Southeastern Pennsylvania Transportation Authority v. Pennsylvania Public Utility Commission, CIVIL ACTION NO. 95-4500 (E.D. Pa. 7/12/2002), CIVIL ACTION NO. 95-4500.
| Decision Date | 12 July 2002 |
| Docket Number | CIVIL ACTION NO. 95-4500.,CIVIL ACTION NO. 01-5570. |
| Parties | SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY, Plaintiff, v. THE PENNSYLVANIA PUBLIC UTILITY COMMISSION, Defendant. NATIONAL RAILROAD PASSENGER CORPORATION, Plaintiff, v. THE PENNSYLVANIA PUBLIC UTILITY COMMISSION, GLEN THOMAS, Chairman, Pennsylvania Public Utility Commission, ROBERT K. BLOOM, Vice Chairman, Pennsylvania Public Utility Commission, AARON WILSON, JR., Commissioner, Pennsylvania Public Utility Commission, TERRENCE J. FITZPATRICK, Commissioner, Pennsylvania Public Utility Commission, Defendants. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
These related cases present important questions of federalism concerning state courts' treatment of the final judgments of federal courts. Specifically, the cases raise the issue of how a litigant who has obtained a final federal judgment in its favor can enforce that judgment when a final order of a state court directly contradicts the earlier final federal order.
The underlying issue is an oft-litigated question: whether PUC may allocate to SEPTA and Amtrak a share of the cost of maintaining and constructing highway bridges over railroad rights of way in the Commonwealth of Pennsylvania notwithstanding a federal statute exempting SEPTA and Amtrak from the payment of a "tax, fee, head charge, or other charge" imposed by a local taxing authority.1 In a series of decisions issued during the past fifteen years, judges of this Court have uniformly decided that federal statutory law exempts Amtrak and SEPTA from paying such costs. The Third Circuit has, in all instances, affirmed these decisions.
Despite this long line of decisions, Pennsylvania state courts have issued opinions directly contradicting the federal courts' rulings. The precise question now presented is whether Amtrak and SEPTA may continue to enforce the federal court judgments in their favor in the face of a state court's conflicting interpretation of federal statutory law. As this Court now holds, the answer to that question is undeniably "yes."
In reaching this decision, the Court addresses seven pending motions. In the SEPTA case, No. 95-4500, there are two pending motions: Motion of SEPTA to Enforce the Consent Decree and Supporting Memorandum of Law (Doc. Nos. 20 and 21, filed Oct. 23, 2001); and Norfolk Southern's Motion to Intervene as Intervenor/Defendant (Doc. No. 24, filed Dec. 4, 2001).
In the Amtrak case, No. 01-5570, there are five pending motions: Motion of the PUC to Dismiss the Verified Complaint in Equity filed by Amtrak (Doc. No. 6, filed Dec. 18, 2001); Motion of Commissioner Aaron Wilson, Jr., to Dismiss the Verified Complaint in Equity filed by Amtrak (Doc. No. 7, filed Dec. 18, 2001)2; Norfolk Southern's Motion to Intervene as Intervenor/Defendant and Supporting Memorandum of Law (Doc. Nos. 8 and 9, filed Dec. 21, 2001)3; Motion of Amtrak for Preliminary and Other Injunctive Relief (Doc. No. 12, filed Jan. 2, 2002); and Amtrak's Renewed Motion for Declaratory Judgment and for Preliminary and Permanent Injunction (Doc. No. 22, filed May 8, 2002).4
For the reasons stated in this Memorandum, the Court will: (1) deny Norfolk Southern's Motions to Intervene; (2) grant SEPTA's Motion to Enforce the Consent Decree; (3) deny PUC's Motions to Dismiss; and (4) grant Amtrak's Motions for Declaratory and Injunctive Relief to the extent Amtrak seeks preliminary injunctive relief.
Since 1986, the parties now before the Court have litigated a number of cases,5 all of which have involved the allocation of costs for the maintenance and construction of highway bridges over railroad rights of way throughout Pennsylvania.6 Because the history of this litigation is essential to disposition of the pending motions, the Court now sets forth that history in some detail.
In 1982, Congress enacted a statute aimed at protecting Amtrak, a federally owned and funded entity, from having to finance railway-related improvements which would otherwise be financed by state and local governments and other entities.7 That statute, as amended, provides, in relevant part:
Amtrak, a rail carrier subsidiary of Amtrak, and any passenger or other customer of Amtrak or such subsidiary, are exempt from a tax, fee, head charge, or other charge, imposed or levied by a State, political subdivision, or local taxing authority on Amtrak, a rail carrier subsidiary of Amtrak, or on persons traveling in intercity rail passenger transportation or on mail or express transportation provided by Amtrak or such a subsidiary, or on the carriage of such persons, mail, or express, or on the sale of any such transportation, or on the gross receipts derived therefrom. 49 U.S.C. § 24301(l)(1) ("statutory exemption").8 In 1988, Congress enacted further legislation extending the exemption to commuter authorities like SEPTA, providing that they are exempt "from paying a tax or fee to the same extent Amtrak is exempt." 49 U.S.C. § 24301(f). Under this federal statutory scheme, both Amtrak and SEPTA are therefore "exempt from a tax, fee, head charge, or other charge, imposed or levied by a State, political subdivision, or local taxing authority." 49 U.S.C. § 24301(l)(1).
In Pennsylvania, PUC is vested with the authority to assess costs for maintaining highway bridges, and, inter alia, to impose those costs on railroads. See Amtrak I, 665 F. Supp. at 403 (). In determining how it will assess costs — that is, to what entities it will allocate costs — PUC considers a number of factors, including the "benefit a party receives from a crossing." Bell Atl. Pa., Inc. v. Pa. Pub. Util. Comm'n, 672 A.2d 352, 355 (Pa.Commw.Ct. 1995). PUC and Pennsylvania's courts have recognized that railroads which own rights of way running underneath highway bridges derive a benefit from those bridges. See Pittsburgh & Lake Erie R.R. Co. v. Pa. Pub. Util. Comm'n, 556 A.2d 944, 946 (Pa.Commw.Ct. 1989). Those benefits include the avoidance of liability caused by accidents and concomitantly reduced insurance costs, as well as the elimination of any need to pay for and maintain crossing signals. Id.
Because Amtrak and SEPTA both either own or use railroad rights of way throughout the Commonwealth of Pennsylvania, and thus benefit from highway bridges transversing those rights of way, PUC has, on several occasions during the past two decades, sought to impose costs for the maintenance of those bridges on Amtrak and SEPTA. Amtrak and SEPTA have argued, however, and judges of this Court have agreed, that the statutory provisions exempting them from paying a "tax, fee, head charge, or other charge, imposed or levied by a State, political subdivision, or local taxing authority" prevent PUC from allocating such costs to exempted entities like Amtrak and SEPTA. The Court will now summarize the proceedings in which this issue was addressed.
On May 30, 1986, PUC assessed to Amtrak costs involved in the replacement of a bridge in Tredyffrin Township carrying Cassatt Avenue over an Amtrak-owned right of way. Amtrak then brought suit in this Court, arguing that PUC's assessment to Amtrak violated the statutory exemption. Although PUC agreed that Amtrak was exempt from taxes, it argued that the phrase "taxes" did not encompass the costs it had assessed to Amtrak. See Amtrak I, 665 F. Supp. at 408.
Judge Newcomer rejected PUC's argument in Amtrak I.9 Explaining that "[t]he common sense understanding of taxation to include any involuntary exaction to support a governmental entity or purpose is consistent with the intent of Congress expressed in the statute," id. at 410, he concluded that the statute "exempts Amtrak from the payment of special assessments such as that imposed by PUC." Id. at 412. Accordingly, Judge Newcomer permanently enjoined PUC from levying on Amtrak a tax "for design, construction or maintenance of the Cassatt Avenue bridge structures." Id.
PUC appealed Judge Newcomer's decision to the Third Circuit, and that court affirmed in Amtrak II. In so doing, the Third Circuit defined the "precise issue" for consideration as "whether the phrase `any taxes or other fees' contained in th[e] statute covers charges of the nature levied against Amtrak for building and maintaining the Cassatt Avenue bridge." Amtrak II, 848 F.2d at 438. Substantially agreeing with Judge Newcomer's analysis, the court explained that...
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