Hotline #251 - July 12, 2002

The supplemental appropriations bill has passed both houses. In light of Amtrak's recent funding crisis and a general desire not to increase Amtrak's debt load, a bipartisan consensus for $205 million for Amtrak had developed on the House-Senate conference committee handling the bill.

Today, to reduce the bill's cost, the White House asked conferees to choose from a hit list of several items, one of which is $100 million of the Amtrak money. To express your support for the full Amtrak $205 million, and opposition to the Administration's effort to reduce it, call the White House comment line (business hours) at 202/456-1111; or e-mail.

S.1991, the Amtrak reauthorization that the Senate Committee on Commerce, Science and Transportation approved 20-3, could come up for a vote as early as the week of July 22. The bill now has 38 sponsors; the two newest are Evan Bayh (D.-Ind.) and Paul Wellstone (D.-Minn.). More co-sponsors would be helpful. Full Senate passage would strengthen Amtrak's hand in the inevitable fight over funding for fiscal 2003 (and beyond), even if no authorization is enacted this year.

In the House, action remains stalled because House Transportation and Infrastructure Chairman Don Young (R.-Alaska) will not advance the committee's Amtrak reauthorization bill, H.R.4545, without resolution of labor issues that are hanging up his high-speed rail bill, H.R.2950.

A Washington Post story, "State Role in Amtrak Funding Could Be Part of Rail Solution," by Don Phillips, fills the entire "Federal Page" today. It includes a discussion of contracting out one long-distance train as a pilot project and ends with a quote from Secretary Mineta about supposed state willingness (ultimately) to pay for keeping long-distance trains -- "They're going to pony up to the bar. I think they'll see the benefit and will want to be part of the system."

The July 10 Washington Post has a letter from Chairman Young. He writes, "In the past 4-1/2 years, Amtrak's former and present boards have made only trivial changes to what is largely a 1971 route system while evoking the fictional excuse of a mandate to run the ossified route system." Young notes that the 1997 law "repealed laws specifying Amtrak's basic system of routes and eliminated federal statutes that triggered labor-protection payments if routes were discontinued, relocated or thinned to fewer than three trains weekly ... The only requirements now are notification that a route is being discontinued and the goal of a national system.

However, Amtrak still has labor protection obligations. The 1997 law required Amtrak and its employees to negotiate new provisions or submit to binding arbitration. They did the latter. "In a November 1999 decision, the arbitration board modified the pre-existing employee protective provisions in significant respects, including reducing the maximum duration of ... benefits from 6 years to 5 years and adopting a sliding scale in terms of service to reach maximum benefits ... The arbitration panel agreed that no employee protection would be required for the first two years of any new service commenced after the arbitration" (Amtrak Reform Council Second Annual Report, pages 82-83; First Annual Report, page 22). NARP is interested in changes that improve Amtrak labor productivity, but not in changes (such as further labor protection cuts) that would just make it easier to drop service.

Amtrak was a major discussion topic at the July 10 Senate rail safety hearing. Commerce, Science and Transportation Chairman Ernest Hollings (D.-S.C.) responded to Chairman Young's Washington Post letter. The letter was headed, "House Cleaning at Amtrak." Hollings said, "What we ought to clean out is what we in the Congress have done ... We need to make a master decision on whether or not we're gong to have an intercity passenger rail system. This committee voted 20-3 yes." Hollings also decried the contrast between federal aviation and highway generosity and rail stinginess.

Hollings insisted that S.1991 contains important reforms, particularly regarding accounting, but John McCain (R.-Ariz.), the ranking member, said he plans to offer floor amendments aimed at incorporating some reforms recommended by the Amtrak Reform Council.

Media reports focus on Amtrak President David Gunn's statement that Amtrak would lose over a billion dollars again this year, or about $500 million on a cash basis (which excludes depreciation). The headlines go to "over $1 billion," but a big part of that depreciation is on right-of-way property, which was $251 million in 2001, up a whopping 28% from $196 million in 2000. No airline or highway carrier has this sort of expense.

Federal Railroad Administrator Allan Rutter said that, "In a matter of days, we'll be coming to Congress for up to $170 million" more for Amtrak for fiscal 2002 (evidently a loan, not a grant). Rutter said that DOT did a $100 million loan to Amtrak last month because that is what DOT believes it has the legal authority to loan. Rutter said the auditors want to see $170 million more if they are to certify Amtrak as a "going concern." Gunn later testified that Amtrak originally expected to draw down $205 million of a $270 million private short-term lending facility, but that proved impossible because of the inability to secure a final audit.

As to safety, Gunn said he was satisfied that Amtrak runs a safe operation, based both on statistics and on many hours he has spent observing out on the railroad.

National Transportation Safety Board Chairman Marion C. Blakey focused her testimony on the NTSB's two open rail recommendations "with the greatest potential to save lives," relating to Positive Train Control (PTC) and to track problems. She said PTC could have prevented the Placentia, Cal., BNSF/Metrolink collision on April 23 where the freight rain ignored both yellow and red signals, applying the brakes only when the Metrolink train was visible. Two Metrolink passengers were killed.

Blakey said that 1,115 of the 2,962 reportable train accidents in 2001 were track-related. NTSB said that FRA should increase track inspections and should modify the inspection program to include the volume of hazardous material shipments in determining "the frequency and type of track inspections." She illustrated the seriousness of the problem by citing the Amtrak Auto Train accident on April 18, as well as a January 2001 Canadian Pacific accident in Minot, N.Dak., that created a huge vapor cloud of ammonia and caused one fatality. [Luckily, the accident was at night so most people were indoors.]

Association of American Railroads President Ed Hamberger said that last year was the safest on record, and argued that PTC technology is not yet proven. He said a "basic" systemwide PTC system was estimated to cost $1.2 billion, producing benefits under $500 million; comparable numbers for the "full bells and whistles" version are $7.8 million and about $850 million.

"The whole town came alive" as Old Orchard Beach, Me., became a seasonal stop on the Downeaster, following a ceremony this morning. All trains will stop there through mid-October. Meanwhile, Downeaster ridership jumped from an average of 775 per day in May to 856 in June.

Good news from Canada's Vancouver Island -- the passenger train is safe for now. The Vancouver Island Rail Development Initiative (VIRDI) reached agreement with ENR (Rail America), the current operator of Island rail services, to permit VIA Rail to continue operations on present terms through September. A VIRDI release says, "This will allow for the transition to a new, integrated rail service company for the Island that will ensure the continuation of rail services well into next year. This agreement is an important step toward the development of an integrated, sustainable and economically sound rail service for the Island."