Posts Tagged ‘Amtrak funding’

Committee OKs Transportation Funding Bill

June 27, 2022

A congressional committee last week approved a bill that provide a 23 percent increase in discretionary spending for public transit, and passenger and freight railroads in federal fiscal year 2023.

The Transportation, and Housing and Urban Development appropriations bill was approved by the transportation subcommittee of the House Appropriations Committee on a voice vote.

The bill is expected to be considered this week by the full Appropriations Committee, which wants to clear spending bills before the July 4th recess.

It would then move to the Senate. The 2023 federal fiscal year begins on Oct. 1.

Much of the appropriations proposed by the bill are above the amounts appropriated for the current fiscal year, but below what was authorized in earlier congressional action.

For example, the bill approves $1.6 billion for Amtrak’s national network. That is an increase over the $1.4 billion appropriated for the current fiscal year but short of the $2.2 billion authorized for FY 2023.

Total Amtrak funding in the bill would be $2.3 billion versus the $3 billion proposed by the Biden administration and $3.3 billion sought by Amtrak.

The passenger carrier had said it needed that level of funding because of “the lingering effects of the COVID-19 pandemic [that] continue to affect revenue and ridership.”

Amtrak said “robust FY 2023 grant funding is needed to enable Amtrak to continue operating our long-distance trains.”

The bill approved last week allocates $500 million for the Federal State Partnership for Intercity Passenger Rail program, which funds capital projects to bring facilities and infrastructure to a state of good repair, improve performance, and expand or establish new intercity passenger rail services.

The Consolidated Rail Infrastructure and Safety Improvements program would receive $630 million. This includes a $150 million set-aside to “support the development of new intercity passenger rail service routes including alignments for existing routes.”

The bill contains language that seeks to prevent Amtrak from reducing or eliminating national network service, stating that Amtrak may not “discontinue, reduce the frequency of, suspend, or substantially alter the route of rail service on any portion of such route,” except in an emergency or during maintenance or construction outages.

No funding was appropriated for the Restoration and Enhancement Grants program, which provides operating assistance grants for initiating, restoring, or enhancing intercity passenger rail transportation.

Instead, the bill says Amtrak may use up to 10 percent of its $1.46 billion national network grant for the activities outlined in the service restoration program.

Amtrak Expects to Need $1B in Annual Federal Funding for the Next Decade

May 9, 2022

Back in 2019 when the much reviled Richard Anderson was president of Amtrak, the nation’s passenger railroad talked a lot about how it was on the cusp of breaking even.

A budget estimate that Amtrak sent to Congress in March 2020 even predicted operating profits by 2025. Those profits were expected to grow over the next decade.

But that same month the COVID-19 pandemic took hold and the bottom fell out for Amtrak and other transportation providers.

America’s Railroad, as Amtrak likes to call itself, lost 97 percent of its ridership and Congress responded by providing Amtrak $3.7 billion in emergency funding in federal fiscal years 2020 and 2021 to stave off bankruptcy.

Although COVID-19 and its variants is still around, the pandemic fears have been waning and passengers are returning to the rails.

Amtrak now projects that it will reach pre-COVID ridership and revenue by FY2024, which begins Oct. 1, 2023.

Yet the passenger carrier’s most recent budget estimates submitted to Congress show a shift in the thinking of Amtrak management about its finances.

Gone are the rosy projections of operating profits. Those have been replaced with an acknowledgement that Amtrak will need federal funding of $1 billion a year over the next decade.

The Eno Center for Transportation has published an analysis of Amtrak’s latest budget estimates that provides an overview of how Amtrak sees its finances playing out in the next several years.

That analysis can be read at https://www.enotrans.org/article/amtrak-concedes-perpetual-1-billion-year-operating-losses/

From my perspective, the most interesting and important points in the analysis written by Jeff Davis are made toward the end because they hint at a coming battle in Congress that some rail passenger advocates may not see coming.

In the past several months Amtrak supporters have been talking up the benefits to intercity rail passenger service of the infusion of money from the Infrastructure Investment and Jobs Act.

The Rail Passengers Association has touted IIJA as an unprecedented if not a once in a lifetime $36 billion investment in passenger rail.

In talking about how transformative this funding will be, RPA has oversold what IIJA is likely to produce. That could be setting up some of its members for future shock.

There is, of course, some truth to the rhetoric being espoused by RPA and other rail passenger advocates. And to his credit RPA head Jim Mathews has hinted that the gains of IIJA could be more fragile than many of his members want to believe.

IIJA has created the potential for expansion of the nation’s rail passenger network. That in turn has led to expectations that have been fed by Amtrak itself proposing an expansive plan known as Amtrak ConnectsUS that would create more than 30 new corridor services.

But expectations are not reality nor do they always become reality.

It is true that the IIJA contains funding that could help launch some of those new services envisioned in Amtrak ConnectsUS.

But what some may not recognize unless they have paid close attention is that IIJA is a capital funding program. It provides not a dime for operating expenses of a single Amtrak train.

Those expenses will be paid for by ticket revenue, public money or both.

Now Amtrak has said that it will not make enough in ticket revenue to pay the expenses of its trains.

For most rail passenger advocates that is no big deal. They have long acknowledged that passenger trains need public funding and have sought to explain that away by saying that all forms of transportation are funded at some level with public funding.

There is some truth to that if you consider that the infrastructure used by airlines and bus companies is paid for in part with public money.

Airlines and bus companies will counter that they pay their “fair share” through user fees and taxes of the cost of that infrastructure, but that’s a debatable proposition that is at best a half truth.

The public funding of airline and bus operations does not stand out as a line item in a budget as does funding of Amtrak operations.

In his analysis, Davis makes a valid point in writing, “Amtrak can claim with some credibility that Congress, through the IIJA, chose to de-emphasize the issue of operating losses.”

He then makes a side-by-side comparison of what the federal code says about Amtrak operations before and after passage of the IIJA.

At first glance, those changes appear to put to rest the notion that Amtrak is expected to be profitable.

But read the language again. Whereas before passage of the IIJA Section  C of 49 U.S.C. §24101 said “Amtrak shall . . . use its best business judgment in acting to minimize United States Government subsidies . . .” the IIJA changed the phrasing to Amtrak shall “maximize the benefits of Federal investments.”

Nothing in the federal code requires Congress to spend money on intercity rail passenger service at all. Likewise, the federal code does not require Congress to spend whatever it takes to maintain the existing Amtrak network forever let alone spend money to expand that network.

That is a significant point because the debate in Congress is not so much about whether Amtrak trains lose money – even if some members try to frame it that way – as it is how much to spend to underwrite those losses.

Since Amtrak’s inception in 1971, some members of Congress have sought to end federal funding of intercity rail passenger service if not put Amtrak out of business.

Those efforts have uniformly failed although at times Congress has reduced its financial support of Amtrak, which in turn led to the discontinuance of some routes and trains.

The last significant shrinkage of routes and services occurred in the early 2000s, the service suspensions that occurred during the COVID-19 pandemic notwithstanding.

It is also noteworthy that those early 2000s service reductions came as a coda to the last time Amtrak proposed major service expansions, many of which never occurred.

In the Eno analysis, Davis notes that when the IIJA was adopted deficit spending was not considered by a majority of members of Congress to be a problem because the nation was still recovering from the fallout of the COVID-19 pandemic.

But now the nation is facing large scale inflation and budget deficits are one factor that drives inflation.

If as many political pundits predict Republicans gain control of one or both chambers of Congress in the November elections Amtrak funding requests may face a more hostile environment.

It may be that federal law doesn’t require Amtrak trains to make a profit, but that means nothing to deficit hawks. It never has and it never will. They have beliefs about what is a legitimate purpose on which to spend public money and what is not. Intercity rail passenger service is among the latter.

And some Republicans have already signaled what they hope to do about Amtrak.

Rep. Rick Crawford (R-Arkansas) introduced the Returning Amtrak to Economic Sustainability Act, which calls for changing the language of 49 USC 24101 to replace  the word “modern in the phrase “intercity passenger and commuter rail passenger transportation” with “economically sustainable.”

The RATES act would also add the phrase “while ensuring route profitability proportional to the Federal share of investment” as well.

It is uncertain if the RATES Act would make it through a GOP-controlled Congress although it likely would receive a more favorable reception than it has in the current Congress controlled by Democrats.

But even if Democrats maintain control of Congress, lawmakers must still deal with the prospect of having to, as Davis put it, “either write the checks for the billion-per-year operating losses over the coming decade, or else use their annual platform to encourage (or require) Amtrak to pay attention to operating losses if they want to avoid writing those checks.”

That could easily lead to environments such as existed in the late 1970s, in the early 1980s and in the late 1990s when Amtrak budget cuts resulted in service reductions.

Rather than enjoying the fruits of a second passenger rail renaissance in which the nation’s passenger train network expands, passenger train advocates will be faced with fighting to save as much existing service as they can if not having to save Amtrak itself.

Amtrak’s budget projections are filled with figures that show how much money long-distance passenger trains lose per passenger.

Those numbers have been used in the past to argue in favor of reducing if not ending federal spending on passenger trains. Don’t be surprised if those arguments surface again.

Richard Anderson is unlikely to return as Amtrak’s president but the political climate could lead to another Amtrak CEO who thinks as Anderson did and behaves as Anderson did in taking aim at long-distance trains for reduction.

Amtrak Seeking $3.3B in FY2023

April 12, 2022

Amtrak is asking Congress for $3.3 billion in grant funding for federal fiscal year 2023.

The passenger carrier said in a statement that accompanied its grant request that the funding will enable it to enter a new era with a historic level of federal investment for capital projects.

CEO Stephen Gardner said funding provided by the Infrastructure Investment and Jobs Act provides Amtrak with “a clear plan to transform and grow our business.”

“Our requested FY2023 annual grant will allow Amtrak to continue operating our long-distance trains, which connect communities across the nation; to continue partnering with states to provide short-distance corridor service; and to continue normalized replacement (necessary maintenance and sustainment) of aged assets on the Northeast Corridor, all while facing new levels of uncertainty and disruption from the ongoing COVID-19 pandemic,” Gardner said in the statement.

The grant request includes $1.1 billion for the Northeast Corridor and $2.2 billion for the national network.

The budget request projects that ridership in FY2023 will be 28.8 million. During FY2019 Amtrak handled 32.5 million passengers. It carried 16.8 million in FY2020 and 12.2 million in FY2021. Expected ridership for FY2022 is 23.2 million.

Projected revenue for FY2023 is $1.98 billion in gross ticket revenue; $3.1 billion in total operating revenue; and an adjusted loss of $1 billion.

Amtrak Gets Boost in FY2022 Budget

March 13, 2022

Amtrak will receive an increase in funding after Congress last week approved an appropriations bill for federal fiscal year 2022.

The $1.5 trillion government funding bill also enables federal agencies to begin spending money earmarked for programs in the Infrastructure Investment and Jobs Act.

That includes $7.3 billion for a rail passenger grant program to be administered by the Federal Railroad Administration over the next five years.

The FRA is in the process of creating guidelines for the program which are expected to be released in late spring when state and local agencies will begin applying for grants from the program.

As for FY2022, Amtrak will receive $875 million for the Northeast Corridor and $1.4 billion for the national network. Those figures compared to $700 million and $1.3 billion respectively that was appropriated in FY2021.

The FRA received $241 million, the Federal-State Partnership program received $100 million and $625 was approved for Consolidated Rail Infrastructure and Safety Improvements grants for FY2022

The budget bill also contains a $300,000 earmark to the City of Ypsilanti, Michigan, to construct a rail passenger station.

Located between Ann Arbor and Detroit, Ypsilanti is on Amtrak’s Chicago-Detroit (Pontiac) corridor but no Wolverine Service trains currently stop there.

Select Amtrak trains did stop in Ypsilanti, the home of Eastern Michigan University, between Jan. 20, 1975, and Jan. 13, 1984.

Rail Passenger Funding, Running Amtrak on Time, New NS President Didn’t Impress Some Workers

January 17, 2022

Bit and pieces of insights into the workings of railroad world . . .

I recently received in my email inbox a message quoting Evan Stair of the Friends of the Southwest Chief group in which he suggested that the promise of new and expanded service contained in the Amtrak Connects US plan is largely a mirage.

Stair, whose group has been promoting additional Amtrak service along Colorado’s Front Range and extending the Heartland Flyer north of Oklahoma City to connect with the Chief in Kansas, was commenting on a Bloomberg News story in which Amtrak President Stephen Gardner said the plan to add 39 new routes will require state financial support.

Amtrak has estimated the plan will cost $75 billion to implement.

In his interview, Gardner characterized the federal government as the capital partner but the ongoing operating expenses are the responsibility of the states and Amtrak.

And Amtrak has made clear that it’s responsibility to pay operating expenses will only last at best for five years. After that states will be on the hook to pay operating expenses as is the case now with state-supported corridors on the West Coast, in the Midwest and along the East Coast.

“I frankly believe the Amtrak Connects US program will result in few, if any new routes,” Stair wrote. “States are unlikely to commit to long-term operational dollars without some federal operational matches.”

Stair is probably right about that but could have gone even farther. It may not be realistic to think that states that are not now and/or have never paid Amtrak for corridor service will do so in the future even with a short-term Amtrak funding match for operational expenses.

Yes, I’m talking about you, Ohio.

Speaking of Amtrak, Canadian Pacific CEO Keith Creel told a Midwest shippers conference in Chicago last week that he was “proud” of having reached an agreement with the passenger carrier to allow for the prospect of additional passenger service on routes operated by CP and it merger partner Kansas City Southern.

As reported by Trains magazine, Creel also talked about how CP has become one of Amtrak’s best host railroads in dispatching its trains on time. It wasn’t always that way.

“Five years ago, six years ago, we didn’t lead the industry in Amtrak service,” Creel said.

He went on to say that his 30 years as an operating officer taught him that it’s not easy for a freight railroad to coexist with passenger service.

“I understand the conflicts sometimes and the tradeoffs sometimes when you mix high speed passenger rail with what is, in comparative terms, low-speed freight rail,” Creel said. “I understand the track geometry challenges, I understand the speed challenges. But I also understand that if you prioritize right, and there’s tradeoffs, and balance in a partnership, you can succeed. And that’s the approach we’ve taken at CP.”

Creel’s comments suggest that having the right attitude is key to running passenger trains on time and if CP can do it so could the other Class 1 Amtrak host railroads.

Yet CP doesn’t host as many Amtrak trains as its Class 1 brethren and doesn’t host any long-distance trains over thousands of miles.

Perhaps the best that can be expected is that the host railroads could do better than they do, but dispatching is a balancing act and there will be times when a host railroad puts its own interests ahead of avoiding delaying Amtrak for what the host sees as a relatively short period of time.

Speaking at the same shipper’s conference, new Norfolk Southern President Alan Shaw told a story of how on his first day in his new post he decided to go out into the field and meet and greet NS operating employees in Toledo, which is the largest NS crew change point on the system.

 “I wanted to thank [the employees] for their dedication to Norfolk Southern and our customers, and I wanted to get their input into how we fix service and how we continue to improve our productivity,” Shaw said.

As reported by Trains magazine on its website, Shaw said he approached some workers sitting outside the crew room.

He was wearing khakis, boots and a collared shirt and the workers thought he was an operations supervisor.

 “So I walk up and introduce myself. They told me their names, and one of the guys said, ‘Well, what do you do?’ I said, ‘Well, I’m the president’. And he looks at me, and I’m like, ‘Not Joe Biden president, but president of Norfolk Southern.’ And the other dude pulls out his phone, and he’s like, ‘Oh, yeah, yeah, yeah, I see the announcement. Congratulations!

“So that made me feel good. And then the one guy looks at me and says, ‘What craft did you come from?  . . . Were you mechanical, or engineering, or a conductor, or an engineer?’

“And I was like, ‘No, I started in finance.’ He was really not impressed with that. He goes, ‘Man, at some point, we’re going to have a craft employee running the railroad.’

“It is somewhat humbling when you go out there and talk to them, because they’ve got their own expectations.”

Shaw is right about that, but expectations are not reality. It’s possible that a future railroad president might have worked as a craft employee at an early point in his or her railroad career, but it is not realistic to think that C suite executives will be pulled from the ranks of operating or maintenance employees.

If you want to be a railroad president you need to have spent extensive time in such areas as finance, law or marketing and moved up the ranks in those departments.

Operating employees are not the only railroad stakeholders who have expectations and the expectations of some stakeholders carry more weight than those of others.

Shaw told another story about his first conversation with members of the railroad’s board of directors.

 “Their primary message to me was, ‘Don’t mess up,’” Shaw said. “Now, it was a little more forceful than that. I’ll let you use your imagination what the real verb was that they used.”

I think we can easily figure that one out.

Some IIJA Transportation Funding Authorizations May Not Win Congressional Approval

December 6, 2021

Although Congress last week approved a stop-gap federal spending bill through a continuing resolution, one effect of that will be to delay approval of funding authorized in the recently approved Infrastructure Investment and Jobs Act.

The continuing resolution will extend federal funding at existing levels and, with few exceptions, ban new contracts. The resolution will expire next February.

Much of the transportation funding proposed by the IIJA, including money for intercity rail passenger service programs, is guaranteed by that legislation, but other funding programs within the IIJA are only authorizations that Congress must approve through the appropriation process.

The Rail Passengers Association reported on its website that a year-long continuing resolution could mean that as much as 20 percent of the authorized new funding of IIJA could go unrealized.

RPA said this includes authorizations for $3.9 billion in Amtrak operations and capital programs.

In a recent fundraising letter sent to RPA members, the group warned that there will be political pressure next spring to scale back federal spending.

Subject to potentially not being approved by lawmakers is funding for authorizations of programs involving grade-crossing improvements, upgrades to existing rail corridors, and the development of new passenger train services.

In an unrelated development, a key congressman who helped push the IIJA through Congress has announced plans to retire at the end of his current term.

Rep. Peter DeFazio, is chair of the House Committee on Transportation and Infrastructure and has been an outspoken proponent of increase rail passenger service and public transit.

The Oregon Democrat has served in Congress for 38 years. In a statement, DeFazio cited wanting to focus on his health and well being.

Charting the Obstacles to Passenger Rail Expansion

November 15, 2021

Last in a three-part series

During the week that leaders in the House of Representatives were struggling to push approval of the Infrastructure Investment and Jobs Act over the finish line, CSX and Norfolk Southern fired another shot across Amtrak’s bow.

The two Class 1 passenger carriers asked the U.S. Surface Transportation Board to dismiss a case brought by Amtrak last spring seeking to have regulators compel the freight carriers to host a new rail passenger service between New Orleans and Mobile, Alabama.

The Gulf Coast corridor proposal is a harbinger of what lies ahead for other proposed new Amtrak services that could be funded by the IIJA. It is a sobering cautionary tale.

Funding for operating and capital expenses is already in place for the 150-mile New Orleans-Mobile route that until August 2005 hosted Amtrak’s tri-weekly Sunset Limited between Los Angeles and Orlando, Florida.

CSX, which owns most of the route, has been dragging its feet on the proposed New Orleans-Mobile service for more than five years. At one point it demanded $2 billion in route infrastructure work.

In their STB filing, CSX and NS said they would withdraw their opposition to the new service if Amtrak pays for 14 capacity improvement projects the carriers say are needed.

In a fit of hyperbole, the Class 1 carriers said Amtrak service without these improvements would cause “systematic failure” to their freight service, most notably adversely affecting first mile, last mile freight service to shippers. These assertions would be comical were they not so serious.

For years Amtrak’s host railroads have demanded expensive infrastructure improvements as the price of agreeing to service expansion, including daily service for the Sunset Limited and Cardinal, or new service on a now freight-only route.

Many a service expansion has been stymied due to these demands for capital improvements, which Amtrak usually cannot afford.

The underlying conflict before the STB is about more than whether passenger trains are going to operate between New Orleans and Mobile and how much Amtrak and its state partners will have to pony up for infrastructure improvement projects.

Ultimately, it is about rules and whose interests those rules favor.

Amtrak and rail passenger advocates want rules that provide an easier path to service expansion in the face of host railroad resistance.

The host railroads want to maintain the status quo of being able to dictate the terms of access. They dislike having to deal with political pressure seeking to force them to accept passenger trains that they view as having the potential to interfere with their freight operations. They dislike having foisted upon them something they view as contributing nothing to their primary reason for being, namely providing transportation of freight.

I’ve written about this issue before and you can follow this link to read more: https://wordpress.com/post/akronrrclub.wordpress.com/61853

If Amtrak loses the STB Gulf case or gets a mixed decision that could curtail how much service expansion it is able to achieve.

But even a favorable decision for Amtrak may not be enough. NS and CSX and/or the Association of American Railroads are likely to go to court to seek to overturn that ruling or get it modified. They have the resources to litigate for as long as it takes to get the rules that they want.

From a rail passenger advocate perspective, the STB case is about serving the public interest. Rail passenger advocates make the assumption that additional intercity rail passenger service by definition does that.

From a host railroad perspective, the STB case is about maintaining control of its own property and protecting its competitive position in the transportation industry.

This is not to say host railroad resistance can’t be overcome. It is matter of on whose terms these disputes will be settled and how much that will cost. It is why the STB case could be critical to the success of the Amtrak ConnectsUS plan.

There are other potential obstacles standing in the way of passenger rail expansion.

The Amtrak ConnectsUS plan is predicated on state and/or local governments taking over the operating expenses of the new corridors described in the plan.

Amtrak has proposed paying up to 90 percent of those costs initially and fronting money for capital projects to establish stations and do host railroad-demanded infrastructure work.

The Amtrak share of operating costs will eventually reach zero over a six-year period.

A key question is whether Amtrak or the FRA will move ahead on projects in which the state(s) to be served by a new route fail to commit to picking up their share of a route’s operating costs.

The Amtrak ConnectsUS plan seems built on the belief that once the new services are up and running the states served will recognize their value and provide funding. Amtrak seems to be hoping that public pressure will lead to continued state funding of the service by the states served.

But what if they don’t? Many of the proposed new corridors are in states that have never funded Amtrak service. Why would they want to do so now?

The American Recovery and Investment Act of 2009 contained $8 billion in grants for high-speed rail projects that did not require a state match.

In January 2010 Ohio received a $400 million grant to launch the 3-C Quick Start project.

In that year’s gubernatorial election, Republican John Kasich actively campaigned against the 3C project and Republicans who controlled the Ohio General Assembly expressed concerns about Ohio having to pay $17 million for operating costs.

After defeating incumbent Ted Strickland, a Democrat, Kasich killed the 3-C project. Ohio Republican legislative leaders in a move that was not well publicized at the time created rules that made it highly unlikely that Ohio would be able to use the federal grant to establish the 3-C Quick Start project.

The U.S. Department of Transportation took back the grant minus the $2 million Ohio had already spent. That money was disbursed elsewhere, primarily to California.

Ohio was not alone in spurning ARIA funding for rail passenger service. Projects in Florida and Wisconsin also were killed by incoming Republican governors.

The rules for grants the FRA will be awarding from IIJA funds have yet to be written although the IIJA enabling legislation establishes some criteria as described earlier in this series.

It is not difficult, though, to image that what happened in Ohio in 2010 could happen again when it comes to developing new passenger service envisioned by the Amtrak ConnectsUS plan.

Some new passenger services may result from IIJA funding, but the scope of expansion might be more modest than what rail advocates are envisioning.

Another obstacle could arise in 2023 when the 118th Congress is seated.

Just as what happened in Ohio in 2010, the 2022 election season is likely to feature candidates pledging to repeal or restrict how funds from the IIJA are used. Passenger rail could find itself in the cross hairs of those attacks.

Historically, the party that holds the White House in a president’s first term loses seats in Congress in the next mid-term election.

With Democrats holding paper-thin margins in the House and Senate, it would not take much for Republicans to gain control of one or both chambers in the 2022 elections.

If that happens, the environment for passenger rail in the 118th Congress likely will be quite different than it has been in the 117th Congress.

As pointed out in the first installment of this series, realizing the full potential of the IIJA on passenger rail service expansion will require appropriation of funds by Congress.

It is difficult to imagine a GOP-Controlled Congress being receptive to spending billions on new rail passenger service.

Republicans tend not to favor expansive and expensive government programs. Many GOP members of Congress identify as fiscal conservatives and they often oppose government-funded passenger rail of any kind.

Some of Amtrak’s fiercest and most persistent critics are conservative think tanks and many GOP members of Congress align with their views when it comes to transportation policy.

President Joseph R. Biden will still be sending appropriation proposals to Congress in January 2023 and 2024 and his administration probably can be counted on to recommend friendly budgets for passenger rail.

Yet Congress will have the final say on how much money passenger rail receives. A Republican-controlled Congress will not be inclined to give Biden any victories he can point to if he seeks re-election in 2024.

It’s not that all Republicans are opposed to intercity passenger rail. Amtrak’s national network has survived as long as it has because enough GOP representatives and senators have voted in favor of continued funding for it. Some of them have advocated for maintaining the existing Amtrak service in their states.

Republicans and Democrats have philosophical differences when it comes to how to spend public money and what to spend it on. There is nothing sinister about that. It is just a divergence of viewpoints about the role of government at the federal, state and local levels.

This includes differing views on the role government has to play in transportation policy and what modes of transportation should benefit the most from government investment.

But even putting that aside, there are limitations as to how much either party is willing to spend on rail passenger service.

In the 50 years of Amtrak’s existence, many Democratic administrations and Democratic-controlled chambers of Congress have failed to provide the type of reliable dedicated funding of rail passenger service that advocates and Amtrak have sought.

It is one thing to marshal political support to maintain the status quo of the existing intercity rail network and quite another to build support for the type of expansive additions to the network that rail passenger advocates favor.

There just seems to be too many forces that have kept intercity rail passenger service from developing into something more than a boutique form of transportation. The IIJA has not vanquished those forces.

The passage of the IIJA and its historic levels of passenger rail funding may thus turn out to be an aberration rather than a transformation to a new world order in which the nation’s rail passenger network undergoes a substantial expansion to resemble something from the 1950s.

There is too much entrenched opposition from interests who fear passenger rail’s gains will come at their expense.

This dynamic be can be seen at the state level where lawmakers must approve a balanced budget every year and passenger rail funding is weighed against the importance of other needs.

Those competing interests were on vivid display in Ohio in 2010 in the controversy over the 3-C Quick Start project.

Aside from a potentially hostile political environment and host railroad intransigence, the success of passenger rail programs funded by IIJA are linked to how well or how poorly the law is implemented.

The potential of the IIJA to influence rail passenger service is a long game and over the course of it there are bound to be changes in priorities among Amtrak managers, members of key congressional committees, and state and local transportation agencies.

Those changes will affect what does and doesn’t get done.

At this point there is much anticipation and expectation among rail passenger advocates about what could happen now that the IIJA is in place.

But expectations are not reality. It is a lesson passenger advocates know all too well. For once there is reason to be optimistic that good things are going to happen. From a passenger rail perspective, some good things will happen with IIJA funding.

It is just that what IIJA is able to achieve may not be as far-reaching as many passenger rail advocates want to believe.

It is far from a sure thing that we are on the cusp of a new era or a second rail revolution.

How IIJA’s Rail Funding is Being Allocated

November 14, 2021

Second in a three-part series

If you’ve ridden an Amtrak long-distance train lately, you know why the passenger carrier could use some new equipment.

As you sit in your Superliner sleeper room you’ll hear squeaks and rattles. Savvy travelers have learned to bring duct tape with them to help muffle the noise.

It will take awhile but new equipment to replace the Superliners, the first of which entered revenue service in 1979, may be on the way thanks to the Infrastructure Investment and Jobs Act.

IIJA is a way for Amtrak to capture capital funding it has coveted for years but been unable to get approved by Congress.

Much of the $66 billion for rail in the IIJA will be used to rebuild existing infrastructure and buy new equipment to replace passenger cars and locomotives that are long in the tooth.

As for how the money in the IIJA for rail will be divided, the Northeast Corridor gets $30 billion with $6 billion going directly to Amtrak and $24 billion being funneled through the Federal Railroad Administration for federal-state partnership grants.

Amtrak’s priorities for this funding include replacement of the Portal Bridge over the Hackensack River in New Jersey; construction of new tunnels under the Hudson River between New Jersey and New York City; rehabilitating a tunnel under the East River in New York City; replacing the B&P Tunnel in Baltimore; and planning to rebuild or replace bridges over the Susquehanna and Connecticut rivers.

The national network gets $28 billion of which $16 billion goes directly to Amtrak and $12 billion to FRA federal-state partnership grants.

Aside from buying new equipment, this funding will be used for infrastructure work on select national network routes, including Amtrak maintenance facilities and passenger stations.

Much of the latter involves bringing stations up to date in meeting standards of the Americans With Disabilities Act.

The federal Consolidated Rail Infrastructure and Safety Improvements grant program gets $5 billion but this money is not restricted solely to passenger rail projects.

The FRA’s grade crossing elimination program gets $3 billion, which can be used for Amtrak-owned lines, such as the one in Michigan, or for freight and commuter rail lines.

The bill reserves $50 million for an FRA Restoration and Enhancement Grants program, which is the funding mechanism for new service on routes Amtrak does not now serve.

There is also $15 million set aside for the FRA to conduct a study of routes operated “less often” – think the Cardinal and Sunset Limited – as well as restoration of previously discontinued long-distance routes or new long-distance routes.

All that is guaranteed to happen is the FRA will conduct a study that might recommend changing tri-weekly trains to daily operation,

The FRA study might recommend adding new long-distance routes or restoring trains that vanished decades ago such as the North Coast Hiawatha, Lone Star or Broadway Limited.

It will be up to Congress to appropriate the money to pay for those trains and Amtrak would need to negotiate operating agreements with the host railroads.

It will be years before the potential of the IIJA is fully realized.

Amtrak is in the very early stages of designing new cars to replace the Superliner fleet.

Even when new cars and locomotives roll off the factory floor it can be months before they begin revenue service.

The new Siemens Venture cars to be used in Midwest corridor services have yet to begin revenue service despite having been on the property for months.

The first new Siemens ALC-42 Charger locomotives are still undergoing testing. For that matter Amtrak has yet to put into revenue service all of the Viewliner II equipment it has.

Many of the improvements the money from the IIJA is expected to pay for will occur behind the scenes, such as modernizing the reservation system.

As has been demonstrated many times during Amtrak’s 50-year history, the wheels of change turn slowly and sometimes they don’t turn at all.

A host of obstacles lie in the path of new and improved rail service over which Amtrak and the Biden administration little to no control.

These have the potential to thwart new services and even reduce the effectiveness of the IIJA.

Next: The challenges facing passenger rail will dictate how transformative the IIJA turns out to be.

Inside IIJA’s Rail Funding: Let the Dreaming Begin

November 13, 2021

First in a three-part series

Last March as President Joseph R. Biden was laying the groundwork for an infrastructure rebuilding plan he was about to send to Congress he spoke about how it could spark a second rail revolution.

In a March 31 speech to introduce his American Jobs Plan, Biden remarked, “You and your family could travel coast to coast without a single tank of gas onboard a high‐​speed train.”

More than a week later, Biden repeated the same claim but added, “close to as fast as you can go across the country in a plane.”

It was a bold although unrealistic vision and it turned out the infrastructure bill, formally known as the Infrastructure Investment and Jobs Act, did not contain funding for high-speed rail.

Nonetheless, Biden’s plan to spend 1.2 percent of the U.S. gross domestic product a year for the next eight years to boost the economy captivated rail passenger advocates.

 Rail Passengers Association President Jim Mathews put Biden’s vision into a rail passenger context in a column published in Passenger Train Journal, titled “$80 Billion Buys a Lot of French Toast.”

The headline referenced the $10 billion a year Biden’s plan would devote to rail service.

“Injecting $10 billion more each year into rail projects would let Amtrak expand passenger rail to 160 new stops, add at least 30 new corridors, and boost frequencies beyond once daily in at least 15 states,” Mathews wrote.

Seven months later the infrastructure bill has cleared Congress – albeit barely – and RPA is hailing it as a “new era for America’s passenger rail network.”

Amtrak CEO William Flynn issued a statement that said in part, “This bill will allow Amtrak to advance significant infrastructure and major station projects on the NEC [Northeast Corridor], purchase new passenger rail equipment and develop new rail corridors, bringing passenger rail to more people across the nation.

Similar rosy statements have been issued by other trade associations representing Class 1 railroads, short line and regional railroads, and public transit agencies.

The $1.2 trillion in the IIJA is a lot of money and passage of the bill is historic. It is a blueprint for spending about 1 percent of GDP per year on such things as roads, bridges, rail, public transit, water systems, broadband, and power systems.

That will increase federal spending on infrastructure to the highest level of GDP that it has been since the 1980s.

Flynn told the news website Axios that the $66 billion for rail in the bill is “more funding than we’ve had in our 50 years of history combined” with about half of that money being used for expanding intercity rail passenger service.

But will the IIJA prove to be the catalyst that creates a sea change for U.S. passenger rail that results in the type of expansive network that rail passenger advocates have been dreaming about for decades?

It could be a step in that direction. Yet many are reading into the IIJA what they want to believe the legislation bill could deliver.

William C. Vantuono, editor of Railway Age, sounded a cautionary note about the effects of IIJA by quoting consultant Jim Hanscom who described IIJA is an authorizing bill.

“It is managed by Congressional authorizing committees. Appropriating committees are separate, and cover what is appropriated for spending in any given year. There is nothing to say that all the money gets spent,” he told Vantuono.

Read that last sentence again while keeping in mind that IIJA contains a five-year surface transportation spending plan.

Authorizing money is not the same as appropriating money, which is subject to the vagaries of the annual congressional appropriation process.

There are a number of things regarding passenger rail that IIJA does not do.

It does not establish a permanent dedicated funding source for passenger rail, something Amtrak and rail advocates have sought for decades and failed to achieve.

It does not repeal a federal law requiring state and local governments to pay for Amtrak routes of less than 750 miles.

It does not allocate nearly enough money to cover the estimated $75 billion cost of implementing the Amtrak ConnectsUS plan that Mathews was referencing in his PTJ column. IIJA is at best a down payment on route expansion.

It does nothing to overcome host railroad resistance of new Amtrak service or reign in their strategy of demanding expensive capital improvement projects in return for allowing passenger service.

Not all of the money in the bill will go directly to Amtrak. Most of it will be channeled to the Federal Railroad Administration through the U.S. Department of Transportation.

The FRA in turn will dole out funding through discretionary grants or to specific initiatives spelled out in the legislation.

The legislation gives the FRA 180 days to “establish a program to facilitate the development of intercity passenger rail corridors.”

Section 22308 of the bill contains criteria the FRA is to take into account when drawing up the grant eligibility guidelines.

This includes whether a proposed route had already been identified as part of a regional planning study; is part of a state’s rail plan; the route’s potential ridership, capital requirements and expected trip times; anticipated public benefits; the level of readiness of the operators and the community to accept federal funds; and existing support from operators and host railroads.

New services are expected to benefit rural communities; enhance “regional equity and geographic diversity;” and/or benefit underserved, low-income communities or areas of “persistent poverty.”

Not all of the money the IIJA will award will necessarily go directly to Amtrak. Eligible recipients include states, interstate compacts, regional passenger rail authorities, regional planning organizations, state political subdivisions, federally recognized Indian Tribes, and “other public entities” recognized by USDOT.

In an interview last month with Trains magazine passenger correspondent Bob Johnston, FRA deputy administrator Amit Bose said, “There’s no other way to dice it: state support and involvement is essential. So is host railroad agreement and support of those projects.”

That underscores a hard truth that some rail passenger advocates will have a hard time swallowing.

The money the FRA will have available is for federal-state partnership projects. It is most likely to go to those states that have shown a willingness to fund a share of the project cost.

That is likely to favor projects already in the works, such as a second Chicago-Twin Cities Amtrak train for which Minnesota and Wisconsin have approved spending for planning work.

This could be bad news for Ohio and the 3-C project, which has received public support from some public officials, namely mayors and legislators along the proposed route, but those whose views count the most have been silent or noncommittal.

Without the governor and legislative leaders being onboard 3C may find itself toward the back of the line.

Next: Breaking down the rail funding in the Infrastructure Investment and Jobs Act.

House Passes Infrastructure Bill

November 8, 2021

The House of Representatives late Friday approved the $1.2 trillion Investment in Infrastructure and Jobs Act, which contains $550 billion for new infrastructure funding. That includes $66 billion for railroads and $39 billion for public transit.

Much of the rail funding is expected to go to Amtrak for capital projects, including the procurement of new passenger rolling stock.

In a statement,  Amtrak CEO William Flynn said the bill will enable Amtrak to move forward on infrastructure and station work in the Northeast Corridor, purchasing new passenger equipment and developing new rail corridors.

The public transit funding is expected to be used to improve infrastructure to make transit faster and more reliable.

Passage of the bill was not assured until the last hour before the vote. Infighting among majority Democrats has held up a vote in the House for the past two months. The Senate approved the bill in August.

Voting for the bill was largely along party line with most Democrats in favor and most Republicans opposed. However, 13 Republicans voted in favor of the bill while six Democrats voted against it.