Investigation of Substandard Amtrak Performance Under Section 213 of The Passenger Rail Investment and Improvement Act of 2008
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1 Investigation of Substandard Amtrak Performance Under Section 213 of The Passenger Rail Investment and Improvement Act of 2008 February 13, 2015 Presented by Kevin M. Sheys, Partner 1666 K Street NW, Ste. 500, Washington, DC 20006
2 Two Ways to Listen If you have state sponsored intercity passenger rail in your work portfolio, you might be interested in what Amtrak is trying to do with PRIIA Section 213, because if Amtrak is successful, Section 213 has the potential to dramatically improve Amtrak service. If you do not have intercity rail in your portfolio, sit back and I will tell you a story about a pending U.S. Supreme Court case and two administrative lawsuits that have the potential to moot a large chunk of that case. 2
3 President Bush signs PRIIA ( ), Section 207: Metrics & Standards FRA and Amtrak to develop performance and service quality metrics, in consultation with stakeholders including freight host railroads. Topics of Metrics - cost recovery, on-time performance and minutes of delay, ridership, on-board services, stations, facilities, equipment, and other services. Had to include measures of on-time performance and delays incurred by intercity passenger trains on the rail lines of each host railroad. 3
4 PRIIA Section 213 If 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 fails to meet those standards for 2 consecutive calendar quarters, upon the filing of a complaint by Amtrak the [Surface Transportation] Board shall initiate [] an investigation First trigger and second trigger. 4
5 PRIIA Section 213 (con t.) Investigation is to: determine whether and to what extent delays or failure to achieve minimum standards are due to causes that could reasonably be addressed by a host railroad or Amtrak. identify reasonable measures and make recommendations to improve the service, quality, and on-time performance of the Amtrak train. 5
6 PRIIA Section 213 (con t.) Damages for Preference Violations Board can award money and provide other relief if it determines that delays or failures to achieve minimum standards are attributable to a rail carrier's failure to provide preference to Amtrak over freight transportation. Preference predates PRIIA. 6
7 Metrics & Standards Published (May of 2010) Three On-Time Performance Metrics: Effective speed (distance divided by time for whole trip). End-station OTP. All-station OTP. 7
8 Association of American Railroads ( AAR ) Lawsuit ( ) Arguing: Metrics violate the non-delegation doctrine (Art I, Sec. 1) by placing regulatory authority in Amtrak, a private entity in the industry regulated by the metrics. Metrics violate 5 th Amendment due process, by allowing Amtrak to regulate its competitors. 8
9 Amtrak v. CN (STB Case #1) Amtrak Section 213 action against Canadian National (CN) ( ) Amtrak complaint says STB, investigate! Amtrak trains on CN did not meet the Section 207 OTP Metrics in two consecutive calendar quarters (specified in Complaint). This is the second trigger. 9
10 AAR Lawsuit (con t.) U.S. District Ct. for D.C. Rules The Metrics Are Constitutional ( ). Amtrak not a private party for relevant purposes. Even assuming Amtrak were a private party, the FRA had sufficient control over the promulgation of metrics to avoid an unconstitutional delegation. For same reason, No 5 th Amendment due process violation. We still have the Metrics, we still have the second trigger. 10
11 AAR Lawsuit (con t.) D.C. Circuit Reverses Ruling that the Metrics are unconstitutional delegation. ( ) Decision does not reach the due process argument. 11
12 AAR Lawsuit (con t.) Supreme Court grants Gov ts Petition for Cert ( ). 12
13 Amtrak v. CN (STB Case #1) (con t) Amtrak files Motion to Amend the CN Complaint. Limited to the Illini/Saluki service (Chicago to Carbondale, IL). First Trigger - the on-time performance of the Illini/Saluki averaged less than 80 percent for any 2 consecutive calendar quarters (specified) CN filed motion to dismiss, says there is no such trigger! Congress unambiguously provided that investigations would be triggered only by OTP Metrics. Amtrak replies. 13
14 PRIAA SECTION 213 If 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 fails to meet those standards for 2 consecutive calendar quarters, upon the filing of a complaint by Amtrak the [Surface Transportation] Board shall initiate [] an investigation First trigger and second trigger. 14
15 Amtrak-Capitol Limited (NS and CSX) (STB Case #2) Amtrak files a second 213 case on Capitol Limited (Chicago-DC via Pittsburgh) First Trigger. The involved railroads, Norfolk Southern and CSXT, get an extension to answer. (NS counsel is the same as AAR s counsel in the Supreme Court case). 15
16 AAR Lawsuit (con t.) Supreme Court oral argument. The Solicitor General is asked twice about the first trigger (although not in these words) and tells the Court the existence of the first trigger is in dispute and has been briefed at the STB. 16
17 STB v. CN (STB Case #1) STB grants the Amtrak s Motion to Amend the Complaint (Amtrak/CN). There are two triggers; the second trigger is dependent on the outcome of the Supreme Court case, but the first trigger is not. Send us briefs on how we should define on-time performance less than 80 percent. Decision is 2:1. Dissent (Vice Chairman Begeman) says - assuming there is a first trigger, we should define OTP by rulemaking. 17
18 STB Composition The one-year anniversary of STB Chairman Dan Elliott s term expiration; he leaves the STB, which then has two members, including the dissenter from Amtrak/CN. 18
19 January Fireworks Then many things happen in 3 weeks in the two Amtrak cases: CN files a Petition for Reconsideration. Amtrak replies. CN Answers the Amended Complaint. Capital Limited railroads (Norfolk Southern and CSXT), file motions to dismiss and answers, saying no first trigger! Amtrak replies to all 4 pleadings. Norfolk Southern and CSXT file motions to intervene in the Amtrak v. CN case, for the setting of the definition. Amtrak and CN say okay. 19
20 AAR Petition for Rulemaking On OTP Trigger Definition ( AAR Petition: There is. no first trigger! (Please don t mess with our D.C. Circuit win). If you disagree (and deny the opposition in the two pending cases) and move forward under the first trigger, you should have a rulemaking on how to define 80 % OTP. (Channeling STB dissent). Not doing so could be abuse of discretion. 20
21 January Fireworks (con t.) STB puts the schedule in Illini/Saluki case (and, practically, in the Capitol Limited) on hold pending decision on rulemaking. 21
22 AAR Petition for Rulemaking on OTP Trigger s Definition (con t.) Amtrak reply in the rulemaking docket Agencies have broad discretion to use adjudication instead of RM (Chenery). Shell Oil v. FERC (5 th Cir. 1983) protects due process rights of future litigants. Need for immediate action and other factors make adjudication appropriate. 22
23 STB Composition Meanwhile, White House names its nominee to replace Dan Elliott at the STB. Nominee is 23
24 Dan Elliott!! 24
25 Where Do Things Stand Supreme Court decision pending STB Petition for rulemaking pending. CN Petition for reconsideration in Amtrak/CN pending Motions to dismiss in Capitol Limited pending. Dan Elliott s re-nomination pending. 25
26 What Could Happen Next STB could deny the opposition filings and the rulemaking petition and proceed in the Amtrak/CN case to define the OTP trigger and do an investigation of the substandard performance of the Illini/Saluki and Capitol Limited services. Beneficial for improved Amtrak service. Determination of whether there have been preference violations. Would moot a large chunk of forthcoming Supreme Court decision. 26
27 What Could Happen Next (con t.) STB could deny the opposition filings, but grant the rulemaking petition and proceed to define the OTP trigger in a rulemaking. This would delay investigation of the substandard performance of the Illini/Saluki and Capitol Limited services. Delay determinations regarding preference violations. 27
28 What Could Happen Next (con t.) STB could grant opposition filings. Rule that there is no first trigger. Refocus on Supreme Court decision. 28
29 What Could Happen in Supreme Court Case Affirm D.C. Circuit - No Metrics, no second trigger. Reverse and remand on 5 th Amendment due process issue delay on second trigger. Reverse and decide the 5 th Amendment Issue. Validate Metrics. Invalidate Metrics. 29
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