Jul 02, 2009: Hotline #611

Hotline# 611
July 2, 2009

California transit riders won a monumental victory over the state government when an appeals court ruled on June 29 that the legislature may not raid the public transportation fund to cover budget shortfalls.

The Third Appellate District Court decision reversed a previous trial court decision, and may cost the state $3.4 billion, the amount that has been diverted from the Public Transportation Account (PTA) over the last three fiscal years.  The court claimed no authority to reclaim the $2.5 billion diverted since 2007, but would appear to prevent the Schwarzenegger Administration from redirecting $952 million this year.

The PTA receives a portion of the revenues from fuel sales taxes and was designated a trust fund by Proposition 116 in 1990, a citizen’s initiative that also authorized a $1.99 billion bond measure for rail improvements that led—among other things—to the startup of the Capitol Corridor and Metrolink commuter trains in Los Angeles.  The PTA is the funding source for the state’s intercity passenger trains as well as other transit programs

California lawmakers are still struggling to come up with a budget resolution for a fiscal year that began yesterday.  The loss of the diversion of a fuel tax to the general fund will be a blow for a state that has made it notoriously difficult to raise general tax rates. 
“The ruling clearly states that the rip-offs are illegal,” said Joshua Shaw, Executive Director of the California Transit Association and lead plaintiff in the suit that was originally filed in 2007.  “It says they’ve been illegal since before 2007, and it says that the definition of mass transportation that lawmakers have adopted since then to mask these diversions is illegal…This is a clear victory for the millions of Californians who depend every day on public transit to get to work, school and health care facilities.”
A spokesman for California’s Department of Finance announced that the Administration will appeal the decision, though there is no guarantee California’s Supreme Court will grant the appeal.

NARP applauds the work of the California Transit Association.  The full decision can be found here.


America will head into this Fourth of July weekend in the middle of the steepest decline in driving since the automobile was invented,

The current drop of 123 billion in vehicle miles traveled (or 4% off the previous 12 month period) eclipses even the 1979-80 gasoline availability crisis, and is due in large part to uncertainty about the economy and anxiety over the future of gas prices.

“We may be witnessing the beginning of a fundamental shift in American driving habits,” Ed McMahon, senior research fellow at the Urban Land Institute, told USA Today, which ran a front page piece on the precipitous decline.

Head to the NARP Blog for more coverage.


The Department of Transportation sent a two page document outlining their strategy for keeping surface transportation plans funded after the current law expires this September, reemphasizing Secretary Ray LaHood’s previous statements about the absolute imperative of providing a continuous source of funding for state transportation departments.  The 18-month plan calls for the borrowing of $20 billion in general funds from the U.S. Treasury, to be repaid over the next 10 years. 

“A revenue measure that repays the general fund contemporaneously is not feasible given the economic situation and pressing needs of the transportation system,” said the department.

The DOT did not specifically identify the mechanism for paying back the Treasury, only saying the Administration is willing to consider a broad range of options, including changing the way international corporations based in the U.S. are taxed. 

House Transportation and Infrastructure Committee Chairman James L. Oberstar (D-MN) continues to disagree with the Administration and instead is pressing ahead with a $500 billion, six-year reauthorization bill that was approved in a House subcommittee on June 24.


Portland released their Climate Change Plan 2009 this week that uses an extensive light rail network and a systemic reduction in car travel as key strategies to halve emissions.

The Oregon city, in conjunction with surrounding Multnomah County, released a plan that aggressively targets CO2 emissions produced by transportation sources, looking to reduce transportation emission amounts 50% by 2030 (below the levels that existed in 1990).  They plan on meeting these goals through an extensive network of light-rail, streetcars and buses; the promotion of bike and pedestrian friendly neighborhoods, where 90% Portland residents and 80% of Multnomah County residents can easily walk or bicycle to meet all basic daily, non-work needs; and implement pricing mechanisms on driving (such as congestion pricing and toll lanes) and direct these funds to non-automobile infrastructure.

The U.S. Secretary of Transportation, Ray LaHood—who has been holding up Portland as a model city for what the Obama Administration is trying to promote in urban areas—visited the city on July 1 to praise the work they’ve been doing.

“I came here today because Portland is the transportation capital of our country; Portland is the green capital of our country; Portland is the streetcar capital of our country; and Portland is the livable community capital of America” said LaHood.

The Secretary visited the Oregon Iron Works—which the NARP Council toured last October— with Oregon Governor Ted Kulongoski and U.S. Representative Earl Blumenauer (D-OR).  LaHood announced to a crowd of workers and reporters that these are the first streetcars to be manufactured in America in over 60 years, and they signal an important change for American labor.

“I believe this is the dawn of a new era for public transportation in the United States; a new opportunity to claim ‘made in America.’”


Yesterday marked the beginning of the Texas State Legislature’s special session, necessitated by the last minute collapse of a budget agreement at the end of the regular session on June 1 [see Hotline# 607].  The lack of a budget agreement leaves dozens of agencies at risk, and severe cutbacks would have to be made across the board.  At least three agencies (the Texas Racing Commission, the Texas Department of Insurance. and the Affordable Housing Commission) will close if a fix is not passed in a special session.

NARP and the Texas Rail Advocates are calling for a dedicated rail division to be created within the Texas Department of Transportation (TxDOT), which would enable Texas to better partner with the federal government to foster intercity and high-speed passenger rail within the state.  We also advocate inclusion of a provision allowing local-options taxes, which allows counties to create direct-use taxes to fund transportation projects.

Governor Rick Perry already signed two important bills into law on June 19.  The first directs TxDOT to be the leader in coordination of a Statewide Passenger Rail System between all agencies, to create a long term plan for the rail in Texas, and to directly work with the U.S. DOT and Federal Railroad Administration to receive federal grants for intercity and high-speed rail.  This bill takes effect on September 1.  The second bill enumerates powers for Intermunicipal Commuter Rail Districts; designates which governmental entities can be a part of a commuter rail district; and also allows districts to acquire, construct, develop, own, operate, and maintain intermodal and commuter rail facilities.  The final train bill signed by the Governor authorizes him to enter into, and provides advance legislative approval for, Texas’ participation in the Southern High-Speed Rail Compact with the states of Louisiana, Mississippi, and Alabama.


As a consequence of last year’s deadly Chatsworth train crash, Metrolink announced on June 26 that they will take control over the engineers and conductors.

The Southern California commuter rail agency’s Board of Directors voted unanimously to take over control in what will be a year long process.  They will be looking at internal supervision, although they will also consider proposals by Amtrak, the previous operator.

The move was in large part forced, since Veolia—which has been accused of lax employee oversight—refused to continue offering their services, not wanting to take on the insurance liability costs.

The Chatsworth crash cost the lives of 25 people, injuring an additional 135.  Lawsuits totaling millions of dollars are still pending.


The Rhode Island Public Rail insurance fund bill faded quietly into the night this week, threatening to kill a deal between Massachusetts Bay Transit Authority (MBTA), Amtrak, and the Rhode Island Airport Corporation (RIAC) to bring an intermodal station to the T.F. Green Airport in Rhode Island.

The bill in question would have provided the money necessary to cover Amtrak and MBTA insurance liability costs for running the passenger trains along the line.  However, Governor Donald Carcieri failed to move the request for $200 million for insurance—and the $7.5 million evergreen letter of credit—forward for consideration by the state House of Representatives so that RIAC could meet its Amtrak requirements.

Until a deal is reached, no MBTA trains will be running on the Amtrak lines, and the future of the Intermodal Station at T.F. Green Airport appears questionable or nonexistent.  RIAC’s board of directors is not scheduled to meet this month. 


A group of private investors announced on June 29 that they have acquired the rights to Colorado Railcar Diesel Multiple Unit and will resume the domestic manufacturing of the passenger train in a new facility later this year under the US Railcar brand.

Financial difficulties forced Colorado Railcar to close in 2008, stranding transit agencies that bought equipment from the company and relied on them for maintenance and retooling.  Assets acquired by US Railcar include the former Colorado Railcar DMU proprietary rights and information, manufacturing documentation, inventory, tooling, fixtures/jigs and other equipment necessary for production.


The National Association of Railroad Passengers is pleased to offer an online copy of the pilot issue of The American Passenger created by our Marketing & Resource Development Committee.  It has information and updates on passenger rail developments throughout the country, and is dedicated to the promotion and expansion of passenger rail service in America.

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