Hotline #777 -- September 21, 2012

National Association of Railroad Passengers President Ross Capon defended the national passenger rail network from calls to end government investment in passenger rail at a Congressional hearing held today.

Convened by Chairman John Mica (R-FL) of the House Committee on Transportation & Infrastructure, A Review of Amtrak Operations, Part III: Examining 41 Years of Taxpayer Subsidies, the hearing’s anti-Amtrak intent was clear from beginning to end.

“Taxpayers have been footing the bill for Amtrak’s gravy train for over forty years, and all they’ve gotten in return for their $40 billion investment is an inefficient, costly, Soviet-style passenger rail system," said Mica in a statement issued after the hearing. 

Capon attempted to provide a countervailing balance in his analysis of Congressional support of intercity passenger rail and transportation:

"In our view, it would be much better for Congress to ask management what steps could improve Amtrak’s overall performance rather than to micromanage the company with restrictions such as those relating to food service and what fares can be charged. ... One of the most frequently expressed frustrations of our members, and of some academics, is the propensity of critics to call federal grants to Amtrak 'subsidies'—even those devoted to infrastructure—while calling grants to other modes 'investments’… The transportation future that we need is a balanced one that includes buses and planes but also includes a greatly expanded train network."

Capon went on to dispel the notion that roads pay are paid for entirely by user fees, pointing out that in 2001, 41% of the $133 billion spent on highways came from payments other than the gas tax, tolls, and vehicle taxes and fees, and that the trend away from anything resembling a user fee has intensified as politicians refuse to increase the gasoline tax.  In his oral presentation, Capon emphasized that most other countries do not earmark motor fuel taxes for highway investment. 

Moreover, “Calling the gas tax a 'user fee' is logically and factually wrong.”  That’s the headline above an April 2011 column by Alex Marshall, transportation columnist for Governing. 

He ridicules the “user-fee” theory with a mock expression of anger that the sales tax he paid for buying an apple was “used for other things than agricultural support programs.”

Amtrak President & CEO Joseph Boardman also emphasized the subsidies enjoyed by highways in the testimony he presented to the committee, adding that it is a trend that has grown more exaggerated in recent years as the Highway Trust Fund has proven insufficient to meet travel demand of a rapidly growing U.S. population:

 “[P]assenger rail has received only a tiny portion of the annual Federal transportation budget. To give just one example, in the past four years the Federal government has appropriated $53.3 billion from the General Fund of the Treasury to bail out the Highway Trust Fund. That’s almost 30% more than the total Federal expenditure on Amtrak since 1971 [$39.3 billion]. Federal expenditures on Amtrak during the past 41 years pale next to what virtually every one of our European and Asian competitors has spent on passenger rail. But Amtrak has provided a high return on the limited Federal investment we’ve received. Our aim is to continue to do that in the years ahead.”

Want Trains?  Move to a big city, suggests Cato Institute representative

Standing in stark philosophical contrast, Mr. O’Toole called for a complete end to all government involvement in transportation.  Some of the committee members in attendance pressed O’Toole on the practical effects of radical privatization of the transportation network.  Rep. Peter DeFazio (D-OR) reacted with incredulity when Mr. O’Toole suggested that the government cede control of U.S.airspace to private companies, and Andy Harris (R-MD) directed a pointed inquiry about how rural communities would fair.

“So in my district, which has rural areas, should there be any program to incentivize availability of transportation?” asked Rep. Harris.

“I live in a rural area… a very rural area,” responded O’Toole.  “We certainly don’t have bus service, and I don’t think the government should subsidize my bus service.  When I decided to move there, I knew I wouldn’t have access to those things.  If I need access to those things, I’ll move to a place where I need to have access.  We’re a mobile society… so if people need that at some point in their lives, they can move to a community that has that.”

In his written testimony, Capon offered clear and compelling evidence as to why this course would be a disaster for rural Americans.

[Read the press release for NARP’s full response to O’Toole.]

More Mica passenger train hearings to come

While there have so far been few concrete proposals to come out of this series of hearings, Chairman Mica vowed that he is far from done with the subject, promising another three hearings in the period after the election and before the new year.  He said the last hearing will be on the Northeast Corridor.  It appears that high speed rail in general may be covered in the first hearing.  Coming during the “lame duck” session, it is nearly certain that no actual legislation will be proposed.  Mica warns that these hearings are just the tip of the iceberg.

"If you think I'm tough on Amtrak, there's another group coming and you ain't seen nothing yet," said Mica, who evidently believes that the November elections will strengthen the Tea Party. 

Amtrak continues to try to strike a positive note in the face of these assaults.  “When you add the net revenues that Amtrak generates from other activities that reduce our federal funding requirements—such as real estate, and our operation of contract commuter services that was the subject of the hearing earlier this month—revenues cover 85 percent of operating costs," wrote Boardman in his prepared testimony. "What that means is that federal taxpayers pay just 15 cents of every dollar Amtrak spends on our operations," Boardman continued. "That's less than the cost of a small cup of coffee at the Starbucks in Washington's Union Station. And the longest line in Union Station these days isn't for Starbucks, but rather to board our trains."

 

The U.S. Department of Transportation awarded $74.8 million to the Commonwealth of Virginia for the Southeast High-Speed Rail Corridor on September 19, funding the continued development of passenger and freight rail service between Virginia and Washington, D.C., and improving commutes for passengers of Virginia Railway Express (VRE) trains.  The announcement was one of two made this week that will benefit the Southeast High-Speed Rail Corridor [see following story].

“The Southeast High-Speed Rail Corridor between Charlotte and Washington D.C. serves one of the fastest growing regions in the country, which is why it is critical to eliminate congestion points so that intercity passenger, freight and commuter rail can all run smoothly without delays,” said U.S. Transportation Secretary Ray LaHood.  “This is a great example of how federal, state and local governments are working with rail carriers to build capacity and improve service for the public.”

The project will build a third track, along with supporting infrastructure improvements, on an 11 mile stretch of track from Arkendale in Stafford County to Powell's Creek in Prince William County, Virginia.  This busy corridor hosts 10 Amtrak trains and 14 VRE trains a day, in addition to between 40 and 50 freight trains.  This project will add much needed capacity, enabling higher speed trains to use the Southeast Corridor without impinging on the operations of freight and commuter trains. 

“The Washington, D.C. area transportation system has been plagued with delays as population in the area has increased and more commodities flow through the region,” said Federal Railroad Administrator Joseph C. Szabo.  “Reducing congestion and adding capacity are two key outcomes we and our state partners in Virginia planned for in making this investment.  Projects like this will make a real difference for passengers while maintaining our world class freight system.”

The U.S. DOT has laid out long term development goals for the busy corridor, which federal officials hope one day to tie into a mega-rail-corridor stretching from Boston to Atlanta:

When completed, the [Southeast Corridor] will have at least eight high-speed trains traveling at 110 mph between Charlotte, N.C. and Washington D.C.  Travel time between Charlotte and Washington D.C. will be reduced by up to three hours, and travel time between Richmond and Washington D.C will be reduced by 35 minutes. 

The train station at the Quantico Marine Base in Quantico, Virginia will also receive a final design and improvements.

 

The U.S. Department of Transportation also awarded $26.5 million to the North Carolina Department of Transportation on September 21, for projects which—like the Virginia project—will directly benefit Amtrak’s state-supported Carolinian and Amtrak’s New York-Savannah-Florida trains. 

“This project will not only bring jobs to the region, but will also reduce delays between New York, Washington, Raleigh, and Charlotte by eliminating existing choke points,” said Transportation Secretary Ray LaHood.  “Our new plan ensures both freight and passenger railroads can thrive while improving service, creating a win-win situation for everyone.”

The project will focus on the eastern part of the state, between Rocky Mount, North Carolina and Petersburg, Virginia.  The slate of work includes “installation of new track and ties, crossovers, and signals to alleviate rail congestion in this area and allow freight and passenger rail traffic to move more fluidly” creating more opportunities for higher speed passenger trains to pass slower freight trains.  State and federal rail planners have targeted 110 mph operations for the North Carolina section of the corridor.

“This project is a great example of rail carriers, governors, mayors, legislators, advocacy groups, and policy makers coming together to establish a clear vision for this multi-state corridor, and creating a plan to eliminate this bottleneck,” said Federal Railroad Administrator Joseph C. Szabo.  “This investment will reduce trip times and delays, resulting in reduced congestion and making the region a better place to start a business and create jobs.”

 

The Federal Railroad Administration (FRA) officially approved the Merced to Fresno alignment for California’s high-speed rail project on September 19, clearing the way for construction to begin next year.  This decision was bolstered by an announcement that the White House plans to help expedite the regulation process to speed construction.

The FRA issued a Record of Decision (ROD) for the initial Merced to Fresno segment of the statewide rail system.  It is the first of a series of segments that will eventually allow millions of Central Valley passengers—and businesses—to connect to tourist and economic hubs in San Francisco and Los Angeles.

“Today is a significant move forward for California’s high-speed rail system,” said Dan Richard, Chair of the Authority’s Board of Directors. “Governor Brown’s leadership brought major improvements to the plans, management and delivery of high-speed rail and has in large part made this day possible. The Authority is committed to a close partnership with the public in the building of high-speed rail. Currently we are gathering public comment on our environmental documents for the Fresno to Bakersfield section and we look forward to again delivering an alignment that is the best for the communities along the route as well as for all Californians.”

Approved by California’s voters in 2008, the state’s business and labor groups have expressed support for the project, with the first Initial Operating Segment projected to create 100,000 job years (one job-year is the equivalent of one person working a full-time job for one year).  The project has also been actively supported by mayors all along the route, including the Mayors of Los Angeles, San Francisco, San Jose, Sacramento and Fresno.

“The Federal Railroad Administration’s action is both an historic step forward for the high-speed rail project and great news for local businesses and workers,” Fresno Mayor Ashley Swearengin said. “The start of the Fresno to Merced segment will provide a much-needed economic boost for our area through the high-paying construction jobs that will be created. Over the long term, building high-speed rail is essential to creating jobs in the San Joaquin Valley and connecting us economically to the state’s other population centers.”

President Barack Obama followed up the FRA’s decision with by including the high speed rail line—along with the San Francisco Downtown Ferry Terminal—as part of his We Can’t Wait initiative.  The President tasked the Office of Management and Budget with overseeing an effort to shorten the time it takes to complete the permitting and review process for critical infrastructure projects.