April 10, 1997 Senbate Subcommittee on Transportation Appropriations

Statement of

Ross B. Capon, Executive Director

National Association of Railroad Passengers

before the

Subcommittee on Transportation

of the Committee on Appropriations

U.S. Senate

---

National Economic Crossroads Transportation Efficiency Act of 1997

Submitted for the Record of the April 10, 1997, Hearing

[Similar to the statement presented at the April 23 Senate Finance Committee hearing, at which Capon testified]

---

Our non-partisan association -- whose members are individuals -- has worked since 1967 towards development of a modern rail passenger network in the U.S. We appreciate this opportunity to provide our views for the record. The subcommittee has heard oral testimony from some organizations strongly opposed to federal funding for Amtrak. We request a similar opportunity to testify at the earliest possible opportunity.

We support NEXTEA's overall general approach to transportation. We applaud giving states the right to use flexible gasoline-tax funds for intercity passenger rail. We support creation of a dedicated funding source for Amtrak, such as through S.436 (including the earmarking of 1% of the funds for states with no Amtrak service). We think the public wants the enhanced travel choices and balanced transportation system such legislation would promote. Section IV (below) lists benefits of intercity passenger rail. Finally, we endorse Amtrak's appropriations request.

I. Poll by Bruskin Goldring Research

On May 19-21, 1995, in a national probability sample of 1,006 adults (524 women, 482 men), age 18 and over -- by telephone -- Bruskin Goldring Research, Inc., of Edison, New Jersey, found:

• 63% support for earmarking a full penny of existing federal gasoline tax "to create a trust fund to pay for long-term Amtrak improvements;" and

  
  

• 63% support for letting states "use, for intercity rail passenger service, a portion of their federal transportation funds now restricted to highways, mass transit and recreational trails."

(See Appendix I for the full text of the poll questions.)

It is noteworthy that:

• "Yes" responses were the majority in all geographical sections of the nation, even where Amtrak service is sparse. The "yes" showing ranged from 58%/59% (penny/flexibility) in the South to 70%/67% in the Northeast.

  
  

• For both questions, only 10% of women and 16% of men were "strongly" opposed.

The poll suggests to us that the public does not view gasoline purchases strictly as votes for more roads. America is in love with travel, not with the automobile. In spite of a woefully inadequate advertising budget, and competition from airlines whose huge ad budgets are mutually reinforcing, modern passenger trains of all types are well used in most places where they exist.

Americans often ask why "we can't have a train network as good as they have in Europe." One answer: you get what your leaders buy. The U.S. spends far more of its gas taxes on roads than do many other countries. Netherlands and Great Britain spend about 25% -- most other European countries about 33% -- of road taxes on roads (National Transportation Strategic Planning Study, U.S. Department of Transportation, March 1990). At the same time, intercity passenger rail investment is tiny and has been declining, both in absolute terms and as a share of federal transportation spending (see appendices).

II. The Public Votes with Its Feet

The traveling public generally responds positively whenever modern intercity passenger rail is provided (click here to see a related chart). The most up-to-date statistics also are encouraging. Compared with the year-earlier months, during the first six months of Fiscal 1997 (October-March), travel is up 3% systemwide and 5% at the Intercity unit (which operates most long-distance trains and all Chicago-based corridors). [The percentage changes are of passenger-miles. A passenger-mile is one passenger traveling one mile.]

Much has been made of Amtrak's small share of total intercity travel. However, this should not obscure the critical role that Amtrak plays where it operates and the fact that this role will become even more critical in the future (see #1, section IV). Amtrak handles about 44% of air-plus-rail traffic in the New York-Washington city-pair market; this figure rises to about 70% if we include intermediate points -- such as Philadelphia, Baltimore and Wilmington. However, Amtrak's share is impressive even as a percent of total travel: Amtrak has 23% of all Philadelphia-Washington travel, 16% of New York-Washington and 13% of New York-Albany, the latter despite an average speed of just 58 mph (vs. 76 and 66 mph, respectively, on most New York-Washington Metroliners and conventional trains). The auto market share is 70% in the two shorter markets, 50% New York-Washington. Investments under way will bring similar benefits to the Boston-New York corridor. Currently, Amtrak has only 7% of all travel in the New York-Boston city-pair market; today's average speeds range from 45 to 54 mph.

III. The Half Cent: Higher Ridership, Lower Federal Operating Grant

The half cent and the ability to spend it would enable Amtrak to improve service quality and to provide more service. New rolling stock, improved maintenance facilities and stations, more track capacity (a new siding on the single-track Los Angeles-San Diego line, for example) and completion of the Boston-Washington high speed project would directly benefit passengers and increase ridership. Rehabilitation of the New York-Washington electrification is necessary to retain existing ridership. New mail-and-express facilities also would enhance Amtrak's efforts to meet its zero-operating-grant-by-2002 goal.

IV. Benefits of Amtrak

1. In crowded corridors, passenger trains represent vital people-moving capacity and help relieve air and road congestion. This benefit will grow over time as travel demand continues to grow while airport and highway construction face more intense local opposition and ever-tighter limits on funding and sheer availability of land.

   
   

2. Amtrak is far safer than auto travel.

   
   

3. During inclement weather, Amtrak is safer and usually more reliable than airplanes and buses.

   
   

4. Amtrak is 45% more energy-efficient than domestic commercial airline service (2,351 Btu's per passenger-mile vs. 4,304.2) and 76% more energy-efficient than general aviation (9,825 Btu's per passenger-mile). Source: Oak Ridge National Laboratory's Transportation Energy Data Book, Edition 16, July 1996. This 1994 data understates Amtrak's efficiency because it:

   
   

   • reflect operation of a large fleet of old, relatively energy-intensive cars, almost all of which Amtrak has since retired.

     
     

   • do not reflect Amtrak's positive impact on energy-efficient downtown development and mass transit (see #6, below).

   [Note: Earlier Oak Ridge reports included Northeast Corridor electricity consumed by Maryland, SEPTA and New Jersey Transit commuter trains using Amtrak-owned tracks but excluded the passenger-miles those trains generated. This partly explains Amtrak's relative improvement from, say, 1992, when Amtrak was "only" 42% and 70% more energy-efficient than commercial and general aviation, respectively.]

   
   

5. Amtrak is much less polluting than airplanes. (Energy efficiency is a good proxy for air pollution -- see #4, above.)

   
   

6. In most cities, Amtrak helps mass transit, downtown areas and transit-dependent people by serving -- and increasing the visibility and economic viability of -- transit-accessible downtown locations. Amtrak feeds connecting passengers to transit. Amtrak shares costs with transit at joint-use terminals and on joint-use tracks. Positive impacts have been observed even in small cities with minimal Amtrak service. Mayor John Robert Smith of Meridian, Miss. -- on Amtrak's New York-Atlanta-New Orleans run, with but one train per day in each direction -- says property values have tripled in recent years around the railroad station, where a new intermodal terminal is under construction.

   By contrast, new airports intensify energy-inefficient suburban sprawl and stimulate auto-dependent development. This leads to the social costs of getting transit-dependent people to work, or the need to address the consequences of their not working.

   
   

7. Amtrak serves many communities where alternative transportation either does not exist, is not affordable or only serves different destinations. Trains can make intermediate stops at smaller cities at minimum cost in energy and time. This is apparent in corridors--where benefits go to such cities as Jefferson City, Lancaster, Trenton, Kalamazoo, Wilmington, Bloomington / Normal and Tacoma. It also means, for example, that the Empire Builder can stop at eight small cities in Washington (plus Seattle and Spokane), 12 in Montana and seven in North Dakota without compromising the train's appeal to those riding between Chicago or Minneapolis and Seattle or Portland. Similarly, the California Zephyr serves five Colorado points (plus Denver) and five points each in Iowa and Nebraska. Also, Amtrak serves 14 North Carolina points.

   Here is one example of long-distance travel that I encountered on the Southwest Chief in March, 1995: a mother and her 14-month-old child rode from Garden City, Kans., to Barstow, Cal. The family was moving to California; the husband was driving the U-Haul; the wife and child were on the train "so the move would not be so traumatic" for the child. They did not consider the plane because they felt it would be too cramped for the child. Also, the Garden City-Ontario, Cal., air fare was $450 round-trip with a change of planes in Denver; the train was $188 round-trip (in coach) and went direct.

   
   

8. Amtrak is important to those who cannot fly due to temporary or permanent medical problems, and to those for whom physical and financial considerations rule out driving long distances, for example, seniors and students. (The editor of Frequent Flier, forced by doctor's orders to take the train to Florida, wrote a favorable column about the trip.) Nonetheless, a large proportion of Amtrak riders do own cars or could fly but instead chose the train.

   
   

9. Thanks to a growing array of connecting buses available with train travel in a single ticket transaction, Amtrak puts people on intercity buses who would not otherwise have considered using them. This trend first developed in a big way in California, where the state underwrites an impressive network of dedicated, feeder buses. (The Winter 1996-97 Bus World cover article, "Amtrak California's Buses," reports: "Currently, there are contracts with six independent bus operators operating 16 routes...About half of the San Joaquin train riders use a bus for part of their journey.")

   However, for a growing number of bus connections across the nation, the private bus companies bear any financial risks themselves. These companies highly value their Amtrak-related revenues. Another article in the same Bus World, "Training Greyhound," states: "Former antagonists -- Greyhound and Amtrak -- are cooperating to combat the real competitor, the private automobile." The article says "six significant bus enhancements to the Amtrak timetable" took effect November 10, linking Amtrak to such places as Cocoa and Melbourne, Fla.; Macon, Ga.; Louisville, Ky.; Columbus, O.; and Laredo, Tex. A link to Key West was added earlier last year.

   
   

10. Amtrak is part carrier (like United and Greyhound) and part infrastructure. Thus Amtrak provides important passenger-moving capacity, unlike airlines and bus companies. In much of the Northeast Corridor and a few other places, Amtrak is the rail equivalent of the air traffic control system, airport authorities and airlines. (Among the "other places": the Chicago terminal, part of the Chicago-Detroit line and the track between Albany, New York, and the Massachusetts state line.) Elsewhere, Amtrak is the only carrier with legal access to freight railroads' tracks -- a quid pro quo for relieving the railroads of their passenger-train obligations in 1971.

    
    

11. Amtrak over much of its network enables one to enjoy gorgeous scenery in total comfort. Some examples: the Connecticut and California coastlines, the Hudson River in New York, the Colorado Rockies, the mountains of Vermont and northern New Mexico, Glacier Park in Montana and West Virginia's New River Gorge.

    
    

12. Amtrak's long-distance trains are transportation "melting pots." The majority of passengers on these trains ride coach. Surveys have indicated that, for 30% of coach passengers traveling over 12 hours, average income is less than $20,000 (for 11%, it is less than $10,000). Obviously, most standard- and deluxe-room sleeping car passengers have considerably higher incomes and pay much higher fares. Nonetheless, anyone who characterizes these trains as land versions of cruise ships should try walking the coaches, especially at night.

    
    

13. Trains, especially on longer trips, offer a form of social contact almost lost in this country today -- the opportunity to meet and relax with total strangers that one may or may not ever see again.

V. Of Trust Funds and Subsidies

Today's transportation system is largely a function of the policies of years past. Some salient parts of that history follow:

1. Railroad passengers paid $2.0 billion (not inflation-adjusted) in federal ticket taxes from 1942 to 1962, money that simply went to the U.S. Treasury (general revenues). The Doyle Report to the Senate Commerce Committee (National Transportation Policy, June 26, 1961) cited this tax as "one of the factors under Federal control which favors the growth of private transportation and makes the preservation of public service more difficult." Had this rail passenger tax been earmarked for rail passenger improvements, it is unlikely that the business would have fallen to the depths it reached by the time Amtrak began operating in 1971.

   
   

2. Federal aviation subsidies through mid-1988 totaled $32.8 billion, as follows:

   
   

   • Airport and airway development costs incurred prior to the assessment of user charges in 1971 have been treated as sunk costs, none of which have been or will be paid for by air carriers and other system users...these sunk costs total $15.8 billion." Source: Study of Federal Aid to Rail Transportation, U.S. Department of Transportation, under President Ford's Secretary Coleman, January 1977.

     
     

   • From the time aviation user charges were imposed (1971) through mid-1988, private-sector air system users "received a general fund subsidy of $17 billion, which is equal to the difference between the private-sector share of FAA spending and aviation-related excise taxes since the start of the trust fund." Source: The Status of the Airport and Airway Trust Fund, Congressional Budget Office special study, December 1988.

   
   

3. Federal transportation taxes are mode-specific, except that -- in recent years -- certain highway taxes have gone to mass transit and, since 1991, to recreational trails. Intercity passenger rail has been completed excluded, although the original, Senate-passed ISTEA in 1991 would have corrected this. The selective imposition of mode-specific taxes biases policy makers at all levels of government in favor of more roads and airports. Road and aviation investment goes forward absent analysis of the merits of intercity passenger rail improvements and the impact they might have on road and air needs.

   
   

4. Federal matches are at 80% plus for most highway and aviation projects. State and local officials are eager to maximize federal aid. There is no serious accounting of the huge external costs of air and especially highway transportation. The result is an overwhelming incentive for states and cities to invest in aviation and highways, regardless of the merits of intercity passenger rail. That so many states nevertheless make some rail investments is encouraging, but such investments generally will be aimed only at projects or routes where the benefits are largely or exclusively within one state.

In short, today's transportation system reflects the manipulation of free market forces almost to the point of strangling the passenger train. The half cent and full funding of Amtrak's appropriations request would help offset this manipulation.

Thank you for considering this statement. I would be pleased to provide any further information the committee might request.

---

Appendix I -- About the poll done in 1995 showing the public supports gas tax money used on trains.

Appendix II -- Federal spending on various transportation modes, 1982-97.

Appendix III -- Same as Appendix II, but in chart form.

Appendix IV -- Passenger rail use declined mid-century as highway spending rose.

Appendix V -- Selected countries' public-sector spending per capita on mainline railroads, including the U.S.