U.S. Supreme Court justices questioned a federal law credited with improving Amtrak’s on-time performance, hearing arguments from freight railroads that the measure subjects them to unlawful penalties.

In an hour-long session today in Washington, the court weighed whether the 2008 law unconstitutionally lets Amtrak help set on-time performance standards that can trigger government investigations of freight carriers.

The performance standards are designed to enforce a requirement that freight railroads, including Union Pacific Corp., give Amtrak priority on their tracks. An industry trade group says the railroads are being forced to substantially change their business operations, at times by delaying their own freight traffic.

A federal appeals court ruled that the industry-opposed measure is an illegal delegation of legislative power to Amtrak, a private corporation with some governmental aspects.

The case is Department of Transportation v. Association of American Railroads, 13-1080.

To contact the reporter on this story: Greg Stohr in Washington at gstohr@bloomberg.net To contact the editors responsible for this story: Patrick Oster at poster@bloomberg.net Laurie Asseo, Mark McQuillan.

Tags: amtrak, usa
Photo Credit: An Amtrak Acela train arrives at Union Station in Washington, D.C. Loco Steve / Flickr