RESEARCH DE 501(C)(3) LINE 7 ASSOCIATION OF AMERICAN RAILROADS 1 RAILPAC 425 THIRD ST SW SUITE 1000 WASHINGTON DC 20024 000280743 POLITICAL ACTIVITIES DC 527 ASSOCIATION OF AMERICAN RAILROADS 1 AAR RETIREE LIFE INSURANCE TRUST 425 THIRD ST SW SUITE 1000 WASHINGTON DC 20024 521161363 PROVIDES RETIREE LIFE INSURANCE TO PLAN PARTICIPANTS DC 501(C)(9) ASSOCIATION OF AMERICAN RAILROADS 1 TRANSPORTATION TECHNOLOGY CENTER INC 55500 DOT ROAD PUEBLO CO 81001 841440384 RESEARCH & TESTING DE ASSOCIATION OF AMERICAN RAILROADS C 30037790 30251916 1.00000 0 RAILINC CORPORATION 7001 WESTON PARKWAY SUITE 200 CARY NC 27513 522131600 IT & SVCS DE ASSOCIATION OF AMERICAN RAILROADS C 56223949 29479852 1.00000 0 1 1 0 1 1 0 0 0 0 1 0 1 1 1 1 0 1 0 0 RAILINC CORPORATION A 155373 COST RAILINC CORPORATION L 1686570 COST RAILINC CORPORATION Q 289745 COST RAILROAD RESEARCH FOUNDATION B 75000 COST RAILROAD RESEARCH FOUNDATION L 107082 COST RAILROAD RESEARCH FOUNDATION M 243169 COST TRANSPORTATION TECHNOLOGY CENTER INC L 773431 COST TRANSPORTATION TECHNOLOGY CENTER INC M 13750618 COST TRANSPORTATION TECHNOLOGY CENTER INC Q 852243 COST FORM 990, PART V THE TRANSACTIONS WITH RAILROAD RESEARCH FOUNDATION CORRESPONDING WITH LINES 1M AND 1N ARE MINIMAL IN AMOUNT. THE TRANSACTION CORRESPONDING WITH LINES 1D AND 1E INVOLVES AN UNSECURED LINE OF CREDIT WHICH WAS CO-SIGNED BY ORGANIZATIONS RELATED TO THE ASSOCIATION OF AMERICAN RAILROADS. DURING 2007, IN CONNECTION WITH AAR'S RENEWAL OF AN UNSECURED LINE OF CREDIT WITH SUNTRUST BANK, THE ASSOCIATION ENTERED INTO AN UNSECURED LINE OF CREDIT AS A CO-BORROWER WITH TTCI AND RAILINC (AS WHOLLY OWNED SUBSIDIARIES OF AAR), AND WITH RRF (AS AN AFFILIATED ORGANIZATION)IN THE AMOUNT OF $4 MILLION THAT EXPIRED JULY 31, 2008 AND WAS SUBSEQUENTLY RENEWED ANNUALLY THROUGH JULY 31, 2013. UNDER THE LINE OF CREDIT FACILITY, SUNTRUST BANK WILL ALLOW ADVANCES AT ANY TIME PROVIDED NO SIGNIFICANT DETERIORATION IN THE FINANCIAL CONDITION OF THE CO-BORROWERS HAS OCCURED. AS OF DECEMBER 31, 2012 NO AMOUNTS HAD BEEN WITHDRAWN ON THE LINE OF CREDIT.