Metropolitan Transportation Authority v. Interstate Commerce Commission

792 F.2d 287
CourtCourt of Appeals for the Second Circuit
DecidedJune 4, 1986
DocketNo. 85-4141
StatusPublished
Cited by2 cases

This text of 792 F.2d 287 (Metropolitan Transportation Authority v. Interstate Commerce Commission) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Metropolitan Transportation Authority v. Interstate Commerce Commission, 792 F.2d 287 (2d Cir. 1986).

Opinion

OAKES, Circuit Judge:

This case concerns questions of the applicability and constitutionality of acts of Congress pertaining to certain rail passenger services as well as questions whether the Interstate Commerce Commission (ICC or Commission), respondent here, has jurisdiction to determine the compensation owed by the National Railroad Passenger Corporation (Amtrak), intervenor here, to the New York Metropolitan Transportation Authority (MTA) and its wholly-owned subsidiary Metro-North Commuter Railroad Company (Metro-North) (jointly referred to as [290]*290Metro), petitioners here, for Amtrak’s use of certain facilities and services of the petitioners and whether the determinations that the ICC made were proper. Resolution of these questions involves examination of the tortuous collation of statutes pertaining to Amtrak, including the relevant sections of the Rail Passenger Service Act of 1970 (RPSA), 45 U.S.C. §§ 501-658 (as amended),1 and to Metro-North, which by virtue, inter alia, of the Northeast Rail Service Act of 1981 (NRSA), Pub.L. No. 97-35, 95 Stat. 643 (codified as amended in scattered sections of 45 U.S.C.), now operates a commuter rail service formerly operated by the Penn Central Transportation Company (Penn Central), and from 1976 through 1982, by Penn Central’s federally-funded successor in interest, Consolidated Rail Corporation (Conrail), which was statutorily constituted pursuant to the Regional Rail Reorganization Act of 1973 (3R Act), Pub.L. No. 93-236, 87 Stat. 985 (codified as amended in scattered sections of 45 U.S.C.).

The case also requires our consideration of, among other things, the tortured history by which the seventy-four miles of lines in question between Poughkeepsie, New York, and Grand Central Terminal (GCT) in New York City (the Harlem-Hudson Line), as well as the GCT facility itself, came to be leased originally to MTA by Penn Central in 1972, the latter reserving certain rights, however, to Amtrak and to itself. Penn Central’s rights were in turn later assigned in part to Conrail. In our trek through these statutes and this history we are aided no end by the previous opinions of the Special Court, Regional Rail Reorganization Act (the Special Court), 45 U.S.C. § 719(b), which (a) declined to stay the instant Commission proceedings, Consolidated, Rail Corp. v. Metro-North Commuter Railroad Co., C.A. No. 83-14 (Regional Rail Reorg. Ct., July 23, 1984) (Conrail I) (holding (1) section 402(a) of RPSA, 45 U.S.C. § 562(a), facially applicable to Amtrak’s trackage rights over the lines in question, (2) a Fifth Amendment constitutional argument insubstantial, (3) section 504(f) of RPSA, added by section 1137 of NRSA, 45 U.S.C. § 584(f), inapplicable, and (4) declining to exercise any power under the All Writs Act, 28 U.S.C. § 1651, in order to preserve its jurisdiction); and (b) in a proceeding related to this one held that the free trackage rights and rights to GCT (collectively “trackage rights”) retained by Penn Central in its 1972 leases to MTA devolved upon Conrail and, to a limited extent, upon Amtrak and remain in full force and effect despite Conrail’s ceasing as of January 1, 1983, to furnish commuter services on the lines in question and despite the enactment of section 504(f) of RPSA, see Consolidated Rail Corp. v. Metro-North Commuter Railroad Co., 598 F.Supp. 1571 (Regional Rail Reorg. Ct. 1984) (Conrail II). With that aid, as well as with a careful independent examination of the historical facts, statutes, and claims involved, we deny the petition to review.

STATEMENT OF FACTS

Because rail passenger service was deteriorating throughout the nation, Congress enacted the RPSA in 1970. The RPSA created Amtrak and provided for its assumption of nearly all “basic system” intercity passenger service obligations. See Congress of Railway Unions v. Hodgson, 326 F.Supp. 68, 70 (D.D.C.1971). Under section 401 of RPSA, 45 U.S.C. § 561, railroads were permitted to terminate their responsibility to provide intercity rail passenger service without filing an application for discontinuance with the ICC; they could, instead, contract with Amtrak, at least until Amtrak’s authority to enter such contracts expired in 1975.

Amtrak continues to have authority under section 402 of RPSA, 45 U.S.C. § 562, to “contract with railroads or with regional transportation agencies for the use of tracks and other facilities.” If the parties cannot agree, section 402(a), the critical statutory provision involved in this case, gives the Commission the authority, if necessary to accomplish the purposes of RPSA, to prescribe compensation to be paid [291]*291by Amtrak for the use of such tracks and facilities. That subsection provides that such compensation is in general to be limited to “incremental costs”; the “quality of service” is the principal factor that can lead to an award of compensation in excess of those costs. “Incremental costs,” all parties to this case agree, are the same as so-called “avoidable costs,” i.e., the costs of the carrier whose facilities are being used that would be avoidable except for Amtrak’s use. These are as opposed to “fully-allocated” or “fully-distributed” costs, which are equal to the total costs of maintenance, operation and repair of a line or facilities, and to a return on investment, in basically the same proportion as the respective carriers use the facilities. It is self-evident that Metro wishes to get out from under the application of section 402(a) so that it can receive fully-allocated costs.2

The relationship that led to the controversy before us can be traced back to 1972, when MTA, which, like its subsidiary Metro-North, is a New York state public benefit corporation, see N.Y.Pub.Auth.Law §§ 1263(1), 1266(5) (McKinney 1982), entered into an arrangement with Penn Central concerning the latter’s Harlem-Hudson service. This arrangement enabled MTA to obtain full control over a substantial part of Penn Central’s tracks, terminals, stations, shops, and yards by a single lease, the so-called Harlem-Hudson Lease. The lease covered both GCT and the whole of the Harlem and Hudson Lines. It was for a term of sixty years with various rights of renewal permitting it to run up to an additional thirty years. The rent that MTA agreed to pay Penn Central was nominal, but the agreement made MTA eligible for substantial federal aid and rehabilitation. See 49 U.S.C. app. § 1602(a). Although Penn Central was then in the process of transferring responsibility for its long-haul passenger services to the newly-created Amtrak, it reserved certain rights under the lease, including the right to continue to operate its freight and long-haul passenger services over the leased properties and all rights necessary to enable Penn Central to perform its obligations and Amtrak to exercise its rights under an April 16, 1971, agreement between Amtrak and Penn Central.

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Cite This Page — Counsel Stack

Bluebook (online)
792 F.2d 287, Counsel Stack Legal Research, https://law.counselstack.com/opinion/metropolitan-transportation-authority-v-interstate-commerce-commission-ca2-1986.