Happening Now

Blame The Lawyers, Part 2…

February 1, 2019

Freights Fight For Their Right To Be Unreliable

by Jim Mathews, President and CEO

Last July, we told you that Rail Passengers won a significant court victory when the U.S. Court of Appeals for the D.C. Circuit ruled 2-1 in favor of Amtrak and the Federal Railroad Administration (FRA) in the multi-year saga over who can set standards for measuring the on-time performance of passenger rail.

With on-time performance last summer at record lows, America’s rail travelers had been waiting for years for the courts to step in and protect the rights of the traveling public – rights that Congress has clearly, unmistakably, and repeatedly written into law, and rights for which your Association has gone to bat, in Congress AND in federal courts across the U.S.

Well, as expected this week the Association of American Railroads filed a formal request to the Supreme Court to take up the issue when its next session convenes in October. And yes, Rail Passengers Association will respond with a brief of its own.

At its core, AAR’s argument is that Amtrak is a for-profit corporation like any other, and giving it the power to work with FRA regulators to set OTP standards is giving that corporation an unfair competitive advantage.

Our position, which the Appeals court vindicated, is that the lower courts erred in gutting the protections passed by Congress in the 2008 Passenger Rail Investment and Improvement Act (PRIIA) and that the Appeals court got it right. We also argued, and the Appeals court agreed, that the Surface Transportation Board (STB) can set and enforce standards to protect rail passengers, contrary to the argument made in lawsuits brought by the freight rail industry. And of course the Supreme Court itself has already ruled in a separate case that Amtrak is a government instrumentality – an inescapable conclusion, given that its leadership is appointed by the President with the advice and consent of the Senate and that the railroad gets a federal appropriation each year to operate.

The U.S. Solicitor General told the Supreme Court last year that he agreed with our interpretation.

I’ve been saying for some time that when the DC Circuit nullified Section 207 in 2017, it took away FRA’s power to develop on-time performance standards. Then the Eighth Circuit that summer interpreted Section 213 in a way that eviscerated the power of the Surface Transportation Board and endorsed the frankly silly premise that Amtrak somehow “competes” with freight railroads.

Let’s be clear on what’s happening: host railroads don’t want there to be any on time performance standards for passengers, so they are throwing up every roadblock they can to avoid meeting their obligations. In their mind it’s too hard and too expensive to run a railroad with enough fluidity to ensure good on time performance.

Congress mandated that we should prioritize people first, which the Solicitor General’s office recognized in its brief to the Supreme Court in 2017. In the real world, the host railroads thumb their noses at Amtrak’s contracts for minimum OTP, just as they have thumbed their noses for years at the federal law outlining passenger-dispatching preference. “You’ll get there when you get there, and you’ll like it,” seems to be the host railroads’ position. That’s why Congress has to keep stepping in.

Recall that you and I as taxpayers rescued the railroads in 1970 when Amtrak was created to relieve the hosts of their common-carrier responsibility of having to run passenger trains. As part of that financially lucrative rescue deal, there was a quid pro quo: the preference clause in the law (49 U.S.C. § 24308(C), which is still on the books). The clause was originally written so that host railroads had to give passenger trains preference unless they could win a DOT exemption by proving that preference would “materially lessen the quality of transportation provided to freight shippers.” Apparently it has never been that big a deal, since the railroads have never filed a challenge under that clause. Ever. Look it up. But they’re still trying to get out of that deal.

But here’s where it gets interesting. One of the authors of that 2-1 decision in the DC Appeals Court has a new job today: Associate Justice of the Supreme Court Brett Kavanaugh. That means that when the case makes it to the Court, if it does, Kavanaugh will have to recuse himself. That, in turn, means that passengers can prevail in this long-running saga with a 4-4 vote, because a tie is not enough to overturn a lower court ruling.

Stay tuned…