/* The full text of the U.S. Supreme Court decision in Amtrak vs.

Boston & Maine Corp. This is a significant case on the deference

given to federal administrative agencies. */

NOTE: Where it is feasible, a syllabus (headnote) will be

released, as is being done in connection with this case, at the

time the opinion is issued. The syllabus constitutes no part of

the opinion of the Court but has been prepared by the Reporter of

Decisions for the convenience of the reader. See United States v.

Detroit Lumber Co., 200 U. S. 321, 337.

SUPREME COURT OF THE UNITED STATES

Syllabus

NATIONAL RAILROAD PASSENGER CORPORATION et al. v. BOSTON & MAINE

CORP. et al. certiorari to the united states court of appeals for

the district of columbia circuit No. 90-1419. Argued January

13, 1992-Decided March 25, 1992

The Rail Passenger Service Act of 1970 (RPSA) created petitioner

National Railroad Passenger Corporation (Amtrak), a private

corporation, to provide intercity and commuter rail passenger

service. The Act permits Amtrak to enter into "trackage rights"

agreements to use tracks owned and used by freight railroads, 45

U.S.C. 562(a); and allows Amtrak to ask petitioner Interstate

Commerce Commission (ICC) to condemn railroad property "required

for intercity rail passenger service" if Amtrak and the railroad

cannot agree upon sale terms, 562(d). For purposes of the ICC's

condemnation order, Amtrak's "need for the property" "shall be

deemed to be established" unless the conveyance will

significantly impair the railroad's ability to carry out its

obligations as a common carrier and unless Amtrak's obligations

can adequately be met by the acquisition of alternative

property. Ibid. Amtrak had a trackage rights agreement with

respondent Boston and Maine Corporation (B&M) to operate its

"Montrealer" train between Washington, D. C., and Montreal.

Amtrak claims it was forced to discontinue this service because

of B&M's poor maintenance of its track segment. Subsequently,

Amtrak entered into an agreement with petitioner Central Vermont

Railroad (CV) which provided that, among other things, Amtrak

would acquire the B&M track and reconvey it to CV, and CV would

grant trackage rights to Amtrak and usage rights to B&M. When

B&M did not accept Amtrak's purchase offer for the track, Amtrak

sought and received an ICC order compelling conveyance for just

compensation.

The ICC found, among other things, that 562(d) created a

statutory presumption of Amtrak's need for the track, which B&M

failed to rebut. The Court of Appeals remanded the case for

further proceedings, concluding that, because Amtrak did not

intend to retain the track, it needed only its use, not its

ownership. While petitions for rehearing were pending, 562(d)

was amended to allow Amtrak to subsequently convey title to

acquired property to a third party if the ICC finds the

reconveyance furthers the RPSA's purposes. Nonetheless, the

court denied rehearing, holding that the condemnation was not

valid because the property was not "required for intercity rail

passenger service." Held:

1. The ICC's decision was based on a reasonable interpretation

and application of 562(d).

(a) The ICC's interpretation of the word "required" is due

deference as a reasonable interpretation of an ambiguous term in

a statute that the ICC administers. See, e. g., Chevron U. S. A.

Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837.

The existence of alternative dictionary definitions for

"required" indicates that the statute is open to interpretation.

The ICC's interpretation gives effect to 562(d)'s presumption of

need. In contrast, the Court of Appeals' view that "required"

establishes a separate condition that Amtrak's condemnation

authority is limited to property that is indispensable to its

operations is in clear tension with the presumption. In

addition, 562(d)'s amendment confirms the ICC's definition, while

the Court of Appeals' strict rule would make the amendment

superfluous by barring condemnation whenever Amtrak's

purpose is to reconvey property.

(b) The ICC was not required to make specific findings regarding

Amtrak's actual need for the condemnation because its oversight

responsibility is limited to ensuring that condemned property

will be used in Amtrak's rail operations. The statute's

structure and its presumption of need create a strong inference

that it authorizes Amtrak to make a reasonable business judgment

that condemnation is advisable, unless the statutory presumption

is rebutted.

(c) B&M's several arguments against the ICC's interpretation are

rejected. The eminent domain power has been given to the ICC,

not a private entity thus is not limited as suggested by cases

such as United States v. Carmack, 329 U.S. 230, 243, n.13.

Furthermore, this case turns on the need for deference to the

agency, not to Amtrak. The ICC's interpretation of 562(d) also

did not violate the "public use" requirement of the Fifth

Amendment's Takings Clause, since the agency's determination that

the condemnation will serve a public purpose by facilitating

Amtrak's rail service was not irrational. See, e. g., Hawaii

Housing Authority v. Midkiff, 467 U.S. 229, 240-241. Moreover,

the agency did not err in concluding that the statutory

prerequisite that the parties were "unable to agree upon terms

for the sale" mandated nothing more than a factual determination

that they would be unable to reach agreement through further

negotiations. Nor did it make inadequate factual findings in

concluding that B&M had not rebutted the presumption of need.

The ICC was not unreasonable in considering the effect of

trackage rights and the just compensation award in assessing

whether the conveyance would significantly impair B&M's ability

to carry out its obligations, or in interpreting the

availability-of-alternative-property provision as referring only

to whether Amtrak could provide service using an alternative

route, not whether a lesser interest in property would suffice to

meet Amtrak's needs.

2. The parties' challenges to the ICC's just compensation finding

as well as certain other issues should be resolved on remand.

286 U.S. App. D.C. 1, 911 F.2d 743, reversed and remanded.

Kennedy, J., delivered the opinion of the Court, in which

Rehnquist, C. J., and Stevens, O'Connor, Scalia, and Souter, JJ.,

joined. White, J., filed a dissenting opinion, in which Blackmun

and Thomas, JJ., joined.

-------------------------------

Nos. 90-1419 and 90-1769

--------

NATIONAL RAILROAD PASSENGER CORPORATION,

et al., PETITIONERS 90-1419 v.

BOSTON AND MAINE CORPORATION et al.

INTERSTATE COMMERCE COMISSION AND

UNITED STATES, PETITIONERS 90-1769 v.

BOSTON AND MAINE CORPORATION et al.

on writs of certiorari to the united states court of

appeals for the district of columbia circuit

[March 25, 1992]

Justice Kennedy delivered the opinion of the Court.

The Interstate Commerce Commission (ICC) issued an order, upon

the request of petitioner National Railroad Passenger

Corporation, requiring conveyance of 48.8 miles of railroad track

from respondent Boston and Maine Corporation (B&M) to the

Corporation. In these consolidated cases we must decide whether

the ICC's decision was based on a reasonable interpretation and

application of 402(d) of the Rail Passenger Service Act, 45 U. S.

C. 562(d), the statute the Corporation invoked in the proceeding.

We hold the ICC's decision is authorized by the statute, and so

reverse the judgment of the Court of Appeals for the District of

Columbia Circuit, which set aside the agency's action.

I

The National Railroad Passenger Corporation, or Amtrak, is a

private, for-profit corporation created by Congress in the Rail

Passenger Service Act of 1970 (RPSA), Pub. L. 91-518, 84 Stat.

1328, 45 U. S. C. 501 et seq. The purpose of Amtrak is to

provide modern and efficient intercity and commuter rail

passenger service. 501, 541. Amtrak is not an agency or

instrumentality of the United States Government, 541, but it has

been supported over the years by congressional appropriations.

Most of Amtrak's passenger trains run over existing track systems

owned and used by freight railroads. In the RPSA Congress

authorized Amtrak to enter into "trackage rights" agreements

which would allow Amtrak to use those tracks. When Amtrak and a

freight railroad are unable to agree on the terms of such an

agreement, Amtrak may request the ICC to order the track to be

provided on reasonable terms. 562(a).

/* An unusual but not uncommon federal practice of chartering

quasi-public corporations. */

In 1973 Congress amended the RPSA to add subsection (d) of 402,

45 U. S. C. 562(d). Section 562(d) provides in pertinent part:

"(1) If the Corporation [Amtrak] and a railroad are unable to

agree upon terms for the sale to the Corporation of property

(including interests in property) owned by the railroad and

required for intercity rail passenger service, the Corporation

may apply to the Commission [ICC] for an order establishing the

need of the Corporation for the property at issue and requiring

the conveyance thereof from the railroad to the Corporation on

reasonable terms and conditions, including just compensation.

Unless the Commission finds that: "(A) conveyance of the

property to the Corporation would significantly impair the

ability of the railroad to carry out its obligations as a common

carrier; and "(B) the obligations of the Corporation to provide

modern, efficient, and economical rail passenger service can

adequately be met by the acquisition of alternative property

(including interests in property) which is available for sale on

reasonable terms to the Corporation, or available to the

Corporation by the exercise of its authority under section 545(d)

of this title, "the need of the Corporation for the property

shall be deemed to be established and the Commission shall

order the conveyance of the property to the Corporation on such

reasonable terms and conditions as it may prescribe, including

just compensation." Amtrak may condemn nonrail property under a

somewhat similar provision, 545(d), a statute not at issue here.

The Amtrak train the "Montrealer" began offering passenger

service between Washington, D.C. and Montreal in 1972. In parts

of Massachusetts, Vermont, and New Hampshire the train used the

tracks of the Connecticut River Line (Conn River Line), portions

of which are owned by B&M and other portions by the Central

Vermont Railroad (CV). B&M and CV have operated freight trains

on the Conn River Line under reciprocal trackage rights

agreements dating back to 1930.

In 1977 Amtrak entered into a trackage rights agreement with B&M

under which B&M agreed to maintain its portions of the Conn River

Line. Those portions include a 48.8 mile segment of track on the

Conn River Line between Brattleboro and Windsor, Vermont. This

is the segment of track at issue here. At first the arrangement

to maintain the track proceeded well, but in the early 1980's

problems developed. Guilford Transportation Industries, Inc.,

purchased B&M out of bankruptcy, and purchased also a railroad

operating a parallel line. Amtrak's claim is that neglect of

track maintenance resulting from this purchase caused delays in

Montrealer service. Maintenance of the Brattleboro-Windsor track

was so poor that at points the train was slowed to five miles an

hour. Negotiations for better maintenance were unsuccessful. In

April 1987 Amtrak was forced to discontinue its Montrealer

service.

Congress responded to these events in July of 1987 by

appropriating $5 million to upgrade the Montrealer route. Act of

July 11, 1987, Pub. L. 100-71, 101 Stat. 447-448. Amtrak decided

not to spend the money to upgrade the Conn River Line while B&M

continued to own it, because in Amtrak's view B&M could not be

relied upon to maintain the track once restored. Amtrak began

negotiations with CV, and in early 1988 reached a preliminary

agreement. Amtrak promised to use its statutory condemnation

power to acquire the 48.8 miles of track in question, to at once

reconvey the track to CV, and to provide up to $3.1 million to

upgrade and rehabilitate the segment. In return, CV promised to

provide the balance of the funds necessary to upgrade the track,

to maintain the track for 20 years in a condition meeting

Amtrak's standards, to grant Amtrak trackage rights for 20 years,

and to grant B&M trackage rights to serve its existing customers.

As a prerequisite to invoking 562(d), Amtrak made an offer to B&M

to purchase the segment for $1 million, on a take-it-or-leave-it

basis. B&M offered to negotiate the terms under which it would

be willing to upgrade the segment, and stated, "it appears clear

that there is no need to pursue the very complex `offer to

purchase' set forth in your letter." App. 60. B&M's refusal to

accept the offer seems to have been anticipated by Amtrak and CV,

as indicated by an internal CV Memorandum written in January,

1988. App. 94.

Interpreting the B&M communication as a rejection of its offer,

Amtrak instituted this proceeding before the ICC to compel

conveyance of the track. CV filed a simultaneous request for an

exemption from ICC regulation for its acquisition of the segment

upon reconveyance from Amtrak.

B&M assessed the transaction as a significant shift in its long

competition with CV for freight traffic. CV already owned large

parts of the Conn River Line and after the proposed transaction

it would own most of it. Though B&M would have trackage rights,

CV would gain not only ownership of the segment, but also the

right to obtain new customers on its route. B&M alleged this

gave a new advantage to CV's corporate parent, the Canadian

National Railway Company, for each railroad links up with

competing companies in Canada. CV's lines link to Canadian

National, while B&M's lines link to the Canadian Pacific, Ltd.,

Canadian National's competitor. B&M challenged the transaction

as simply a device to shift ownership among railroads, not to

give ownership to Amtrak which, B&M argued, was the sole purpose

of the condemnation provision.

B&M filed initial objections to the 562(d) proceeding on two

grounds: that Amtrak had not shown that the parties were unable

to agree on reasonable terms of sale, and that 562(d) did not

authorize condemnation of railroad lines. The ICC rejected B&M's

arguments and in a condemnation proceeding held that Amtrak had

shown the inability of the parties to agree to terms. It ruled

that 562(d) covers railroad tracks because tracks are "rail

property `required for intercity rail passenger service."' App.

to Pet. for Cert. in No. 90-1419, pp. 130a-133a. B&M next sought

to convert the proceeding into a trackage rights proceeding under

562(a), but the ICC again rejected B&M's position, holding that

Amtrak had an "election of remedies" under 562 and so had no

obligation to seek trackage rights under subsection (a) before

invoking subsection (d). Id., at 115a-116a. Meanwhile, CV and

the States of Vermont and Massachusetts, as well as numerous

other parties, intervened in the ICC proceeding. (CV appears as

a petitioner before this Court, and Vermont and Massachusetts

support petitioners.)

This was the first decided case involving Amtrak's condemnation

powers under 562(d). Id., at 39a. The ICC issued its final

decision in 1988 and ordered conveyance of the segment with just

compensation of $2,373,286. It reaffirmed earlier rulings and

found that Amtrak "ha[d] met the statutory criteria for the

institution of a proceeding" under 562(d). Id., at 40a-42a, 81a.

The ICC concluded that the presumption of Amtrak's need for the

track contained in 562(d)(1) was applicable. In its view both

statutory criteria must be met to rebut the presumption, and B&M

had established neither. As to alternative property (subsection

(B)), the ICC found that no reasonable alternative route existed

for the Montrealer service. And as to significant impairment of

B&M's ability to carry out its common carrier obligations

(subsection (A)), the ICC found that because B&M had been awarded

just compensation and could continue to serve its customers under

the trackage rights agreement which was part of the transaction,

its ability had not been impaired. Id., at 45a-46a. The bulk of

the ICC's final decision deals with the question of just

compensation, which is not before this Court. See infra.

On petition for review, a divided panel of the Court of Appeals

for the District of Columbia Circuit granted the petition and

remanded the matter to the ICC for further proceedings. 286 U.

S. App. D.C. 1, 911 F.2d 743 (1990). The majority held that

562(d) does not permit Amtrak to condemn railroad property which

it intends to reconvey to another railroad. It acknowledged that

the ICC had interpreted 562 in a different way, and that in the

usual course judicial deference would be given to its

interpretation under the principles enunciated in Chevron U.S.A.

Inc. v. Natural Resources Defense Council, Inc., 467 U. S. 837

(1984); but the court concluded 562(d) is unambiguous in light of

its language and history, and so no deference was due. The panel

majority reasoned that because Amtrak did not intend to retain

the track to be condemned, it needed only its use, not its

ownership. As Amtrak could obtain use of the property by

obtaining either a trackage rights agreement under 562(a), or by

condemning an easement under 562(d), the entire fee interest was

not "`required for intercity rail passenger service."' 286 U. S.

App. D.C., at 8, 911 F.2d, at 750. The majority stated that its

holding was confirmed by other considerations, including: (1)

the potential constitutional problems, under the Takings Clause,

raised by the ICC's interpretation of 562(d); (2) the structure

of 562, which indicated an intent on the part of Congress to

relegate Amtrak to trackage rights under 562(a) when seeking only

the use of track; and (3) Congress' policy against cross-

subsidization between sectors of the railroad industry, which the

majority concluded would have been violated by this transaction.

Judge Ruth B. Ginsburg concurred separately, rejecting the

majority's interpretation of the statute, but concluding that a

remand to the ICC was necessary because the ICC had not made

adequate findings to determine whether Amtrak in fact needed to

shift ownership of the segment from B&M to CV to protect its

interests. Id., at 11-13, 911 F.2d, at 753-755. This factual

question, whether Amtrak's portrayal of a recalcitrant B&M is

accurate, remains in dispute. Under our resolution of the case,

however, the issue need not be reached.

Amtrak and the ICC filed petitions for rehearing, and while the

petitions were pending Congress amended 562(d). The amendment,

adopted in specific response to the Court of Appeals' decision in

this case, added the following sentence to 562(d)(1): "The

Corporation may subsequently convey title or other interest in

such property to a third party, if such reconveyance is found by

the Commission to further the purposes of this Act." Independent

Safety Board Act Amendments of 1990 9(a), Pub. L. 101-641, 104

Stat. 4658. The amendment was made applicable to all pending

cases, 9(b), and B&M does not dispute that it applied in this

case even while it was before the Court of Appeals on rehearing.

Brief for Respondent B&M 33-35. The Court of Appeals considered

the 1990 amendment, but denied rehearing nonetheless. 288 U. S.

App. D.C. 196, 925 F.2d 427 (1991). The panel majority held that

while 9 made it clear Amtrak was authorized to reconvey condemned

property "subsequent to a condemnation that is otherwise valid

under [562(d)]," it did not change the statutory limitation that

the property be "`required for intercity rail passenger service"'

in the first place. Id., at 197, 925 F. 2d, at 428 (emphasis in

original). The majority reasoned that since its original decision

was based on Amtrak's failure to satisfy that requirement, the

amendment did not affect its holding. The majority also

distinguished a case from the Second Circuit, National R.R.

Passenger Corp. v. Two Parcels of Land, 822 F.2d 1261 (1987),

cert. denied 484 U. S. 954, which had interpreted 545(d)(1) (the

provision authorizing Amtrak to condemn nonrail property) to

permit reconveyance following condemnation. 288 U. S. App. D.C.,

at 196-197, 425 F. 2d, at 427-428. In a separate opinion, Judge

Ginsburg wrote that the amendment confirmed her view that the ICC

had not misinterpreted the statute, but that a remand remained

necessary for further factual determinations.

/* As we know now. Judge Ginsburg has been nominated for a seat

on the U.S. Supreme Court. The Court here appears to be rather

patiently explaining that Congress was sending a message to the

appeals court. ""My lack of education never hurt me none, since I

could always read the handwriting on the wall."" [Paul Simon]

Amtrak and CV, in No. 90-1419, and the ICC, in No. 90-1769, filed

separate petitions seeking review of the Court of Appeals'

decision. We granted certiorari and consolidated the cases. 502

U. S. --- (1991). We now reverse.

II

The primary question raised by the case is a straightforward

matter of statutory interpretation: whether 562(d), as amended,

authorizes the condemnation and transaction approved by the ICC

but set aside by the Court of Appeals. The Court of Appeals

disallowed the transaction based on its own interpretation of the

language "required for inter-city rail passenger service" in

562(d)(1). In so holding it limited Amtrak's condemnation

authority to property which was necessary, in the sense of

indispensable, to Amtrak's operations. The ICC interpreted the

relevant statutory language to give Amtrak more latitude, and it

is our task to determine whether the agency had authority for its

statutory interpretation.

Judicial deference to reasonable interpretations by an agency of

a statute that it administers is a dominant, well settled

principle of federal law. We relied upon it in Chevron U.S.A.,

supra, and have reaffirmed it often. See, e.g., K Mart Corp. v.

Cartier, Inc., 486 U. S. 281, 292-293 (1988); Pauley v.

Bethenergy Mines, Inc., 501 U. S. ---, --- (1991). These

decisions mandate that when a court is reviewing an agency

decision based on a statutory interpretation, "if the statute is

silent or ambiguous with respect to the specific issue, the

question for the court is whether the agency's answer is based on

a permissible construction of the statute." Chevron U.S.A., 467

U. S., at 843. If the agency interpretation is not in conflict

with the plain language of the statute, deference is due. K Mart

Corp., 486 U. S., at 292. In ascertaining whether the agency's

interpretation is a permissible construction of the language, a

court must look to the structure and language of the statute as a

whole. Id., at 291; Sullivan v. Everhart, 494 U. S. 83, ---

(1990). If the text is ambiguous and so open to interpretation

in some respects, a degree of deference is granted to the agency,

though a reviewing court need not accept an interpretation which

is unreasonable.

/* This is the central holding of this case, and is worthy of

note. The U.S. Supreme Court through its decisions usually

attempts to suggest which way it would like lower courts to move

in the future. Appealate courts tend to view their job not as

error correction so much as law creation and indication of where

the lower Courts should move. This opinion is a push towards

higher deference to federal agencies decisions as to

interpretation of the laws that they administer. */

Under these principles the ICC's interpretation of 562(d) was

permissible, and the Court of Appeals' decision was in error to

disregard it. While the ICC's opinion is not explicit in all of

its details, the agency's decision is based on a reading of the

statute quite different from the Court of Appeals'. The ICC

agreed that property Amtrak seeks to condemn under 562(d) must be

"required for intercity rail passenger service." It determined

however that the word "required" need not mean, as the Court of

Appeals' opinion suggests, indispensable or necessary. Instead,

the ICC gave effect to the statutory presumption of Amtrak's need

for the track, and in so doing implemented and interpreted the

statute in a manner that comports with its words and structure.

The analysis of the Court of Appeals is inconsistent with the

agency's interpretation of the statutory presumption of need.

The ICC's position before the Court is that "required" can also

mean "useful or appropriate," Brief for Petitioners in No. 90-

1769, p. 17, and that the order under review adopted that

meaning. We agree that the manner in which the ICC's applied the

statute in this case has that interpretation as its basic

premise. App. to Pet. for Cert. in No. 90-1419, pp. 42a-46a.

In its brief the ICC cites a dictionary definition in support of

its view. Brief for Petitioners in No. 90-1769, p. 17, citing

Webster's Third New International Dictionary 1929 (1986). The

existence of alternative dictionary definitions of the word

"required," each making some sense under the statute, itself

indicates that the statute is open to interpretation.

/* Editor's note: I can't wait to try that one out in Court! */

See Sullivan v. Everhart, supra. Few phrases in a complex scheme

of regulation are so clear as to be beyond the need for

interpretation when applied in a real context. Further, the

structure of the provision reinforces our conclusion that

statutory interpretation is appropriate and that the Court of

Appeals' interpretation is itself open to serious question. The

court defined the word "required," to establish a separate

condition that the property sought to be condemned be necessary

(indispensable) for Amtrak's operations, a view which is not

without support. See e.g., American Heritage Dictionary of the

English Language 1105 (1981). This interpretation, though,

leaves little substance to the statutory presumption in favor of

Amtrak's need, and so is in clear tension with that part of the

statute.

We decide that 562(d) is ambiguous in some respects and conclude

that the ICC's interpretation of the word "required" is a

reasonable one. We defer to its interpretation. This is not to

say that the issue is beyond dispute, but these alternative

interpretations are as old as the jurisprudence of this Court.

In McCulloch v. Maryland, 4 Wheat. 316, 413 (1819), Chief Justice

Marshall, in a choice of interpretations with some parallels to

this one, read the word "necessary" to mean "convenient, or

useful," rejecting a stricter reading of the term which would

have limited congressional power under the Constitution to the

"most direct and simple" means available. We think that as a

matter of definition and interpretation in the context of this

statute it is plausible, if not preferable, to say that Amtrak

can find that an acquisition is required when it is a useful and

appropriate way to accomplish its goals.

The agency's interpretation is consistent also with the 1990

statutory addition enacted by the Congress. While the amendment

does not modify the specific language of 562(d) at issue here, it

confirms the ICC's view. The interpretation given to 562(d) by

the Court of Appeals and B&M, on the other hand, would make the

amendment superfluous, because if the word "required" has the

strict meaning they seek to attribute to it, condemnations by

Amtrak would seem to be barred whenever Amtrak's purpose is to

reconvey the property.

Contrary to the position of the dissent, we are not "deferring to

what we imagine an agency had in mind." Post, at 4. Rather, we

defer to an interpretation which was a necessary presupposition

of the ICC's decision. We recognize the well-established rule

that an agency's action may not be upheld on grounds other than

those relied on by the agency. SEC v. Chenery Corp., 318 U. S.

80, 88 (1943). But the fact that the ICC did not in so many words

articulate its interpretation of the word "required" does not

mean that we may not defer to that interpretation, since the only

reasonable reading of the agency's opinion, and the only

plausible explanation of the issues that the agency addressed

after considering the factual submissions by all of the parties,

is that the ICC's decision was based on the proffered

interpretation. Chenery does not require a remand under those

circumstances. It is noteworthy in this regard that neither

party contends the ICC's decision was not informed and governed

by this statutory interpretation. B&M's primary argument to the

Court is that the word required must mean necessary. Brief for

Respondent B&M 16, 22, 44. But this, as we have said, is quite

inconsistent with the statutory presumption of need to which the

ICC gave effect.

There is no dispute on this record that Amtrak intends to use the

condemned track for its Montrealer service. Under the ICC's view

that use is sufficient to satisfy the statutory command that the

rail property be "required for intercity rail passenger service."

This is a reasonable interpretation and application of the RPSA.

And it ends the judicial inquiry on this point.

What we have said also answers Judge Ginsburg's concern that the

ICC must make specific findings regarding Amtrak's actual need

for the condemnation. The contention that such a finding was

necessary, to implement the statutory criterion that the property

be "required for intercity rail passenger service," was the basis

for Judge Ginsburg's concurrence in the Court of Appeals. 286 U.

S. App. D.C., at 12, 911 F.2d, at 754. That position, however,

appears to be based on the same interpretation of the word

"required" as adopted by the Court of Appeals' majority, and so

is inconsistent with the ICC's interpretation. The ICC contends

that the factual finding is not mandated. It argues that the

structure of the statute, combined with the presumption created

by the statute of Amtrak's need for the property sought, creates

a strong inference that the statute authorizes Amtrak to make a

reasonable business judgment that condemnation of the property is

advisable. We agree. The ICC's oversight responsibility,

exercised by enforcing the "required for intercity rail passenger

service" language as interpreted by the agency, is limited to

ensuring that the condemned property will be used in Amtrak's

rail operations. The further determination of need is delegated

to Amtrak, unless the statutory presumption is rebutted; and it

is not rebutted here. Indeed, as our discussion above indicates,

supra, at __, it seems to us that any other interpretation may be

inconsistent with the statutory presumption of need. In all

events, the ICC's interpretation is a reasonable one and we may

not substitute a different view.

Arguing against the ICC's interpretation, B&M cites to us cases

such as United States v. Carmack, 329 U. S. 230, 243, n. 13

(1946), which suggest that delegations of eminent domain power to

private entities are of a limited nature. We do not believe that

argument has any relevance here because Amtrak does not exercise

eminent domain power under 562(d). Rather, the statute gives

that power to the ICC, a Government agency. To be sure, the

statute creates a presumption in favor of conveyance to Amtrak.

But the ICC must assess the impact of any condemnation and make a

determination as to just compensation. Since 562(d) is a proper

exercise of regulatory authority, and the ICC's oversight of

Amtrak is intended to ensure compliance with the statute, the

eminent domain power here is not private.

Furthermore, this case turns on the need for deference to the

ICC, not Amtrak. There is nothing in the cases B&M cites

contradicting the rule of judicial deference to an agency's

statutory interpretation, even when the statute is one

authorizing condemnation of private property. In short, the

principle advanced by B&M does not prevail over Chevron's rule of

deference.

We also reject B&M's constitutional objections. B&M claims that

562(d) as interpreted by the agency violates the "public use"

requirement of the Fifth Amendment's Takings Clause, because the

transaction leaves unchanged the use made by Amtrak of the

condemned track. B&M's position cannot be reconciled with our

precedents. We have held that the public use requirement of the

Takings Clause is coterminous with the regulatory power, and that

the Court will not strike down a condemnation on the basis that

it lacks a public use so long as the taking "is rationally

related to a conceivable public purpose." Hawaii Housing

Authority v. Midkiff, 467 U. S. 229, 240-241 (1984); see also

Berman v. Parker, 348 U. S. 26, 32-34 (1954). In Midkiff we

upheld land reform legislation which authorized condemnations for

the specific purpose of transferring ownership to another private

party, in order to eliminate a land oligopoly. In Berman we

permitted land condemnations which contemplated reselling the

land to redevelopers, as part of a plan to restore dilapidated

sections of the District of Columbia. In both Midkiff and

Berman, as in the present case, condemnation resulted in the

transfer of ownership from one private party to another, with the

basic use of the property by the government remaining un-changed.

The Court held these exercises of the condemnation power to be

constitutional, as long as the condemning authorities were

rational in their positions that some public purpose was served.

Those holdings control here, for there can be no serious argument

that the ICC was irrational in determining that the condemnation

will serve a public purpose, by facilitating Amtrak's rail

service. That suffices to satisfy the Constitution, and we need

not make a specific factual determination as to whether the

condemnation will accomplish its objectives. Midkiff, supra, at

242-243.

As a last effort, B&M argues that this matter must be remanded to

the ICC because the agency did not make adequate and accurate

findings regarding several different matters. B&M claims that

Amtrak failed to prove the parties were "`unable' to agree" on

terms of sale. In B&M's view 562(d) demands that Amtrak engage

in "good faith . . . negotiations" before it may invoke its

condemnation powers. Brief for Respondent B&M 42. The ICC

construed the language of 562(d) in a more narrow fashion, to

mandate nothing more than a factual determination that the

parties will not be able to reach agreement through further

negotiations. App. to Pet. for Cert. in No. 90-1419, pp. 130a-

131a ( "Nothing in this record provides any indication that

Amtrak and B&M will ever reach agreement on terms of sale" ).

This is a reasonable interpretation of the phrase "unable to

agree upon terms for the sale," and we do not substitute a

different view. Thus the agency did not err in concluding that

this statutory prerequisite was satisfied.

B&M argues further that the ICC made inadequate factual findings

in concluding: (1) that this conveyance will not significantly

impair B&M's ability to carry out its obligations as a common

carrier, 562(d)(1)(A), and (2) that Amtrak's obligations cannot

be met by the acquisition of alternative property, 562(d)(1)(B).

As to significant impairment, B&M's argument, like the decision

of the Court of Appeals on this point, 286 U. S. App. D.C., at 8-

9, 911 F.2d, at 750-751, relies on the notion that in ang

impairment the ICC may consider only the conveyance itself, not

any mitigating measures adopted in response to the conveyance

such as the grant of trackage rights to B&M. We find no basis in

the text or structure of 562(d) for this position, and cannot say

that the statute must be interpreted to mandate such a

restrictive inquiry. The ICC was not unreasonable in considering

the effect of the trackage rights agreements and the just

compensation award in assessing significant impairment; and the

ICC's conclusion, that B&M's ability to carry out its common

carrier obligations will not be impaired by the transaction in

any significant way, is supported by substantial evidence. As to

the availability of alternative property, the ICC interpreted

that provision as referring only to whether Amtrak could provide

service using an alternative route, not whether a lesser interest

in property would suffice to meet Amtrak's needs. Again, this

was a reasonable reading to which we defer. Since B&M would have

to prevail on both the significant impairment and alternative

property issues to rebut Amtrak's presumption of need, there can

be no doubt that the ICC's finding that Amtrak established its

need for the property must be affirmed.

III

For the reasons we have stated, we hold that the ICC did not

exceed its authority in ordering conveyance of the 48.8 mile

segment of the Conn River Line from B&M to Amtrak. Because of its

contrary holding on this point, the Court of Appeals did not

address the parties' challenges to the ICC's just compensation

finding as well as certain other issues. 286 U. S. App. D.C., at

11, 911 F. 2d, at 753. These questions should be resolved on

remand. The judgment of the Court of Appeals is reversed, and

the case is remanded for further proceedings consistent with this

opinion.

It is so ordered.

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Justice White, with whom Justice Blackmun and Justice Thomas

join, dissenting.

The majority opinion proceeds from the well-established principle

that courts should defer to permissible agency interpretations of

ambiguous legislation. Chevron U.S.A. Inc. v. Natural Resources

Defense Council, Inc., 467 U. S. 837, 843 (1984); Pauley v.

Bethenergy Mines, Inc., 501 U. S. ___, ___ (1991). I have no

quarrel with that general proposition. I do, however, object to

its invocation to justify the majority's deference, not to an

agency interpretation of a statute, but to the post hoc

rationalization of government lawyers attempting to explain a gap

in the reasoning and factfinding of the Interstate Commerce

Commission (ICC or Commission). Motor Vehicle Mfrs. Assn. of

United States, Inc. v. State Farm Mut. Automobile Ins. Co., 463

U. S. 29, 50 (1983).

Section 402(d) of the Rail Passenger Service Act (RPSA), codified

at 45 U. S. C. 562(d), provides that Amtrak may apply to the ICC

for an order directing the conveyance of another railroad's

property if Amtrak can meet two conditions: Amtrak and the other

railroad must be unable to agree upon terms for sale of the

property, and the property must be "required for intercity rail

passenger service." If these conditions are met, "the need of

[Amtrak] for the property shall be deemed to be established," and

the other railroad will be able to retain its property only if it

can rebut the strong presumption of Amtrak's need. Ibid.

Because conferring upon Amtrak the presumption of need will

determine the outcome of most disputes under this section, the

two conditions that Amtrak must establish to receive the benefit

of the presumption assume particular importance. However, in the

present case, the ICC failed to address one of these factors.

Although the Commission determined that the parties had been

unable to come to terms for sale of the disputed property, see

App. to Pet. for Cert. in No. 90-1419, pp. 130a-131a, it neither

interpreted nor applied the second condition, that the property

be "required for intercity rail passenger service." Instead,

after rejecting respondent's argument that Amtrak could restore

Montrealer service by obtaining trackage rights or an easement,

the ICC simply concluded that "Amtrak has demonstrated sufficient

reason to justify acquisition of ownership of the line." Id., at

43a.

The majority acknowledges that "the ICC's opinion is not explicit

in all of its details," see ante, at 9, but nevertheless

concludes that the Commission's reading of the statute is

entitled to deference because it "gave effect to the statutory

presumption of Amtrak's `need' for the track, and in so doing

implemented and interpreted the statute in a manner that comports

with its words and structure." Ibid. But this begs the question

of what showing Amtrak must make to establish that the track is

"required" so that Amtrak may therefore obtain the benefit of the

presumption of need.

The simple fact is that the ICC never addressed this point, and

therefore failed to construe a key portion of the statute. The

omission is particularly significant because this is the first

case treating Amtrak's condemnation powers under 402(d) of the

Act; it will guide future adjudications.

Rather than acknowledging the ICC's omission and remanding for

clarification and factfinding, the majority relies on the

Government's argument that the Commission must have interpreted

the word "required" as meaning "useful or appropriate." Ibid.

But this interpretation was not developed by the ICC during its

administrative proceedings. Indeed, the explanation was not even

proposed in the Commission's argument to the Court of Appeals.

This ICC definition of "required" debuted in the Commission's

briefs before this Court. It is nothing more than a creation of

appellate counsel, concocted to fill the gaps in the Commission's

analysis. "The short-and sufficient-answer to [this] submission

is that the courts may not accept appellate counsel's post hoc

rationalizations for agency action. . . . It is well established

that an agency's action must be upheld, if at all, on the basis

articulated by the agency itself." Motor Vehicle Mfrs. Assn.,

supra, at 50 (emphasis added), citing Burlington Truck Lines,

Inc. v. United States, 371 U. S. 156, 168 (1962); SEC v. Chenery

Corp., 332 U. S. 194, 196-197 (1947); American Textile Mfrs.

Institute, Inc. v. Donovan, 452 U. S. 490, 539 (1981).

Therefore, the majority is simply wrong in asserting that, even

though "the ICC did not in so many words articulate its

interpretation of the word `required,"' the Court may

nevertheless defer to the Commission's decision. See ante, at 11

(emphasis added).

Because of the gap in the ICC's interpretation of the statute,

"[t]here are no findings and no analysis here to justify the

choice made, no indication of the basis on which the Commission

exercised its expert discretion." Burlington Truck Lines, Inc.,

supra, at 167. The majority concludes, again based on the

agency's presumed interpretation of the statute, that the

Commission was not obligated to make specific findings as to

whether the property was "required for intercity rail passenger

service." See ante, at 12. This magnifies the ICC's mistake; an

administrative "agency must make findings that support its

decision, and those findings must be supported by substantial

evidence." Burlington Truck Lines, Inc., 371 U. S., at 168.

Deferring to a federal agency's construction of the legislation

that it is charged with administering is one thing. But

deferring to inferences derived from reading between the lines of

an agency decision or excerpted from the brief of a government

lawyer is another matter entirely. "For the courts to substitute

their or counsel's discretion for that of the Commission is

incompatible with the orderly functioning of the process of

judicial review." Id., at 169. Because the ICC has failed to

provide a clear, authoritative construction of "required for

intercity rail passenger service," we should return this case to

the Commission so that the agency can do its job properly. But

we should not strain the Chevron principle by deferring to what

we imagine an agency had in mind when it applied a statute.

Therefore, I respectfully dissent.

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