Clearing the tracks: CEI’s three-point blueprint to DOT deregulation 

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Background 

The Trump administration has made good on some of its promises of deregulation – namely with two executive orders from the beginning of this year, EO 14219 and EO 14192. Within these orders, President Trump directed agencies to review regulations for legality, cost, and effects on innovation. The Department of Transportation (DOT) accordingly issued an RFI (Request for Information) soliciting public suggestions for existing DOT regulations or guidances that could be modified or repealed “consistent with law,” to ensure that “DOT administrative actions do not undermine the national interest and that DOT achieves meaningful burden reduction.”  

This request is admirable. By soliciting public comments regarding deregulation, DOT and other agencies taking similar actions show that the voice of the public does matter. 

CEI took an interdisciplinary approach in its reply to this RFI. In three comments, we proposed regulatory reform in adjudication, unnecessary freight train mandates, and federal preemption. 

The minimum train crew rule 

CEI’s first DOT comment, authored by research fellow Sean Higgins, takes on a requirement instituted last year under the Biden administration. This rule states that all trains must have at least two operators at all times, purportedly to ensure that trains are adequately staffed and have appropriate safeguards in place.  

The rule can cite no data that shows single-operator trains are any less safe than ones with at least two operators. Many lines are already run with only one operator, thanks to the implementation of automation within modern trains. Pragmatically, the only effect that this rule has is stifling innovation by discouraging the development of rail automation. As Sean Higgins states, the rule affects:  

  1. The industry, which faces competition in interstate commerce from trucking, shipping and now drone aircraft; 
  2. The reliability of the nation’s supply chain, which has faced several shocks in recent years due in part to antiquated technology and infrastructure; and 
  3. The broader public, which needs goods delivered quickly and efficiently. 

The FRA’s system of exceptions further proves that this rule does not have a practical purpose. It grandfathers in “Class II and Class III legacy freight train operations” and allows for “special approval of one-person train crew operation not covered by the exception.” All that the rule and its exceptions will accomplish is that powerful railway operations with skilled lobbying operations will have a large competitive edge over other operations without lobbying power. To protect innovation, the railway industry, and the broader public, this rule should be repealed. 

Ensuring lawful regulation 

CEI’s second comment, authored by attorney David McFadden, addresses constitutional violations within DOT’s adjudication system. Although these violations may not have been so apparent when the rules in question were adopted, the Supreme Court’s decision in SEC v. Jarkesy (2024)compels reconsideration of DOT’s adjudicatory procedure. 

Jarkesy held that if a statutory claim is in the nature of an action at common law, the Seventh Amendment is implicated and the right to a jury trial must be preserved. To determine whether or not the claim falls into this category, the most important factor is the nature of the remedy. In the case of Jarkesy, because the civil penalties were meant to “punish and deter, not to compensate,” they are considered an action at common law and can “only be enforced in courts of law.”  

The current adjudicative framework of DOT and several of its sub-agencies does not follow this guideline. Nearly all of DOT’s actions for civil penalties are allowed to be tried administratively. 

 The statutes within DOT’s jurisdiction that authorize civil penalties fall into three categories 

Neither the statute nor DOT’s regulation specifies a mode of recovery. In this situation, a rule should be adopted to provide that the secretary may request the Attorney General to commence a civil action to recover civil penalties for an alleged violation in an appropriate US district court. 

  1. While the statute authorizes judicial adjudications assessing civil penalties, or authorizes both judicial and administrative adjudication, the regulations permit or require actions to be tried administratively. The regulations should be amended to require judicial adjudication of civil penalties. 
  2. The statute authorizes violations to be adjudicated administratively and does not authorize them to be adjudicated judicially. The applicable rules should be amended to state that the Department will not seek civil monetary penalties for violations of such laws until Congress amends them or the Administrative Procedure Act to allow for enforcement by civil actions in district court. 

Taking these steps will allow for the Department of Transportation to achieve its regulatory objectives while staying consistent with the Constitution. 

Reinstate SAFE 1 

CEI’s third comment, authored by senior fellow Marlo Lewis, advises DOT to rescind the Biden administration’s repeal of Part 1 of the Trump administration’s Safer Affordable Fuel-Efficient Vehicles Rule (SAFE 1). The Energy Policy and Conservation Act (EPCA) prohibits states (like California) from adopting or enforcing laws or regulations related to fuel economy standards, and SAFE 1 applied this statute to block California’s tailpipe carbon dioxide emission standards and zero emission vehicle mandates. The Biden administration’s repeal of this rule empowers California to collude with the Environmental Protection Agency (EPA) to upend the fuel economy program Congress established and force automakers to phase out sales of gas- and diesel-powered cars and trucks.  

Reasserting and strengthening SAFE 1’s preemption is essential for DOT to restore lawful regulation and safeguard national interests. The most obvious challenge is one of constitutionality. By allowing California and other states to defy the EPCA, the rule implicitly defies the Supremacy Clause of the US Constitution, which is the source of authority for all federal preemption statutes. 

The repeal of SAFE 1 and the EPA’s subsequent authorization of California’s zero emission vehicle mandates threatens to price many Americans out of the car market and crush consumer freedom. It also underpins the entire Biden-California regulatory agenda and damages the US auto industry’s competitiveness by compelling automakers to discontinue production of many of their top-selling models.  

CEI suggests that the repeal of SAFE 1 be rescinded and a new interpretative rule be put into place that reasserts the EPCA’s preemption of state laws “related to” fuel economy standards. By doing this, NHTSA can bolster consumer choice, auto industry competitiveness, and the authority of the Constitution itself. 

Conclusion 

In these three comments, CEI’s experts underscore changes the Department of Transportation ought to make to align with the Trump administration’s call for “ending Federal overreach and restoring the constitutional separation of powers.”  

As mentioned earlier, DOT is not the only agency making this effort. The Office of Management and Budget, the Department of Health and Human Services, and the Centers for Medicare & Medicaid Services have all made similar requests for information.  

CEI will continue to monitor the administration’s deregulatory agenda. We encourage other agencies to take similar actions in order to ensure that their rules adhere to the Constitution, and do not hinder free market principles.