The ICC had definitions for Class I to Class V repairs, and I have seen them somewhere, but I can't recall how it went. They didn't make a distinction between an overhaul and a rebuilding, though.
I would take a stab at it like this: an "overhaul" would be defined as returning a piece of equipment to near-new condition, while a "rebuild" would include some significant improvement (replacing slide valves with piston valves, adding a superheater, etc.)
The primary distinction would be for accounting purposes as John mentions. Railroads were regulated as a public utility - their rates were fixed by the ICC, they were compelled to offer services that lost money (like the line from Alamosa to Durango) in the public interest.
I have seen instances, primarily in wartime, where even equipment purchases had to be approved, and if a "new" freight car purchase was vetoed, a set of cars were chosen for "rebuild." Often the only thing that remained of the original car was the number - 99-100% of the fabric of the car was new, but it satisfied the regulators.
One facet of that regulation is that certain expenditures are classified as capital costs, and depreciated over varying amounts of time. A running gear overhaul might be depreciated over three years, while a flue job might be depreciated over four. Firebox repairs might be depreciated over ten. A new cylinder saddle might be depreciated over twenty-five years.
Thus the Class repairs - a standard set of capital maintenance to be depreciated over a fixed time period, so that railroads can't artificially mess with the balance sheet by fiddling with depreciation schedules.
It also offers some insight into the AFEs posted here. Somewhere in the accounting department those AFEs were tracked, and the investments depreciated according to certain guidelines if they were considered capital.
JAC
