 United States Court of Appeals
         FOR THE DISTRICT OF COLUMBIA CIRCUIT



Argued February 19, 2013               Decided July 2, 2013

                       No. 12-5204

          ASSOCIATION OF AMERICAN RAILROADS,
                      APPELLANT

                             v.

 UNITED STATES DEPARTMENT OF TRANSPORTATION, ET AL.,
                     APPELLEES


        Appeal from the United States District Court
                for the District of Columbia
                    (No. 1:11-cv-01499)


    Thomas H. Dupree, Jr. argued the cause for appellant.
With him on the briefs was Louis P. Warchot.

    Michael S. Raab, Attorney, U.S. Department of Justice,
argued the cause for appellees. With him on the brief were
Stuart F. Delery, Acting Assistant Attorney General, Ronald
C. Machen Jr., U.S. Attorney, Mark B. Stern and Daniel
Tenny, Attorneys, Paul M. Geier, Assistant General Counsel
for Litigation, U.S. Department of Transportation, Peter J.
Plocki, Deputy Assistant General Counsel for Litigation, and
Joy Park, Attorney.
                                 2
   Before: BROWN, Circuit Judge, and WILLIAMS and
SENTELLE, Senior Circuit Judges.

     BROWN, Circuit Judge: Imagine a scenario in which
Congress has given to General Motors the power to coauthor,
alongside the Department of Transportation, regulations that
will govern all automobile manufacturers. And, if the two
should happen to disagree on what form those regulations will
take, then neither will have the ultimate say. Instead, an
unspecified arbitrator will make the call. Constitutional? The
Department of Transportation seems to think so. 1

     Next consider a parallel statutory scheme—the one at
issue in this case. This time, instead of General Motors, it is
Amtrak (officially, the “National Railroad Passenger
Corporation”) wielding joint regulatory power with a
government agency. This new stipulation further complicates
the issue. Unlike General Motors, Amtrak is a curious entity
that occupies the twilight between the public and private
sectors. And the regulations it codevelops govern not the
automotive industry, but the priority freight railroads must
give Amtrak’s trains over their own. Whether the Constitution
permits Congress to delegate such joint regulatory authority to
Amtrak is the question that confronts us now.

     Section 207 of the Passenger Rail Investment and
Improvement Act of 2008 empowers Amtrak and the Federal
Railroad Administration (FRA) to jointly develop
performance measures to enhance enforcement of the
statutory priority Amtrak’s passenger rail service has over
    1
       Counsel for the Appellees embraced precisely this position at
oral argument, albeit with some preliminary hemming and hawing.
See Oral Arg. 30:20–33:00.
                              3
other trains. The Appellant in this case, the Association of
American Railroads (AAR), is a trade association whose
members include the largest freight railroads (known in the
industry as “Class I” freight railroads), some smaller freight
railroads, and—as it happens—Amtrak. Compl. ¶ 10, at 4.
Challenging the statutory scheme as unconstitutional, AAR
brought suit on behalf of its Class I members against the four
Appellees—the Department of Transportation, its Secretary,
the FRA, and its Administrator (collectively, the
“government”). Id. ¶¶ 14–17, at 6–7. We conclude § 207
constitutes an unlawful delegation of regulatory power to a
private entity.

                              I

                              A

    To reinvigorate a national passenger rail system that had,
by mid-century, grown moribund and unprofitable, Congress
passed the Rail Passenger Service Act of 1970, Pub. L. No.
91-518, 84 Stat. 1327. See Nat’l R.R. Corp. v. Atchison,
Topeka & Santa Fe Ry. Co., 470 U.S. 451, 453–54 (1985).
Most prominently, the legislation created the passenger rail
corporation now known as Amtrak, which would “employ[]
innovative operating and marketing concepts so as to fully
develop the potential of modern rail service in meeting the
Nation’s intercity passenger transportation requirements.”
Rail Passenger Service Act, § 301, 84 Stat. at 1330. The act
also made railroad companies languishing under the prior
regime an offer they could not refuse: if these companies
consented to certain conditions, such as permitting Amtrak to
use their tracks and other facilities, they could shed their
cumbersome common carrier obligation to offer intercity
passenger service. See Nat’l R.R. Corp., 470 U.S. at 455–56.
                                4
Pursuant to statute, Amtrak negotiates these arrangements
with individual railroads, the terms of which are enshrined in
Operating Agreements. 2 See 49 U.S.C. § 24308(a). Today,
freight railroads own roughly 97% of the track over which
Amtrak runs its passenger service.

     Naturally, sharing tracks can cause coordination
problems, which is why Congress has prescribed that, absent
an emergency, Amtrak’s passenger rail “has preference over
freight transportation in using a rail line, junction, or
crossing.” Id. § 24308(c). More recently, this same concern
prompted enactment of the Passenger Rail Investment and
Improvement Act of 2008 (“PRIIA”), Pub. L. No. 110-432,
Div. B, 122 Stat. 4848, 4907. At issue in this case is the
PRIIA’s § 207, which directs the FRA and Amtrak to
“jointly . . . develop new or improve existing metrics and
minimum standards for measuring the performance and
service quality of intercity passenger train operations,
including cost recovery, on-time performance and minutes of
delay, ridership, on-board services, stations, facilities,
equipment, and other services.” PRIIA § 207(a), 49 U.S.C.
§ 24101 (note). If Amtrak and the FRA disagree about the
composition of these “metrics and standards,” either “may
petition the Surface Transportation Board to appoint an
arbitrator to assist the parties in resolving their disputes
through binding arbitration.” Id. § 207(d), 49 U.S.C. § 24101
(note). “To the extent practicable,” Amtrak and its host rail
carriers must incorporate the metrics and standards into their
Operating Agreements. Id. § 207(c), 49 U.S.C. § 24101
(note).
    2
       If the parties cannot reach agreement, the Surface
Transportation Board (STB) will “order that the facilities be made
available and the services provided to Amtrak” and “prescribe
reasonable terms and compensation.” 49 U.S.C. § 24308(a).
                                5


     Though § 207 provides the means for devising the
metrics and standards, § 213 is the enforcement mechanism. If
the “on-time performance” or “service quality” of any
intercity passenger train proves inadequate under the metrics
and standards for two consecutive quarters, the STB may
launch an investigation “to determine whether and to what
extent delays or failure to achieve minimum standards are due
to causes that could reasonably be addressed by a rail carrier
over whose tracks the intercity passenger train operates or
reasonably addressed by Amtrak or other intercity passenger
rail operators.” PRIIA § 213(a), 49 U.S.C. § 24308(f)(1).
Similarly, if “Amtrak, an intercity passenger rail operator, a
host freight railroad over which Amtrak operates, or an entity
for which Amtrak operates intercity passenger rail service”
files a complaint, the STB “shall” initiate such an
investigation. Id. (emphasis added). Should the STB
determine the failure to satisfy the metrics and standards is
“attributable to a rail carrier’s failure to provide preference to
Amtrak over freight transportation as required,” it may award
damages or other relief against the offending host rail carrier.
Id. § 24308(f)(2).

                                B

     Following § 207’s mandate, the FRA and Amtrak jointly
drafted proposed metrics and standards, which they submitted
to public comment on March 13, 2009. See Metrics and
Standards for Intercity Passenger Rail Service Under Section
207 of Public Law 110-432, 74 Fed. Reg. 10,983 (Mar. 13,
2009). The proposal attracted criticism, with much vitriol
directed at three metrics formulated to measure on-time
performance: “effective speed” (the ratio of route’s distance to
the average time required to travel it), “endpoint on-time
                               6
performance” (the portion of a route’s trains that arrive on
schedule), and “all-stations on-time performance” (the degree
to which trains arrive on time at each station along the route).
AAR, among others, derided these metrics as “unrealistic”
and worried that certain aspects would create “an excessive
administrative and financial burden.” The FRA responded to
the comments, and a final version of the metrics and standards
took effect in May 2010. See Metrics and Standards for
Intercity Passenger Rail Service Under Section 207 of the
Passenger Rail Investment and Improvement Act of 2008, 75
Fed. Reg. 26,839 (May 11, 2010).

     AAR filed suit on behalf of its Class I freight railroad
members, asking the district court to declare § 207 of the
PRIIA unconstitutional and to vacate the promulgated metrics
and standards. The complaint asserted two challenges: that
§ 207 unconstitutionally delegates to Amtrak the authority to
regulate other private entities; and that empowering Amtrak to
regulate its competitors violates the Fifth Amendment’s Due
Process Clause. Compl. ¶¶ 47–54, at 16–17. The district court
rejected these arguments, granting summary judgment to the
government and denying it to AAR. See AAR v. Dep’t of
Transp., 865 F. Supp. 2d 22, 35 (D.D.C. 2012). AAR renews
these constitutional claims on appeal.

                               II

     AAR’s argument takes the following form: Delegating
regulatory authority to a private entity is unconstitutional.
Amtrak is a private entity. Ergo, § 207 is unconstitutional.
This proposed syllogism is susceptible, however, to attacks on
both its validity and soundness. In other words, does the
conclusion actually follow from the premises? And, if it does,
are both premises true? Our discussion follows the same path.
                               7


                               A

     We open our discussion with a principle upon which both
sides agree: Federal lawmakers cannot delegate regulatory
authority to a private entity. To do so would be “legislative
delegation in its most obnoxious form.” Carter v. Carter Coal
Co., 298 U.S. 238, 311 (1936). This constitutional prohibition
is the lesser-known cousin of the doctrine that Congress
cannot delegate its legislative function to an agency of the
Executive Branch. See U.S. CONST. art. I, § 1 (“All legislative
Powers herein granted shall be vested in a Congress of the
United States . . . .”); see A.L.A. Schechter Poultry Corp. v.
United States, 295 U.S. 495, 529 (1935). This latter
proposition finds scarce practical application, however,
because “no statute can be entirely precise,” meaning “some
judgments, even some judgments involving policy
considerations, must be left to the officers executing the law
and to the judges applying it.” Mistretta v. United States, 488
U.S. 361, 415 (1989) (Scalia, J., dissenting). All that is
required then to legitimate a delegation to a government
agency is for Congress to prescribe an intelligible principle
governing the statute’s enforcement. See J.W. Hampton, Jr., &
Co. v. United States, 276 U.S. 394, 409 (1928).

     Not so, however, in the case of private entities to whom
the Constitution commits no executive power. Although
objections to delegations are “typically presented in the
context of a transfer of legislative authority from the Congress
to agencies,” we have reaffirmed that “the difficulties sparked
by such allocations are even more prevalent in the context of
agency delegations to private individuals.” Nat’l Ass’n of
Regulatory Util. Comm’rs v. FCC (“NARUC”), 737 F.2d
                                  8
1095, 1143 (D.C. Cir. 1984) (per curiam). 3 Even an
intelligible principle cannot rescue a statute empowering
private parties to wield regulatory authority. Such entities
may, however, help a government agency make its regulatory
decisions, for “[t]he Constitution has never been regarded as
denying to the Congress the necessary resources of flexibility
and practicality” that such schemes facilitate. Pan. Ref. Co. v.
Ryan, 293 U.S. 388, 421 (1935). Yet precisely how much
involvement may a private entity have in the administrative
process before its advisory role trespasses into an
unconstitutional delegation? Discerning that line is the task at
hand.

    Preliminarily, we note the Supreme Court has never
approved a regulatory scheme that so drastically empowers a
private entity in the way § 207 empowers Amtrak. True, § 207
has a passing resemblance to the humbler statutory
frameworks in Currin v. Wallace, 306 U.S. 1 (1939), and
Sunshine Anthracite Coal Co. v. Adkins, 310 U.S. 381 (1940).
In Currin Congress circumscribed its delegations of
     3
        At least one commentator has suggested that the “doctrine
forbidding delegation of public power to private groups is, in fact,
rooted in a prohibition against self-interested regulation that sounds
more in the Due Process Clause than in the separation of powers.”
A. Michael Froomkin, Wrong Turn in Cyberspace: Using ICANN
To Route Around the APA and the Constitution, 50 DUKE L.J. 17,
153 (2000). Carter Coal offers some textual support for this
position, describing the impermissible delegation there as “clearly a
denial of rights safeguarded by the due process clause of the Fifth
Amendment.” 298 U.S. at 311. While the distinction evokes
scholarly interest, neither party before us makes this point, and our
own precedent describes the problem as one of unconstitutional
delegation. See NARUC, 737 F.2d at 1143 n.41. And, in any event,
neither court nor scholar has suggested a change in the label would
effect a change in the inquiry.
                                  9
administrative authority—in that case, by requiring two thirds
of regulated industry members to approve an agency’s new
regulations before they took effect. See 306 U.S. at 6, 15.
Adkins, meanwhile, affirmed a modest principle: Congress
may formalize the role of private parties in proposing
regulations so long as that role is merely “as an aid” to a
government agency that retains the discretion to “approve[],
disapprove[], or modif[y]” them. 310 U.S. at 388. Like the
private parties in Currin, Amtrak has an effective veto over
regulations developed by the FRA. And like those in Adkins,
Amtrak has a role in filling the content of regulations. But the
similarities end there. The industries in Currin did not craft
the regulations, while Adkins involved no private check on an
agency’s regulatory authority. 4 Even more damningly, the
agency in Adkins could unilaterally change regulations
proposed to it by private parties, whereas Amtrak enjoys
authority equal to the FRA. Should the FRA prefer an
alternative to Amtrak’s proposed metrics and standards, § 207
leaves it impotent to choose its version without Amtrak’s
permission. No case prefigures the unprecedented regulatory
powers delegated to Amtrak. 5

     4
        For what it is worth, Currin also involved the collective
participation of two thirds of industry members, and the regulations
in Adkins arose from district boards comprising multiple members of
the regulated industry. Neither upheld a statute that favored a single
firm over all its market rivals.
     5
        The government also cites various decisions from other
Circuits that purportedly support its position. All are
distinguishable. Several upheld schemes like that in Currin in which
the effect of regulations was contingent upon the assent of a certain
portion of the regulated industry. See Ky. Div., Horsemen’s
Benevolent and Protective Ass’n v. Turfway Park Racing Ass’n, 20
F.3d 1406, 1416 (6th Cir. 1994); Sequoia Orange Co. v. Yeutter,
                                10


     The government also points out that the metrics and
standards themselves impose no liability. Rather, they define
the circumstances in which the STB will investigate whether
infractions are attributable to a freight railroad’s failure to
meet its preexisting statutory obligation to accord preference
to Amtrak’s trains. See PRIIA § 213(a), 49 U.S.C. § 24308(f).
We are not entirely certain what to make of this argument.
Taken to its logical extreme, it would preclude all
preenforcement review of agency rulemaking, so it is probably
unlikely the government is pressing so immodest a claim. 6 If


973 F.2d 752, 759 (9th Cir. 1992). The others resemble Adkins
insofar as they approve structures in which private industry
members serve in purely advisory or ministerial functions. See
Pittston Co. v. United States, 368 F.3d 385, 394–97 (4th Cir. 2004);
United States v. Frame, 885 F.2d 1119, 1128–29 (3d Cir. 1989),
abrogated on other grounds by Glickman v. Wileman Bros. &
Elliott, Inc., 521 U.S. 457 (1997); Sorrell v. SEC, 679 F.2d 1323,
1325–26 (9th Cir. 1982); First Jersey Sec., Inc. v. Bergen, 605 F.2d
690, 697 (3d Cir. 1979); Todd & Co. v. SEC, 557 F.2d 1008,
1012–13 (3d Cir. 1977); R.H. Johnson & Co. v. SEC, 198 F.2d 690,
695 (2d Cir. 1952). In none of these cases did a private party stand
on equal footing with a government agency.
    6
       AAR’s Reply Brief treated this argument as an ordinary
ripeness challenge. See Br. 18–21. If that is what the government
intended, then we are not persuaded. As a purely legal question,
§ 207’s constitutionality is appropriate for immediate judicial
resolution. See Abbott Labs. v. Gardner, 387 U.S. 136, 149 (1967),
overruled on other grounds by Califano v. Sanders, 430 U.S. 99
(1977). And depriving AAR of review at this stage would result in
considerable hardship. See United Christian Scientists v. Christian
Sci. Bd. of Dirs., First Church of Christ, Scientist, 829 F.2d 1152,
1160 n.29 (D.C. Cir. 1987). The record is replete with affidavits
from the freight railroads describing the immediate actions the
                                11
the point is merely that the STB adds another layer of
government “oversight” to Amtrak’s exercise of regulatory
power, this precaution does not alter the analysis. Government
enforcement power did not save the rulemaking authority of
the private coal companies in Carter Coal, nor the power of
private landowners in Washington ex rel. Seattle Title Trust
Co. v. Roberge, 278 U.S. 116 (1928), to impose a zoning
restriction on a neighbor’s tract of land. As is often the case in
administrative law, the metrics and standards lend definite
regulatory force to an otherwise broad statutory mandate. See,
e.g., Whitman v. Am. Trucking Ass’ns, 531 U.S. 457, 465
(2001). The preference for Amtrak’s traffic may predate the
PRIIA, but the metrics and standards are what channel its
enforcement. Certainly the FRA and Amtrak saw things that
way, responding to one public comment by noting the STB “is
the primary enforcement body of the standards.” J.A. 63
(emphasis added). Not only that, § 207 directs “Amtrak and
its host carriers” to include the metrics and standards in their
Operating Agreements “[t]o the extent practicable.” PRIIA
§ 207(c), 49 U.S.C. § 24101 (note). The STB’s involvement is
no safe harbor from AAR’s constitutional challenge to § 207.

     As far as we know, no court has invalidated a scheme like
§ 207’s, but perhaps that is because no parallel exists.
Unprecedented constitutional questions, after all, lack clear
and controlling precedent. We nevertheless believe Free
Enterprise Fund v. Public Co. Accounting Oversight Board,
130 S. Ct. 3138 (2010), offers guidance. There the Supreme
Court deemed it a violation of separation of powers to endow
inferior officers with two layers of good-cause tenure

metrics and standards have forced them to take. See Decl. of Paul E.
Ladue ¶¶ 6–9, at 3–5; Decl. of Mark M. Owens ¶ 9, at 4; Decl. of
Virginia Marie Beck ¶¶ 9–11, at 4–6; Decl. of Peggy Harris ¶¶
8–14, at 3–5.
                             12
insulating them from removal by the President. See id. at
3164. Two principles from that case are particularly resonant.
To begin with, just because two structural features raise no
constitutional concerns independently does not mean
Congress may combine them in a single statute. Free
Enterprise Fund deemed invalid a regime blending two
limitations on the President’s removal power that, taken
separately, were unproblematic: the establishment of
independent agencies headed by principal officers shielded
from dismissal without cause, see Humphrey’s Ex’r v. United
States, 295 U.S. 602, 629–31 (1935), and the protection of
certain inferior officers from removal by principal officers
directly accountable to the President, see Morrison v. Olson,
487 U.S. 654, 691–93 (1988). See 130 S. Ct. at 3146–47. So
even if the government is right that § 207 merely synthesizes
elements approved by Currin and Adkins, that would be no
proof of constitutionality.

     As for the second principle, Free Enterprise Fund also
clarifies that novelty may, in certain circumstances, signal
unconstitutionality. That double good-cause tenure, for
example, lacked an antecedent in the history of the
administrative state was one reason to suspect its legality:

       “Perhaps the most telling indication of the
       severe constitutional problem with the PCAOB
       is the lack of historical precedent for this
       entity. Neither the majority opinion nor the
       PCAOB nor the United States as intervenor has
       located any historical analogues for this novel
       structure. They have not identified any
       independent agency other than the PCAOB that
       is appointed by and removable only for cause
       by another independent agency.”
                                13


Id. at 3159 (quoting Free Enter. Fund v. Pub. Co. Accounting
Oversight Bd., 537 F.3d 667, 699 (D.C. Cir. 2008)
(Kavanaugh, J., dissenting)); accord Nat’l Fed’n of Indep.
Bus. v. Sebelius, 132 S. Ct. 2566, 2586 (2012). In defending
§ 207, the government revealingly cites no case—nor have we
found any—embracing the position that a private entity may
jointly exercise regulatory power on equal footing with an
administrative agency. This fact is not trivial. Section 207 is
as close to the blatantly unconstitutional scheme in Carter
Coal as we have seen. The government would essentially limit
Carter Coal to its facts, arguing that “[n]o more is
constitutionally required” than the government’s “active
oversight, participation, and assent” in its private partner’s
rulemaking      decisions.    Appellee’s     Br.    19.   This
proposition—one we find nowhere in the case law—vitiates
the principle that private parties must be limited to an
advisory or subordinate role in the regulatory process.

     To make matters worse, § 207 fails to meet even the
government’s ad hoc standard. Consider what would have
happened if Amtrak and the FRA could not have reached an
agreement on the content of the metrics and standards within
180 days of the PRIIA’s enactment. Amtrak could have
“petition[ed] the Surface Transportation Board to appoint an
arbitrator to assist the parties in resolving their disputes
through binding arbitration.” PRIIA 207(d), 49 U.S.C.
§ 24101 (note). And nothing in the statute precludes the
appointment of a private party as arbitrator. 7 That means it

    7
      The government notes § 207’s arbitration provision does not
require the arbitrator be a private party. This is irrelevant. “[A]n
agency can[not] cure an unlawful delegation of legislative power by
adopting in its discretion a limiting construction of the statute.”
Whitman, 531 U.S. at 472. Nor does the canon of constitutional
                                 14
would have been entirely possible for metrics and standards to
go into effect that had not been assented to by a single
representative of the government. Though that did not in fact
occur here, § 207’s arbitration provision still polluted the
rulemaking process over and above the other defects besetting
the statute. As a formal matter, that the recipients of illicitly
delegated authority opted not to make use of it is no antidote.
It is Congress’s decision to delegate that is unconstitutional.
See Whitman, 531 U.S. at 473. As a practical matter, the
FRA’s failure to reach an agreement with Amtrak would have
meant forfeiting regulatory power to an arbitrator the agency
would have had no hand in picking. Rather than ensuring
Amtrak would “function subordinately” to the FRA, Adkins,
310 U.S. at 399, this backdrop stacked the deck in favor of
compromise. Even for government agencies, half an apple is
better than none at all.

     We remain mindful that the Constitution “contemplates
that practice will integrate the dispersed powers into a
workable government.” Youngstown Sheet & Tube Co. v.
Sawyer, 343 U.S. 579, 635 (1952) (Jackson, J., concurring).
But a flexible Constitution must not be so yielding as to
become twisted. Unless it can be established that Amtrak is an
organ of the government, therefore, § 207 is an
unconstitutional delegation of regulatory power to a private
party.

                                 B

avoidance offer a solution. The statute’s text precludes the
government’s suggestion that we construe the open-ended language
“an arbitrator” to include only federal entities. The constitutional
avoidance canon is an interpretive aid, not an invitation to rewrite
statutes to satisfy constitutional strictures. Reno v. ACLU, 521 U.S.
844, 884–85 (1997).
                               15


    Now the crucial question: is Amtrak indeed a private
corporation? If not—if it is just one more government
agency—then the regulatory power it wields under § 207 is of
no constitutional moment.

     Many of the details of Amtrak’s makeup support the
government’s position that it is not a private entity of the sort
described in Carter Coal. Amtrak’s Board of Directors
includes the Secretary of Transportation (or his designee),
seven other presidential appointees, and the President of
Amtrak. See 49 U.S.C. § 24302(a). The President of
Amtrak—the one Board member not appointed by the
President of the United States—is in turn selected by the eight
other members of the Board. See id. § 24303(a). Amtrak is
also subject to the Freedom of Information Act. See id.
§ 24301(e). Amtrak’s equity structure is similarly suggestive.
As of September 30, 2011, four common stockholders owned
9,385,694 outstanding shares, which they acquired from the
four railroads whose intercity passenger service Amtrak
assumed in 1971. BDO USA, LLP, NATIONAL RAILROAD
PASSENGER CORPORATION AND SUBSIDIARIES (AMTRAK)
CONSOLIDATED FINANCIAL STATEMENTS: YEARS ENDED
SEPTEMBER 30, 2011 AND 2010, at 18 (2011) (J.A. 351). At
the same time, however, the federal government owned all
109,396,994 shares of Amtrak’s preferred stock, each share of
which is convertible into 10 shares of common stock. Id. at 17
(J.A. 350). And, all that stands between Amtrak and financial
ruin is congressional largesse. See id. at 6 (J.A. 339).

     That being said, Amtrak’s legislative origins are not
determinative of its constitutional status. Congress’s power to
charter private corporations was recognized early in our
nation’s history. See McCulloch v. Maryland, 17 U.S. (4
                              16
Wheat.) 316, 409 (1819). And, as far as Congress was
concerned, that is exactly what it was doing when it created
Amtrak. As Congress explained it, Amtrak “shall be operated
and managed as a for-profit corporation” and “is not a
department, agency, or instrumentality of the United States
Government.” 49 U.S.C. § 24301(a). We have previously
taken Congress at its word and relied on this declaration in
deciding whether the False Claims Act applies to Amtrak. See
United States ex rel. Totten v. Bombardier Corp., 380 F.3d
488, 490 (D.C. Cir. 2004) (“Amtrak is not the Government.”);
id. at 491 (“Amtrak is Not the Government.”); id. at 502
(“Amtrak is not the Government.”). Amtrak agrees: “The
National Railroad Passenger Corporation, also known as
Amtrak, is not a government agency or establishment [but] a
private corporation operated for profit.” NAT’L R.R.
PASSENGER CORP., FREEDOM OF INFORMATION ACT
HANDBOOK 1 (2008). And, somewhat tellingly, Amtrak’s
website is www.amtrak.com—not www.amtrak.gov.

     How to decide? Since, in support of its claim that Amtrak
is a public entity, the government looks past labels to how the
corporation functions, it is worth examining what functional
purposes the public-private distinction serves when it comes
to delegating regulatory power. We identify two of particular
importance. First, delegating the government’s powers to
private parties saps our political system of democratic
accountability. See Mich. Gaming Opposition v. Kempthorne,
525 F.3d 23, 34 (D.C. Cir. 2008) (Brown, J., dissenting in
part). This threat is particularly dangerous where both
Congress and the Executive can deflect blame for unpopular
policies by attributing them to the choices of a private entity.
See NARUC, 737 F.2d at 1143 n.41; cf. New York v. United
States, 505 U.S. 144, 169 (1992) (“[W]here the Federal
Government directs the States to regulate, it may be state
                               17
officials who will bear the brunt of public disapproval, while
the federal officials who devised the regulatory program may
remain insulated from the electoral ramifications of their
decision.”). This worry is certainly present in the case of
§ 207, since Congress has expressly forsworn Amtrak’s status
as a “department, agency, or instrumentality of the United
States Government.” 49 U.S.C. § 24301(a)(3). Dislike the
metrics and standards Amtrak has concocted? It’s not the
federal government’s fault—Amtrak is a “for-profit
corporation.” Id. § 24301(a)(2).

     Second, fundamental to the public-private distinction in
the delegation of regulatory authority is the belief that
disinterested government agencies ostensibly look to the
public good, not private gain. For this reason, delegations to
private entities are particularly perilous. Carter Coal
specifically condemned delegations made not “to an official
or an official body, presumptively disinterested, but to private
persons whose interests may be and often are adverse to the
interests of others in the same business.” 298 U.S. at 311.
Partly echoing the Constitution’s guarantee of due process,
this principle ensures that regulations are not dictated by those
who “are not bound by any official duty,” but may instead act
“for selfish reasons or arbitrarily.” Roberge, 278 U.S. at 122.
More recent decisions are also consistent with this view. See
Pittston Co., 368 F.3d at 398; NARUC, 737 F.2d at 1143–44;
Sierra Club v. Sigler, 695 F.2d 957, 962 n.3 (5th Cir. 1983).
Amtrak may not compete with the freight railroads for
customers, but it does compete with them for use of their
scarce track. Like the “power conferred upon the
majority . . . to regulate the affairs of an unwilling minority”
in Carter Coal, § 207 grants Amtrak a distinct competitive
advantage: a hand in limiting the freight railroads’ exercise of
                               18
their property rights over an essential resource. 298 U.S. at
311.

     Because Amtrak must “be operated and managed as a
for-profit corporation,” 49 U.S.C. § 24301(a)(2), the fact that
the President has appointed the bulk of its Board does nothing
to exonerate its management from its fiduciary duty to
maximize company profits. Also consistent with this purpose,
“Amtrak is encouraged to make agreements with the private
sector and undertake initiatives that are consistent with good
business judgment and designed to maximize its revenues and
minimize Government subsidies.” Id. § 24101(d). Yet § 207
directs Amtrak and its host carriers to incorporate the metrics
and standards in their Operating Agreements. See id.
§ 24101(c) note. So to summarize: Amtrak must negotiate
contracts that will maximize its profits; those contracts
generally must, by law, include certain terms; and Amtrak has
the power to define those terms. Perverse incentives abound.
Nothing about the government’s involvement in Amtrak’s
operations restrains the corporation from devising metrics and
standards that inure to its own financial benefit rather than the
common good. And that is the very essence of the
public-private distinction when a claim of unconstitutional
delegation arises.

     No discussion of Amtrak’s status as a private or public
institution would be complete, however, without an
examination of the Supreme Court’s decision in Lebron v.
National Railroad Passenger Corp., 513 U.S. 374 (1995). 8

    8
       Strangely, the government’s brief places almost no emphasis
on Lebron. Perhaps this indicates the government’s agreement with
AAR’s reading of the case. Whatever the reason for this
near-silence, we think it important to address the Supreme Court’s
most explicit discussion of Amtrak’s status.
                              19
There the Court held that Amtrak “is part of the Government
for purposes of the First Amendment.” Id. at 400. Otherwise,
the majority cautioned, the government could “evade the most
solemn obligations imposed in the Constitution by simply
resorting to the corporate form.” Id. at 397. What the Court
did not do in Lebron was conclude that Amtrak counted as
part of the government for all purposes. On some
questions—Does the Administrative Procedure Act apply to
Amtrak? Does Amtrak enjoy sovereign immunity from
suit?—Congress’s disclaimer of Amtrak’s governmental
status is dispositive. See id. at 392; Totten, 380 F.3d at
491–92. This makes sense: Congress has the power to waive
certain governmental privileges, like sovereign immunity, that
are within its legislative control; but it cannot circumvent the
Bill of Rights by simply dubbing something private.

     Whether § 207 effects an unconstitutional delegation is a
constitutional question, not a statutory one. But just because
Lebron treated Amtrak as a government agency for purposes
of the First Amendment does not dictate the same result with
respect to all other constitutional provisions. To view Lebron
in this way entirely misses the point. In Lebron, viewing
Amtrak as a strictly private entity would have permitted the
government to avoid a constitutional prohibition; in this case,
deeming Amtrak to be just another governmental entity would
allow the government to ignore a constitutional obligation.
Just as it is impermissible for Congress to employ the
corporate form to sidestep the First Amendment, neither may
it reap the benefits of delegating regulatory authority while
absolving the federal government of all responsibility for its
exercise. The federal government cannot have its cake and eat
it too. In any event, Lebron’s holding was comparatively
narrow, deciding only that Amtrak is an agency of the United
States for the purpose of the First Amendment. 513 U.S. at
                               20
394. It did not opine on Amtrak’s status with respect to the
federal government’s structural powers under the
Constitution—the issue here.

     This distinction is more than academic. When Lebron
contrasted “the constitutional obligations of Government”
from “the ‘privileges of the government,’” it was not drawing
a distinction between questions that are constitutional from
those that are not. Any “privilege” of the federal government
must also be anchored in the Constitution. Id. at 399. As our
federal government is one of enumerated powers, the
Constitution’s structural provisions are the source of
Congress’s power to act in the first place. See United States v.
Lopez, 514 U.S. 549, 552 (1995); THE FEDERALIST NO. 45
(James Madison). And, generally speaking, these provisions
authorize action without mandating it. Congress’s power to
regulate interstate commerce, for example, does not dictate
the enactment of this or that bill within its proper scope. By
contrast, individual rights are “affirmative prohibitions” on
government action that become relevant “only where the
Government possesses authority to act in the first place.”
Nat’l Fed’n of Ind. Bus., 132 S. Ct. at 2577. While often
phrased in terms of an affirmative prohibition, Congress’s
inability to delegate government power to private entities is
really just a function of its constitutional authority not
extending that far in the first place. In other words, rather than
proscribing what Congress cannot do, the doctrine defines the
limits of what Congress can do. And, by designing Amtrak to
operate as a private corporation—to seek profit on behalf of
private interests—Congress has elected to deny itself the
power to delegate it regulatory authority under § 207. Cf.
Religious Freedom Restoration Act of 1993, 42 U.S.C.
§§ 2000bb to bb-4 (requiring, beyond what the Constitution
mandates, that the federal government “not substantially
                             21
burden a person’s exercise of religion even if the burden
results from a rule of general applicability” unless the
restriction satisfies strict scrutiny).

     We therefore hold that Amtrak is a private corporation
with respect to Congress’s power to delegate regulatory
authority. Though the federal government’s involvement in
Amtrak is considerable, Congress has both designated it a
private corporation and instructed that it be managed so as to
maximize profit. In deciding Amtrak’s status for purposes of
congressional delegations, these declarations are dispositive.
Skewed incentives are precisely the danger forestalled by
restricting delegations to government instrumentalities. And
as a private entity, Amtrak cannot be granted the regulatory
power prescribed in § 207.

                             III

    We conclude § 207 of the PRIIA impermissibly delegates
regulatory authority to Amtrak. We need not reach AAR’s
separate argument that Amtrak’s involvement in developing
the metrics and standards deprived its members of due
process. Accordingly, the judgment of the district court is

                                                    Reversed.
