Posts Tagged ‘Donald Trump’

Trump Talks Broadly About Infrastructure Plan

February 1, 2018

As expected President Donald Trump in his state of the union speech before Congress this week called for legislation to modernize the nation’s infrastructure.

Trump did not give any details about the proposal. Administration sources have said that those will come sometime after the speech.

“We will build gleaming new roads, bridges, highways, railways and waterways across our land,” Trump said.

During his address, Trump called for a bill that will result in “at least $1.5 trillion for the new infrastructure investment we need.”

He acknowledged as has been reported by multiple sources that his plan will call for using federal funding to match money put up by state and local governments, as well as the private sector.

Some reports citing a leaked document said the federal match will be no more than 20 percent per project.

Trump described this as a way “to permanently fix the infrastructure deficit.”

He also said the bill also should shorten time needed to issue permits and grant approvals for projects to no more than two years.

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Crystal Ball Look at 2018 and Railroads

January 3, 2018

With a new year upon us, it’s time to look ahead to what 2018 might bring in the railroad industry. Such predictions are fraught with peril given that unexpected developments can occur at any time that dramatically changes the trajectory of the industry or its individual components.

A year ago at this time we thought E. Hunter Harrison was living out his days as CEO of Canadian Pacific. Few knew that he was plotting with a hedge fund to take over CSX.

Even fewer knew that Harrison was in his final days of overseeing any railroad and would die before the year ended.

With that in mind I press ahead in reviewing four stories to watch in 2018.

What now for CSX? The patriarch of precision scheduled railroading left before his model could be fully implemented.

Look for CSX to continue the PSR model under new CEO James M. Foote, although with some modifications.

Much of the early months of 2018 will see Foote finding his way at CSX while assuring investors that he was a wise choice to replace Harrison.

Industry analysts have pointed out that Foote is thin in operating experience. Much of his industry time has been spent in marketing and sales.

That could turn out to be a good thing for CSX because customer relations was not Harrison’s strong suit. He was an old school operating man who wanted to dictate terms to shippers not the other way around.

Look for CSX to appoint an operations vice president so that Foote can focus on what he knows best.

Both Canadian National and CP have done quite well post-Harrison. Will the same be true for CSX? Perhaps, but if that is the case it will be due to Harrison having laid the foundation not from having built the house as was the case at CN and CP.

What now for Amtrak? Richard Anderson is firmly in control of the nation’s rail passenger carrier with Charles “Wick” Moorman having retired.

Anderson, the former CEO at Delta Air Lines, has hired a supporting team that includes former airline executives. It remains to be seen what that means.

These airline executives cut their teeth during the airline deregulation era when airlines learned ways to squeeze every last dollar out of passengers through such things as baggage fees and seat assignment fees, among others.

Remember the last time that an airline served you a not meal in coach as part of your fare? Yeah, it’s been a while.

Anderson won’t necessarily remake Amtrak in that model but look for him to move in that direction.

The name of the game will be maximizing revenue yield – something Amtrak has already been doing – as the carrier seeks to recover even more of its expenses from the fare box.

Anderson will have his hands full this year attending to matters that grabbed a disproportionate number of headlines in 2017. This includes the rebuilding of New York’s Penn Station and dealing with the aftermath of the derailment of a Cascades Service train in Washington State.

Much of the latter has focused on the fact that positive train control was not yet in operation on the route. Questions are being raised about the adequacy of training of Amtrak operating employees and the railroad’s safety culture.

These matters will continue to attract attention in 2018 and take up much of Anderson’s time.

Rail passenger advocates in places such as Ohio will continue to be disappointed in Amtrak in 2018. But that is nothing new.

Little, if any, progress will be made in terms of route expansion, new equipment for long-distance trains or expanding the frequency of such tri-weekly services as the Chicago-Washington Cardinal.

Perhaps the best that can be hoped for is that the aging Superliners will get a new interior look starting later in the year.

Will Railroads Make the PTC Deadline? The last day of 2018 is the deadline for the railroad industry to implement positive train control systems on routes that handle passengers and/or carry hazardous cargo. The deadline has been moved once already.

The Federal Railroad Administration has warned that waivers won’t be issued again, but that was during a different administration.

The Trump administration might be far more sympathetic to railroad industry pleas for a little more time due to the expense and complexity of PTC systems.

Some railroads will make the deadline, but others are going to be cutting it close.

Will the Trump Infrastructure Plan See the Light of Day? Candidate Donald Trump liked to talk about his big plans to revamp the nation’s infrastructure. President Donald Trump has barely mentioned it other than to pay it lip service on occasion.

The administration has been tight lipped about the scope of the plan other than a few broad details, such as $200 billion in federal funds will be used to leverage $1 trillion worth of infrastructure improvements.

Supposedly, the infrastructure plan was being held in abeyance until Congress passed a tax bill, which it did in late December.

In theory, an infrastructure improvement plan should have bi-partisan support. But in a hyper partisan environment during a midterm election year bi-partisan support might be hard to come by. Political hardball will be the rule.

There remains the question of how much the railroad industry would benefit from an infrastructure plan once or even if it is implemented. Few rail infrastructure plans come with a private developer other than than the railroad itself to provide matching funds.

Passenger rail should be a prime beneficiary of an infrastructure plan, but given the current political climate it might find little to feed on except for a few token crumbs that will be eaten by Northeast Corridor infrastructure needs, of which there are many.

Freight railroads might fare a little better in getting funds for some projects, e.g., enlarging tunnels or replacing bridges that they agree to help fund.

But don’t be surprised if the infrastructure plan winds up benefiting highways and even some areas that only a strained definition of infrastructure would incorporate, e.g., a veteran’s hospital. It will hinge on how the terms of the plan are written.

A lot of hungry government agencies and private companies are going to be looking for a slice of the infrastructure pie and might provide tortuous explanations as to how their project constitutes infrastructure.

I’m reminded of that famous response from bank robber Willie Sutton in the Saturday Evening Post as to why he robbed banks: “I rob banks because that’s where the money is.”

The infrastructure plan might make available money not available otherwise so there are going to be a lot of hand out seeking a part of it.

Conservatives in Congress will not necessarily offer automatic support for an infrastructure plan, which they might fame as a stimulus plan. That would remind them too much of something they despised during the early years of the Obama administration.

And conservatives absolutely, positively dislike spending federal money on passenger rail. They are not all that more supportive of public transportation even when it uses rubber tires on asphalt and concrete surfaces.

Trump Meets to Talk Infrastructure Plan

December 13, 2017

News reports said that President Donald Trump met this week with U.S. Transportation Secretary Elaine Chao and House Transportation and Infrastructure Committee Chairman Bill Shuster to discuss the administration’s infrastructure proposal.

The administration has proposed using $200 billion in federal funds to leverage $1 trillion worth of infrastructure improvements.

Trump had indicated last month that once a tax bill had passed Congress that his administration would be ready to focus on the infrastructure plan.

Trump Might Support 7-cent Gas Tax Hike

October 31, 2017

The Trump administration might seek an increase in the federal gasoline tax as a way of paying for a proposed $1 trillion infrastructure program.

That point was made by Trump’s economic adviser Gary Cohn during a private meeting with House lawmakers last week.

The proposed 7-cent increase would be used to fund public work projects, such as railways, roads, waterways and bridges.

Trump had said earlier this year during an interview with Bloomberg News that he was open to a gas tax increase. The last gasoline tax increase came in 1993.

Rep. Bill Shuster (R-Pennsylvania), the chairman of the House Transportation and Infrastructure Committee said there is little interest in a gas tax hike now, but that committee members might support one if the White House gets involved and supports the increase.

Although the Trump infrastructure plan has received widespread attention, the administration has yet to reveal any hard details about it.

Infrastructure Council Terminated

August 21, 2017

The Trump Administration has dropped its plans to create an Advisory Council on Infrastructure.

The council was proposed to help provide guidance on spending for a multi-billion dollar program to improve roads, bridges and other public works.

Membership of the council would have included 15 members from real estate, finance, labor and other sectors.

Termination of the infrastructure council followed the disbanding of two other advisory groups to guide U.S. manufacturing and policies.

In the meantime, President Donald Trump has released a plan that is designed to alleviate the length of time it takes to get federal approval for projects. Trump issued an executive order that will:

  • Establish “one Federal decision” for major infrastructure projects to proceed.
  • Set a two-year goal for completing reviews.
  • Set up a “quarterly scorecard” to hold agencies accountable for delays.
  • Reduce duplicative requests for information and late-stage changes in the approval process.

Trump Infrastructure Plan Included in Budget

May 25, 2017

It turns out that the Trump administration’s much-ballyhooed transportation infrastructure plan was tucked away inside the fiscal year 2018 budget announced on Tuesday although you can be forgiven for having missed it.

It was contained in a six page fact sheet as part of the budget proposal.

As hinted at by various administration officials, including Secretary of Transportation Elaine Chao, the plan proposes spending $200 billion over 10 years with the expectation that the money will attract and support $1 trillion in private/public infrastructure investment.

The budget document described the plan as a combination of new federal funding, incentives for private sector investment, and expedited projects.

“The administration’s goal is to seek long-term reform on how infrastructure projects are regulated, funded, delivered and maintained,” Transportation Secretary Elaine Chao said at a news conference.

She said more details will be forthcoming, including a legislative package later this year, but Chao described the plan outlined on Tuesday as “the main key principles.”

The plan calls for making changes in regulations so as to speed up the environmental review and permit process and shifting more service to the private sectors.

One example of the latter mentioned in the budget document would be to transfer the air traffic control system from the Federal Aviation Administration to a nonprofit or nongovernmental entity in 2021.

Another change would be to expand the ability of states to impose tolls on interstate highways by reducing existing restrictions on that practice.

Related to that the plan is a proposal to allow private investors to construct and maintain rest stops along highways.

A report by The Hill, said that the infrastructure plan relies on leveraging private sector investment, ensuring federal dollars are targeted toward transformative projects, shifting more services and underused capital assets to the private sector and giving states and localities more flexibility.

Pilot programs will be proposed to explore new environmental reviews, designate a single entity to guide a project through the approval process; put some permitting into the hands of states and localities, and ensure that agencies don’t need to worry about making a permit approval process litigation proof.

Funding of the Transportation Infrastructure Finance and Innovation Act program will be boosted to $1 billion every year.

The proposal to allow states to impose tolls on interstate highways won the approval of Patrick D. Jones, executive director and CEO of the International Bridge, Tunnel and Turnpike Association, although with some qualifications.

“Congress should give states access to one more tool in the toolbox by allowing them to toll their interstate highways specifically to rebuild them,” he said. “This wouldn’t be a mandate. No state would be required to toll their interstates. This would simply give states an option, the flexibility to choose tolling if it makes sense to them.”

President Donald Trump had spoken often during his 2016 campaign about the need to improve the nation’s infrastructure.

He mentioned it again during an election night speech and during a Feb. 28 address to Congress, saying it would create millions of jobs.

In response, Democrats noted the Trump’s budget would provide just $5 billion in FY 2018 and did not provide any detail about where the money would go or how it would be paid for.

But Senate Commerce Chairman John Thune said the plan “recognizes important needs in our country and takes a long-term view on meeting those needs.”

Chao expects Congress to begin working on the infrastructure package in the third quarter of this year.

Kan Nominated for Key U.S. DOT Post

April 11, 2017

Derek Kan has been nominated by President Donald Trump to become the undersecretary of the U.S. Department of Transportation.

Kan has served on the Amtrak board of directors since 2015 and is general manager of Lyft in Southern California.

He previously served as director of strategy at a Silicon Valley startup and has been a management consultant at Bain & Company.

Kan has been a policy adviser for Senate Majority Leader Mitch McConnell and served as the chief economist for the Senate Republican Policy Committee.

Transit Looks to Trump Infrastructure Plan

April 10, 2017

Faced with federal budget cuts, rail and transit agencies are hoping that the Trump administration will be open to helping to fund transit capital projects as part of a $1 trillion infrastructure plan that has been promised.

It is not clear yet when the plan will be rolled out or what it will seek to fund.

President Donald Trump recently said that the infrastructure plan will be for at least $1 trillion and that there may be a 90-day deadline to get started in order to receive funding.

Trump has said the plan will be revealed as early as next month.

That timeline was echoed by U.S. Secretary of Transportation Secretary Elaine Chao who said the administration is “working on a legislative package that will probably be in May, or late May.”

Chao said the plan will focus on investments for roads, bridges, airports and potentially broadband access, veteran hospitals, and improvements for the electrical grid and water systems.

She added that the bill containing the infrastructure plan will tackle reducing regulations.

In particular, rail and transit authorities are concerned about how the administration’s “skinny budget” seeks to reduce grant funding from the Federal Transit Authority and the U.S. DOT’s TIGER program. Hence, their interest in obtaining funding for capital projects through the infrastructure plan.

Budget Proposal Just a Starting Point

March 21, 2017

More than likely it is a waste of time to discuss the Trump administration proposal to eliminate funding for Amtrak’s long-distance trains.

A president’s budget proposal is just that, a proposal, and no president of either party sees the budget he sent to Congress come out without any substantive changes.

For that matter the House and Senate will have their own ideas about how to spend public money, including how much to allot to the national rail passenger carrier.

Amtrak has been down this road before, many times in fact. Past administrations have proposed zeroing out Amtrak funding only to see Congress time and again appropriate just enough to keep Amtrak’s skeletal national network operating.

If anything is a surprise that the Trump budget would seek to keep any funding for Amtrak.

Amtrak may have survived past budget fights but there have been route casualties along the way. A major restructuring in 1979 killed the only Amtrak service in Columbus and Dayton with the discontinuance of the New York-Kansas City National Limited.

A 1995 restructuring killed the Broadway Limited, which wiped Akron, Youngstown and Fostoria off the Amtrak map.

They later regained service for a short time when a revived Broadway operating as the Three Rivers ran between Chicago and New York.

Another budget fight took Athens and Chillicothe out of the Amtrak network when the Cincinnati-Washington Shenandoah was discontinued in 1981.

For a short time, that 1981 budget fight kicked Cincinnati out of Amtrak, but thanks to the political clout of the late Senator Robert Byrd of West Virginia, the Cardinal returned to its Chicago-New York flight path in early 1982, albeit as a tri-weekly rather than a daily train.

Given the history of Amtrak funding, it would seem likely that some, if not all, of Amtrak’s long-distance trains will survive due to political wrangling.

What could happen is that the fight becomes one of percentages as in what percentage of the Amtrak long-distance network will survive.

If that is the case, Ohio could be in the middle of the fight when some modifications of the long-distance route network are proposed to consolidate “duplicate” service, e.g., the Lake Shore Limited and Capitol Limited between Chicago and Cleveland.

I could see someone proposing reducing the Capitol Limited to a Pittsburgh-Washington service that connects with a combined Lake Shore Limited and Pennsylvanian between Chicago and New York. That would leave Erie, Pennsylvania, off the Amtrak map.

Already, Amtrak and the Michigan Department of Transportation have proposed rerouting the Lake Shore Limited through Michigan, presumably in lieu of an existing Wolverine Service train.

Someone in Washington in an Amtrak office, a Department of Transportation office and/or a congressional office has probably been studying the Amtrak map with an eye toward finding a way to end federal funding of the Lake Shore Limited by making it into a state train.

Michigan and Pennsylvania already fund the legs into Chicago and New York City respectively. Why not tell Ohio that if it wants service it needs to fund the leg between Detroit and Pittsburgh?

And if Pittsburgh-Washington service is to survive then Pennsylvania, Maryland and West Virginia or a combination of those three states will have to fund what would be left of the Capitol Limited.

Some lawmakers like to talk about offering “options.”  They may or may not know or may or may not care that Ohio is unlikely to agree to fund the middle section of the Lake Shore Limited route.

But if Ohio says “no,” well it was given an option and it voted with its wallet.

Buried in the Trump budget proposal is the rational for sharply reducing funding for programs that benefit public transportation: “Future investments in new transit projects would be funded by the localities that use and benefit from these localized projects.”

Look for some in the coming months or years to begin seeking to apply this philosophy to funding for Amtrak long-distance trains.

It would be part of a larger effort to frame the narrative over passenger train funding as a local issue, not a national one even if the trains in question work to form a national transportation network.

Trump Budget Would Hit Ohio Public Transit

March 20, 2017

The proposed fiscal year 2018 budget submitted to Congress by the Trump administration would put funding-starved public transportation in Ohio in even more dire straits.

“We’re barely hanging on. It’s just going to make the existing problems even worse,” said Kirt Conrad, president of the Ohio Public Transit Association and CEO of the Stark Area Regional Transit Authority.

President Donald J. Trump wants to cut the U.S. Department of Transportation budget by $2.4 billion, which is 13 percent.

Much of the adverse effect on public transportation could come from cuts to grant programs that benefit public transit systems.

The New Starts program, which was authorized to fund $2.3 billion in new rail or bus-rapid transit lines or to expand existing lines through 2020, was used by Greater Cleveland Regional Transit Authority’s HealthLine on Euclid Avenue.

“It [budget cuts] really potentially cuts future transit expansions in the country in general. It’s not just Ohio; in the whole country, public transit is at risk,” Conrad said. “In Ohio, without the federal support, I do not see those expansions.”

Also slated to be cut is the TIGER grant proram, which has also been used to fund transit in Ohio.

TIGER grants have funded rehabilitation of RTA stations, including the Little Italy-University Circle station and the University-Cedar station.

Two TIGER grants awarded in 2016 funded bicycle infrastructure in Cleveland and Akron.

Ohio transportation officials say the state’s transit systems rely on federal funding because Ohio limits the use of gas tax revenue to road projects.

Further squeezing public transit systems is a coming loss of revenue from a Medicaid MCO sale tax, which had been used for transit funding.

Starting in 2019, public transit systems in Ohio will lose $34 annually from that revenue source.

Ohio Gov. John Kasich has proposed increasing state funding for public transportation by $10 million to make up part of the slack being left by the loss of the Medicaid MCO sales tax.

“Access to public transit is just getting worse, not better, in Ohio,” Conrad said.

Although the impact of the proposed Trump budget on highway construction and maintenance funding has yet to come into clear focus, transportation officials say that the loss of TIGER grants will have an adverse effect by removing another source of federal funding.

A $125 million TIGER grant helped pay, for example, for the new eastbound span of the George V. Voinovich (Innerbelt Bridge).

The Trump budget would also shift responsibility for air traffic control from the Federal Aviation administration to an independent, non-governmental organization.