Hotline #210 - September 28, 2001

Amtrak ridership remains above pre-September 11 levels, despite the fact that we are now in an autumn period when travel demand normally goes down, and despite the fact that travel demand seems to be reduced overall as a result of the crisis. Currently, based on bookings and ticket issuances, Amtrak reports a 15% increase nationwide over pre-September 11 levels, with a 40% increase on Acela Express on the Northeast Corridor. This may continue, as many people who now are reluctant to fly will look to rail as an alternative for flights of any distance, and as longer waits in air terminals make many short-distance rail trips more time-competitive than they were.

Obviously, Amtrak ridership is down somewhat from when all commercial airline flights were annulled, and thousands of stranded air passengers were desperate for a way to get home. During that period, Amtrak reported a nationwide increase in ridership of 17%, with an increase of 35% on long-distance trains.

Amtrak announced that as part of its larger efforts to increase passenger safety, individual passengers who are 18 or older may be asked to show valid photo identification when purchasing tickets or checking baggage. A notice about this appeared on the Amtrak web site late on September 21. "Valid" identification includes state-issued driver's license with photo; other state-issued photo identification; state-issued identification that provides physical characteristics (if it includes no photo); passport; photo identification for federal, state, county employees; photo identification for university, college, or high school students. More policy changes affecting passengers are possible.

Amtrak also has asked mayors across the country to increase local police presence at train stations; this is already happening at many airports.

Fiscal 2001 ends this weekend, but appropriations bills for 2002 have not been passed yet. Federal transportation programs (like others) will be funded under a Congressional continuing resolution that expires October 16 (or when an appropriations bill is enacted, whichever comes first).

The $15-billion airline bailout bill we mentioned here last week quickly became law (P.L.107-42, September 22), after passage by both Houses September 21. The law includes $5 billion in direct grants to airlines that can show losses directly arising from the September 11 crisis, and the rest in loan guarantees, along with liability limits. Also included was $120 million to subsidize "essential air services" to smaller communities.

Meanwhile, the Senate Commerce Committee has scheduled an October 2 hearing on surface transportation security at which Amtrak President George Warrington is to testify. Amtrak has requested $3.15 billion for security and capacity enhancements to help passenger rail better cope with increased ridership. At one point this week, Sen. Harry Reid (D.-Nev.) argued for inclusion of $37 billion in a potential economic stimulus package -- $20 billion for high-speed rail, and $17 billion for maglev.

H.R.2329, the House version of the High Speed Rail Investment Act, now has 184 sponsors, with the most recent addition of Conyers (D.-Mich.) and Lowey (D.-N.Y.). S.250 remains at 57.

As we reported here three weeks ago, House Transportation and Infrastructure Chairman Don Young (R.-Alaska) has been planning to introduce his own high-speed rail bill. That happened September 25, and the resulting bill is H.R.2950. A hearing on the bill will take place October 2. There is no Senate counterpart as yet.

The sheer total of possible funding in H.R.2950 -- $71 billion -- should seem attractive. That amount, even spread over ten years, is a far larger rail program than we've seen before. However, there are several important differences with previous bills:

--Of the $71 billion, $35 billion comes in the form of loans and loan guarantees. It's not clear how much of the loan money actually would go toward building high-speed rail, given the implicit expectation that loan principal (capital) would be repaid over time from revenues -- a very tall order for such proposals. Loan money can also go toward fright and commuter projects. The loan program is an extension of an existing, $3-billion loan program from TEA-21 (1998), under which no loan has yet been made. (This is the loan program that has been contemplated for improving Kansas City Southern tracks in connection with Amtrak's Crescent Star proposal.)

--The remaining $36 billion is for high-speed rail bonds, to be issued by states, with interest that is exempt from federal taxes. States would have responsibility of paying all interest and principal costs. Sponsors of H.R.2950 say that the entire program would cost the federal treasury $6 billion (because of the tax exemption), where the smaller HSRIA would cost $7.4 billion (because of the tax credits). The question is whether states are ready to assume this burden.

--H.R.2950 requires that bonds be used only for projects designed for "sustaining cruising speeds of 125 mph or more" and that eliminate all grade crossings. However, Alaska is exempt from these requirements.

The Federal Railroad Administration, in its 1997 work, "High-Speed Ground Transportation for America," found that the increment from 110-moh running to 125-mph running yielded relatively little in terms of added ridership (and diversion from aviation), but often greatly increased costs. Also, some corridors have made great strides at lower speeds (and costs), and this trend is likely to intensify under the new competitive situation since September 11 (which was after H.R.2950 was conceived). State planning generally has focused on projects with speeds under 125 mph and that do not contemplate elimination of all crossings.

Finally, H.R.2950 reauthorizes the Swift Act (high-speed rail) at $35 million a year through 2009, with $25 million for corridor planning and the rest for technology development.

A new Northeast Corridor timetable takes effect September 30. Amtrak will add more Acela Express service, and all remaining trains designated "NortheastDirect" will become Acela Regional. The new station at Newark Airport was to open at the same time, but the Washington Post indicated that would be delayed by about two weeks as construction workers who were finishing up the project were diverted to emergency work in Manhattan.

The Sunset Limited will begin serving Maricopa, Ariz., with the eastbound train passing there October 28. There will be a grand opening October 20. Bus connections to Phoenix will be shifted to Maricopa from Tucson.

The board of Sound Transit in Seattle yesterday, in a controversial vote, approved a 14-mile light-rail starter line for $2.1 billion, to be complete in 2009. The line would run from downtown Seattle south to Tukwila. Where some praised the decision as a way forward in introducing light-rail to Seattle, others were concerned that areas north of downtown Seattle were being left out -- though these areas were to be served by a series of tunnels that would have been controversial in their own right. Also, the southern terminus in Tukwila stops the line a mile short of the major Sea-Tac airport (an airport shuttle service is planned).