Jul 22, 2011: Hotline #716

U.S. Transportation Secretary Ray LaHood announced yesterday that his department has reached a final grant agreement with the Commonwealth of Pennsylvania, allowing work to begin on a $24.3 million upgrade of the Keystone Corridor and to clear the way for future top speeds of 125 mph.

The funds, awarded from the American Recovery and Reinvestment Act’s High Speed & Intercity Passenger Rail program, will go to eliminate the last three grade crossings on the corridor, removing the intersection of rail and automobile traffic that is the cause of the majority of accidents involving passenger trains.  The grant covers engineering and environmental work, as well as improvements to signaling systems.

“Closing highway-rail grade crossings eliminates potential accidents,” said Federal Railroad Administrator Joseph C. Szabo.  “We must keep safety at the forefront in the high-speed and intercity passenger rail program.”

Operating between New York, Philadelphia and Harrisburg, the Keystone is Amtrak’s fourth most heavily used route, carrying more than 1.2 million passengers in fiscal year 2010.  That is a 36% increase over the passenger volume in FY2006, when 110 mph service was first introduced.

“We are committed to the President’s vision of a world-class rail network providing fast, efficient and affordable service,” said Secretary LaHood.  “Closing these highway-rail grade crossings will allow travelers along the heavily-used Keystone corridor to enjoy a reduction in their trip time with future train speeds boosted to 125-mph.”

As in all Recovery Act rail projects, there are strict “Buy America” provisions that will direct work to U.S. companies.

Watch video: http://www.youtube.com/watch?v=1QOSuMLEtKI&feature=player_embedded  

Senate transportation leaders held multiple hearings this week on the state of the surface transportation reauthorization, part of an effort to push back against a House draft bill that would slash funding by a third—a cut that has been blasted by transportation groups and the business community, both.

On July 20, the Senate Committee on Commerce, Science, & Transportation held a hearing titled “Building American Transportation Infrastructure Through Innovative Funding”, which looked at nontraditional ways to leverage federal dollars through private partnerships.  While Chairman Jay Rockefeller (D-WV) was clearly engaged in the discussion about how to augment public money through the involvement of private investors, he was adamant that private partnerships were not a replacement for significant government investment.  There was also concern about the immediate impact the House bill would have on an already-faltering economy.

“If there is no action in this Congress—both in the House and the Senate—there will be a major, major dislocation in every segment of the construction industry” said Peter Ruane, President of the American Road & Transportation Builders Association.  “600,000-plus jobs [lost] is a number that has been cited by multiple Senators, and it is a valid number.”

The Senate Committee on Environment & Public Works held a hearing the next day (July 21) titled “Legislative Issues for Transportation Reauthorization”, during which Chairwoman Barbara Boxer (D-CA) unveiled her two year, $339 billion surface transportation counterproposal: Moving Ahead for Progress in the 21st Century (MAP-21).  The bill would maintain funding at current levels, and looks to sidestep a number of the thornier issues involved in the House’s six year transportation reauthorization by focusing on a two year fix—presumably readdress the problem after the Presidential elections, when political rhetoric is less heated.

The hearing certainly displayed bipartisanship that has been rarely seen in the 112th Congress.  Ranking Member James Inhofe (R-OK), consistently one of the most conservative members of the Senate, expressed support for MAP-21 while confirming his belief in the essential role of the government in funding defense and transportation.

In maintaining current funding levels, however, the Senate will have to resolve a $12 billion shortfall between authorized levels and the gas tax revenue flowing in to the Highway Trust Fund.  The gas tax hasn’t been raised since 1991, and has faltered as a source of revenue as consumers drive fewer miles with more fuel efficient cars.  For that reason, perhaps the most important endorsement came from Senator Max Baucus (D-MT), chairman of the Senate Finance Committee.

“I want to say publicly that I am working very hard in the Finance Committee to find that money,” Baucus said. “I feel fairly that we will, on a bipartisan basis, find that $12 billion.”

In his opening statement, Baucus quoted at length from a statement made by President Lyndon Johnson in 1966.  The quote highlighted the difficulties faced by every generation, while also reminding how much America has built in the intervening four and a half decades:

America today lacks a coordinated transportation system that permits travelers and goods to move conveniently and efficiently from one means of transportation to another, using the best characteristics of each.  …The result is waste—of human and economic resources—and of the taxpayers’ dollar.  We have abided this waste too long.  We must not permit it to continue…  Modern transportation can be the rapid conduit of economic growth—or a bottleneck.  It can bring jobs and loved ones and recreation closer to every family—or it can bring instead sudden and purposeless death.  It can improve every man’s standard of living—or multiply the cost of all he buys.  It can be a convenience, a pleasure, the passport to new horizons of the mind and spirit—or it can frustrate and impede and delay.  The choice is ours to make.”

The U.S. House of Representatives adjourned today without passing an extension of the Federal Aviation Administration (FAA) authorization law, which expires at midnight tonight.  The lapse will cost the government around $200 million per week in uncollected airline ticket taxes, while presumably resulting in lower total fares for air travelers.

Congress has kept the FAA funded through 20 short term extensions, which have come to be considered routine. This time, however, House Republicans added “riders” including one that eliminates Essential Air Services funding—which subsidizes air service to small, isolated communities—for 13 rural communities, including some in the states of key Senate leaders (Nevada/Reid; Montana/Baucus; West Virginia/Rockefeller).  Senate Democrats called the provision unacceptable, but House Republicans refused to remove it.

U.S. Transportation Secretary Ray LaHood criticized Congress for letting politics get in the way of good policy, and for leaving $2.5 billion in airport construction projects in limbo.

“I’m very disappointed that Congress adjourned today without passing a clean extension of the FAA bill,” said Secretary LaHood.  “Because of their inaction, states and airports won’t be able to work on their construction projects, and too many people will have to go without a paycheck.  This is no way to run the best aviation system in the world.”

In addition to the construction projects, 4,000 “non-essential” employees will be furloughed until the House can successfully pass reauthorization legislation.  While air traffic controllers and other safety personnel will still be on the job, industry experts are warning travelers they may see disruptions.  And as the standoff drags on and the FAA is starved of revenue, the FAA will have to close air traffic control operations at smaller airports.


Wisconsin’s State Legislature’s budget committee approved $31.6 million to maintain Amtrak’s Milwaukee-to-Chicago Hiawatha train, continuing service on a route whose popularity is on the rise, carrying almost 800,000 passengers last year alone. The funds were approved by a 12-2 vote on July 19.

However, in an ironic twist, it seems as if an $810 million federal high-speed rail grant rejected by Governor Scott Walker (R) would have obviated the need for much of these state funds. The project—which would have funded the extension of the Hiawatha west of Milwaukee to Madison, while reducing trip time and increasing frequency—was killed by Walker shortly after he took office this year.  The Governor claimed the project put Wisconsin taxpayers at risk, citing annual operating costs and the potential for construction overruns while questioning ridership estimates.

Wisconsin’s nonpartisan budget office, however, found that the federal high-speed rail funds would have covered around $22.4 million of the $31.6 million that the State Legislature just approved.  And that’s apparently just the tip of the iceberg.

Wisconsin’s transportation officials have warned that the state needs to invest in new locomotives, signals, and a new maintenance base just to maintain the Hiawatha at its current seven daily roundtrips—to say nothing of expanding service to meet rising demand.  State capital costs that could have been covered by the federal Milwaukee-Madison high-speed rail grant could reach $99 million.  Compare that to the $30 million in matching state operating costs, paid out over 20 years, required to secure the $810 million federal grant.

“We had an opportunity to take advantage of federal funding in one of the tightest budgets in years,” Sen. Lena Taylor (D-Milwaukee) told the Journal Sentinel, lamenting Walker’s rejection of the Madison upgrade.

The U.S. Department of Transportation has speedily responded to Florida Governor Rick Scott’s green-light for SunRail (Central Florida commuter rail), announcing July 19 that $178.6 million in federal funds is now available and construction can begin.

“Investing in a modern transportation network is part of President Obama’s strategy to win the future by out-building and out-competing the rest of the world,” Secretary LaHood said. “We’re bringing real transportation choices to greater Orlando, so more people can leave their cars at home, give their kids cleaner air to breathe and reduce our nation’s dependence on oil.”

Construction and engineering on the project will create 11,000 direct jobs, with the Florida Department of Transportation projecting the creation of another 150,000 jobs from business and economic development along the densely populated SunRail corridor.  The train will provide access to Orlando’s central business district and its 730,000 jobs.  Federal officials stated there are an additional 79,000 jobs “within walking distance of the line’s 12 stations.”  The project includes major improvements to CSX’s north-south route through Ocala, where many freight trains that now run through Orlando will be diverted.

“SunRail will give hundreds of thousands of Central Florida residents a viable transportation alternative,” said Administrator Peter Rogoff. “Not only will they be able to avoid congestion, they will be in an environment where they can get work done while commuting.”


A consortium of Spanish rail companies secured a contract to connect the Saudi Arabian cities of Medina, Jeddah, and Mecca through a high-speed rail network—a contract estimated to be worth $10 billion. The Spanish consortium consist of rail operator Renfe, and manufactures Talgo, Adif, OHL, along with eight other companies.

The 280-mile line will connect the popular Muslim pilgrimage sight of Mecca to the rest of the nation.  Mecca attracts around 2.5 million Muslims from around the world during the annual Hajj pilgrimage.

The contract is a powerful reminder of the economic benefits that attend investing in transportation research and development, and the potential windfall that comes with exportation to foreign markets.


Travelers Advisory:

• Virginia’s Blacksburg-Roanoke area is now being served by a bus service that will connect passengers to the Amtrak station in Lynchburg, providing a connection to Northeast Regional trains. Tickets cost $4.00, and are purchased onboard. For more information go to www.smartwaybus.com.
• Amtrak’s Train 371—operating between Grand Rapids, MI and Chicago, IL—will be operating 90 minutes earlier than its normal schedule from Monday, August 15 through Thursday, September 1, 2011. The change will let CSX Transportation replace ties and rail between Holland, Michigan and Porter, Indiana.  Train 370 will be unaffected.