NARP February 1998 Hotlines

#19-A - February 2, 1998
#20 - February 6, 1998
#21 - February 13, 1998
#22 - February 20, 1998
#23 - February 27, 1998

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President Clinton today released his federal budget proposals for fiscal 1999. For Amtrak, the budget raises more questions than it answers.

First, it calls for all new funding to come from the Highway Trust Fund. The Administration has tried this before, and failed. There is no reason to think success is any more likely now.

Second, the funding level is $621 million, all for capital. Comparing that with this year's funding is tricky because appropriators nominally gave Amtrak $793 million, but required Amtrak to pay the first $199 million of Taxpayer Relief Act [TRA] money back to the Treasury. More about that below. The Clinton $621 million is 22% below the $793 million, but 5% above the $594 million appropriators really gave Amtrak.

Third, the budget breaks faith with the Brotherhood of Maintenance of Way Employes agreement brokered by Transportation Secretary Rodney Slater. Under that agreement, Amtrak can void wage increases not yet paid if specific funding actions do not occur. Those actions include provision of enough additional operating assistance to correct shortfalls in 1996 and 1997 operating assistance, which the new budget clearly does not do, and reversing the "$199-million deduct" from the 1998 appropriation. One would not expect this to happen in the 1999 budget, but the logical place is in a supplemental appropriation the Administration is preparing.

Third, the Administration assumes the operating grant will be eliminated eight months from now, or three years ahead of schedule. The Administration relies on language in the TRA that makes maintenance of equipment an eligible use for the $2 billion that Amtrak gets under that law. Much maintenance of equipment expense is considered operating today, so this, again, will be a tough sell to a Congress that generally understood the TRA to be for long-term capital investment.

Fourth, even if equipment maintenance can be drawn from the TRA money, that money was only for two years ending in 1999. What would Amtrak use to pay for equipment maintenance in 2000 and after? Does the Administration propose the unlikely concept of restoring the operating grant after it didn't exist for a year?

As Peter Rogoff -- who works for Senator Lautenberg (D.-N.J.) -- stated in an excellent memo highly critical of Administration policy, "If OMB is not prepared to request sufficient funds for Amtrak in fiscal year 1999, why should we expect them to request sufficient amounts in future years?" Rogoff's entire memo can be seen at the web site of the United Transportation Union, or send NARP a self-addressed/stamped envelope and $2.

The kindest thing one can say about the Administration's approach is that use of the Highway Trust Fund is an appealing idea to many of us. But it is a long shot. The Administration's position may well, in Rogoff's words, "undermine the efforts of Amtrak's congressional friends in obtaining Amtrak funding for fiscal year 1999 that is consistent with the railroad's needs and its pending labor agreements."

[Continues with text from #19 of January 30.]

President Clinton on February 2 released his fiscal 1999 budget. While widely praised for being the first balanced budget in 30 years, there is -- as always -- plenty to worry about in the Amtrak department.

First, the budget calls for all 1999 Amtrak funding to come from the Highway Trust Fund. The Clinton Administration has tried this before, and failed. When Congress budget leaders reject Highway Trust Fund money for Amtrak, it will be very difficult for appropriators to carve out enough general funds for Amtrak. The fact that key appropriators are lukewarm or hostile to Amtrak does not help.

The Clinton budget breaks commitments made previously to passengers and employees. Though Clinton has said he wants a "high-quality, reliable rail service," the proposed amount of 1999 funding is a 40% reduction in Amtrak outlays -- the amount of cash actually spent on a program in a given year. The budget proposal raises doubts about whether Amtrak can honor last fall's maintenance-of-way labor contract, which ironically was brokered by the Administration's top transportation official, DOT Secretary Slater.

Finally, by making the new 1999 money only for capital items, Clinton proposes to achieve operating self-sufficiency eight months from now, which is three years ahead of schedule. That may be a foolhardy proposition in itself, but there is absolutely only one way that can work -- that is, if the allowable uses of appropriated capital are broadened to include things like maintenance of equipment. Other modes, notably transit, already enjoy this distinction, and applying it to Amtrak may be the key to Amtrak's survival in 1999.

Amtrak's spring timetable change this year will be May 17. At that time, Amtrak will restore through sleeping cars and coaches between Chicago and Los Angeles via San Antonio on the tri-weekly Texas Eagle/Sunset Limited. That's in addition to the new fourth Texas Eagle frequency, which begins this weekend. Restoration of the through cars is due in large part to the persistence of NARP President Jack Martin and the hard work of Bill Pollard and others.

Storms on the West Coast earlier this week shut down some of Amtrak's services. Flooding between Los Angeles and Salinas, Cal., disrupted service on the Coast Starlight and the San Diegans. Metrolink in Los Angeles added cars to its commuter trains to accommodate extra passengers.

Another storm in Florida caused Tri-Rail to urge commuters to find alternate transportation. Tri-Rail and Amtrak trains were delayed as trains had to be flagged through damaged grade crossings. The storm broke nineteen of 67 crossing gates on Tri-Rail.

A study presented to the Florida Transportation Commission yesterday said that the proposed high-speed rail service from Miami to Orlando and Tampa would attract 8.25 million passengers a year. That's almost as many passengers as on the Metroliners, Clockers, and NortheastDirect trains put together, which was 9.1 million in 1997. The projected ridership is more than enough to please the Florida DOT, but more analysis is needed. State and project officials also hope for some federal funding.

A Travel Weekly article (January 29) discussed the fact that travel agents are starting to charge customers service charges, as a way to counteract the effect of declining airline ticket commissions. Although Amtrak has kept its 10% commission for travel agents, some agents are including Amtrak tickets under their new service charges. Amtrak has complained, with good reason, since this practice puts Amtrak into sort of a double-jeopardy -- Amtrak pays high commissions to travel agents who then make Amtrak tickets more expensive for customers to buy.

Canadian National and Illinois Central have confirmed they are in merger talks.

The most important Amtrak funding message right now is support for the broader definition of capital that transit already enjoys. This is critical if Amtrak is to survive without an operating grant. Meanwhile, Senate Commerce Chairman John McCain (R.-Ariz.) has written to President Clinton warning him that reappointment of any incumbent Amtrak board member other than Transportation Secretary Slater would be unacceptable.

Amtrak announced its first group of investments using the capital funding from the Taxpayers Relief Act of 1997, on February 12. The initial amount is $360 million, about a third of the available 1998 total. Of that, 27% is going to systemwide projects such as upgrading the reservations system and expanding mail transfer facilities; 28% is for Amtrak Intercity for projects such as improving the Kalamazoo line and upgrading Superliner and Horizon cars; 27% is for Northeast Corridor projects such as the Boston high-speed project; and 17% is for Amtrak West for projects such as improving the Las Vegas line and stations such as Seattle, Centralia, Salem, and Sacramento. The projects were chosen for speedy return on investment that will help Amtrak cope with shrinking federal operating support.

The inaugural of the fourth-weekly Texas Eagle last weekend was marred by a five-and-one-half-hour delay, caused by the derailment of a Union Pacific coal train near Kensett, Ark. The Eagle had to be rerouted through Pine Bluff to Little Rock. However, UP overall gave the train excellent handling, including on the detour. Festivities at stations from Little Rock all the way through Fort Worth -- though delayed -- were a big success.

Amtrak and the States of Texas and Louisiana are considering a new train from Fort Worth to Dallas, Shreveport, and Bossier City, according to a February 9 wire story. The train would be aimed at bringing tourists to Louisiana casinos, which have been asked to pay part of the cost.

Amtrak service in California was disrupted for a second week due to flooding. However, Capitol Corridor service was restored February 10, as well as some San Joaquins. The Coast Starlight was not running south of Portland, and may be restored today or tomorrow. The San Diegans did not run north of Los Angeles most of the week. South of Los Angeles, they were subject to delay. The California Zephyr was annulled west of Sacramento. Metrolink service was truncated on the Oxnard and Lancaster routes.

The Missouri House Appropriations Committee has cut the governor's $4.95-million request to support St. Louis-Kansas City trains. The committee approved only $3.5 million. NARP members in Missouri should contact their state legislators, starting with House members, and urge that the governor's $4.95 million be restored. Write to them at the State Capitol, Jefferson City 65101.

The Federal Aviation Administration has given its approval to a plan to use part of the $3 airport departure tax to build a light rail line from Kennedy Airport to Jamaica in Queens, N.Y., where connections could be made to city subways and the Long Island Rail Road. The Port Authority of New York and New Jersey, which owns the three New York-area airports, will build the light rail line. It already owns and operates the PATH subway from Manhattan to New Jersey. The light-rail line should be open to Howard Beach A-line subway station in 2002, and to Jamaica in 2003.

We are sorry to report that former NARP board member John P. Stith of Richmond, Va., died February 10 at the age of 59, following heart surgery. Jack Stith continued to be an active NARP members and was running again for Region 4 director. He also produced the newsletters of the Virginia Association of Railway Patrons and the Old Dominion Chapter of the NRHS, and did much other work to promote his interest in passenger trains. He retired in 1994 after serving 26 years as the principal of the Falling Creek Middle School.

Amtrak announced an order for eight new train-sets of five cars each to be used on the San Diegans, on February 18. The order for $100 million is the single-largest investment every made by Amtrak in California. The order was awarded to GEC Alsthom, a French company that is also involved in the Florida high-speed rail project and in supplying the propulsion systems for Amtrak's American Flyer trains. The cars will be built at the former Morrison-Knudsen plant in Hornell, N.Y., with at least 75% U.S.-content including materials and labor. This will provide about 140 new jobs at Hornell.

The new trains will start service in early 2000. They will be bi-level cars, like the Superliners and California cars. Each set will include a Custom Class car, a Coach-Cafe car, two coaches, and a cab car with both a coach and baggage section. Each train will be pulled by F-59 diesel locomotives.

Public events were held in Los Angeles and San Diego to commemorate the new car order.

The order was made possible by Amtrak's gaining access to the $2.2 billion in Taxpayer Relief capital funds. While this car order was not part of the initial cut of investment projects using TRA money and announced by Amtrak last week, Amtrak was able to use the TRA money as a means to leverage private financing for these cars.

For its part, California has invested almost $1 billion of its own money since 1990 alone for every imaginable aspect of passenger train operations and capital investment. Ridership on the San Diegans is up 13% in the last three years, and can be expected to increase even more with the arrival of new equipment replacing the worn-out, poorly designed, 25-year-old Amfleet I cars now used there.

A renovated and upgraded Pacific Parlor Car for the Coast Starlight was unveiled at a ceremony at Los Angeles yesterday.

One of the partner firms in the Florida high-speed rail consortium has quit the project. Odebrecht Contractors have said the project is proceeding too slowly. Florida DOT said it wasn't concerned, as it had other, private contractor companies that could step in.

The Union Pacific and Burlington Northern Santa Fe announced an agreement on February 13 to place the ex-Southern Pacific main line between Houston and New Orleans under joint ownership and joint dispatching by the two companies. Under the terms of the 1995 merger between the UP and SP, BNSF had been given trackage rights from Houston to Lake Charles, and full ownership from there to New Orleans. This is the route of Amtrak's Sunset Limited. The UP had made some progress in late 1997 in relieving serious congestion on that and other main lines under its control, but the backlog of stalled freight trains had been rising again in January and February.

Senate Commerce Committee Chairman John McCain (R.-Ariz.) wrote to the Surface Transportation Board last week about the on-going UP problem. In the letter, which was co-signed by Surface Transportation Chair Kay Bailey Hutchison (R.-Tex.), McCain brought up the subject of open access. He said, "Some believe that providing open access, forced access or competitive access in the rail industry would stimulate competition and help to address the concerns of shippers in general."

Open access has been anathema to most of the rail industry. It is not clear how far McCain would be willing to go, but there are many who believe that having rail rights-of-way in the public domain, with private companies providing transportation services over them, would put rail on a more equal legal footing with highways and aviation in the U.S. It would bring the U.S. closer to what is being done in several European countries, and could even bring benefits to the area of passenger rail.

Five of the eleven members of the Amtrak Reform Council now have been appointed. Senate Majority Leader Trent Lott (R.-Miss.) this week named his three choices. They are former Federal Railroad Administrator Gil Carmichael, former Amtrak board member Paul Weyrich, and former NARP and Amtrak official Joseph Vranich.

Vranich is easily the most controversial. His association with NARP and Amtrak ended decades ago, and more recently he has written a book and many newspaper columns bitterly attacking Amtrak, and advocating replacing the national system with several high-speed rail lines on new rights-of-way. Vranich has allied himself with the Cato Institute and the Reason Foundation, who also would like to eliminate Amtrak, but who probably do not share his views on high-speed rail. There is much legitimate concern that Vranich will join the Reform Council with a pre-set agenda to destroy Amtrak, though he noted in a release this week he will keep an open mind.

The other two members were appointed earlier. Senate Minority Leader Daschle (D.-S.Dak.) appointed Donald Sweitzer, a former Senate staffer with ties to rail labor.  House Minority Leader Gebhardt (D.-Mo.) appointed S. Lee Kling, a banker who is chairman of the Missouri Transportation Commission and who was an Amtrak board member from 1979 to 1981.

The Senate began debating S.1173, the ISTEA bill, yesterday, with more important issues coming next week. They will debate how to allocate new funds that may be added to ISTEA programs -- some, of course, want it all to go to highways, but you should urge your Senators to make sure that transit and intercity rail get their share. Several anti-environment amendments will be offered, the first one likely to be from Inhofe (R.-Okla.), requiring the Administration to dismantle its new air quality standards.

The Coast Starlight has been running only north of Oakland since February 25, with alternate train and bus connections south of there, due to a washed-out bridge near Ventura. Also, all San Diegan service north of Los Angeles was cancelled February 23. South of Los Angeles, passengers are being bussed around a bridge out near San Clemente. This service outage will last at least until March 2.

Union Pacific is threatening to end Metrolink commuter service between Moorpark and Oxnard, Cal., effective this weekend, unless and agreement can be reached with the Ventura County Transportation Commission. UP is raising the rent significantly for commuter trains on its lightly used Coast Line.

Amtrak will extend two Hiawatha round-trips from Milwaukee to Watertown, Wis., under an agreement with Canadian Pacific and the State of Wisconsin. The service will run from April 13 to July 11, during a construction project on I-94, and will also serve Wauwatosa, Brookfield, Pewaukee, and Oconomowoc. Two other round-trips will run off-peak in order to position equipment at Watertown.

There is now more information on how Amtrak will spend the first part of its Taxpayer Relief Act money. Amtrak West will spend $9 million on track improvements and construction of a train facility for the Los Angeles-Las Vegas Talgo service set to begin next year.

Also, Amtrak Intercity will spend $3.3 million on improving its line between Porter, Ind., and Kalamazoo, Mich. This includes upgrades to a swing bridge at Michigan City to reduce mechanical delays, new crossties in Indiana, and new communications facilities in Niles and Michigan City to avoid replacing 90 miles of outdated, buried copper signal cable, as part of the positive train separation program.

The Auto Train terminal in Lorton, Va., will get $8 million to complete a larger reconstruction program, which will cut the amount of time needed to unload automobiles in half, plus a platform extension to allow boarding of the train in one section.