Hotline #922 - March 22, 1996

The Clinton Administration released its proposed budget figures for fiscal 1997 on March 19. The fiscal year begins only six months from now. For all government programs, the budget proposes a slight increase in spending, with a higher increase in revenues, creating a smaller deficit for the year.

The transportation budget is also up slightly, overall. The Federal Highway Administration budget drops 3%, the Federal Aviation Administration budget is virtually unchanged, and the Federal Transit Administration would get 6% more than in 1996.

The Amtrak total would go from $750 million in 1996 to $918.5 million. The increases are mostly in capital areas, something Amtrak sorely needs. System capital would go from $230 million to $296.5 million. Northeast Corridor programs would go from $115 million to $280 million. That includes a one-time grant of $80 million for Amtrak's share of high-speed rail train sets and maintenance facilities.

Another increase is for excess mandatory payments for federal railroad retirement and unemployment. For 1996, the Administration proposed -- and got -- only $120 million for this, and the $22 million shortfall came right out of Amtrak's operations. So this year, the Administration has accepted Amtrak's estimate of $142 million for this item.

A big problem is the operating grant. In 1995, the year of big service cuts, Amtrak got $392 million for operations. This year, Amtrak got a combined $285 million for operations and transition costs. Amtrak requested $250 million for operations in 1997, but the Administration has accepted only $200 million. The Administration blithely says its "goal for Amtrak is operational self-sufficiency by 2002, which will be achieved through a combination of new services, continued streamlining, and capital investment."

Currently the three business units have a combined, estimated shortfall exceeding $60 million. Even after budget-tightening measures, Amtrak likely will borrow money just to finish 1996. It is also not clear what benefits will come from pending authorization legislation, or when they will come. Therefore, the impact on service of a federal operating grant $50 million below Amtrak's request is cause for alarm. While prospects are still good for the gas-tax half cent -- which can be used only for capital -- Congress needs to question Clinton's operating-grant request.

The Senate spent the week on continuing resolutions to avert a government shutdown and a filibuster on the product liability reform bill. The Clinton Administration's opposition to liability reform means any such reform in the Amtrak bill will be watered down. But it is still important for you to tell your Senators that you want the Amtrak bill to move, and that they should oppose any liability-related amendments from Senator Breaux (D.-La.).

The Senate is close to approving a bill to give the President the line-item veto, and President Clinton is expected to sign it. The line-item veto will create a great shift in power, including over the transportation appropriations process matters we have followed for so long. Ten years ago, President Reagan wanted the line-item veto very badly, and there is little doubt he would have used it to strike out what little Congress was able to appropriate for Amtrak. It looks like future presidents will actually get the chance to use the line-item veto in such a way.

The Journal of Commerce says Indiana is considering a bill to let 18-year-olds drive commercial trucks in the state. While federal regulations limit interstate trucking to those over 21, some states already allow 18-year-old drivers. There is a shortage of truck drivers now. However, studies show that drivers between the ages of 18 and 21 have the highest accident rates.