[Federal Register Volume 81, Number 150 (Thursday, August 4, 2016)]
[Rules and Regulations]
[Pages 51343-51348]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-18256]


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SURFACE TRANSPORTATION BOARD

49 CFR Part 1040

[Docket No. EP 726]


On-Time Performance Under Section 213 of the Passenger Rail 
Investment and Improvement Act of 2008

AGENCY: Surface Transportation Board.

ACTION: Final rule.

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SUMMARY: The Surface Transportation Board (STB or Board) is adopting a 
final rule to define ``on time'' and specify the formula for 
calculating ``on-time performance'' for purposes of Section 213 of the 
Passenger Rail Investment and Improvement Act of 2008. The Board will 
use these regulations only for the purpose of determining whether the 
``less than 80 percent'' threshold that Congress set for bringing an 
on-time performance complaint has been met. In light of comments 
received on the Board's notice of proposed rulemaking issued on 
December 28, 2015, the proposed rule has been modified to deem a 
train's arrival at, or departure from, a given station ``on time'' if 
it occurs no later than 15 minutes after its scheduled time and to 
adopt an ``all-stations'' calculation of ``on-time performance.''

DATES: This rule is effective on August 27, 2016.

FOR FURTHER INFORMATION CONTACT: Scott M. Zimmerman at (202) 245-0386. 
Assistance for the hearing impaired is available through the Federal 
Information Relay Service (FIRS) at (800) 877-8339.

SUPPLEMENTARY INFORMATION: The National Railroad Passenger Corporation 
(Amtrak) was established by Congress in 1970 to preserve passenger 
services and routes on the Nation's railroads. See Lebron v. Nat'l R.R. 
Passenger Corp., 513 U.S. 374, 383-384 (1995); Nat'l R.R. Passenger 
Corp. v. Atchison, Topeka, & Santa Fe R.R., 470 U.S. 451, 454 (1985); 
see also Rail Passenger Serv. Act of 1970, Public Law 91-518, 84 Stat. 
1328

[[Page 51344]]

(1970). As a condition of relieving the railroad companies of their 
common carrier obligation to provide passenger service, Congress 
required them to permit Amtrak to operate over their tracks and use 
their facilities. See 45 U.S.C. 561, 562 (1970 ed.). Since 1973, 
Congress has required railroads to give Amtrak trains preference over 
freight service when using their lines and facilities: ``Except in an 
emergency, intercity and commuter rail passenger transportation 
provided by or for Amtrak has preference over freight transportation in 
using a rail line, junction, or crossing . . . .'' 49 U.S.C. 24308(c); 
see Amtrak Improvement Act of 1973, Public Law 93-146, section 10(2), 
87 Stat. 552 (initial version).
    Prior to 2008, the Board was not involved in the adjudication of 
Amtrak's preference rights. The only way that Amtrak could enforce its 
preference rights was by asking the Attorney General to bring a civil 
action for equitable relief. 49 U.S.C. 24103. Further, the Secretary of 
Transportation had the authority under section 24308(c) to grant a host 
rail carrier relief from the preference obligation and to establish the 
usage rights between Amtrak and the host carrier if the Secretary found 
that Amtrak's preference materially lessened the quality of freight 
transportation provided to shippers. In 2008, Congress enacted Section 
213 of the Passenger Rail Investment and Improvement Act of 2008 
(PRIIA), 49 U.S.C. 24308(f), to address, among other things, the 
concern that one cause of Amtrak's inability to achieve reliable on-
time performance was the failure of host railroads to honor Amtrak's 
right to preference. See Passenger Rail Inv. & Improvement Act, Public 
Law 110-432, Div. B, 122 Stat. 4907 (2008); S. Rep. No. 67, 110th 
Cong., 1st Sess. 25-26 (2007). Section 207 of PRIIA, 49 U.S.C. 24101 
note, charged Amtrak and the Federal Railroad Administration (FRA) with 
``jointly'' developing new, or improving existing, metrics and 
standards for measuring the performance of intercity passenger rail 
operations, including on-time performance and train delays incurred on 
host railroads.
    PRIIA also transferred from the Secretary of Transportation to the 
Board the administration and enforcement of Amtrak's preference rights. 
Thus, PRIIA amended 49 U.S.C. 24308(c) to provide that: ``Except in an 
emergency, intercity and commuter rail passenger transportation 
provided by or for Amtrak has preference over freight transportation in 
using a rail line, junction, or crossing unless the Board orders 
otherwise under this subsection'' (emphasis added). Congress likewise 
transferred to the Board the authority under section 24308(c) to 
determine if ``preference for intercity and commuter rail passenger 
transportation materially will lessen the quality of freight 
transportation provided to shippers'' on a freight carrier's line, and, 
if so, to ``establish the rights of the carrier and Amtrak on 
reasonable terms.''
    Under Section 213(a) of PRIIA, 49 U.S.C. 24308(f)(1), if the ``on-
time performance'' (OTP) of any intercity passenger train averages less 
than 80% for any two consecutive calendar quarters, the Board may 
initiate an investigation, or upon complaint by Amtrak or another 
eligible complainant, the Board ``shall'' do so. The purpose of such an 
investigation is to determine whether and to what extent delays are due 
to causes that could reasonably be addressed by the passenger rail 
operator or the host railroad. Following the investigation, should the 
Board determine that Amtrak's substandard performance is ``attributable 
to'' the rail carrier's ``failure to provide preference to Amtrak over 
freight transportation as required'' by 49 U.S.C. 24308(c), the Board 
may ``award damages'' or other appropriate relief from a host railroad 
to Amtrak. 49 U.S.C. 24308(f[hairsp])(2). If the Board finds it 
appropriate to award damages to Amtrak, Amtrak must use the award ``for 
capital or operating expenditures on the routes over which delays'' 
were the result of the host railroad's failure to grant the statutorily 
required preference to passenger transportation. 49 U.S.C. 
24308(f[hairsp])(4).
    Thus, 49 U.S.C. 24308(f) sets up a two-stage process involving, 
first, a ``less than 80 percent'' threshold to indicate whether a 
train's OTP allows for an investigation; and second, if this 
prerequisite is satisfied, the Board may investigate (or on complaint, 
shall investigate) the causes of the deficient OTP, which could lead to 
findings, recommendations, and other possible relief as detailed in the 
statute.
    On May 15, 2015, the Board instituted this rulemaking proceeding in 
response to a petition filed by the Association of American Railroads 
(AAR). See On-Time Performance Under Sec. 213 of the Passenger Rail 
Inv. & Improvement Act of 2008, EP 726 (STB served May 15, 2015). In 
that decision, the Board stated that a rulemaking would provide clarity 
regarding the ``less than 80 percent'' OTP threshold in all applicable 
cases and allow the Board to obtain the full range of stakeholder 
perspectives in one docket and avoid the potential relitigation of the 
issue in each case, thereby conserving party and agency resources.\1\
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    \1\ By that point Amtrak had filed two complaints (both pending, 
but in abeyance based on this rulemaking) requesting that the Board 
initiate an investigation pursuant to section 24308(f), and claiming 
that host Class I carriers have not given Amtrak preference as 
required under section 24308(c). See Nat'l R.R. Passenger Corp.--
Sec. 213 Investigation of Substandard Performance on Rail Lines of 
Canadian Nat'l Ry., NOR 42134; Nat'l R.R. Passenger Corp.--
Investigation of Substandard Performance of the Capitol Ltd., NOR 
42141.
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    On December 28, 2015, the Board issued a Notice of Proposed 
Rulemaking (NPRM) that proposed a definition for OTP derived from a 
previous definition used by our predecessor, the Interstate Commerce 
Commission (ICC).\2\ The Board's proposed rule read: ``A train is `on 
time' if it arrives at its final terminus no more than five minutes 
after its scheduled arrival time per 100 miles of operation, or 30 
minutes after its scheduled arrival time, whichever is less.'' NPRM, 
slip op. at 4-9. The Board sought comments on this definition but also 
encouraged the public to propose other alternatives, including the 
alternative adopted here: factoring into the calculation a train's 
punctuality at intermediate stops rather than the final terminus only. 
See NPRM, slip op. at 6. The Board also established a procedural 
schedule providing for comments and replies.
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    \2\ The NPRM contains additional background on the court and 
agency litigation and controversies that led the Board to initiate 
the rulemaking.
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    The Board received 121 comments and replies on its proposed rule 
from the railroad industry (both passenger and freight), states, the 
U.S. Department of Transportation, elected officials at all levels of 
government, individual members of the traveling public, and various 
stakeholder groups.
    Shortly after the comment period in this docket closed, in 
Association of American Railroads v. Department of Transportation, 821 
F.3d 19 (D.C. Cir. 2016), the United States Court of Appeals for the 
District of Columbia Circuit held that the structure of Section 207 of 
PRIIA violates the Due Process Clause of the U.S. Constitution because, 
in the court's view, it authorized Amtrak, ``an economically self-
interested actor,'' to ``regulate its competitors''--that is, the 
railroads that host Amtrak passenger trains outside the Northeast 
Corridor. Accordingly, the FRA and Amtrak metrics are currently 
invalid.

Discussion of Issues Raised in Response to the NPRM.

    The Board's Authority. Several freight rail interests argue that--
even though section 24308(f)(1) allows, and in some

[[Page 51345]]

circumstances requires, the Board to investigate the causes of poor 
``on time performance,'' including whether a host rail carrier has 
failed to provide preference to Amtrak over its rail line as required 
by section 24308(c)--the Board lacks authority to give meaning to the 
term ``on-time performance.'' They argue this even though PRIIA 
provides that if the on-time performance of an Amtrak passenger train 
falls below 80% for two consecutive quarters, such performance may 
warrant an investigation by the Board.
    Although regulatory agencies like the Board typically have the 
authority to define the terms in provisions of the statutes that they 
administer, AAR and freight railroad commenters (Canadian National 
Railway Company (CN), CSX Transportation, Inc. (CSXT), and Norfolk 
Southern Railway Company (NS)) argue that the Board does not have the 
authority to define on-time performance because Congress gave that 
responsibility jointly to Amtrak and FRA in Section 207 of PRIIA. We 
disagree.
    In National Railroad Passenger Corp.--Section 213 Investigation of 
Substandard Performance on Rail Lines of Canadian National Railway 
(Illini/Saluki), NOR 42134, slip op. at 2 (STB served Dec. 19, 2014), 
the Board concluded that the unconstitutionality of Section 207 of 
PRIIA does not prevent the Board from initiating investigations of on-
time performance problems under section 24308(c). Indeed, the only way 
for the Board now to fulfill its responsibilities under 49 U.S.C. 
24308(f) is to define OTP as a threshold for such investigations.
    CN and AAR in their initial comments (see CN Feb. 8 Comment 4; AAR 
Feb. 8 Comment 6) raise concerns that host freight railroads may be 
faced with two inconsistent sets of regulations (i.e., issued by (1) 
FRA/Amtrak and (2) the Board) if section 24308(f) investigations are 
instituted using the OTP definition established in this final rule and 
the courts ultimately uphold the validity of the PRIIA Section 207 
metrics and standards. However, at present there are not two different 
operative standards, and there may never be. We will, therefore, 
address the issue of conflicting OTP definitions if and when the issue 
should arise.
    CN and AAR argue that the issue is not whether section 24308(f) 
survives if Section 207 of PRIIA is unconstitutional, but whether 
Congress delegated to the Board in section 24308(f)(1) the authority to 
define on-time performance. They contend that because Congress 
explicitly delegated the authority to define on-time performance to FRA 
and Amtrak in Section 207 of PRIIA, the Board lacks that authority even 
if FRA and Amtrak are found not to have the legal authority to meet the 
statutory command.\3\
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    \3\ In support, they cite National Railroad Passenger Corp. v. 
National Association of Railroad Passengers, 414 U.S. 453, 458 
(1974) (``When a statute limits a thing to be done in a particular 
mode, it includes the negative of any other mode.'') and Bayou Lawn 
& Landscape Services v. Secretary of Labor, 713 F.3d 1080 (11th Cir. 
2013). But neither case has any bearing on the Board's authority to 
fill the definitional gap exposed by the invalidation of a statutory 
provision. National Railroad Passenger Corp. did not involve agency 
delegation; that case addressed the question whether the predecessor 
to 49 U.S.C. 24103, which allows the Attorney General to bring suit 
against Amtrak or host freight railroads to enforce obligations 
related to Amtrak, created a private right of action to allow third 
parties to sue to prevent what they regarded as the unlawful 
discontinuance of certain passenger trains. In Bayou Lawn, the court 
held that the Department of Labor's general rulemaking authority did 
not give it delegated authority to issue legislative rules for visa 
applications for non-agricultural workers where Congress had 
expressly delegated that authority to the Department of Homeland 
Security. There was no suggestion there that the express delegation 
to Homeland Security had been invalidated, or that Homeland Security 
was otherwise incapable of carrying out the Congressional 
delegation.
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    An agency has implied authority to implement ``a particular 
statutory provision . . . when it appears that Congress delegated 
authority to the agency generally to make rules carrying the force of 
law, and that the agency interpretation claiming deference was 
promulgated in the exercise of that authority.'' United States v. Mead 
Corp., 533 U.S. 218, 226-27 (2001).\4\ ``Sometimes, the legislative 
delegation to an agency on a particular question is implicit rather 
than explicit.'' Chevron U.S.A., Inc. v. Natural Res. Def. Council, 
Inc., 467 U.S. 837, 844 (1984). Several federal courts of appeals have 
held that an administrative agency with rulemaking authority has 
implicit authority to fill a gap exposed by the Supreme Court's 
invalidation of a portion of a statute. See Pittston Co. v. United 
States, 368 F.3d 385, 403-04 (4th Cir. 2004); Sidney Coal Co. v. Social 
Security Admin., 427 F.3d 336, 346 (6th Cir. 2005).\5\
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    \4\ See ICC v. Am. Trucking Assns., 467 U.S. 354, 364-67 (1984) 
(agency may ``modify express remedies in order to achieve specific 
statutory purposes'' if the ``discretionary power . . . further[s] a 
specific statutory mandate [and] the exercise of that power [is] 
directly and closely tied to that mandate''); W. Coal Traffic League 
v. STB, 216 F.3d 1168 (D.C. Cir. 2000).
    \5\ CN argues that the Fifth Circuit held in Texas v. United 
States, 497 F.3d 491, 504 (5th Cir. 2007) that a later court 
decision cannot affect or create ambiguity for purposes of Chevron 
delegation. But Chief Judge Jones' opinion cited by CN is not the 
majority opinion on the issue of implicit delegation. Both Judge 
King, who concurred in the result, and Judge Denis, who dissented, 
agreed that a court decision invalidating a portion of a statute 
creates implicit authority to the agency administering the statute 
to engage in gap-filling. 497 F.3d at 511-12, 513-14. Judge King and 
Judge Denis disagreed over whether the agency's authority to fill 
gaps included overriding portions of the statute that remained in 
effect. There is no such problem here because the Board is simply 
defining the term ``on-time performance,'' which remains in effect.
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    Here, as in Pittston and Sidney Coal, the invalidation of Section 
207 of PRIIA leaves a gap that the Board has the delegated authority to 
fill by virtue of its authority to adjudicate complaints brought by 
Amtrak against host freight railroads for violations of Amtrak's 
statutory preference and to award damages where a preference violation 
is found. Any other result would gut the remedial scheme, a result that 
Congress clearly did not intend.
    All-Stations OTP. As summarized below, the Board's NPRM proposed to 
calculate OTP solely on the basis of train arrivals at endpoint termini 
(Endpoint OTP). The Board proposed Endpoint OTP as an appropriate 
threshold for bringing OTP cases under 49 U.S.C. 24308(f)(1) because it 
would be ``clear and relatively easy to apply,'' i.e., comprehensible 
to the traveling public and simple to describe and implement. In 
addition, Amtrak's public OTP data \6\ suggest that under either an 
Endpoint OTP or All-Stations OTP standard, the threshold for initiating 
a case could be triggered in a comparable number of cases, if long-
established trends continue. Nevertheless, many commenters perceived 
that in proposing an Endpoint OTP threshold, the Board was devoting 
insufficient attention to intermediate stations, their passengers, and 
even the states in which the intermediate stations are located. That 
was not the Board's intent; rather, the intent was solely to set a 
threshold for accepting cases.
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    \6\ See Amtrak's Monthly Performance Reports on Amtrak.com, as 
well as the quarterly OTP statistics published by the Federal 
Railroad Administration (http://www.fra.dot.gov/Page/P0532).
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    Except for the freight railroad industry, virtually all commenters 
urge the Board to define ``on time'' based on train punctuality at all 
stations, rather than just at the endpoints (as originally proposed), 
because the majority of the traveling public are destined for 
intermediate rather than endpoint stations. (See, e.g., Amtrak Feb. 8 
Comment 7.) Moreover, the examples provided by individual passengers--
e.g., of waiting for hours at unattended stations in remote or 
unsecured locations at night for late trains that would be deemed ``on 
time'' at their endpoints--convince us that an ``all-stations'' 
definition will more appropriately reflect the principle that rail 
passengers destined for every station along a line, regardless of its

[[Page 51346]]

size, should have the same expectation of punctuality. This principle 
underlies the Congressional aspiration that ``Amtrak shall . . . 
operate Amtrak trains, to the maximum extent feasible, to all station 
stops within 15 minutes of the time established in public timetables.'' 
49 U.S.C. 24101(c)(4) (emphasis added).\7\ We therefore will 
incorporate an all-stations calculation in the threshold for bringing 
cases to the Board under 49 U.S.C. 24308(f).
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    \7\ See also Adequacy of Intercity Rail Passenger Serv., 351 
I.C.C. 883 (1976).
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    As the freight railroads point out, and as FRA and Amtrak 
themselves acknowledged in their final metrics and standards under 
PRIIA Section 207 (in which they deferred application of an all-
stations test for OTP for two years to allow for schedule adjustments), 
some schedules, particularly for long-distance trains, may need to be 
modified to more realistically distribute recovery time in light of an 
all-stations threshold. (See CN Mar. 30 Reply 3-4; AAR Mar. 30 Reply 6-
7.) For example, as CSXT notes, considerable care must be exercised in 
distributing recovery time along a route, to avoid site-specific 
operational concerns. (See CSXT Mar. 30 Reply 10.) Moreover, a number 
of current passenger rail schedules insert a very large share of 
recovery time between the last stations on a route. To support all 
stations OTP on such a route could require a reevaluation and potential 
reallocation of recovery time across the entire route. We are 
confident, however, that following adoption of an all-stations approach 
to OTP in this rulemaking, rail operations planners from all affected 
parties will be able to devise appropriate, realistic, and up-to-date 
modifications to published schedules that are consistent both with all-
stations OTP and with Congress' explicit intent in PRIIA to improve 
intercity passenger rail service. Furthermore, considerations regarding 
the published schedules may enter into the investigation stage of the 
two-stage process contemplated in the statute.
    The 15-Minute Allowance. In the NPRM, the Board proposed that an 
Amtrak train would be considered on-time if it arrives at its final 
terminus no more than five minutes after its scheduled arrival time per 
100 miles of operation, or 30 minutes after its scheduled arrival time, 
whichever is less. Based on the comments received,\8\ the Board has 
decided to deem a train's arrival or departure ``on time'' if it occurs 
no later than 15 minutes after its scheduled time. In our view, this 
15-minute allowance has several advantages. First, it is consistent 
with the Congressional goal set forth in 49 U.S.C. 24101(c)(4).\9\ 
Second, in comparison with the tiered proposal, it is simple and easy 
to apply. Third, it treats all stations and all passengers equally. 
Finally, Amtrak has long been calculating All-Stations OTP with a 
constant 15-minute allowance at each station,\10\ so the data needed to 
apply this final rule are readily available to the public and 
stakeholders.
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    \8\ See, e.g., Capital Corridor Joint Powers Authority March 30 
Reply 4 n.3; Amtrak February 8 Comment 8; Virginia Rail Policy 
Institute February 8 Comment 1.
    \9\ ``Amtrak shall . . . operate Amtrak trains, to the maximum 
extent feasible, to all station stops within 15 minutes of the time 
established in public timetables.''
    \10\ The only exception is Amtrak's Acela service in the 
Northeast Corridor, to which Amtrak applies a 10-minute lateness 
allowance.
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    Contract On-Time Performance Versus Published Schedules. The 
freight railroads generally argue that OTP should be measured in 
accordance with the criteria contained in their private contracts with 
Amtrak (contract OTP) rather than the published Amtrak timetables. (See 
Union Pac. R.R. (UP) Feb. 8 Comment 3; AAR Feb. 8 Comment 10; CN Feb. 8 
Comment 5.) However, the Congressional goal at 49 U.S.C. 24101(c)(4) 
refers to the ``time established in public timetables.'' In addition to 
being consistent with the Congressional goal, a comparison of publicly 
scheduled train timings with actual train timings is also the simplest 
and most transparent way to compare a train's OTP, as experienced by 
the traveling public, with the ``less than 80 percent'' threshold 
mandated in 49 U.S.C. 24308(f)(1). Although the private contracts 
between Amtrak and its host carriers will not enter into the threshold 
stage of an OTP case, such contracts could be relevant in the 
investigation stage.
    Several freight railroads and AAR claim that if the Board does not 
account for the problems with the schedules and simply relies on the 
published schedules as they are, it could result in an avalanche of 
complaints and ``false positives''--trains that technically fall below 
the OTP threshold but are not necessarily poor performers because the 
schedules are allegedly ``unrealistic.'' (See AAR Mar. 30 Reply; CN 
Mar. 30 Reply; UP Mar. 30 Reply; NS Mar. 30 Reply; CSXT Mar. 30 Reply.) 
Because the complainant has the primary burden of proving its case and 
litigation is resource intensive, the adopted approach is not expected 
to result in an overwhelming number of claims.
    Finally, some commenters (e.g., Virginia DOT, Michigan DOT, States 
for Passenger Rail Coalition) argue that the Board should set standards 
for the development of route schedules or conduct further study of the 
schedules prior to adopting rules. However, while section 24308(f) 
permits the Board, in conducting a particular investigation, to review 
the extent to which scheduling may contribute to the delays being 
investigated and to identify reasonable measures to improve OTP, the 
statute does not include generalized authority, outside a particular 
investigation, for the Board to set standards for the development of 
schedules. Thus, what these commenters are asking the Board to do is 
beyond the scope of our authority and this rulemaking.
    Third-Party (State) Agreements. A number of states and others 
expressed concern that the Board's OTP rule could undermine or preempt 
separate agreements entered into between states, operators, hosts, and 
others for the improvement of passenger rail service in specific 
corridors--for example, service outcomes agreements under FRA's High-
Speed Intercity Passenger Rail (HSIPR) Program. (See States for 
Passenger Rail Coalition, Inc. Feb. 8 Comment 3; Cal. State Transp. 
Agency Feb. 8 Comment 3.) We reiterate, however, that the Board is 
defining ``on time'' and describing the calculation of OTP only for the 
purpose of determining whether the ``less than 80 percent'' threshold 
for bringing an OTP complaint has been met. The Board neither intends 
nor expects that its OTP definition here will have any applicability 
beyond that limited purpose.
    Multicarrier Routes. Several commenters, including freight railroad 
interests, argue that for routes where there are multiple host 
carriers, OTP should not be measured for the entire route, but for each 
host carrier's segment. The commenters argue that this would allow the 
Board to determine if the delays are occurring on one carrier's segment 
and, if so, to properly narrow the investigation solely to that 
carrier's conduct. The commenters argue that if the Board does not do 
so, a carrier that is meeting its statutory duty could be unfairly 
drawn into an investigation.
    Although the Board understands that concern, the attribution of 
delays to hosts and specific causes more properly pertains to--indeed, 
would likely be among the initial topics addressed in--the 
investigatory phase of a case. Moreover, the statutory mandate (49 
U.S.C. 24308(f)) specifically refers to the ``on-time performance of 
any intercity passenger train,'' irrespective of the number of host 
carriers involved in the

[[Page 51347]]

train's operation. Therefore, the adopted approach is consistent with 
the statute.
    Calculation of OTP. Two individuals take issue with the Board's 
proposal to exclude from the OTP analysis any train that does not 
operate ``from its scheduled origin to its scheduled destination.'' The 
commenters argue that these trains should be accounted for, because 
they might represent instances of the most severe service failures.
    The changes adopted in this final rule will lessen the potential 
impact of this issue. Endpoint OTP, as proposed in the NPRM, would not 
have included any train that does not serve both its scheduled 
endpoints. By contrast, under the all-stations calculation method, 
every departure from origin and every arrival at subsequent stations 
that actually occurs--regardless of whether the train originates at its 
scheduled origin or completes its run to its scheduled destination--
will enter into the denominator. The Board will exclude, from its 
prescribed calculation method, only trains that do not operate at all, 
or stations on a curtailed train's route that do not actually receive 
service. This is consistent with the statute, which provides that 
Congressionally-mandated investigations in 49 U.S.C. 24308(f)(1) should 
analyze ``delays'' (not cancellations). In addition, in a train 
operation that does not take place, there typically would be no 
practical way to determine whether preference (the focus of 49 U.S.C. 
24308(f)(2)) was granted or withheld. Finally, because Amtrak generally 
cancels or curtails its services only in the event of emergencies or 
extreme weather events (such as the severe flooding in South Carolina 
in the Fall of 2015), it is doubtful that inclusion of such incidents 
in the denominator of the calculation would shed light on what is 
taking place under typical operating conditions for a particular train. 
To clarify this point, language is being added to the final rule making 
clear that the OTP calculation includes only ``actual'' arrivals and 
departures.
    Additional issues, including the following, were raised by certain 
commenters, but the issues are beyond the scope of this rulemaking.
    Per-Train vs. Per-Route Calculation. Some railroad interests argue 
that the Board should not calculate OTP for all trains on the route, 
but rather, for each individual train that operates on that route. This 
argument goes to the question of what constitutes a ``train,'' an issue 
that this rulemaking does not address and was not intended to address.
    International Service. Some commenters note that the proposed OTP 
standard rule does not provide any guidance for cross-border routes 
(i.e., those that go into Canada). No such issue has arisen in a case 
brought to the Board, and this issue goes to the question of what 
constitutes a ``train,'' an issue that, again, this rulemaking does not 
address and was not intended to address.
    Eligible Complainants. The Michigan Association of Railroad 
Passengers argues that the Board should expand the pool of the parties 
that can file complaints to include passengers. However, the parties 
eligible to bring complaints under section 24308(f) are specified by 
that statute, and we are not at liberty to expand it in this 
rulemaking.
    Time Limits on Data. Some freight railroad commenters also state 
that without a time limit on the period during which the OTP deficiency 
at issue is alleged to have occurred (e.g., the most recent four 
quarters), outdated and unnecessary claims could be filed regarding a 
train that is currently performing well. (See CN Feb. 8 Comment 6; AAR 
Feb. 8 Comment 14.) This issue, too, is beyond the scope of this 
rulemaking, which was intended solely to define ``on time'' and specify 
the formula for calculating OTP for purposes of 49 U.S.C. 24308(f).

Summary of the Final Rule

    For the reasons discussed above, we are modifying the rule as 
initially proposed and adopting the all-stations approach. This 
approach will be codified at 49 CFR 1040. The final regulations are 
attached at the end of this decision.
    Section 1040.1 makes explicit the strictly limited purpose of the 
rulemaking, as discussed above: To define ``on time'' and specify the 
formula for calculating OTP so as to trigger implementation of 49 
U.S.C. 24308(f).
    Section 1040.2 states that a train's arrival at or departure from a 
particular station is ``on time'' if it occurs no later than 15 minutes 
after its scheduled time. This section embodies the 15-minute allowance 
contained in the longstanding Congressional goal for Amtrak at 49 
U.S.C. 24101(c)(4).
    Section 1040.3 implements the ``all-stations'' option that was 
suggested as an alternative to endpoint OTP in the NPRM. Pursuant to 49 
U.S.C. 24308(f)(1), which states that a train can be the subject of an 
OTP complaint if its OTP ``averages less than 80 percent for any two 
consecutive calendar quarters,'' Section 1040.3 describes the method 
for calculating a train's OTP in each quarter. Specifically, OTP is the 
percentage equivalent to the fraction (1) whose denominator is the 
total number of the train's actual (a) departures from its origin 
station, (b) arrivals at all intermediate stations, and (c) arrivals at 
its destination station, during that calendar quarter, and (2) whose 
numerator is the total number of such actual departures and arrivals 
that are ``on time'' under Sec.  1040.2--i.e., that occur no later than 
15 minutes after their scheduled time.

Regulatory Flexibility Act Statement

    The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, 
generally requires a description and analysis of new rules that would 
have a significant economic impact on a substantial number of small 
entities. In drafting a rule, an agency is required to: (1) Assess the 
effect that its regulation will have on small entities; (2) analyze 
effective alternatives that may minimize a regulation's impact; and (3) 
make the analysis available for public comment. 5 U.S.C. 601-604. Under 
section 605(b), an agency is not required to perform an initial or 
final regulatory flexibility analysis if it certifies that the proposed 
or final rules will not have a ``significant impact on a substantial 
number of small entities.''
    Because the goal of the RFA is to reduce the cost to small entities 
of complying with federal regulations, the RFA requires an agency to 
perform a regulatory flexibility analysis of small entity impacts only 
when a rule directly regulates those entities. In other words, the 
impact must be a direct impact on small entities ``whose conduct is 
circumscribed or mandated'' by the proposed rule. White Eagle Coop. 
Ass'n v. Conner, 553 F.3d 467, 478, 480 (7th Cir. 2009). An agency has 
no obligation to conduct a small entity impact analysis of effects on 
entities that it does not regulate. United Distrib. Cos. v. FERC, 88 
F.3d 1105, 1170 (D.C. Cir. 1996).
    In the NPRM, the Board already certified under 5 U.S.C. 605(b) that 
the proposed rule would not have a significant economic impact on a 
substantial number of small entities within the meaning of the RFA. The 
Board explained that the proposed rule would not place any additional 
burden on small entities, but rather clarify an existing obligation. 
The Board further explained that, even assuming for the sake of 
argument that the proposed regulation were to create an impact on small 
entities, which it would not, the number of small entities so affected 
would not be substantial. A copy of the

[[Page 51348]]

NPRM was served on the U.S. Small Business Administration (SBA).
    The final rule adopted here uses a different measure of ``on time'' 
and ``on-time performance'' for purposes of Section 213 of PRIIA than 
those proposed in the NPRM. However, the same basis for the Board's 
certification of the proposed rule applies to the final rule adopted 
here. The final rule would not create a significant impact on a 
substantial number of small entities. Host carriers have been required 
to allow Amtrak to operate over their rail lines since the 1970s. 
Moreover, an investigation concerning delays to intercity passenger 
traffic is a function of Section 213 of PRIIA rather than this 
rulemaking. The final rule only defines ``on-time performance'' for the 
purpose of implementing the rights and obligations already established 
in Section 213 of PRIIA. Thus, the rule does not place any additional 
burden on small entities, but rather clarifies an existing obligation. 
Moreover, even assuming, for the sake of argument, that the final rule 
were to create an impact on small entities, which it does not, the 
number of small entities so affected would not be substantial. The 
final rule applies in proceedings involving Amtrak, currently the only 
provider of intercity passenger rail transportation subject to PRIIA, 
and its host railroads. For almost all of its operations, Amtrak's host 
carriers are Class I rail carriers, which are not small businesses 
under the Board's new definition for RFA purposes.\11\ Currently, out 
of the several hundred Class III railroads (``small businesses'' under 
the Board's new definition) nationwide, only approximately 10 host 
Amtrak traffic.\12\ Therefore, the Board certifies under 5 U.S.C. 
605(b) that the final rule will not have a significant economic impact 
on a substantial number of small entities within the meaning of the 
RFA. A copy of this decision will be served upon the Chief Counsel for 
Advocacy, Office of Advocacy, U.S. Small Business Administration, 
Washington, DC 20416.
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    \11\ At the time the Board issued the NPRM, the Board used the 
SBA's size standard for rail transportation, which is based on 
number of employees. See 13 CFR 121.201 (industry subsector 482). 
Subsequently, however, pursuant to 5 U.S.C. 601(3) and after 
consultation with SBA, the Board (with Commissioner Begeman 
dissenting) established a new definition of ``small business'' for 
the purpose of RFA analysis. Under that new definition, the Board 
defines a small business as a rail carrier classified as a Class III 
rail carrier under 49 CFR 1201.1-1. See Small Entity Size Standards 
Under the Regulatory Flexibility Act, EP 719 (STB served June 30, 
2016).
    \12\ This number is derived from Amtrak's Monthly Performance 
Report for May 2015, historical on-time performance records, and 
system timetable, all of which are available on Amtrak's Web site.
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    The final rule is categorically excluded from environmental review 
under 49 CFR 1105.6(c).

 List of Subjects in 49 CFR Part 1040

    On-time performance of intercity passenger rail service.

    It is ordered:
    1. The final rule set forth below is adopted and will be effective 
on August 27, 2016. Notice of the rule adopted here will be published 
in the Federal Register.
    2. A copy of this decision will be served upon the Chief Counsel 
for Advocacy, Office of Advocacy, U.S. Small Business Administration.
    3. This decision is effective on the date of service.

    Decided: July 28, 2016.

    By the Board, Chairman Elliott, Vice Chairman Miller, and 
Commissioner Begeman.
Kenyatta Clay,
Clearance Clerk.

    For the reasons set forth in the preamble, the Surface 
Transportation Board amends title 49, chapter X, subchapter A, of the 
Code of Federal Regulations by adding part 1040 as follows:

PART 1040: ON-TIME PERFORMANCE OF INTERCITY PASSENGER RAIL SERVICE

Sec.
1040.1 Purpose.
1040.2 Definition of ``on time''.
1040.3 Calculation of quarterly on-time performance.

    Authority: 49 U.S.C. 1321 and 24308(f).


Sec.  1040.1.  Purpose.

    This part defines ``on time'' and specifies the formula for 
calculating on-time performance for the purpose of implementing Section 
213 of the Passenger Rail Investment and Improvement Act of 2008, 49 
U.S.C. 24308(f).


Sec.  1040.2.  Definition of ``on time.''

    An intercity passenger train's arrival at, or departure from, a 
given station is on time if it occurs no later than 15 minutes after 
its scheduled time.


Sec.  1040.3.  Calculation of quarterly on-time performance.

    In any given calendar quarter, an intercity passenger train's on-
time performance shall be the percentage equivalent to the fraction 
calculated using the following formula:
    (a) The denominator shall be the total number of the train's 
actual: Departures from its origin station, arrivals at all 
intermediate stations, and arrivals at its destination station, during 
that calendar quarter; and
    (b) The numerator shall be the total number of the train's actual: 
Departures from its origin station, arrivals at all intermediate 
stations, and arrivals at its destination station, during that calendar 
quarter, that are on time as defined in Sec.  1040.2.

[FR Doc. 2016-18256 Filed 8-3-16; 8:45 am]
 BILLING CODE 4915-01-P