Hotline #928 - May 3, 1996

Thanks to the work of Sen. Byron Dorgan (D.-N.Dak.), it appears that the floor manager's amendment also will link determination of long-term operating grants to creation of a significant source of capital investment for Amtrak. This is a big improvement, replacing a clear statement that the operating grant will drop to zero in five years. This change may pick up votes of some liberal Democrats who had threatened to vote against the reauthorization bill precisely because of the zero-funding threat. But it is sad that rail labor seems to be working against passage of the bill.

Sen. John Warner (R.-Va.) is likely to try to kill the ISTEA flexibility. We hope he will lose by the two-to-one margin that defeated him last July, but the highway lobby is working hard on Warner's side. John Breaux (D.-La.) likely will offer an amendment on liability, to which we are opposed.

Finally, Chuck Grassley (R.-Ia.) and John McCain (R.-Ariz.) plan to offer a devastating, system-killing, "privatization plan." It was conceived by Ray Chambers, a Washington lobbyist for small railroads, for the Discovery Institute of Seattle. It is a thinly veiled attempt to shift funding away from Amtrak to corridor tracks owned by freight railroads, thereby killing all long-distance trains.

There is danger that the Chambers program will appeal to moderate Republicans. Please make it clear that a vote for the Grassley or McCain privatization amendment is the same as voting to kill Amtrak and passenger rail service.

A good reauthorization bill is vital. Appropriations season starts soon and it will be difficult for Chairman Wolf (R.-Va.) to get Amtrak a decent funding level if Amtrak remains unauthorized for a second straight year.

Congress is likely to repeal the 4.3-cent deficit reduction gas tax imposed in 1991. Rather than seeing it for the bad transportation policy that it is, even the White House is talking about how -- rather than whether -- repeal will occur. The airlines only began paying the tax in October 1995, when their two-year exemption from it ran out. Of course, three months later, the airlines stopped paying the taxed that fuel the aviation trust fund.

Repeal intensifies the need for an authorization that enables Amtrak to improve its bottom line, for a dedicated source of capital investment, and for a healthy 1997 appropriation. Unfortunately, to offset the loss of tax revenues, repeal has sent legislators looking for $3 billion of budget savings through January 1, 1997, or $30 billion for seven years. That makes it even harder to fund Amtrak from general revenues.

Amtrak's 25th birthday this week got almost no public attention. Amtrak was reluctant to throw a huge bash while funding is so tight and labor relations so difficult.

Amtrak was nearly evicted from the station it uses at Charleston, W.Va. The contract for Amtrak to use it rent-free expired April 30. CSX had sold the building to a private owner and vetoed Amtrak's plans to stop in nearby St. Albans. Amtrak was forced to negotiate a costly five-year contract to continue using the present station.

The Central Puget Sound Regional Transit Authority will go to the polls again this fall with a rail transit package. A very ambitious plan was defeated by voters in March 1995, but the new, smaller plan can be accomplished at about half the cost in about half the time. It still includes 81 miles of commuter train routes and 16 miles of light rail.