July 25, 2001 Current Status and Future Prospects of Amtrak and High Speed Rail

Thank you for the opportunity to present this information.  Our non-partisan organization has worked since 1967 in support of more and better passenger trains of all types in the U.S.

I. Success Stories

For the Amtrak system as a whole, FY 2000 saw ridership rise to a record 22.5 million; this was the fourth straight year in which ridership grew. Similarly, travel, measured in passenger-miles (one passenger traveling one mile), rose for the fourth straight year, to 5.49 billion. (The latter figure is not a record, due to reductions in the size of Amtrak's long-distance network.) System ridership and revenues appear to have held up well during the current fiscal year. At least through June, there are consistent increases above year-earlier months, in contrast to the declines some airlines have posted in recent months.

Below I discuss several (but not all) of the success stories that have resulted from Amtrak/state/railroad partnerships. Some critics of Amtrak and the current structure suggest that all of these accomplishments could have happened without Amtrak. That is speculation. What is clear is that these accomplishments were a product of the existing structure, including the law that gives Amtrak access to the freight railroads under specific terms.

California

The improvements described below reflect an extraordinary commitment by the State of California and its localities, and their superb partnership with Amtrak and the freight railroads (which own much of the trackage). The state has invested in rolling stock, stations and track improvements, including track capacity enhancements. Freight operations also benefited from much of this work.

A superb feeder-bus network enhances ridership on the California corridors. This network includes not only the heavily traveled Bakersfield-Los Angeles link but a dense network of connections to many smaller markets. When Amtrak began in 1971, California corridor service consisted of just three Los Angeles-San Diego roundtrips. Today, there are 25 intercity roundtrips (11 Surfliner, five San Joaquin, and nine Capitol). On the commuter-rail side, the southern California network has grown from a single round-trip in 1990 to a significant network that includes about 2.5 million annual trips on the Los Angeles-San Diego segment alone. There has also been significant commuter-rail growth in the Bay Area.

On the Capitol Corridor linking Sacramento with the Bay Area, ridership grew 109% from 366,800 in 1994 to 767,800 in 2000. For the year ended June 30, 2001, the total is 1.03 million, which is 181% above the 1994 level. This is all the more impressive when one considers that this service only started in 1991. Again, increased frequencies and more modern equipment have been crucial. The number of daily round-trips on the main segment (Sacramento-Oakland) grew from three in the May, 1994, timetable to seven in the May, 2000, timetable. [The current timetable shows nine round trips, and FY 2001 ridership for October-June (nine months) is up 49% and already exceeds the FY 2000 12-month total.]

On the San Joaquin Corridor between Bakersfield (bus connections to southern California) and Oakland/Sacramento, ridership grew 22% from 554,500 in 1994 to 676,100 last year. For October-June this fiscal year, ridership is up 7% over last year.

What is now called the Pacific Surfliner route (San Diego-Los Angeles-Santa Barbara) is the only Amtrak route outside the Northeast and Empire Corridors where annual ridership exceeds one million. It was 1.58 million last year; FY 2001 ridership is up 7% through nine months (October-June); the increase in June was 11%. However, Amtrak figures tell only part of the story of the growth in rail usage on this line. First, we understand that overcrowding mainly on weekends has created situations where many tickets were not collected and thus riders not counted.

More importantly, county-sponsored commuter rail operations which did not even exist on the line before 1990 have grown dramatically and now account for about 2.6 million riders a year. Starting with a single, Orange-County-sponsored, Amtrak-operated Los Angeles-San Juan Capistrano rush-hour train April 30, 1990 (extended to Oceanside in May, 1994), commuter rail serving the Amtrak stations plus additional stations mushroomed into the huge Metrolink operation of today. February 27, 1995, saw start-up of the "Coaster" service on the southern end of the line (San Diego-Oceanside). Coaster ridership in 1999 was 1.2 million and last year daily ridership on Metrolink’s Orange County line was 5,670 (roughly 1.4 million a year).

New York

The Empire Corridor in New York has become solidly established even among business travelers, although achieving significant market share west of Albany obviously will require faster service. For Albany businesspeople going to New York City, the train is by far the first choice. Overall, Empire Corridor ridership was 1,071,400 in 1994 and 1,320,500 last year. Amtrak deserves credit for adding frequencies, which is a factor in the ridership growth.

Reflecting strong interest in passenger rail, cities on their own initiative are planning to rebuild nearly every station between Albany and Buffalo, usually with state aid.

• We greatly appreciate your work, Mr. Chairman, in securing federal funds for a downtown Buffalo station, and the work of Assemblyman Sam Hoyt in securing state funds for the same project. The new station will be a huge improvement -- particularly if buses also use it so that it will be staffed around the clock. The station should be a tremendous asset both to downtown Buffalo and to Amtrak and its customers.
• Depew has been completed. This was done mostly by Amtrak.
• Syracuse has been finished, with funding from many sources. It creates a much nicer environment for rail passengers, and with buses also using the facility there is always some staff on duty, even when Amtrak is closed. [A plan to bring a second track into the station so the Syracuse diesel rail car shuttle can link the city’s new intermodal (Amtrak and intercity bus) terminal to downtown Syracuse, as well as to the nearby baseball stadium on special occasions, thus far has been stymied by liability concerns associated with construction of a necessary bridge. We are hopeful that these concerns can be overcome, the bridge built and the link established.]
• Construction is underway at Utica (second platform, with pedestrian overpass) and Albany (new station).
• Other stations are still in planning, or awaiting adequate funding or CSX approval. Rome seems closest to action.

The State of New York has committed over $100 million for service upgrades including refurbishing seven turboliner train sets, double-tracking the 17-mile bottleneck between Albany and Schenectady, and raising top speeds to 125 mph on part of the route south of Albany. The state is currently developing a master plan for specific improvements and is involving all users of the tracks in the process.

Unfortunately, three years after Gov. Pataki announced $185 million program shared equally by Amtrak and the State, no results are visible. The chief problem now is the failure of the state to enact tax relief for New York's extraordinarily high and discriminatory rail property tax. Understandably, CSX will not allow passenger improvements to their line which increase its value and their property tax burden. Two construction seasons have been lost and it is not clear when the state will act, even though there is widespread support for the tax relief proposal.

Separately, and unrelated to property tax problems, we are mystified by the failure thus far of the refurbished turboliners to enter revenue service. Despite being displayed since last November, they never seem to be ready for actual service. Defects and the need for  modifications seem constantly to be discovered, and the price is going up. The work is being done by Super Steel Schenectady. A July 13 Schenectady Gazette article quotes Amtrak spokeswoman Karen Dunn: "We still plan to have the first train in service by the end of the summer."  We certainly hope there will not be another postponement.

North Carolina

North Carolina has mounted a solid program that includes sponsoring two passenger trains, highway/railroad grade crossing improvements, intermodal terminal development and plans for significant track improvements and speed reductions. Ridership on the New York-Richmond-Raleigh-Charlotte Carolinian was 206,400 in 1994 and 241,600 last year. This is a single daily round trip; one-way route mileage is 702. A high proportion of riders on this train are making fairly long trips. At a February 1, 2000, meeting on Capitol Hill to announce formation of the States for Passenger Rail Coalition, David King of North Carolina DOT said "two-thirds of the people who board our trains want to go to the Northeast Corridor."

A second train, running only between Raleigh and Charlotte, was added during FY 1995. FY 1996 ridership was 29,100; last year it was 55,000.

The state has a major station improvement program, which has helped ridership and will do so even more in the future.

Pacific Northwest

On the Pacific Northwest Corridor between Eugene, Oregon, and Vancouver, British Columbia, annual ridership grew 165% from 226,000 in FY 1993 (first year of the Amtrak/State of Washington partnership) to 640,100 in calendar 2000, in spite of modest train speeds. (These ridership figures include relevant short-distance travelers on long-distance trains.) The major factors that explain this growth:

• Modern, Talgo trains
• Modest reduction in Seattle-Portland running time for the corridor trains from 3:55 (average speed: 47.5 mph) to three and a half hours (average speed 53.1 mph)
• Modest increase in frequency of Seattle-Portland corridor trains from one to three (total departures including long-distance trains from three to four)
• Modest service expansion north and south of those two cities (Portland-Eugene service doubled from one to two daily round-trips; Seattle-Bellingham went from zero to two, one of which continues on to Vancouver, B.C.)
• Increased highway congestion and higher gasoline prices.

While this service is nowhere near European or Japanese standards, it is more frequent than at any time since 1957, and the average speed for the fastest trains is higher than at any point in the last 50 years (except during 1971 when Amtrak achieved this speed but at a cost of dropping three intermediate stops).

If that kind of ridership growth can be obtained with modest improvements in speed and frequency, it is reasonable to expect that significant improvements would generate dramatic ridership improvements. Indeed, state plans -- which are dependent on a federal funding partnership -- envision over two million riders in the year 2018, based on reducing Seattle-Portland trip times to 2-1/2 hours and increasing frequencies to 13 daily Seattle-Portland round trips. If the High Speed Rail Investment Act is passed, the Washington State DOT plans to accelerate the improvement program to complete the program in as soon as 10 years -- still painfully slow by our standards.

U.S. Postal Service Contracts

Amtrak's longstanding relationship with the Postal Service has greatly benefited the bottom line, particularly of the long-distance trains. Amtrak's FY 2000 revenues were $96.1 million (annual report, page 20), and we understand that Amtrak "earns a 30% margin on sales" (Strategic Business Plan, FY 1999-2002, published October 12, 1998, page 33).

Midwest

This really is a success story to come. Progress has been much slower here than elsewhere. The Midwest Regional Rail Initiative aims to change that, and some notable progress has occurred:

• Amtrak and St. Louis finally have agreement on plans for a long-awaited intermodal terminal in that city, which will increase Amtrak's visibility as well as permit convenient transfers between Amtrak and the region’s highly successful light rail line. Amtrak's inconveniently located "temporary" St. Louis station has been a major obstacle to ridership development.
• As we speak, Amtrak is rerouting one Chicago-St. Louis train to accommodate major track improvement work on this line.
• Testing is well advanced on a signal system on the Amtrak-owned third of the Chicago-Detroit line that will permit 110 mph operation.
• Wisconsin has plans for a new passenger-train station at Milwaukee’s Mitchell Field, to begin to tap the huge market of travelers that would like to follow the European model of easy transfer between air and rail travel.
• The Wisconsin DOT on June 12 released a favorable Environmental Assessment for the proposed Milwaukee-Madison line, which is envisioned as eventually extending to the Twin Cities.  On the 85-mile Milwaukee-Madison segment, travel time is projected at 1:07 (average speed 76.1 mph; top speed 110 mph).  Testimony at recent hearings on the Environmental Assessment was very positive, with a clear majority of speakers in favor of developing the rail line.

People in cities near the rail line are increasingly seeing fast, frequent train service as a strong asset to their communities.

II. Elements of Success

In most of the above cases, states have provided significant capital and operating support. To the extent that operating support has helped keep fares lower, this support has helped increase ridership. Indeed, whenever Amtrak is criticized for not showing more dramatic ridership growth in recent years, it should be noted that the 1997 Amtrak reauthorization sent a pretty clear message (a misguided one, in our view) that improvement to the bottom line was to be a higher priority than ridership growth. Consequently, ridership growth has come against a backdrop of pressure to increase fares, even on state-supported trains. For example, our New York members are concerned that pricing in the New York-Albany market has all but eliminated family and leisure travel. On the line west of Albany, where low airfares are now a major factor, our members think Amtrak has been slow to react and lower its own fares. They also feel that extension of a daytime train to Cleveland and restoration of an overnight train to Toronto would help develop markets where such competition is not a factor.

III. High Speed Rail Investment Act, H.R. 2329

We strongly support the High Speed Rail Investment Act (HSRIA). It offers the only realistic, near-term hope for enabling the federal government to partner with states in developing air-competitive rail corridor services.  Most of this work will be upgrading lines that already have Amtrak service. As noted above, some of these lines already have experienced significant ridership increases based on very modest improvements in running time.

One criticism of HSRIA which we have heard is the high price tag for a "complete build out" of all of the Northeast Corridor and all of the federally designated high speed rail corridors around the country, and the fact that such a price tag is well beyond the resources in the HSRIA. A recent news report cited "preliminary Amtrak estimates of $50 to $70 billion over 20 years."

We do not see this as a problem. First, the 20% state match requirement will help insure that the most useful and economically viable projects get funded; intercity passenger rail money is hard enough to get to offer assurance that states are not going to "waste" it on low-priority projects. Second, in general, each small investment in this program is going to produce tangible benefits, such as reduction in rail travel time by a given number of minutes, and/or improved safety at certain grade crossings. Therefore, if a decision is made to stop the investment process before a corridor is "fully developed," the money spent up to that point will not have been wasted. Finally, it is obviously our expectation and hope that -- just as the modest projects described above have created enough new ridership to build political support for further investment -- so also will future investment projects further expand the high-speed rail constituency, enabling significant investments beyond those possible under the HSRIA.

We think it is a national disgrace that no state partnership program exists currently and that, in effect, there is no mechanism to reflect rail's ability to let the U.S. avoid certain  costly, disruptive aviation investments. We understand that direct appropriations likely would cost less, but they are effectively "off the table." The small gap between "fire-walled" highway and aviation trust fund dollars and total resources available to the transportation appropriations subcommittee means it is always a struggle to fund Amtrak's core system, as well as the Coast Guard and FAA operations.

The HSRIA is not an Amtrak bailout. A June 25 General Accounting Office report describes various concerns about S.250, the first version of the HSRIA introduced this year. H.R.2329 addresses most of the concerns described in this report, and some of them also have been addressed in a newer version of the Senate bill which is expected to form the basis for initial action in that body.

IV. Long-distance trains

The long-distance trains account for the majority of Amtrak's route-miles. These trains are important to people who live in or are trying to reach small communities where alternate public transportation does not exist, does not go to the right place, or -- in the case of some small-town commercial flights -- is unaffordable. They appeal to those who want a break from the fast-lane world of commercial aviation. They're essential to people who don't like to fly or cannot fly for medical reasons, permanent or temporary. These trains are appreciated by those who like the unparalleled view of America's physical beauty that most Amtrak long distance routes offer.

Long distance trains are the melting pots of U.S. and Canadian transportation, carrying passenger railroading’s lowest-income riders (long-distance coach travelers) and some of its wealthiest (those riding in deluxe sleeping accommodations). Coach passengers account for about 84% of the riders on these trains, and about 76% of the passenger-miles traveled. Moreover, the total subsidy per passenger-mile on the long-distance trains is substantially lower than it is on short-distance corridors outside the Northeast.

These trains help glue the system together physically, facilitating the ferrying of corridor (and commuter rail) equipment around the nation. They also facilitate future efforts to build air-competitive corridors and commuter rail service. A downtown commuter rail station is not easy to start from scratch -- witness the painful efforts to recreate one in Atlanta -- so having it in place is a big help.

Long distance trains also perform important non-passenger functions, including the carriage of mail noted above, most of which would have gone by truck in the absence of Amtrak. The express business, also conceived to improve Amtrak's long-distance economics, had a rough start, with too much emphasis on revenue and not enough on cost. Amtrak's appointment last year of Lee Sargrad as President - Mail and Express appears to reflect a strong focus on enabling express, like mail, to make a significant contribution to the bottom line while relieving highways of some truck traffic.

There also are benefits for the freight railroads. Amtrak has been a leader in improving grade crossing safety, particularly in Florida, where, so far, it only runs long distance trains. Finally, Amtrak's express initiative appears to have inspired freight railroad efforts to recover some of the time-sensitive cargo lost to trucks years ago.  Motorists, public safety, and energy efficiency generally benefit when cargo switches from road to rail.

V. Ongoing funding needs

The High Speed Rail Investment Act would provide funds to develop high-speed rail corridors.  Amtrak has core capital needs that will continue apart from the high-speed rail program and apart from (i.e., assuming Amtrak meets) the operational self-sufficiency target.