OIG Finds Amtrak Handled CARES Funds Well

The Amtrak Office of Inspector general has found the passenger carrier has made effective use of its federal CARES Act relief funds.

The OIG said there were some flaws in how Amtrak addressed use of those funds for state-supported intercity rail passengers service but otherwise the carrier has been effective in its use of and accounting of relief funds.

Amtrak received $1.018 billion in CARES Act funding and through October had spent about 87 percent of that money.

Amtrak underreported its use of the funds set aside for state-supported costs by about $686,000 out of a total of $97 million, the OIG audit found.

The OIG report said Amtrak’s finance department has since revised its reporting to more accurately reflect the remaining funds.

In another finding, the OIG said Amtrak could more consistently apply its coronavirus paid leave policy.

Transit Systems Push for More Aid

Greater Cleveland Regional Transit Authority Director of Marketing and Communications Stephen Bitto said this week that the agency has thus far been able to avoid worker furloughs and massive service cuts but that might not remain the case unless Congress approves more emergency COVID-19 pandemic aid.

Bitto joined executives of several public transit agencies on a virtual conference call this designed to pressure Congress to provide more aid.

Congress is considering various pandemic stimulus plans, some of which do not include emergency funding for public transit.

Cleveland RTA received $112 million in emergency aid earlier this year through the CARES Act.

Speaking to the value of public transit, Bittlo said, “In our community, this is critical as nearly half a billion dollars in annual earnings is brought home by those that are dependent on RTA to get to work”

Ridership of RTA trains and buses has fallen by nearly 70 percent and the current spike in COVID-19 infections continues to depress ridership and fares.

Bitto said fare revenue at Cleveland RTA has fallen by $19 million.

“Local unemployment is approximately 11.5 percent, lagging significantly behind both national and state levels,” Bitto said.

“The corresponding drop in disposable income is negatively impacting local sales tax receipts, accounting for over 80 percent of our annual operating budget.

Cleveland RTA faces a backlog of unfunded infrastructure projects totaling $500 million and the entire entire heavy and light rail fleets have far exceeded their useful lives.

A third of RTA buses have also exceeded their useful lives.

Nine transit agencies took part in the virtual rally including New York’s Metropolitan Transportation Authority, the New Orleans Regional Transit Authority, Denver’s Regional Transportation District, the Indianapolis Public Transportation Corp., San Francisco’s Bay Area Rapid Transit, the Utah Transit Authority, Miami-Dade County Department of Transportation and Public Works, and the Southeastern Pennsylvania Transportation Authority.

MTA CEO Patrick J. Foye said there would not be an economic recovery regionally or nationally without significant investment in mass transit.

 “Scaled down transit does not build resilient cities, and will not help with economic recovery,” he said.

“Five years from now, when we look back at this time, will it be the moment we widened the mobility divide? Or will it be the moment we thrived in the face of challenges? The federal government needs to answer the call.”

Public transit received $24.9 billion in CARES Act earlier and the American Public Transportation Association is seeking at at least $32 billion in emergency funding.

One proposal that has received bipartisan support would allocate $15 billion to public transit.

CAK Has Escaped Service Cuts Thus Far

With federal emergency aid running out on Sept. 30, airlines have been announcing service cuts and employee layoffs set to take effect in October.

Thus far Akron-Canton Airport has escaped losing service next month by any of its three carriers although officials have indicated that service to the airport remains below what it was before the COVID-19 pandemic took hold.

Airport CEO Ren Camacho said service is now 15 flights a day provided by Spirit Airlines, United Express and American Eagle.

Flights are currently linking CAK with Chicago O’Hare, Orlando, Philadelphia and Charlotte.

“It’s been 20 percent of the traffic then we had before the pandemic began, so we’re averaging about anywhere between three to four hundred passengers a day where we would normally average about 2,000 passengers a day,” Camacho said.

At the depth the pandemic last spring Akron-Canton was seeing as few as 30 passengers a day.

American has announced that it will stop flying to 15 cities next month, which it serves with its American Eagle-branded partners.

None of those cities are in Ohio, but American plans to stop flying to Huntington, West Virginia; Williamsport, Pennsylvania; and Kalamazoo, Michigan.

Airport officials had earlier expressed optimism that service from Akron-Canton would be reinstated this fall to New York’s LaGuardia, Washington Reagan National, Houston Bush Intercontinental and Atlanta Hartsfield-Jackson airports.

They also expect seasonal service by Spirit to return to Tampa and Fort Myers in late fall.

It is unclear how many of those routes will be reinstated during a time when airlines are announcing widespread cuts in scheduled flights for the fall.

Airline announcements have warned of further flight cuts, which could mean Akron-Canton might lose some of the flights it has now.

Although there had been some upturn in leisure air travel during the summer that season has ended.

Security checkpoint figures released by the U.S. Transportation Security Agency show that 711,178 travelers passed through security checkpoints on a recent Monday, a decline of nearly 70 percent compared to the same day in 2019.

In an effort to stimulate travel, United, American and Delta have announced that they are temporarily suspending change fees imposed when travelers change their days of travel or switch to another flight on the same day.

Camacho said restaurant and other concessions at the airport remain open, but at reduced hours.

Akron-Canton received $7.6 million in CARES Act funding and plans to apply to over four years against projected losses of $3 million due to the pandemic.

Transit Agencies Want More Emergency Aid

U.S. public transit agencies on Wednesday asked Congress to give them $36 billion in emergency federal funding as part of a new COVID-19 pandemic relief bill.

The agencies said the $25 billion they received from the Coronavirus Aid, Relief and Economic Security  Act in March is nearly exhausted and more funding is needed to help agencies continue providing passenger-rail and other transit services.

The Senate will return to session next week and the House has already earmarked $15.7 million for public transportation in its HEROES Act.

Although that legislation is before the Senate, Republican Senators have rejected the bill and are divided on how much to spend on additional COVID-19 relief funding.

The Greater Cleveland Regional Transit Authority and Southeastern Pennsylvania Transportation Authority are among the agencies in the coalition seeking the additional funding.

Railroaders May Be Able to Get CARES Aid

Railroaders may be eligible for benefits under the Pandemic Unemployment Assistance program that was established by the federal Coronavirus Aid, Relief and Economic Security.

The U.S. Department of Labor has advised the Railroad Retirement Board that PUA provisions do not prohibit railroaders from being eligible for benefits if they are not eligible for Railroad Unemployment Insurance Benefits.

A railroad labor union official said the RRB’s general counsel has found there is nothing in the RUIA that prohibits railroaders from receiving PUA benefits if they are not receiving RUIA benefits.

Cleveland RTA to Get $111M in CARES Aid

The Greater Cleveland Regional Transit Authority will receive $111 million in emergency federal aid from the CARES Act.

In a news release, the agency said the money will help make up for lost fare revenue and sales tax receipts.

At a meeting of its trustees on Tuesday, RTA Secretary-Treasurer Floun’say Caver said the agency expects to lose $91 million in sales tax revenue this year because of an economic downturn triggered in part by the COVID-19 pandemic.

RTA expects to lose $22 million in fare revenue. Caver said ridership has plunged by 70 percent.

For its 2020 budget, RTA expects a $113 million shortfall, most of which will be made up by the CARES Act funding.

Caver told the trustees that the agency expects to save $22.7 million in expenses due largely to a 15 percent cut in bus and rail service.

He said that includes salaries, fuel and supplies. However, RTA will incur an additional expense of $2.5 million in salaries and supplies for disinfecting transit vehicles and stations potentially contaminated by the virus as well as IT equipment needed to allow some employees to work from home.

In a news release, RTA said its March 2020 revenue fell by 21 percent compared with March 2019.

Because there is a three-month lag between sales tax revenue collection and when it is apportioned to RTA, the full impact of COVID-19 on sales tax will not be known until summer 2020 when RTA receives tax proceeds relating to March 2020 business activity.

Most Airlines Agree to Emergency Aid Terms

The federal government has reached an agreement in principle with 10 airlines over terms of the federal emergency aid that they will receive.

A report by Aviation Daily said he carriers will receive a combination of grants and loans as part of the $25 billion allocated to them by the Coronavirus Aid, Recovery, and Economic Security Act.

The airlines had wanted all of the funding to come in the form of grants that they would use to pay employees through spring and summer.

However, 30 percent of the aid will be low-interest loans with 70 percent of the funds being grants.

The agreement also said the U.S. Department of Treasury will receive warrants equal to 10 percent of the amount of the loan, which the agency can later convert into shares at a pre-determined price should it desires.

Airlines agreeing to participate in the program include Alaska Airlines, Allegiant Air, American Airlines, Delta Air Lines, Frontier Airlines, Hawaiian Airlines, JetBlue Airways, SkyWest Airlines, Southwest Airlines and United Airlines.

Spirit Airlines said it continues to negotiate with the government over terms of its application for emergency aid but expects to reach an agreement soon.

Treasury Secretary Steven Mnuchin said talks with other airlines are still ongoing, particularly smaller carriers.

The CARES Act requires that airlines accepting financial assistance cannot cut positions through layoffs or furloughs, but can reduce staff through voluntary incentives such as early-retirement or paid leave packages.

Airlines also are prohibited from repurchasing stock or issuing dividends through September 30. They must agree to certain limits on executive pay until March 24, 2022.

The carriers are required to provide minimum levels of service to all points in their pre-pandemic networks to the extent “reasonable or practicable.”

However, some airlines, including Alaska, Allegiant and United have sought waiver requests for exemptions to cease flying to certain points, citing weak demand due to the COVID-19 pandemic.

Amtrak to Get $1B in Emergency Pandemic Aid

The U.S. Department of Transportation said late last week that it will be conveying $1 billion to Amtrak that was appropriated as part of the Coronavirus Aid, Relief, and Economic Security Act.

The funding was approved by Congress after the passenger carrier reported that it was expected to lose that amount of money due to a 90 percent plunge in bookings and a wave of cancellations due to the COVID-19 pandemic.

In a news release, DOT said the emergency aid will help Amtrak maintain service when the economy recovers.

DOT said the CARES funding is intended to offset the loss of ticket revenue, enable the carrier to continue to pay its employees, buy fuel for its operations and construction materials for its projects.

The CARES Act funding will grant Amtrak $492 million for the Northeast Corridor and $526 million for its national network.

At $239 million of the funding will be used in lieu of any increase in states payments for Amtrak corridor service.

FTA Set to Release Transit Emergency Aid

Federal emergency aid to public transit systems is ready to be distributed by the Federal Transit Administration.

The agency announced Thursday that it is providing $25 billion to transit systems that was allocated in the Coronavirus Aid, Relief, and Economic Security Act.

The funding is being allocated on the basis of $22.7 billion to large and small urban areas, and $2.2 billion to rural areas.

Transit agencies will not need to match the funding, which can be used to support capital, operating, and other expenses generally eligible under those programs to prevent, prepare for, and respond to COVID-19.

Operating expenses incurred since Jan. 20 can be covered by the emergency funding, including paying for administrative leave for transit personnel due to reduced operations during an emergency.

In a news release, the FTA said it has taken a number of other steps to support transit agencies, including expanding the eligibility of Federal assistance available under FTA’s Emergency Relief Program to help transit agencies respond to COVID-19 in states where the governor has declared an emergency.

FTA said all transit providers can now use federal formula funds under the Urbanized Area Formula Program and Formula Grants for Rural Areas Program for emergency-related capital and operating expenses.

This includes the provision of personal protective equipment or special-purpose trips.

The agency also has established an emergency relief docket that allows transit providers in states where the governor has declared an emergency related to COVID-19 to request temporary relief from Federal requirements as well as any non-statutory FTA requirements.

Unemployed Rail Workers to Get Benefits

Unemployed railroad workers will have access to unemployment and sickness benefits during the COVID-19 pandemic the Association of American Railroad announced.

AAR said that relief was included in the $2.2 trillion Coronavirus Aid, Relief and Economic Security Act approved last week.

Railroad workers do not receive unemployment benefits through state-administered programs, but through the Railroad Retirement Board’s Railroad Unemployment Insurance Program.

The CARES law waives the seven-day waiting period for filing a sickness or unemployment claim with the RRB and provides $50 million to cover the costs of providing these additional benefits.

It also increases unemployment benefits through an additional $1,200 biweekly benefit, provides $425 million to cover the costs of providing these additional benefits through July 31, and allows RRB to access about $130 million of remaining American Recovery and Reinvestment Act funds to provide extended benefits through Dec. 3.

The law also appropriated $5 million to RRB for additional administrative costs.