In the latest of the continuing battles between Amtrak and the host railroads over which it operates, the Massachusetts Bay Transit Authority (“MBTA”) filed suit against Amtrak last week in the U.S. District Court in Massachusetts, seeking to recover costs for the services it provides to Amtrak to facilitate Amtrak’s passenger service. Amtrak has operated over MBTA’s rail lines for years pursuant to an agreement which allows Amtrak the right to run over and control dispatching for an MBTA line in exchange for Amtrak’s agreement to provide certain services and maintenance along the line free of charge. Following the enactment of the FAST Act (“Fixing America’s Service Transportation Act”) last year, Amtrak repudiated its existing contract with MBTA and demanded a new agreement, claiming that Amtrak’s new Cost Sharing Policy established pursuant to PRIIA and the Fast Act gave Amtrak the unilateral right to revoke its prior contracts and impose new financial terms on its host railroads. MBTA filed this suit seeking to recover $30 million in the value of services provided by Amtrak and to obtain a declaration that Section 212 of PRIIA, as amended by Section 11305 of the FAST Act, is unconstitutional. A copy of the complaint can be found here.
This will be an interesting case to watch for all of the railroads who host Amtrak service, and for those states looking to expand their state sponsored passenger service. In the DOT v. AAR case (135 S.Ct. 1225, 2015), the Supreme Court raised questions regarding the constitutionality of Amtrak’s ability to impose terms on the freight railroads and remanded the matter back to the D.C. Circuit to examine those issues. Although Congress had the opportunity to fix some of the constitutional flaws in Amtrak’s authority with the FAST Act, it did not do so. Now, two courts will be taking a closer look at whether Amtrak’s authority over the freight railroads violates the Appointments Clause, the Due Process Clause and the overarching constitutional principles of separation of powers. Stay tuned.