Submitted: February 8, 2017
for Review of an Order of the Surface Transportation Board
SMITH,  BENTON and SHEPHERD, Circuit Judges.
Congress expressly delegates rulemaking authority in a
regulatory sphere to one agency, and that delegation is
declared unconstitutional, may a different agency provide
regulatory guidance in the same sphere on its own initiative?
The Surface Transportation Board ("Board") said
yes-and on that basis it promulgated a rule defining
"on-time performance" under the Passenger Rail
Investment and Improvement Act of 2008 after the Act's
delegation to another agency was invalidated. Now the Board
argues that the Act itself allows the Board to promulgate
on-time performance standards. Because the Board's
interpretation contradicts the Act's plain language, we
grant these consolidated petitions and hold that the Board
exceeded its authority.
National Railroad Passenger Corporation ("Amtrak")
and freight railroad companies share the nation's
railways. Congress created Amtrak as a passenger railroad in
1970. Dep't of Transp. v. Assoc. of Am. R.Rs.,
135 S.Ct. 1225, 1228 (2015). Amtrak relieved freight
railroads of their common-carrier obligation to offer
passenger service, and in exchange it received the right to
use freight-railroad tracks and facilities at rates set by
agreement or by the Interstate Commerce Commission, a
now-defunct agency. Id. at 1229. Congress later
granted Amtrak a statutory preference over freight railroads
on shared track. Id. But in 2008, the Department of
Transportation's Inspector General reported that this
preference right was weak. Office of Inspector Gen., Fed.
R.R. Admin., CR-2008-076, Root Causes of Amtrak Train Delays
4 (2008). He noted that freight railroads could "adjust
their dispatching practices" to give their own trains an
advantage over Amtrak. Id.
address this situation, Congress enacted the Passenger Rail
Investment and Improvement Act of 2008, Pub. L. No. 110-432,
122 Stat. 4907 (PRIIA). Two sections of the Act are relevant
here. The first, § 207(a), instructs the Federal
Railroad Administration (FRA) and Amtrak, jointly and in
consultation with other groups, to "develop new or
improve existing metrics and minimum standards for measuring
the performance and service quality of intercity passenger
train operations, including cost recovery, on-time
performance and minutes of delay, ridership, on-board
services, stations, facilities, equipment, and other
services." Id. § 207(a) (codified at 49
U.S.C. § 24101 (note)). These metrics must include
"measures of on-time performance and delays incurred by
intercity passenger trains on the rail lines of each rail
metrics and standards have at least four uses: (1) they are
the basis for quarterly reports published by the FRA,
id. § 207(b); (2) they are the basis for an
annual evaluation by Amtrak, id. § 210(a)
(codified at 49 U.S.C. § 24710); (3) they are a
benchmark for a performance improvement plan to be developed
by Amtrak, id.; and (4) at least some of the metrics
and standards trigger Board investigations into freight
railroads' compliance with Amtrak's statutory
preference right, id. § 213(a) (codified at 49
U.S.C. § 24308(f)).
second relevant section is § 213(a). Congress added
§ 213(a) to 49 U.S.C. § 24308, the Code provision
containing Amtrak's statutory preference right.
See 122 Stat. at 4925. Section 213(a) authorizes,
and sometimes requires, the Board to investigate when an
Amtrak train fails to meet certain performance standards.
PRIIA § 213(a). If the Board determines that the failure
is attributable to the host railroad's failure to honor
Amtrak's preference right, then the Board may award
damages and other relief. Id. An investigation is
[i]f the on-time performance of any intercity passenger train
averages less than 80 percent for any 2 consecutive calendar
quarters, or the service quality of intercity passenger train
operations for which minimum standards are established under
section 207 of the Passenger Rail Investment and Improvement
Act of 2008 fails to meet those standards for 2 consecutive
calendar quarters . . . .
Id. This case addresses how "on-time
performance" is defined for purposes of § 213(a).