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Indian River County, Florida v. Department of Transportation

United States District Court, District of Columbia

December 24, 2018

INDIAN RIVER COUNTY, FLORIDA[1] et al, Plaintiffs,
v.
DEPARTMENT OF TRANSPORTATION et al, Defendants.

         TABLE OF CONTENTS

         I. Background ................................................................................................................... 3

         A. Factual Background ..................................................................................................... 3

         1. The proposed project ................................................................................................... 3

         2. The Secretary's bond allocation ...................................................................................... 4

         3. The environmental review process ................................................................................... 5

         B. Procedural Background .................................................................................................. 7

         II. Analysis .......................................................................................................................... 9

         A. The Bond Allocation ....................................................................................................... 9

         1. Section 142(m) .............................................................................................................. 11

         2. Section 147(f) ............................................................................................................... 24

         B. NEPA Compliance ....................................................................................................... 35

         1. Public-safety effects of the project .................................................................................. 38

         2. Effects of vessel queuing at railroad bridges over navigable waters .................................. 49

         3. Alternatives to the route and the use of moveable bridges ................................................ 55

         4. Noise impacts ................................................................................................................. 59

         5. Changes to freight operations .......................................................................................... 66

         III. Conclusion ................................................................................................................... 72

          MEMORANDUM OPINION

          CHRISTOPHER R. COOPER UNITED STATES DISTRICT JUDGE

         AAF Holdings, Inc. (“AAF”) plans to construct and operate an express passenger railway connecting Orlando and Miami, Florida. The initial segment of the line between Miami and West Palm Beach is currently operational. The extension of the line to Orlando is still in the planning stages. To help AAF finance the extension, the U.S. Department of Transportation has allocated $1.15 billion in federally tax-exempt bonds to be issued by a Florida economic development agency.

         The planned extension of the railway will run through Indian River County on Florida's Treasure Coast. The County and its Emergency Services District (together, “Indian River County” or “Plaintiff”) have long objected to the project. In this, its second lawsuit challenging the project, Indian River County seeks summary judgment on two grounds. First, it contends that the Department of Transportation exceeded its authority in allocating the bonds because the project is not eligible to receive tax-exempt funding under two separate provisions of the Internal Revenue Code. Second, the County maintains that the Federal Railway Administration (“FRA”) violated the Administrative Procedure Act (“APA”) and the National Environmental Policy Act (“NEPA”) by conducting a flawed and incomplete review of the public health and safety consequences of the project. Defendants the Department of Transportation, its component FRA, and several of its officers (together, “federal Defendants, ” “the Department, ” or “FRA”) filed a cross motion for summary judgment, as did AAF, which has intervened as a defendant. Because the Department's allocation met the tax code's requirements and the FRA's review complied with NEPA, the Court will deny Indian River County's motion for summary judgment and grant the federal Defendants' and AAF's.

         I. Background

         A. Factual Background

         1. The proposed project

         AAF is in the process of constructing a private passenger train service that will ultimately provide service between Miami and Orlando. Phase I of the project currently operates from Miami to West Palm Beach. AR 65115-16. Phase II will run from West Palm Beach north along Florida's east coast to Cocoa and then west and inland to Orlando. Id. AAF plans to lay a second track along a 128.5 mile stretch of single-track train corridor owned by the Florida East Coast Railway (“FECR”) from West Palm Beach north to Cocoa. AR 65115. This track is currently used only by freight trains, some of which carry hazardous materials, but historically was used by both freight and passenger trains. AR 73914. This corridor is referred to in the record and by the parties as either the FECR Corridor or the N-S Corridor. AR 65115. The N-S Corridor bisects Indian River County. AR 73572. AAF also proposes constructing a new 40-mile track that would connect Cocoa and Orlando. This stretch of track is referred to as the E-W Corridor. AR 65115.

         AAF plans to operate thirty-two passenger trains per day in addition to the FECR freight trains that now run along the N-S Corridor. AR 65116. These trains would run through Indian River County for twenty-one miles. AR 73753. There are thirty “grade crossings” in the County. Id. A grade crossing is an intersection where the railway crosses a road or path at the same level or grade, rather than an intersection where trains cross over or under the road using an overpass or tunnel. In addition to these grade crossings, the trains will traverse bridges that are either fixed or moveable (i.e., draw bridges). Two of these moveable bridges are at issue in this case: the St. Lucie River Bridge and the Loxahatchee River Bridge. AR 73915. When these bridges are in the “down” position, trains can cross over but boats on the river cannot cross under.

         2. The Secretary's bond allocation

         AAF is partially financing the railway project through private activity bonds (“PABs”) issued by the Florida Development Finance Corporation (“FDFC”), an agency of the State of Florida. Congress has authorized the United States Department of Transportation to allocate tax-exempt authority to PABs used to finance specific types of transportation projects. See 26 U.S.C. § 142(m)(2)(C). AAF initially applied for a PAB allocation in August 2014. In December 2014, the Department of Transportation approved that application and provisionally allocated $1.75 billion in tax-exempt PABs for the project. See Indian River Cty. v. Rogoff (“Indian River Cty. I”), 110 F.Supp.3d 59, 65 (D.D.C. 2015). AAF planned to use these PABs to finance both phases of the railway.

         In November 2016, the Department, at AAF's request, withdrew the provisional allocation and replaced it with a $600 million allocation of PAB authority to finance only Phase I of the project. See Indian River Cty. v. Rogoff (“Indian River Cty. III”), 254 F.Supp.3d 15, 17- 18 (D.D.C. 2017). Then, in December 2017, AAF applied for a new allocation of $1.15 billion in PAB authority to finance Phase II of the project. See AR 74220-62. As part of its application, AAF represented that the project had received $9 million in Title 23 federal funds, disbursed by Florida's Department of Transportation for highway-rail crossings along the rail corridor. AR 74235. AAF included in its application a resolution by FDFC approving the issue of bonds to finance the project. AR 74240-53. That resolution concluded that the bond issue had received requisite public approval for tax-exempt status because a designee of the State's Governor had approved their issue after a properly noticed public hearing. AR 74242-44. AAF's application highlighted that the bonds had already received this public approval. AR 74221. Further, AAF included in its application a bond counsel validity opinion, by the law firm Greenberg Traurig, which concluded that “interest on the Bonds . . . is excludable from gross income for purposes of federal income taxation under existing laws as enacted and construed[.]” AR 74256.

         The Department approved the application and provisionally allocated $1.15 billion in PAB authority on December 20, 2017. AR 74324-26. Its provisional allocation letter conditioned final allocation on several requirements, including compliance with all applicable federal laws, as well as “a final bond counsel tax and validity opinion . . . issued at the time of the closing of the bond issue in substantially the form provided with the application.” AR 74324. While FDFC will issue the bonds, AAF is responsible for marketing and selling them to investors. The parties have represented that the bonds will be marketed in the next several weeks.

         3. The environmental review process

         AAF originally sought federal loan funding for the project through the Railroad Rehabilitation and Improvement Financing (“RRIF”) program. RRIF loans are subject to NEPA review. 49 C.F.R. § 260.35. FRA reviewed the potential environmental impacts of the project under NEPA. AR 73636. With respect to Phase I, FRA issued a Finding of No Significant Impact in 2013. AR 73570. FRA then began preparing an Environmental Impact Statement (“EIS”) for Phase II. AR 73571. It held five public scoping meetings in May 2013 and received 248 comments in response to those meetings and more than 160 comments in the subsequent seventeen months. AR 74155-56. As required, FRA coordinated with federal, state, local, and tribal governments, including Indian River County. AR 74157-59.

         FRA completed a draft EIS in September 2014. AR 74164. The draft attracted some 15, 400 public comments. Id. During the comment period, FRA also held eight public meetings, id., which were attended by over 2, 500 people, AR 74165. FRA issued a Final Environmental Impact Statement (“FEIS”) in August 2015. See AR 73568. FRA subsequently received additional comments on the FEIS, including from Plaintiff. AR 65154. When AAF withdrew its RRIF loan application in 2015, FRA decided to not issue a Record of Decision (“ROD”). AR 65118. After AAF re-filed an RRIF application in 2017, FRA resumed the NEPA process and published the ROD in December 2017. AR 65109-65. Appendix C to the ROD provides responses to the comments on the FEIS. See AR 65154; AR 65266-300.

         The FEIS selects AAF's preferred route as the best alternative for the project and determines that no further environmental review is necessary. AR 73578. The FEIS itself is 646 pages long and separately includes numerous appendices including maps and analyses of noise impacts, navigation patterns, and more. The FEIS and ROD outline the purpose of and need for the project, the alternatives considered, the affected environment, the potential environmental consequences of the project and reasonable alternatives, and the historic properties affected by the project. The FEIS also includes a chapter on measures that would avoid, minimize, or mitigate impacts that would result from the project. AAF has committed to implementing a series of mitigation measures during both the construction and operation phases of the project.

         As part of the NEPA process, AAF retained the environmental consulting firm Vanasse Hangen Brustlin (“VHB”) as a third-party advisor to FRA. This arrangement was memorialized in an agreement between FRA, VHB, and AAF. See AR 1045-62. Under that agreement, VHB's “scope of work, approach, and activities shall be under the sole supervision, direction, and control of the FRA.” AR 1046. AAF also hired its own consultant, Amec Foster Wheeler (“Amec”). In general, Amec conducted initial technical work, which it then submitted to VHB and FRA for review and comment. AR 897-98; see also AR 1062. The record includes a series of technical memoranda produced by Amec on issues like noise and vibration. See, e.g., AR 61081-238 (Amec's “Technical Memorandum No. 5 Noise and Vibration for AAF Passenger Rail Project”). The record also reflects significant back-and-forth regarding those memoranda between VHB and FRA on the one hand and Amec and AAF on the other. See, e.g., AR 1083- 87, 1305-43, 1561-62, 7302-06, 7349-51 (charts setting forth VHB/FRA comments on Amec technical memoranda and Amec/AAF responses).

         B. Procedural Background

         As noted above, this is the second time Indian River County has sued in this Court to prevent or delay the Secretary of Transportation's allocation of tax-exempt bond issuance authority to finance the AAF project. In 2015, both Indian River County and nearby Martin County, through which the proposed railway would also run, sought (among other relief) a preliminary injunction vacating the Secretary's authorization of the tax exemption, which allocated PAB authority for both phases of the project. See Indian River Cty. I, 110 F.Supp.3d at 66. Both counties alleged violations of NEPA, the National Historic Preservation Act (“NHPA”), and the Department of Transportation Act (“DTA”), each of which sets forth certain procedural requirements for major federal actions. Martin County also alleged a violation of § 142 of the Internal Revenue Code. There, as here, AAF intervened as a defendant. Initially, the Court concluded that the counties had failed to show that their asserted injuries-public-safety hazards and harms to environmental and historic sites from the construction and operation of the railway-were traceable to the Secretary's action or redressable by the Court. Specifically, while the counties had shown that the cost of financing the project would increase without the Secretary's allocation of tax-exemptions, they were unable to show “that these costs would significantly increase the likelihood that AAF would abandon the project[.]” Id. at 71. In short, the plaintiffs had failed to show that if the Court were to grant them precisely what they asked for, the project would cease and their harms would be remedied. The Court also held that the counties' alleged procedural injury-stemming from the purported failure to conduct an appropriate environmental review-was insufficient to confer standing absent some tethering to a substantive injury sufficient for standing. Id. at 73. The Court thus denied the counties' motions because they had not established standing to sue. See id.

         Following Indian River County I, the Court granted the counties permission to conduct jurisdictional discovery to demonstrate that, but for the PAB allocation, AAF would not complete the railway. Subsequently, the Department of Transportation moved to dismiss the counties' suits. The Court concluded that through jurisdictional discovery, the counties had shown “that invalidating [the Department's] decision to authorize . . . PABs would significantly increase the likelihood that AAF would not complete . . . the project.” Indian River Cty. v. Rogoff (“Indian River Cty. II”), 201 F.Supp.3d 1, 4 (D.D.C. 2016). Further, the Court found that the plaintiffs had alleged sufficient facts to demonstrate that the AAF project qualified as “major federal action” triggering certain requirements under NEPA, NHPA, and DTA. Id. at 20. Consequently, it denied the motion to dismiss those claims. It did, however, dismiss Martin County's claim that the PAB allocation violated § 142 of the Internal Revenue Code, concluding that the County's asserted injuries fell outside the zone of interests that Congress sought to protect in § 142. Id. at 21.

         Following the Court's decision in Indian River County II that the counties had stated valid claims, AAF withdrew its application for a PAB allocation. It replaced that application, which had sought to use the bonds to finance both phases of the project, with an application for a smaller allocation to be used only for Phase I. Because Phase I dealt only with a portion of the proposed railway that did not run through the plaintiff counties, the Court dismissed the cases at moot. Indian River Cty. III, 254 F.Supp.3d at 22.

         Since then, AAF applied for an allocation to help finance Phase II, which the Department of Transportation provisionally approved. Indian River County, initially joined by Martin County and a group of concerned citizens, has again sued. They contend that the PAB allocation violated two provisions of the Internal Revenue Code and that FRA did not comply with its requirements under NEPA. AAF again intervened as a defendant. The parties all moved for summary judgment. The Court held a hearing on these motions on November 27, 2018. Shortly before this hearing, Martin County and the citizens group reached a settlement with the federal Defendants and AAF and, therefore, are no longer plaintiffs in the case.

         II. Analysis

         A. The Bond Allocation

         To facilitate Phase II of the AAF railway, the Secretary of Transportation provisionally allocated tax-exempt authority to $1.15 billion in PABs to be issued to finance the project. The Secretary of Transportation's allocation is subject to review under the APA. 5 U.S.C. §§ 702, 706. Chevron, U.S.A. v. NRDC, 467 U.S. 837 (1984), establishes a two-part inquiry to determine whether an agency has arrived at a permissible interpretation of the law it is charged with administering. First, if a law directly addresses the precise question at issue, Congress's directive controls. Id. at 842-43. Second, if the statute is silent or ambiguous regarding the matter at hand, “the question for the court is whether the agency's interpretation is based on a permissible construction of the statute in light of its language, structure, and purpose.” Nat'l Treasury Emps. Union v. Fed. Labor Relations Auth., 754 F.3d 1031, 1042 (D.C. Cir. 2014) (quoting AFL-CIO v. Chao, 409 F.3d 377, 384 (D.C. Cir. 2005)). The court must defer to any reasonable agency interpretation, Loving v. IRS, 742 F.3d 1013, 1016 (D.C. Cir. 2014), which need not be the one “deemed most reasonable by the courts[, ]” Entergy Corp. v. Riverkeeper, Inc., 556 U.S. 208, 218 (2009).

         Indian River County contends that the Secretary's allocation violated two provisions of the Internal Revenue Code. A brief overview of the statutory scheme contextualizes these challenges and the Department and AAF's responses. Congress has authorized interest earned on certain types of PABs to be exempted from federal taxation. See 26 U.S.C. §§ 103, 141. Because this exemption allows the bondholder to keep all the interest, bond issuers can sell the bond at a lower interest rate. A PAB must be a “qualified bond” in order for it to be tax-exempt. Id. § 103. Section 141 outlines certain types of PABs that can constitute “qualified bond[s], ” including “exempt facility bond[s].” Id. § 141(e)(1)(A). Under § 142(a), a bond is an “exempt facility bond” if at least 95% of proceeds from its issue are used to finance one of fifteen enumerated categories of projects. Id. § 142(a). One such category is “qualified highway or surface freight transfer facilities.” Id. § 142(a)(15). Section 142(m) defines “qualified highway or surface freight transfer facilities, ” id. § 142(m)(1), and authorizes the Secretary of Transportation, “in such manner as [she] determines appropriate, ” id. § 142(m)(2)(C), to allocate up to $15 billion of PAB authority to eligible projects, id. § 142(m)(2)(A). Put simply, Congress has enacted a mechanism through which the Secretary can allocate tax exemptions to bonds used to finance construction of, or improvements to, certain types of facilities. These exemptions lower the cost of selling the bonds, better enabling state and local governments to finance the projects.

         The Secretary's allocation is necessary, but not sufficient, for a bond to be tax-exempt because it finances a “qualified highway or surface freight transfer facilit[y].” Id. § 142(m)(2)(A). The Internal Revenue Code also establishes other requirements for PABs to be considered “qualified” and thus tax-exempt. See id. § 141(e)(3). These include a requirement that bonds used to finance a facility must be approved by both “the governmental unit . . . which issued such bond, ” id. § 147(f)(2)(A)(i), and “each governmental unit having jurisdiction over the area” in which any bond-financed facility is located, id. § 147(f)(2)(A)(ii).

         In this case, Indian River County alleges first that the Secretary violated the statute because the AAF passenger railway is ineligible for a PAB allocation under § 142(m). The County also contends that, in any event, because it has not approved the bond issue as § 147(f) requires, the PABs cannot be tax exempt. The Court turns to each of these statutory provisions.

         1. Section 142(m)

         Indian River County alleges that the Secretary's allocation of PAB authority to the AAF railway violated 26 U.S.C. § 142(m). It contends that because the project is not an eligible “qualified highway or surface freight transfer facilit[y], ” the Secretary exceeded her statutory powers in allocating PAB authority to the project. In the last round of litigation, Martin County raised a similar argument, which the Court rejected as going beyond the “zone of interests” protected by § 142. See Indian River Cty. II, 201 F.Supp.3d at 20-21. Both the federal Defendants and Intervenor-Defendant ask the Court to reach the same result this time around. Alternatively, they argue that the allocation complied with § 142. For the following reasons, the Court concludes that Indian River County has shown that its asserted interests arguably fall within the zone of interests Congress sought to protect in § 142, but that its claim fails on the merits.

         a. Zone of Interests

         Before the Court reaches the substance of Indian River County's § 142 claim, it “must . . . inquire whether the plaintiff[] fall[s] within the class of persons whom Congress has authorized to sue under the Administrative Procedure Act.” Mendoza v. Perez, 754 F.3d 1002, 1016 (D.C. Cir. 2014). To do so, it must determine whether Indian River County's “grievance . . . arguably fall[s] within the zone of interests protected or regulated by the statutory provision . . . invoked in the suit, ” in this case § 142. Id. (quoting Bennett v. Spear, 520 U.S. 154');">520 U.S. 154, 162 (1997)). This inquiry “is not meant to be especially demanding” and “forecloses suit only when a plaintiff's ‘interests are so marginally related to or inconsistent with the purposes implicit in the statute that it cannot reasonably be assumed that Congress intended to permit the suit.'” Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians v. Patchak, 567 U.S. 209, 225 (2012) (quoting Clarke v. Sec. Industry Ass'n, 479 U.S. 388, 399 (1987)).

         When Martin County advanced its § 142 claim in the last round of litigation, the Court concluded that it had not cleared this hurdle. In that instance, like Indian River County does here, Martin County asserted interests in public safety, environmental protection, and historic preservation. Indian River Cty. II, 201 F.Supp.3d at 21. It relied on SAFETEA, Pub. L. 109- 59, 119 Stat. 1144 (2005)-the legislation through which Congress amended § 142 to add PAB authorization for “qualified highway or surface freight transfer facilities”-to contend that Congress sought to protect these interests when it amended § 142. See Indian River Cty. II, 201 F.Supp.3d at 20-21. But as the Court explained at the time, SAFETEA is a “massive statute with many objectives” and its relevant amendments to § 142 were “but a tiny component of the overall legislation.” Id. at 21. As such, it would have been-and remains-too dilutive of the zone of interests test to allow a plaintiff to challenge an allocation under § 142(m) based on an interest advanced anywhere in SAFETEA. Id. at 20 (citing Tax Analysts & Advocates v. Blumenthal, 566 F.2d 130, 141 (D.C. Cir. 1977)). Instead, “the relevant unit of analysis” for conducting the inquiry is § 142 itself. Id. And because “Martin County present[ed] no real argument that its interests [were] more than marginally related [to] those protected or regulated by Section 142 itself, ” but rather “place[d] all its eggs in the SAFETEA basket instead, ” id. at 21, the Court dismissed the claim.

         In this litigation, Indian River County has advanced stronger arguments, focusing appropriately on the interests at stake in § 142 itself. Indian River County contends that these interests are illuminated by § 147(f), which requires State or local government approval for certain PABs to qualify for tax exemption. “In applying the zone-of-interests test, [courts] do not look at the specific provision said to have been violated in complete isolation[.]” Fed'n for Am. Immigration Reform, Inc. (“FAIR”) v. Reno, 93 F.3d 897, 903 (D.C. Cir. 1996). At the same time, courts must police the extent to which they look beyond the provision invoked to ensure that casting a wider net does not “deprive the zone-of-interests test of virtually all meaning.” Air Courier Conference of Am. v. Am. Postal Workers Union, 498 U.S. 517, 530 (1991). Accordingly, a court must limit its analysis to the provision invoked for suit, as clarified by any provisions to which it bears an “integral relationship.” See, e.g., FAIR, 93 F.3d at 904. In this case, then, the Court must first determine whether § 147(f) bears an integral relationship with § 142, the provision upon which Indian River County sues.

         The Court concludes that the two provisions do bear an integral relationship. They form adjacent requirements for PABs used to finance certain categories of facilities to qualify for tax-exempt status: § 142 enumerates the types of facilities, and § 147(f) ensures public approval and democratic accountability for their construction.[2] Absent § 147(f) approval, PABs used to finance a § 142 facility cannot be tax-exempt; and PABs approved pursuant to § 147(f) are not tax-exempt unless they are used to finance a § 142 facility. Cf. Wash. All. of Tech. Workers v. DHS, 156 F.Supp.3d 123, 135 (D.D.C 2015) (holding that provisions share an integral relationship in part because they perform an “interlocking task”).

         Most importantly, each requirement evinces a common purpose: ensuring that when the public fisc forgoes revenue through tax-exempt bonds, those bonds are used to benefit the public. As the Court explained in Indian River County II: “Congress enacted 26 U.S.C. § 142 in general, and Sections 142(a)(1) and 142(m) in particular, to create a tax benefit to support the development and construction of certain kinds of projects with significant public benefits and a demonstrated need for financial assistance.” 201 F.Supp.3d at 21. When Congress added § 142(m) to the Internal Revenue Code in 2005, it did so against the backdrop of § 147(f), which it had first added to the Code in 1982 in a clear effort to ensure public benefit from tax-exempt bonds. As the Senate Finance Committee Report explained at the time:

The committee believes that new restrictions are needed on [bonds] to help eliminate inappropriate uses and to help restore the benefit of tax-exempt financing for traditional governmental purposes. However, the committee believes that, in general, state and local governments are best suited to determine the appropriate uses of [bonds]. The committee believes that providing tax exemptions for the interest on certain [bonds] may serve legitimate purposes in some instances provided that the elected representatives of the state or local governmental unit determine after public input that there will be substantial public benefit from issuance of the obligations[.]

S. Rep. No. 97-494(I), at 168 (1982).

         This suggests a common purpose: § 142 reflects congressional judgment about the types of projects that benefit the public enough to warrant tax-exempt financing, and § 147(f) creates a mechanism of democratic accountability by which the public can confirm that a particular project does indeed confer public benefit. Cf. Nat'l Petrochemical & Refiners Ass'n v. EPA, 287 F.3d 1130, 1148 (D.C. Cir. 2002) (holding that provisions shared an integral relationship because one helped “accomplish[] one of the express goals” of the other).

         The same legislative history and interlocking purpose compel the Court to reconsider its holding in Indian River County II that local governments fall outside § 142's zone of interests. Indian River County has properly focused its attention not on SAFETEA as a whole, but on § 142 itself and its purpose of “support[ing] the development and construction of certain kinds of projects with significant public benefits[.]” Indian River Cty. II, 201 F.Supp.3d at 21. By demonstrating that § 142 and § 147(f) bear an integral relationship, the County has illuminated § 142 in a way that suggests Congress's intent was indeed to allow State and local governments to ensure public benefit would accrue from projects financed by tax-exempt bonds. And because it appears from the legislative history that Congress gave some deference to State and local governments' assessment of public benefit, Indian River County's asserted interests at least arguably fall within the zone of interests protected by § 142. Accordingly, the Court concludes that Indian River County has plausibly stated a claim under that provision.

         b. The merits of the County's Section 142(m) claim

         Moving to the merits of Indian River County's § 142 claim, the County contends that the Secretary's allocation is inconsistent with the statute because Phase II is not a “qualified highway or surface freight transfer facilit[y], ” 26 U.S.C. § 142(a)(15), and thus is ineligible for an allocation of PAB authority. The Court concludes that the Secretary's allocation conformed to the statutory requirements and was a reasonable exercise of her discretion. It will therefore grant summary judgment on this issue to the Department and AAF.

         Section 142 defines “qualified highway or surface freight transfer facilities” to include “any surface transportation project which receives Federal assistance under title 23, United States Code[.]” Id. § 142(m)(1)(A). The Secretary allocated PAB authority after concluding that the project fell within this definition. Indian River County challenges that allocation, contending that § 142(m)(1)(A) does not encompass the project and it was thus ineligible for an allocation. Specifically, the County contends that, when read in proper context, a “surface transportation project” means only a highway project, which necessarily precludes an allocation to any rail project. It also maintains that if the term “any surface transportation project” did encompass rail projects, the AAF project has not received Title 23 federal assistance. The Court addresses each point in turn.

         i. Whether the AAF project is a “surface transportation project” within the meaning of § 142(m)(1)(A)

         The plain meaning of § 142(m)(1)(A) is unambiguous. It defines “qualified highway or surface freight transfer facilities” to include “any surface transportation project[.]” 26 U.S.C. § 142(m)(1)(A). Because Congress did not specify what “surface transportation” means, the ordinary meaning of the phrase controls. See, e.g., Johnson v. United States, 559 U.S. 133, 138 (2010). The dictionary definition of “surface transport” is “the movement of people or goods by road, train, or ship, rather than by plane.” Cambridge Business English Dictionary (2011). This plainly includes rail projects. Defining “surface transportation” to include rail comports with its use elsewhere in federal law. For example, in SAFTEA, the legislation through which Congress enacted § 142(m), a provision in another portion of the bill defined “surface transportation system” to include “freight and intercity passenger bus and rail infrastructure and facilities.” SAFETEA § 1909(b)(14), Pub. L. 109-59, 119 Stat. 1476 (2005). The Surface Transportation Board-a congressionally created agency-is particularly notable: its charge includes jurisdiction over rail issues. See generally, ICC Termination Act of 1995, Pub. L. 104-88, 109 Stat. 803 (1995); Surface Transportation Board Reauthorization Act of 2014, Pub. L. 114-110, 129 Stat. 2228 (2014). There is no need to belabor the point with more examples: the dictionary definition of “surface transportation, ” the phrase's meaning in other areas of law, and its ordinary usage all indicate that § 142(m)(1)(A) includes rail projects.

         Congress's use of “any” further indicates as much: “Read naturally, the word ‘any' has an expansive meaning, that is, ‘one or some indiscriminately of whatever kind.'” United States v. Gonzales, 520 U.S. 1, 5 (1997) (quoting Webster's Third New International Dictionary 97 (1976)). The Supreme Court has explained that when interpreting a statutory provision, “Congress' use of ‘any' to modify ‘other law enforcement officer' is most naturally read to mean law enforcement officers of whatever kind.” Ali v. Fed. Bureau of Prisons, 552 U.S. 214, 220 (2008). The same principle applies here: Congress's use of “any” to modify “surface transportation project” is most naturally read to mean surface transportation projects of whatever kind-including rail projects.

         Indian River County nonetheless insists that the plain text of § 142(m)(1)(A) cannot be read in isolation and that its context indicates that it refers only to highway projects. Relying on the principle of noscitur a sociis-a word is known by the company it keeps-the County highlights several contextual clues to contend that when Congress said “any surface transportation project, ” it was actually referring only to highways.

         First, the County notes that § 142(m)(1)(A) must be read in light of the word “highway” in the phrase that it is defining: “qualified highway or surface freight transfer facilities.” 26 U.S.C. § 142(m)(1) (emphasis added). Because another portion of § 142(m)(1) deals with surface freight transfer facilities, see 26 U.S.C. § 142(m)(1)(C), Plaintiff contends, § 142(m)(1)(A) must deal with the “highway . . . facilities.” But that argument is unavailing in the face of Congress's chosen definition. In interpreting a statute, courts defer to Congress's definition of a statutory provision, even if that definition is at odds with the ordinary meaning. See, e.g., Digital Realty Trust, Inc. v. Somers, 138 S.Ct. 767, 776-77 (2018). Thus, even accepting Plaintiff's premise, it was Congress's prerogative to define “highway . . . facilities” as encompassing more than highways. And, as discussed, that is plainly what it did when it defined the term to include “any surface transportation project.”

         Second, Indian River County notes that when Congress added “qualified highway or surface freight transfer facilities” to § 142, the statute already listed fourteen other types of facilities eligible for PABs financing. See 26 U.S.C. § 142(a). Plaintiff insists that the fact that this list already included railway facilities-in the form of “high-speed intercity rail facilities, ” id. § 142(a)(11), and “mass commuting facilities, ” id. § 142(a)(3)-Congress's inclusion of “qualified highway . . . facilities” must be understood to preclude passenger rail projects. As an initial matter, the original list did not encompass all rail projects. “[M]ass commuting facilities” do not encompass longer passenger rail services that connect distant cities to one another. Likewise, “high-speed intercity rail facilities” include only passenger trains capable of 150 mile- per-hour maximum speeds, id. § 142(i)(1), which excludes slower trains (including those AAF is using). In other words, the list to which Congress added “qualified highway or surface freight transfer facilities” encompassed some types of passenger rail projects, but not all. It would make perfect sense and would not be duplicative for Congress to add a provision covering other types of rail projects. Nor would it supplant those provisions. While the types of railways encompassed by “mass commuting facilities” and “high-speed intercity rail facilities” fall into the ambit of “any surface transportation project, ” they do not necessarily also receive Title 23 funds as § 142(m)(1)(A) requires.

         Third, Indian River County points to the fact that § 142(m)(1)(A)'s limiting provision references Title 23-i.e., that a surface transportation project constitutes a “qualified highway or surface freight transfer facilit[y]” only if it “receives Federal assistance under title 23, United States Code[.]” Id. § 142(m)(1)(A). Title 23 is a portion of the U.S. Code entitled “Highways.” This detail, Plaintiff insists, further demonstrates that “any surface transportation project” must refer only to highways-especially since later in the provision, Congress included in its definition of “qualified highway or surface freight transfer facilities” certain types of facilities that receive funding under either Title 23 or Title 49, which addresses railroads. See Id. § 142(m)(1)(C). According to Plaintiff, the exclusion of a reference to Title 49 in § 142(m)(1)(A), when it was included in § 142(m)(1)(C), means that § 142(m)(1)(A)'s reference to Title 23 indicates that it extends only to highway projects. But while Title 23 does deal generally with highways, it also contains provisions authorizing funds for non-highway transport, including passenger rail. See, e.g., 23 U.S.C. § 601(a)(12). Consequently, the reference to Title 23 is not as strong a contextual clue as Plaintiff suggests and is insufficient to supplant Congress's capacious definition, notwithstanding the fact that the Title 23 is called “Highways.” Cf. United States v. Spencer, 720 F.3d 363, 367 (D.C. Cir. 2013) (embracing “the wise rule that the title of a statute and the heading of a section cannot limit the plain meaning of the text” (citation omitted)).

         Indian River County also invokes the canon expressio unius est exclusio alterius-that “expressing one item of an associated group or series excludes another left unmentioned, ” Chevron U.S.A., Inc. v. Echazabal, 536 U.S. 73, 80 (2002) (citation and internal alteration omitted). The County suggests that because other portions of § 142(m) reference non-highway surface transport, § 142(m)(1)(A) cannot be interpreted to include such transport. Section 142(m) includes both “any project for an international bridge or tunnel for which an international entity authorized under Federal or State law is responsible, ” 26 U.S.C. § 142(m)(1)(B), and “any facility for the transfer of freight from truck to rail or rail to truck, ” id. § 142(m)(1)(C), among “qualified highway and surface freight transfer facilities, ” provided they receive appropriate funding. But their inclusion does not imply an exclusion of non-highway projects from “any surface transportation project[.]” The D.C. Circuit has repeatedly indicated that “[t]he expressio unius canon is a ‘feeble helper in an administrative setting, where Congress is presumed to have left to reasonable agency discretion questions that it has not directly resolved.'” Adirondack Med. Ctr. v. Sebelius, 740 F.3d 692, 697 (D.C. Cir. 2014) (quoting Cheney R.R. Co. v. I.C.C., 902 F.2d 66, 68-69 (D.C. Cir. 1990)). In particular, “when countervailed by a broad grant of authority contained within the same statutory scheme, the canon is a poor indicator of Congress' intent.” Id. (citing Creekstone Farms Premium Beef, L.L.C. v. Dep't of Agric., 539 F.3d 492, 500 (D.C. Cir. 2008)). Here, Congress granted the Department wide discretion, allowing it to allocate PAB authority among facilities “in such manner as the Secretary determines appropriate.” 26 U.S.C. § 142(m)(2)(C). Plaintiff's invocation of expressio unius est exclusio alterius is thus misplaced and does little to undermine the Secretary's interpretation, particularly in light of § 142(m)(1)(A)'s plain, capacious language.

         Put simply, if Congress had intended for the addition of “qualified highway or surface freight transfer facilities” to cover only highway projects, it would have made that clear. For example, it could have defined “qualified highway . . . facilities” to include only highway surface transportation projects, instead of “surface transportation project[s].” It did not do so. Instead, ...


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