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Flag Stops: Dreams and Schemes

Tuesday, July 28, 2009

NARP hits YouTube, hopes for the Sunset, omissions of a high-speed rail critic, transit cuts cripple Berlin, why more should be spent on transportation in a recession, and more.

—Malcolm Kenton

Posted by Malcolm Kenton

Flag Stops: Informed Decisionmaking (Or Lack Thereof)

Friday, January 15, 2010

Many reasons cited for car ownership drop, a way to show that conventional intercity trains actually do make money, Schwarzenegger’s missteps, and more.

—Malcolm Kenton

Posted by Malcolm Kenton

Train Investment IS a Deficit Reduction Measure

Wednesday, October 06, 2010

Many articles in the press are playing up the opposition of some politicians to spending scarce state funds, or adding to the national debt, to improving passenger train service. Most recently, a New York Times piece cites opposition from some gubernatorial candidates in Ohio, Wisconsin, Florida and California. However, if polls showing broad public support for passenger trains reflects the attitude of the electorate, running on an anti-rail platform may not be wise. Yes, the price tag for high(er)-speed rail projects is high, but the price of maintaining the status quo—lost productivity from ever-increasing road and air congestion, escalating health costs from air pollution, and the opportunity cost of forgoing the economic development that modern train service would generate—is much higher.

As economic policy expert Ezra Klein writes in the Washington Post, “[d]elaying a dollar of needed infrastructure repairs is no different than racking up a dollar of debt.” Now is the best time to build major pieces of infrastructure like better railroads and train equipment because construction costs and interest rates are historically low and so many people are in desparate need of a job. The economic output generated through building out needed infrastructure—both direct and indirect—will result in increased tax revenue, leaving us better able to pay down whatever additional debt we incur.

If we use our fiscal deficit as an excuse to continue to ignore our infrastructure deficit, our children and grandchildren—putting up with a lower quality of life than we now enjoy—will look back and ask “What were they thinking?” We already have the vision and the means to build out our rail network so that almost every American community is served by fast, frequent, reliable trains. We just need the political will, and that’s where each of us citizens comes in. Make sure your elected officials and candidates know that investing in this infrasturcture now will pay much greater political dividends than continued inaction.

Side Track

• A Vancouver Sun editorial details just how misguided Canada Border Service is in its insistence that Washington State pay additional hundreds of thousands (more than $20 per passenger per day) in order to keep the popular second Portland-Vancouver Cascades frequency running across the border. The train’s economic benefit to British Columbia far exceeds this cost, and Canada does not charge US authorities for border inspections at road crossings, which far outnumber the 3 existing passenger train crossings. If you live in Canada, please contact Prime Minister Harper and your Member of Parliament and ask them to waive this charge.

—Malcolm Kenton

Posted by Malcolm Kenton

Japan Shows Willingness to Finance Half of California High-Speed Railroad

Tuesday, January 18, 2011

NARP Council member Dennis Lytton of Los Angeles filed this report for the California High-Speed Rail Blog, cross-posted here:

Yesterday I attended the Japanese government sponsored high speed rail seminar in Los Angeles. Led by the Japan International Transport Institute (JITI) and their country’s passenger rail operators and manufactures, the conference was an impressive push for California HSR to utilize Japanese knowledge, equipment, and perhaps most critically, financing.

Japan’s ambassador to the United States, Ichiro Fujisaki, was in Los Angeles from Washington, DC for the conference. Ambassador Fujisaki’s opening remarks to the conference were a forceful call for us to use Japanese know-how and equipment for our high speed rail. Most extraordinarily, the ambassador stated that he believes Japan will pay for up to half of the cost of the California’s HSR.

This is significant of course as we try to find dollars to complete our system. While Fujisaki’s comments of course don’t bind the Japanese government, its railways, or the Japan Bank for International Cooperation (JBIC, the likely vehicle for California HSR financing as I’ll explain below) it is nonetheless a significant statement. Japan’s highest ranking diplomat would not make such a statement lightly. Furthermore, there is every reason to believe that such cooperation on HSR between the US and Japan is very much in our bi-lateral national security interests.

The half day conference featured U.S. elected officials as well as Japanese railway and manufacturing companies (see JITI’s website here for the complete program). Congressman Jim Costa, the pioneer that conceived the Prop. 1A bond when he was in the legislature stated memorably that after many false starts for HSR in the U.S. the Japanese clearly believe that this is the real deal. Congresswoman Laura Richardson similarly observed that talking about high speed rail before Prop. 1A and ARRA passed got you strange looks.

Authority CEO Roelof van Ark gave an up to date presentation on where the project stands now with the funds in hand. He projected an opening of the current segment for revenue service as early as 2018 while funds are aggressively being sought for extensions north and south of the Central Valley.

JR East President and Chairman of Japan’s Council for Global Promotion of Railways Satoshi Seino explained that the state owned Japan Bank for International Cooperation has recently been authorized to invest in high-speed rail and urban rail in the U.S. and other developed countries. Their presentation suggested that the loan terms would be long and the interest rate would be set at a quarter percent over the LIBOR rate (an interbank interest rate).

Executives from several of Japan’s Shinkansen operating railway companies and train manufacturer Kawasaki followed. Some highlights from their presentations included:

• Mixed Use Development – Land use planning and economic development of station areas has been an integral part of HSR development from the beginning in Japan. Examples of both infill and greenfield station developments there were illustrated.  Useful parallels to Los Angeles Union Station and Fresno’s future HSR station were made.
• Earthquake Design Countermeasures – They are extensive in the Japanese system and we can be confident that being on a California HSR train will be one of the safest places to be when the big one hits.
• Integration of Conventional Branch Lines into HSR Operations – The Japanese practice of trains uncoupling cars at intermediate stations and having one of the cars proceed down the “conventional” railroad (at conventional speeds) was discussed. This would certainly be possible here. In a way it would be easier since HSR and conventional railroads would use the same gauge (4 ft. 8.5 in.) whereas Shinkansen uses a different gauge than the “legacy” railways in Japan. However, the lack of electrification on American railways would make this harder. Down the San Joaquin corridor and even the LA Metrolink/Surfliner corridors would be candidates for this kind of one-seat operation.
• Technology Transfer – Kawasaki Heavy Industries (which already has two plants in the US for conventional railcar manufacture) as well as the JR operating companies’ representatives all expressed a strong willingness to transfer their expertise to this country. This would be accomplished through the development of American parts suppliers, final assembly in the U.S., and pre-training of trainset maintenance staff. Kawasaki even expressed a desire to retool American auto parts suppliers to HSR parts suppliers.
• FRA Compliance – Kawasaki asserts that their efSET (2) proposed train for export will “comply with FRA requirements”. Whether this is the current FRA requirements for inefficient overbuilt HSR trains (Acela) or upcoming sensible regulations remains to be seen.

(All the presentations are supposed to be on JITI’s website soon).

All-in-all a day that could be hardly imagined pre-Nov. 2008 and pre-ARRA funds. Basically our Japanese allies are begging us for the chance to build our train because they know it’s going to profitable. You can look at it this way. Japan is already a large purchaser of America’s sovereign debt. Investing in HSR will, in my analysis, simply be an “earmarking” of money that Japan is already spending on US and state government securities.

Should the federal government be putting more money down? Absolutely. But until the current Congress gets it head out of the sand we need to get busy and build it.

Furthermore, I find that sovereign investment in our HSR system from Japan and also France, for instance, to be in keeping with out national security and foreign policy goals. Chinese investment, in contrast, seems more problematic foreign policy-wise. Japan and Western Europe are our long standing allies in the world and they largely share our values with regards to democracy and civil society.

I “feel good” about a enlisting Japanese help in getting California and this country moving into the 21^st century.

Posted by Malcolm Kenton

U.S. High-Speed Rail Association’s Kunz Appears on Fox Business Channel

Wednesday, July 27, 2011

Andy Kunz, President of the U.S. High-Speed Rail Association, appeared on Fox Business’ Varney & Co. today.  Kunz put up a good defense of the High-Speed and Intercity Passenger Rail Program against the hostile program host—Stuart Varney—pointing to the economic benefits high-speed rail in California would bring, and the solutions it provides to congestion, pollution, and oil dependency.

Varney was unmoved, saying that “high-speed rail, despite all this taxpayer money, is dead in America.”  And when Kunz responded to Varney’s comment about the absence of profitable high-speed rail systems by pointing out—correctly—that all transportation is subsidized, Varney visibly grimaced (as in disbelief).

Kunz might have pointed to a Pew Charitable Trust SubsidyScope study, which found that between 2000 and 2009, highways received a total direct expenditure subsidy (public expenditure minus revenue like gas taxes, tolls, taxes on tires, etc.) of $360 billion.  Now compare that to passenger rail, which in the same period received a total direct expenditure subsidy (public expenditure minus revenue, like ticket sales, concessions, advertising, etc.) of $2.4 billion. 

The infrastructure we build today will determine how well we are able to accommodate the 130 million additional Americans that will join the population in the next 40 years.  The numbers clearly show we can’t afford a roads-only approach.

—Sean Jeans-Gail

Posted by NARP

Fast Track to Lazy Analysis

Friday, September 16, 2011

The worst thing about having a President throw their Administration’s support behind your cause is all the presidential politics it injects into what should be a discussion about good policy.

Photo by AP/Getty Images.

Don’t get me wrong; we here at NARP are grateful to finally have someone in the White House who understands the benefits of trains, and the transformative potential of a truly world class passenger rail network.  But it certainly has lead to a lot of head-scratching analysis. 

Take Charles Lane’s recent post “Fast track to nowhere”, hosted over on the Washington Post’s politics blog.  Lane criticizes President Obama’s American Jobs Act proposal, which calls for investment in the modernization of our transportation network.  In an address before a joint session of Congress, the President argued that transportation projects can create jobs immediately, and increase U.S. competitiveness in the long term:

“Building a world-class transportation system is part of what made us an economic superpower. And now we’re going to sit back and watch China build newer airports and faster railroads? At a time when millions of unemployed construction workers could build them right here in America?”

» read more...

Posted by NARP

Jet Blue’s CEO sees benefits of high-speed rail

Friday, September 23, 2011

Image: Examiner.com

In last week’s response to Charles Lane’s “Fast track to nowhere” on the Washington Post’s politics blog, I took issue with Lane’s slapdash transportation policy analysis.  Particularly, his fuzzy thinking about the modal relationship between passenger airlines and passenger rail:

“It’s a bit odd that the president wants simultaneous investment in air transport and high-speed rail, since they are competing modes of travel.

I argued that air and rail should be complementary, with shorter-distance travel (around 500 miles and less) handled primarily by passenger trains, freeing up airport capacity for longer distance trips where airplane’s superior top speeds can provide a significant savings in total, door-to-door trip time.

Well, an article in the Boston Business Journal quotes David Barger, Jet Blue’s CEO, making much the same case:

Asked after his address whether the Obama administration’s focus on high-speed rail would hurt JetBlue, Barger said better rail service between cities like Boston and New York, both of which are important to the airline, actually would be beneficial.

The airspace around New York is full, Barger said, with too much of it “wasted” on planes carrying only a few dozen passengers. “I think high-speed rail would be very, very helpful.”

Barger also spoke about being eager to expand Jet Blue service Rhode Island’s T.F. Green airport, which has just added a rail connection. When you remove the political baggage that pundits attach to projects—based on which politician is supporting what—policy becomes a lot less binary. 

Because whatever Barger’s own political leanings, he’s also responsible for a business that moves people.  And that means looking for mobility solutions in whatever form it presents itself.

Posted by NARP

NJ-ARP meets to discuss future of NEC

Monday, November 14, 2011

The New Jersey Association of Railroad Passengers’ (NJ-ARP) Annual Meeting convened on Saturday, November 12, 2011 at the historic Farnsworth House in Bordentown, New Jersey.  Guest speakers included Amtrak’s Drew Galloway, Vice President of Policy & Development, and NARP’s Vice President Sean Jeans-Gail.

You can read the minutes and NJ-ARP’s President’s message after the jump.

» read more...

Posted by NARP

Congress protects state-supported trains, slashes Amtrak operating funds, and kills high-speed rail

Tuesday, November 15, 2011

House and Senate negotiators last night agreed on a fiscal 2012 “minibus” spending bill that includes transportation. 

The bill funds Amtrak at $1.42 billion and protects short distance services from the attack in the House subcommittee’s bill.  But there is no new funding for the High-Speed and Intercity Passenger Rail Program of grants to states for infrastructure and equipment investments.  The Senate had included $100 million for this, the House nothing. 

The Amtrak operating number is alarmingly tight at $466 million, which is $95 million (or 17%) below the 2011 level. 

The bill is expected to pass both House and Senate this week. 

In a victory for passenger train advocates, negotiators eliminated language from passed by a House subcommittee that would have prohibited the use of federal operating funds on state-supported routes.  This targeted such popular services as California’s Capitol Corridor and Pacific Surfliner, the Midwest’s Hiawatha and Heartland Flyer, and Maine’s Downeaster—among many others.  Passage of this provision would have eliminated 150 weekday trains and stranded more than nine million passengers each year.

Amtrak capital funding was increased by negotiators above the Senate’s $936 million and the House subcommittee’s $898 million.

But the offsetting price is heavy.  Amtrak Operating was slashed to $466 million.  While well above the House subcommittee’s proposal of $227 million—which NARP believes would have forced a system shutdown—this was well below the Senate’s $544 million and the 2011 level of $561 million.  The $466 million figure is slightly more than the $457.5 million Amtrak needed for 2011. 

The new operating level presents a bigger problem than may first appear.  Amtrak cannot count on record revenues every year, or on besting the bottom line in its budget (which it did for 2011 by $30 million).  A major economic downturn or accident could wreak havoc in fiscal 2012.  Legislators, it seems, are looking to provide the bare minimum to keep existing trains running or, as some observers would put it, giving Amtrak “just enough to fail.”

Negotiators also included a provision encouraging Amtrak to build up an operating reserve account:

“The conferees encourage Amtrak to carry $200 million in reserves within their Operating account, and encourage use of any favorable ticket revenue to get to this amount before using this favorable ticket revenue on Capital expenses unless such Capital expenses are necessary to ensure the safe operation and maintenance of the passenger rail system.”

Given the very tight operating grant level legislators have just provided, it is not clear how they expect Amtrak to build up its reserves. This language perhaps is intended as advance warning that appropriators will continue to look at ways to eat away at Amtrak’s grant in future budgeting cycles.

The news was also bad for the High-Speed and Intercity Passenger Rail Program, which saw all funding eliminated.  This comes as a disappointment, following a successful summer and fall by the Federal Railroad Administration.  The FRA made great strides in clearing the way for states to request bids, hire engineers and workers, and begin upgrading tracks around the U.S.  This zero-out could also negatively impact California’s Los Angeles-to-San Francisco high-speed rail project, which has been caught in turmoil over a new business plan which increased the final price tag of the project.  Nonetheless, funding already in the pipeline will provide a lot of jobs and service improvements over the next few years—if Congress does not continue to ratchet Amtrak funding down to the point where the trains stop running.

Posted by NARP

With new report, Los Angeles to San Francisco high-speed rail corridor stays on the boil

Thursday, January 05, 2012

The battle over the Los Angeles to San Francisco high-speed rail line continues to boil, with a new report issued by the California High-Speed Rail Peer Review Group which criticizes the projects funding structure, adding heat to the argument.

The California High Speed Rail Authority responded immediately with harsh condemnation of the group’s study, questioning their fundamental understanding of how high-speed rail systems are built throughout the world.

California Law AB 3034 mandated creation of an eight-member Peer Review Group with a different California official responsible for appointing each member; the group currently has six members, two slots are open. The document’s central criticism seems to be that the California High-Speed Rail Authority (CAHSRA) has failed to secure funds to cover the projects $74.5 billion final cost:

We cannot overemphasize the fact that moving ahead on the HSR project without credible sources of adequate funding, without a definitive business model, without a strategy to maximize independent utility and value to the State, and without the appropriate management resources, represents an immense financial risk on the part of the State of California.

CAHSRA was quick to point out that no large project of any stripe—rail, road, or otherwise—is held to this strict standard.  They argued that the plan created by the Authority was in line with best practices for high-speed rail systems built around the world.

Roelof van Ark, chief executive of CAHSRA, wrote, “It is unfortunate that the peer review committee has delivered a report to the Legislature that is deeply flawed in its understanding of the authority’s program and the experience around the world in successfully developing high-speed rail.  As someone involved in many of the successful high-speed rail programs internationally, I can say that the recommendations of this committee simply do not reflect a real world view of what it takes to bring such projects to fruition.”

There was also the implication that this report could be a self-fulfilling prophecy.  The more doubt that legislators cast upon their willingness to go forward with the project, the more skittish the U.S. Congress and private investors get about supporting the project.  Another peer review committee commissioned by the Authority to review its work—made up of engineers, transportation planners, and economists—had in fact already deemed the ridership model a solid foundation for project planning just this summer, with this to say about CAHSRA’s business plan:

“We are satisfied with the documentation presented in Cambridge Systematics, and conclude that it demonstrates that the model produces results that are reasonable and within expected ranges for the current environmental planning and Business Plan applications of the model.  We were very pleased with the content, quality and quantity of the information.”

As for the political implications of the new peer review group study, Robert Cruickshank has this to say over at the California High Speed Rail Blog:

There’s no doubt that the lack of secured, full funding is a problem. The question is how does one resolve it? Do you assume that the federal government will never spend another dime on high speed rail again and call it a day? Or do you press onward and build what you can, working to change Congress’ mind while also hoping that the initial construction can itself act as a spur to win more funding?

…

There’s no doubt this report will be used by HSR critics in Sacramento and Washington to argue against spending the bond money. But they’ll have to fight Governor Brown, President Obama, California’s Democratic Congressional delegation, and the California Labor Federation.

Mr. Cruikshank may well be right, but we’d be remiss not to come up with a full tally of the opponents lined up and ready to fight this project.  You can be certain that when an issue becomes as politicized as high-speed rail has—and when a project is as big as this one is—there will no shortage of willing combatants. 

None of this is to say the legislature should not be closely involved with the project; overseeing the prudent investment of public funds is one of the highest responsibilities of government officials.  But there is an inconsistency in the way the Los Angeles to San Francisco rail corridor is being treated, as compared to other transportation expenditures.  And the legislators involved are certainly on the hook to consider the cost of the alternatives: the cost of more congestion, more roads, and more airports and runways.  The current estimates put that cost at as much as $171 billion, for an additional 2,300 lane-miles of highways, 4 runways, and 115 airline gates.

Posted by NARP

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