[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]



 
                     FREIGHT AND PASSENGER RAIL IN

                    AMERICA'S TRANSPORTATION SYSTEM
=======================================================================

                                (113-4)

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON

                       RAILROADS, PIPELINES, AND

                          HAZARDOUS MATERIALS

                                 OF THE

                              COMMITTEE ON

                   TRANSPORTATION AND INFRASTRUCTURE

                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 5, 2013

                               __________

                       Printed for the use of the
             Committee on Transportation and Infrastructure


         Available online at: http://www.gpo.gov/fdsys/browse/
        committee.action?chamber=house&committee=transportation




                  U.S. GOVERNMENT PRINTING OFFICE
79-735                    WASHINGTON : 2013
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing 
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC 
area (202) 512-1800 Fax: (202) 512-2104  Mail: Stop IDCC, Washington, DC 
20402-0001



             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE


                  BILL SHUSTER, Pennsylvania, Chairman
DON YOUNG, Alaska                    NICK J. RAHALL, II, West Virginia
THOMAS E. PETRI, Wisconsin           PETER A. DeFAZIO, Oregon
HOWARD COBLE, North Carolina         ELEANOR HOLMES NORTON, District of 
JOHN J. DUNCAN, Jr., Tennessee,          Columbia
  Vice Chair                         JERROLD NADLER, New York
JOHN L. MICA, Florida                CORRINE BROWN, Florida
FRANK A. LoBIONDO, New Jersey        EDDIE BERNICE JOHNSON, Texas
GARY G. MILLER, California           ELIJAH E. CUMMINGS, Maryland
SAM GRAVES, Missouri                 RICK LARSEN, Washington
SHELLEY MOORE CAPITO, West Virginia  MICHAEL E. CAPUANO, Massachusetts
CANDICE S. MILLER, Michigan          TIMOTHY H. BISHOP, New York
DUNCAN HUNTER, California            MICHAEL H. MICHAUD, Maine
ERIC A. ``RICK'' CRAWFORD, Arkansas  GRACE F. NAPOLITANO, California
LOU BARLETTA, Pennsylvania           DANIEL LIPINSKI, Illinois
BLAKE FARENTHOLD, Texas              TIMOTHY J. WALZ, Minnesota
LARRY BUCSHON, Indiana               STEVE COHEN, Tennessee
BOB GIBBS, Ohio                      ALBIO SIRES, New Jersey
PATRICK MEEHAN, Pennsylvania         DONNA F. EDWARDS, Maryland
RICHARD L. HANNA, New York           JOHN GARAMENDI, California
DANIEL WEBSTER, Florida              ANDRE CARSON, Indiana
STEVE SOUTHERLAND, II, Florida       JANICE HAHN, California
JEFF DENHAM, California              RICHARD M. NOLAN, Minnesota
REID J. RIBBLE, Wisconsin            ANN KIRKPATRICK, Arizona
THOMAS MASSIE, Kentucky              DINA TITUS, Nevada
STEVE DAINES, Montana                SEAN PATRICK MALONEY, New York
TOM RICE, South Carolina             ELIZABETH H. ESTY, Connecticut
MARKWAYNE MULLIN, Oklahoma           LOIS FRANKEL, Florida
ROGER WILLIAMS, Texas                CHERI BUSTOS, Illinois
TREY RADEL, Florida
MARK MEADOWS, North Carolina
SCOTT PERRY, Pennsylvania
RODNEY DAVIS, Illinois
VACANCY
                                ------                                7

     Subcommittee on Railroads, Pipelines, and Hazardous Materials

                   JEFF DENHAM, California, Chairman
JOHN J. DUNCAN, Jr., Tennessee       CORRINE BROWN, Florida
JOHN L. MICA, Florida                DANIEL LIPINSKI, Illinois
GARY G. MILLER, California           JERROLD NADLER, New York
SAM GRAVES, Missouri                 ELIJAH E. CUMMINGS, Maryland
SHELLEY MOORE CAPITO, West Virginia  MICHAEL H. MICHAUD, Maine
CANDICE S. MILLER, Michigan          GRACE F. NAPOLITANO, California
LOU BARLETTA, Pennsylvania           TIMOTHY J. WALZ, Minnesota
LARRY BUCSHON, Indiana               ALBIO SIRES, New Jersey
BOB GIBBS, Ohio                      ELIZABETH H. ESTY, Connecticut
PATRICK MEEHAN, Pennsylvania         PETER A. DeFAZIO, Oregon
RICHARD L. HANNA, New York, Vice     MICHAEL E. CAPUANO, Massachusetts
    Chair                            STEVE COHEN, Tennessee
DANIEL WEBSTER, Florida              DINA TITUS, Nevada
THOMAS MASSIE, Kentucky              NICK J. RAHALL, II, West Virginia
ROGER WILLIAMS, Texas                  (Ex Officio)
TREY RADEL, Florida
SCOTT PERRY, Pennsylvania
BILL SHUSTER, Pennsylvania (Ex 
    Officio)


                                CONTENTS

                                                                   Page

Summary of Subject Matter........................................     v

                               TESTIMONY

Edward R. Hamberger, President and Chief Executive Officer, 
  Association of American Railroads..............................     5
Hon. Paula J. Hammond, P.E., Secretary of Transportation, 
  Washington State; Chair, American Association of State Highway 
  and Transportation Officials High-Speed and Intercity Passenger 
  Rail Leadership Group; and Chair, States for Passenger Rail 
  Coalition......................................................     5
James A. Stem, Jr., National Legislative Director of the 
  Transportation Division of the Sheet Metal, Air, Rail, 
  Transportation Union (SMART)...................................     5
Hon. Joseph H. Boardman, President and Chief Executive Officer, 
  Amtrak.........................................................     5

          PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS

Hon. Steve Cohen, of Tennessee...................................    37

 PREPARED STATEMENTS AND ANSWERS TO QUESTIONS FOR THE RECORD SUBMITTED 
                              BY WITNESSES

Edward R. Hamberger:

    Prepared statement...........................................    39
    Answer to question from Hon. Lou Barletta, a Representative 
      in Congress from the State of Pennsylvania.................    57
    Answers to questions from Hon. Michael H. Michaud, a 
      Representative in Congress from the State of Maine.........    57
    Answers to questions from Hon. Corrine Brown, a 
      Representative in Congress from the State of Florida.......    58
Hon. Paula J. Hammond, P.E.:

    Prepared statement...........................................    60
    Answer to question from Hon. Jerrold Nadler, a Representative 
      in Congress from the State of New York.....................    66
    Answers to questions from Hon. Corrine Brown, a 
      Representative in Congress from the State of Florida.......    67
James A. Stem, Jr.:

    Prepared statement...........................................    72
    Answers to questions from Hon. Michael H. Michaud, a 
      Representative in Congress from the State of Maine.........    79
    Answers to questions from Hon. Corrine Brown, a 
      Representative in Congress from the State of Florida.......    81
Hon. Joseph H. Boardman:

    Prepared statement...........................................    83
    Answers to questions from Hon. Jeff Denham, a Representative 
      in Congress from the State of California...................    93
    Answers to questions from Hon. Corrine Brown, a 
      Representative in Congress from the State of Florida.......    97
    Answers to questions from Hon. Jerrold Nadler, a 
      Representative in Congress from the State of New York......   103

                       SUBMISSIONS FOR THE RECORD

Edward R. Hamberger, President and Chief Executive Officer, 
  Association of American Railroads, inserts for the record......17, 35
Hon. Jerrold Nadler, a Representative in Congress from the State 
  of New York, request to submit the Northeast Corridor 
  Infrastructure and Operations Advisory Commission's report 
  entitled, ``Critical Infrastructure Needs on the Northeast 
  Corridor,'' (January 2013)................................ \\

                         ADDITION TO THE RECORD

American Chemistry Council, written statement....................   105

----------
\\ The report entitled ``Critical Infrastructure Needs on 
  the Northeast Corridor'' can be found online at http://www.nec-
  commission.com/wp-content/uploads/2013/01/
  necc_cin_20130123.pdf.
  [GRAPHIC] [TIFF OMITTED] 79735.001
  
  [GRAPHIC] [TIFF OMITTED] 79735.002
  
  [GRAPHIC] [TIFF OMITTED] 79735.003
  
  [GRAPHIC] [TIFF OMITTED] 79735.004
  
  [GRAPHIC] [TIFF OMITTED] 79735.005
  
  [GRAPHIC] [TIFF OMITTED] 79735.006
  


                     FREIGHT AND PASSENGER RAIL IN


                    AMERICA'S TRANSPORTATION SYSTEM

                              ----------                              


                         TUESDAY, MARCH 5, 2013

                  House of Representatives,
              Subcommittee on Railroads, Pipelines,
                           and Hazardous Materials,
            Committee on Transportation and Infrastructure,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 11:04 a.m. in 
room 2167, Rayburn House Office Building, Hon. Jeff Denham 
(Chairman of the subcommittee) presiding.
    Mr. Denham. The subcommittee will come to order. First let 
me welcome our distinguished witnesses and thank them for their 
testimony today. We invited you because each of you represents 
a key stakeholder group involved in our Nation's rail industry.
    As you know, passenger and freight rail, coupled with 
railroad suppliers and union workers play important and 
dependent roles in our Nation's economy, and are vital to its 
success. As you all may know, Chairman Shuster and I are 
committed to rail reauthorization this year. I say again, 
``this year.'' And hopefully, this hearing will be a productive 
start to a bipartisan effort.
    We need to be pragmatic and transparent, and we will need 
all parties to participate in order to deliver the best 
bipartisan product to the House floor. We want to make it a 
point to welcome all ideas from many viewpoints, in order to 
make the most robust and comprehensive reauthorization. We 
thought an educational hearing on our Nation's rail industry 
would be the best way to start and really have a very 
productive conversation.
    Railroads are an integral part of North America's 
infrastructure network and, in turn, our economic 
competitiveness. From the building of the Nation's first rail 
in 1828 until now, both passenger and freight railroads have 
played a central role in our Nation's development. It is 
important to note that the U.S. freight rail system is the 
number one in the world, with our passenger rail system also 
increasing ridership yearly.
    Our witnesses include representatives of freight and 
passenger rail, as well as representatives of States and labor. 
And they will describe their interdependent roles in this 
important industry. Since I don't want to repeat their 
testimony, let me very briefly describe the current Federal 
role in the railroad industry.
    First, the Federal Railroad Administration, a modal 
administration within the U.S. Department of Transportation, 
oversees railroad safety and manages rail infrastructure 
programs. Independent of DOT, there are three Federal 
Government boards: the Surface Transportation Board, which 
administers economic regulations of the rail; the Railroad 
Retirement Board, which manages rail retirement and 
unemployment programs; and the National Mediation Board, which 
administers the Railway Labor Act to ensure interstate commerce 
is not interrupted by railroad labor disputes.
    Finally, Congress also provides support by authorizing and 
subsidizing Amtrak, which operates intercity passenger rail and 
owns a majority of the Northeast Corridor. Our goal for this 
year is to re-examine the Federal Government's role and discuss 
and analyze what has worked in the past, and what needs to be 
reformed.
    The purpose of this is to be an educational hearing. So I 
ask the witnesses and Members to try and save their policy 
preferences for future hearings. Again, I thank the witnesses 
for being here with us today.
    I would now like to recognize Ranking Member Corrine Brown 
from Florida for 5 minutes to make any opening statements she 
may have.
    Ms. Brown. Thank you, Mr. Chairman, and I want to thank you 
for holding this hearing today. I know that you are committed 
to improving our Nation's freight and passenger rail system, 
and I am looking forward to working with you and this Congress 
for important legislation. This hearing will be very helpful to 
our new Members, and a good start in preparing to re-authorize 
the Passenger Rail Investment and Improvement Act.
    I truly appreciate what freight and passenger rail have 
done and will continue to do for our country. And I am pleased 
again to serve as ranking member of the subcommittee for the 
113th Congress. My top priority for rail is to continue to 
increase investment in freight and passenger rail, expand 
passenger and high-speed rail throughout the country, ensure a 
safe workplace, and, most important, put America and the entire 
community back to work.
    I will also continue to fight to ensure minority 
participation in leadership and contracting throughout the 
transportation industry.
    The fact is that railroads are the backbone of the North 
American transportation network. From the building of our 
Nation's first railroad in 1828 to the creation of Amtrak in 
1970, railroads have played a central role in our Nation's 
economic development. Every year, American freight railroads 
invest billions of dollars of their own capital, not taxpayers' 
money, to maintain bridges, lay new tracks, purchase equipment, 
and upgrade signal systems.
    In fact, railroads spend five times more on capital 
expenditures than the average U.S. manufacturer. In 2013, 
railroads plan to spend $24.5 billion in maintenance, growth, 
and modernization of the network.
    Amtrak is also investing, thanks to an increased funding 
authorization by the Passenger Rail Investment and Improvement 
Act of 2008, and provisions that provided appropriations in the 
American Recovery and Reinvestment Act of 2009. In 2012 Amtrak 
carried a record number, 31.2 million passengers, a 55-percent 
increase since 1997. Meanwhile, their request for operation 
assistance has decreased.
    Together, our Nation's freight and passenger rail employs 
about 250,000 people. Railroad suppliers employ about 95,000 
workers. Thanks to these hard-working men and women, we 
literally have the greatest freight rail system in the world. I 
hear this from transportation leaders across the globe. In 
fact, any time you travel, they want to know about our freight 
rail system.
    In addition to easing highway congestion, shifting freight 
from trucks and passengers from cars to rail have substantially 
environmental and energy benefits. Freight trains are at least 
four times more fuel-efficient than trucks, and can move 1 ton 
of freight 436 miles with a single gallon of fuel.
    Is my time up?
    [Laughter.]
    Ms. Brown. In closing, I want to welcome today's panelists, 
especially Mr. Boardman--we should have a witness chair named 
after him for being here so many times. I am looking forward to 
hearing your testimony and your ideas for preparing our rail 
system for the future.
    Thank you very much, and I will yield back my time and ask 
any additional questions at the proper time.
    Mr. Denham. I now call on the chairman of the full 
committee, Mr. Shuster.
    Mr. Shuster. Thank you, Mr. Chairman. I just want to 
welcome the folks here, the witnesses today. Appreciate you 
being here. And I just want to echo what the ranking--
distinguished ranking member said about--we have the finest 
rail freight system in the world, and we want to make sure that 
it continues to be, that it continues to not have to rely on 
the Federal Government for funding, and that they continue to 
be prosperous and invest 18 to 20 percent of their revenues 
back into the system.
    But also, appreciate the help--the chairman having this 
hearing to not only talk about freight rail, but passenger 
rail. I think it is pretty clear--I have made it pretty clear I 
really want to try to do something to reform Amtrak, to make 
sure that--it may never make a profit, but we need to make it 
move in that direction. I appreciate what--some of the things 
Mr. Boardman has done over his tenure as CEO at Amtrak, but we 
need to sit down--labor, management, Congress--and figure out 
how we need to move forward, and focus on those areas that I 
believe can be--or that are profitable, and build on that, and 
look at other areas that aren't, and figure out ways to correct 
them or spend them or reform them in such a way that we can be 
moving in the right direction.
    I think it is critical that we have passenger rail in this 
country, some places a lot more than others. And, of course, it 
is no secret the Northeast Corridor is one of those places that 
should shine, even more than it does now. And just full 
disclosure, I do not live along the--western Pennsylvania is 
not in the Northeast Corridor. So for those folks that say that 
is, you know, parochial interest, it is not. I think it is of 
interest to anybody who lives in that corridor, that population 
density, that we continue to see significant improvements to 
Amtrak and its operations there, as we move forward.
    So, I am going to be working very closely with the chairman 
as we move forward to do a rail reauthorization bill this year.
    So, Mr. Chairman, thank you for yielding me the time. I 
yield back.
    Mr. Denham. I now call on Mr. Mica, former chair of the 
full committee.
    Mr. Mica. Well, just a minute. First, I want to thank 
Chairman Shuster, Chairman Denham, and Ranking Member Brown for 
conducting this meeting, and doing an assessment from all the 
stakeholders.
    Just 1 second to remind folks that the last time we did a 
rail reauthorization it took us 11 years. And working in a 
bipartisan manner with Mr. Oberstar, we were able to pass the 
current PRIIA legislation we all worked on, which had some good 
elements, the high-speed rail, a whole host of improvements 
that we really need to look at again.
    So, I think it is very important that we work together. 
This could be, I think, one of the most important things that 
we do. We weren't able to get reforms like RIF in the final 
MAP-21. We tried to do that rail section, we had some 
disagreements. But I think that we can resolve those 
differences, so I salute Chairman Denham, Chairman Shuster, 
Ranking Member Brown, and look forward to working with everyone 
as we move this important legislation forward. And thank you.
    Mr. Denham. I would like to again welcome our witnesses 
here today. Our first panel will include: Mr. Ed Hamberger, 
president and CEO of the Association of American Railroads; the 
Honorable Paula Hammond, who holds three titles as the 
secretary of transportation of Washington State, the chair of 
the States for Passenger Rail Coalition, and the chair of 
AASHTO's High-Speed and Intercity Passenger Rail Leadership 
Group; James Stem, national legislative director of the United 
Transportation Union; and once again, our frequent visitor, the 
Honorable Joseph Boardman, president and CEO of Amtrak.
    I ask unanimous consent that our witnesses' full statements 
be included in the record.
    [No response.]
    Mr. Denham. Without objection, so ordered. Since your 
written testimony has been made part of the record, the 
subcommittee would request that you limit your oral testimony 
to 5 minutes.
    Mr. Hamberger, first I would like to take the opportunity 
to recognize you and the association for your participation in 
the Veterans Jobs Caucus and the rail industry's commitment to 
hiring our veterans. Thank you for your efforts. And with that, 
please proceed.

TESTIMONY OF EDWARD R. HAMBERGER, PRESIDENT AND CHIEF EXECUTIVE 
   OFFICER, ASSOCIATION OF AMERICAN RAILROADS; HON. PAULA J. 
 HAMMOND, P.E., SECRETARY OF TRANSPORTATION, WASHINGTON STATE; 
CHAIR, AMERICAN ASSOCIATION OF STATE HIGHWAY AND TRANSPORTATION 
 OFFICIALS HIGH-SPEED AND INTERCITY PASSENGER RAIL LEADERSHIP 
GROUP; AND CHAIR, STATES FOR PASSENGER RAIL COALITION; JAMES A. 
STEM, JR., NATIONAL LEGISLATIVE DIRECTOR OF THE TRANSPORTATION 
 DIVISION OF THE SHEET METAL, AIR, RAIL, TRANSPORTATION UNION 
   (SMART); AND HON. JOSEPH H. BOARDMAN, PRESIDENT AND CHIEF 
                   EXECUTIVE OFFICER, AMTRAK

    Mr. Hamberger. Thank you, Mr. Chairman. It is something 
that we are focused on. One in four employees is a veteran. And 
last year we hired 5,000 returning veterans. Thank you for the 
opportunity to appear before you this morning. Joe Boardman is 
here. Amtrak is a member of the AAR. Joe sits on our board. So 
I will focus my comments on the freight side of the house this 
morning, but I am ready to talk about either side during Q&A.
    If I can impress upon this committee one important salient 
fact about the freight railroad industry, it is this: we are 
privately owned. Unlike highways, barges, and airports, we 
operate on our own right-of-way, which we pay taxes on, which 
we pay to maintain, and which we pay to upgrade. From 1980 
through 2012 we spent $525 billion--``b,'' as in ``boy''--in 
private capital to upgrade and modernize this infrastructure. 
We continue that trend in 2013. Projected spending will be 
$24.5 billion back into the infrastructure.
    And this is the literal foundation over which passenger 
rail operates. Outside of the Northeast Corridor it is the 
foundation for Amtrak moving around the country. So these 
investments are not only for the benefit of our freight 
customers, but they have benefits for passenger movement, as 
well.
    What has this investment meant? Well, first of all, and 
most importantly, it has dramatically improved our safety. 2012 
has been the safest year on record, in terms of accident rate, 
grade-crossing incidents, and, most importantly, employee 
injury rate. In fact, it is safer to work on the freight 
railroads and passenger railroads than in any other mode of 
transportation, and many other industries, including the one 
comparison that I love: It is safer to work on a railroad than 
it is in a grocery store.
    But there are accidents and there are fatalities. We are 
focused on improving our safety, working with labor, and 
working with the Federal Railroad Administration--FRA. We are 
doing lots of research at the Transportation Technology Center, 
where this subcommittee has held hearings in the past. I invite 
you again to travel to Pueblo, Colorado, to see the new 
technologies that we are working on there.
    Second, our investment has paid dividends for a cleaner 
environment. We can move 1 ton of freight almost 500 miles on 1 
gallon of fuel. In fact, Mr. Chairman, it would take just about 
6 gallons to move a ton of freight from your home district to 
the U.S. Capitol. And Ranking Member Brown, it would take about 
a gallon-and-a-half to get something from Jacksonville to here.
    We are, therefore, 75 percent cleaner, in terms of 
greenhouse gas emissions than the trucking industry. If we 
could get just 10 percent of the freight off the highways onto 
the railroads, we would save 1 billion gallons of fuel and 11 
million tons of CO2 not emitted into the air every year. We 
think that that would be a good goal. And, in fact, it is a 
goal of the draft freight rail plan at the Department of 
Transportation.
    Third, freight rail service has never been better. We are 
able to give the best service in history to our customers, 
making them competitive in global markets. But in addition to 
great service, rates for our customers are lower. Railroads are 
moving commodities today at an average rate that is 45 percent 
less than when railroads moved that commodity in 1980. 
Railroads are moving twice as much today as they did in 1980 
for half the cost. That is the impact of the investment our 
freight railroad members have made.
    And I mentioned 1980 to you because none of these successes 
and none of this investment would have occurred were it not for 
the Staggers Rail Act of 1980. In 1980, 25 percent of the 
industry was in bankruptcy. Congress was considering whether or 
not to nationalize the industry. Instead, they passed the 
Staggers Rail Act, which resulted in a balanced regulatory 
system, and has led to this heavy investment, increased 
service, increased productivity, increased safety, and lower 
rates for our customers.
    As you take a look at policies going forward, we strongly 
urge you to avoid enacting policies that would discourage this 
necessary and critical private investment in the rail 
infrastructure--investments that boost our economy and enhance 
our global competitiveness.
    This is my first opportunity to appear before you, Chairman 
Denham. I have been here many times in the past, but I look 
forward to working with you, other members of the subcommittee, 
the full committee, the administration, and, of course, other 
stakeholders, to address the challenges we have in the future. 
Thank you.
    Mr. Denham. Mr. Hamberger, thank you.
    Ms. Hammond, you may proceed.
    Ms. Hammond. Thank you, Chairman Denham and Ranking Member 
Brown, for inviting me to participate. States have a unique 
story to tell. As we sponsor intercity passenger service on 
largely private freight rail networks, we work with Amtrak to 
operate and deliver passenger rail service, and we work with 
our freight railroads to deliver projects. And, in some States, 
we own commuter rail service.
    Today I will talk about Washington's freight rail network 
and our Northwest Amtrak Cascade's passenger rail program. In 
Washington the evolution of railroads have mirrored that of the 
national trends. In 1870, the Northern Pacific began 
construction on its first set of tracks in the Washington 
Territory. And by the turn of the century, railroad's 
connections enabled people in Washington to have rail access to 
commercial centers across North America.
    Today, BNSF Railroad and Union Pacific Railroads are the 
main Class I railroads operating in the State, carrying freight 
and passenger rail. I will talk first about our freight rail in 
Washington State.
    We have a robust freight rail system and a strong 
partnership with Burlington Northern Santa Fe, which owns the 
main line that runs north and south through our State, largely 
along Interstate 5. In addition to that main line, we have 30--
excuse me, 23 short-line freight routes. Of those short-line 
routes, the State owns the Palouse Coulee City Railroad, a 297-
mile short-line railroad spanning 4 counties in agricultural-
rich eastern Washington.
    The combination of the short-line routes and the main-line 
routes provide a very essential link for our agricultural and 
manufactured goods to market. And it is one that supports not 
only the economic vitality of the State, but also of our 
Nation.
    In 1990, a national shortage of rail hopper cars made it 
difficult and costly for Washington State farmers to get grain 
to market. To help alleviate the shortage of grain cars, the 
State used Federal funds to purchase 29 used grain cars to 
carry wheat and barley from loading facilities in eastern 
Washington to export facilities in Washington and Oregon. From 
that time we have grown to own 113 railcars, which have been 
self-supporting, and the operating cost has developed and 
enabled that program to grow. This was a kind of a partnership 
with our ports in eastern Washington that has enabled us to 
continue to get heavy loads on rail to market, which then 
reduces the damage that is caused on our State highways.
    The State Freight Rail Assistance bank is an important 
program in our own State. It is a loan program that we have for 
public sectors intended for small projects, or is a small 
contribution towards larger projects. And we have programs 
administered by WashDOT that also allows for grants and loans 
through freight rail assistance. Sometimes that is the only 
ability for our rail shippers and our growers to find the 
ability to make improvements on short-line railroads and the 
main line to enable improvements that will help goods get to 
market better.
    Let me talk a bit about our Amtrak Cascades service, as 
well. Washington first partnered with Amtrak in 1994 in the 
connection and coordination of a passenger rail program. From 
that time, our vision and our goal from the Amtrak Northwest 
Cascades program, which spans from Eugene, Oregon, up to 
Vancouver, BC, was to grow incrementally a service of passenger 
rail programs which today serves six round-trips between 
Seattle and Portland, two round-trips between Seattle and 
Vancouver, BC, and carries over 890,000 passengers a year. It 
was the ability for us to have a program that enabled us to be 
ready for the Federal rail grant when it came, which we were 
able to successfully get $800 million for improvements to our 
Burlington Northern Santa Fe rail line, which will add 
increased trips, speeds, and reliability.
    As this body considers and discusses PRIIA, the 
reauthorization, I would want to make sure that we mention that 
the Section 305 coordinated equipment purchase program is a 
very good thing for our States. It enables us to get lower 
cost, economy of scale for equipment. It enables us to have 
partnerships across the United States, to deliver projects and 
programs and higher speed passenger rail service, as an 
opportunity for our States to continue to serve the public in a 
growing population that we have.
    Thank you for your time.
    Mr. Denham. Thank you, Ms. Hammond.
    Mr. Stem, you may proceed.
    Mr. Stem. Thank you, Mr. Chairman. We appreciate the 
opportunity to testify today about our views on rail 
transportation policy. We want to readily acknowledge that 
although I am here representing SMART transportation division 
today, these remarks are intended to represent the input and 
the equity that all of our railroad employees have earned in 
the industry.
    All of rail labor has a long history of supporting our 
industry and working in partnership with the industry on a 
variety of issues. We understand and readily acknowledge that 
the most secure job is one in a profitable company that 
provides service that America needs. We have participated in 
many successful partnerships with this committee and with our 
industry on equipment safety standards, hours of service 
improvements, railroad retirement, pension reforms, and many 
opportunities to grow our freight and passenger rail 
industries.
    We think one of the success stories that this committee 
rarely hears about that should be acknowledged today is the 
success of the Rail Safety Advisory Committee that was 
sponsored by the Federal Railroad Administration during the 
Clinton administration. It was the first time that rail 
management, rail labor, rail suppliers, and the Federal 
Railroad Administration were all gathered together in an 
informal setting to participate in problem-solving exercises, 
an exchange of thoughts and an opportunity for suggestions on 
improved safety. RSAC continued to function well through the 
Bush administration, and continues today. Our rail industry 
today has improved safety processes in place and our safety 
record has significantly improved because of the RSAC process.
    We are proactive in our support for the industry, take an 
active role in policy discussions supporting the expansion of 
freight and passenger rail across the country. We also work 
with all segments of our rail and transit industries and 
legislative activities designed to highlight the advantages of 
rail. Our rail employees today have earned equity in the rail 
industry, and are very aggressive in long-term growth and 
stability of our industry.
    Passenger and freight railroads today are vital parts of 
America's transportation system, which require a level of skill 
and professionalism in the operation and maintenance of our 
industry that translates into tens of thousands of good career 
jobs for railroad employees. It takes many years to train and 
qualify most of the safety-critical railroad employee class. 
Our industry now focuses on hiring military veterans. We 
readily acknowledge that decision not only is that a patriotic 
decision, but military veterans bring something else to the 
table. They understand the discipline necessary to operate in a 
safety-critical environment, and they readily accept their role 
in the overall safety of the operation.
    The decision to focus on military veterans has proven to be 
a win-win situation for all involved. Raises our hiring 
standards, the railroads get a stable and mature employee that 
readily accepts instructions and the safety-critical 
responsibilities. Once they are trained and qualified, these 
military veterans then have transferable skills that are very 
much in demand.
    Railroad jobs are not just a job. They are careers where a 
person can earn a living wage to provide for their family and 
send their kids to college. Our rail industry enjoys the lowest 
turnover rate of any blue-collar industry in the country. In 
spite of the 24/7 operations in all types of weather, working 
on the railroad is more than a job, it is a way of life that 
was chosen. We are expecting the influx of new military 
veterans to even further reduce our turnover rate, and also to 
contribute to improved safety performance.
    We look forward to working with this committee during the 
RSIA and PRIIA reauthorizations. We have a few technical 
corrections to suggest for your consideration, and are working 
with your staff to do that.
    Mr. Hamberger mentioned the importance of coal for 
generation. Twenty percent of our jobs in this industry are 
directly related to the movement of coal, the use of coal. We 
encourage the committee to continue to look at alternatives for 
the use of coal, and the fact that the United States has 28 
percent of the world coal reserves.
    I need not remind this committee about the importance of 
Amtrak. It is America's passenger railroad. Amtrak is a partner 
with our private freight railroads.
    Hazmat. Hazardous material shipments are also an integral 
part of what our industry does.
    I thank you for the opportunity to address the committee, 
and I look forward to answering any questions the committee may 
have. Thank you.
    Mr. Denham. Thank you, Mr. Stem.
    Mr. Boardman, you may proceed.
    Mr. Boardman. Thank you, Mr. Chairman, Ranking Member 
Brown. In 1966 I rode a Penn Central passenger train from Rome, 
New York, to Syracuse, New York, as I volunteered to serve the 
country in the Air Force. Four years later, Penn Central was 
bankrupt, along with many others. And over the next 10 years, 
Congress repeatedly reorganized the industry.
    First came passenger rail, with the Rail Passenger Service 
Act, and Amtrak was created. Then there was deregulation. The 
implication was that railroads were no longer railroads, they 
were freight railroads, commuter railroads, and Amtrak. I spent 
the first 25 years of my career operating and managing 
passenger transportation, beginning in college as a bus driver, 
then a city transit manager, a public transit authority CEO, a 
county transportation commissioner, and then my own business, 
where I was the first employee.
    We had 11 different systems in New York State and 300 
employees when I left. And one of the critical pieces of what 
we did was to reduce the cost for social service agencies 
throughout New York State. We hired travel trainers, and we 
used every source of public transportation, including Amtrak, 
to move the people to reduce the cost.
    Each year a new Congress, a changing administration, 
freight railroads, commuters, NARP, real estate developers, 
vendors, advocates, extreme critics, global management 
companies, States, cities, counties, public authorities, rail 
labor all exist at various intersections with Amtrak. The 
result of those intersections, things like guidance and policy, 
requirements, often outlive both their authors and the 
circumstances that produce them.
    This is the world Amtrak inhabits. Amtrak will soon 
celebrate its 42nd birthday. And when that happens, I will have 
been the second-longest CEO in Amtrak's history. And that is 
4\1/2\ years. That is largely due to the world that Amtrak 
inhabits, based on the constant change fostered by these 
intersections.
    Ridership is up, revenue is up, while Federal operating 
subsidy is down, and so is our debt level. But the need for 
capital investment underpins operating cost improvements all 
along this industry. As Mr. Hamberger talked about, the private 
freight railroad capital investment in the long-distance 
network this year is over $24 billion.
    I came here to Amtrak on November 26th in 2008. I came here 
because I was committed to improving intercity passenger 
service in the United States. And it is for the same reason 
that I left my job as commissioner of transportation for George 
Pataki in New York, and joined the George W. Bush 
administration as a Federal Railroad Administrator. I love my 
country, and I know that safe, reliable, connected public 
transportation is a critical element of the common good needed 
by our people in support of our economy and the global 
competition we are in.
    When I got here there was no plan for fleet replacement, no 
strategic plan for the business, no vision for what could be. 
Today all of those things exist. And if this Congress works 
with us, I believe we can move all of those things forward for 
our Nation.
    Our strategic plan defines operational business lines. 
First in the Northeast Corridor, which needs tremendous capital 
investment today. But it is generating enough revenue above the 
rail to help reduce operating subsidies. But without that 
Federal capital investment, we are beginning to eat our assets 
into early retirement, and may have to reduce our speeds 
instead of increasing our speeds.
    It is 10 miles from Newark to Penn Station, New York City, 
500 trains a day on 2 tracks with 2 tunnels. In Penn Station 
over 1,000 trains a day on 21 tracks, the busiest station in 
North America. When one Hudson tunnel is out of service, 50 
percent of our capacity is lost. When both are out, New York 
and New England essentially are severed from the continental 
United States.
    The rural portions of our Nation are being abandoned, both 
by intercity buses and by airlines today. Most rural folks are 
driving today, and buses have a new business model as hub-to-
hub carriers, like Megabus. Airlines must depend on Federal 
subsidies, some direct and some indirect, just like the 
highways. But it is Amtrak's long-distance trains that provide 
the backbone of connectivity for the people in the United 
States. Serving 40 percent of the rural population, 15 percent 
of our ridership comes from handling that----
    Ms. Brown. Excuse me, Mr. Boardman. Mr. Chairman, I would 
ask for 2 additional minutes for Mr. Boardman.
    Mr. Boardman. I am going fast enough, I can----
    Ms. Brown. I know it, that is why I want you to slow down. 
We want to hear what you have to say.
    Mr. Boardman. OK.
    [Laughter.]
    Ms. Brown. Thank you.
    Mr. Boardman. We provide the only service available for 
half of our stations in half of the States that we serve. This 
is the system you see today that we operate above here, and it 
is hard to pick out the colors. The long-distance are the 
lighter blue, the red is the Northeast Corridor, and the darker 
blue are systems like Paula operates.
    This next slide identifies what we lose on each of the 
long-distance trains. And if Congress were to tell us today to 
get rid of any of the lines that cost $10 million or more per 
year, it would be the top six routes on this chart.
    This next slide would be the initial result of the Nation, 
and would be divided at the Mississippi River. The common good 
of our Nation, its scattered families, and our belief in the 
United States of America truly demands a connected surface 
transportation service. That is Amtrak. Thank you.
    Mr. Denham. Thank you, Mr. Boardman. We will now commence 
with 5-minute questions from each of the Members. I would ask 
each Member, as we are starting this committee off, to follow 
those timelines so that we do not have to handle the gavel 
strongly from this end.
    Let me start first with Ms. Hammond. From a national 
perspective, how has the States' relationship with Amtrak 
evolved over the past 5 years?
    Ms. Hammond. We have, as I said, in Washington State had a 
relationship with Amtrak since 1994. As the incremental service 
and additional operating opportunities have come about, we have 
increased our partnership with Amtrak.
    It wasn't until the investment and the $800 million we 
received for high-speed rail was the opportunity for us and 
Amtrak and Burlington Northern Santa Fe to talk more about the 
measuring performance-managed opportunity that we have, and the 
commitment our State had taken on in accepting the capital 
money.
    With Amtrak, we now--and with Burlington Northern--have 
performance measures that we expect and are working through on 
service, speed, and reliability for the service. It has been 
difficult a bit at times, as Joe knows, as we have been working 
through a new accounting system that Amtrak has developed. But 
with the States now taking on, in 2013, 100 percent of the 
operating cost of our passenger service, contracting with 
Amtrak, we have made sure that we are getting it right on how 
our agreements between our service from Amtrak and how the 
States' contribution to Amtrak for that service is right and 
fair and equitable for the taxpayers of our own State.
    We in Washington State have been in performance management 
for many years, since 2001. And for us to see MAP-21 take on 
the requirements for a closer, more heavily managed performance 
for investments, as well as performance management for 
decisionmaking, we think it is the right step to go.
    We appreciate the partnership we have with Amtrak, we are 
struggling through the details on how much of the cost of 
operating that we will be taking on. But I would say it is a 
strong partnership, particularly strong with the relationships 
we have with the Northwest Amtrak staff and leadership, and we 
appreciate the opportunity to continue to work with them.
    Mr. Denham. Thank you. And certainly we recognize that it 
is a big adjustment. As chair of AASHTO's High-Speed Rail and 
Intercity Passenger Rail Leadership Group, are you getting the 
details that you need to implement Section 209 of the Passenger 
Rail Reinvestment----
    Ms. Hammond. We have been working closely--and one of the 
things that we did that was smart and right was, as a group of 
States, we banded together to work with Amtrak as a body. So, 
as we set forth the criteria and the requirements that we would 
need for information for negotiating and understanding our 
operating costs that we are assuming, we are doing that as a 
Nation and as a group of States, which I think is the right way 
to go.
    We have had our moments. I wouldn't say that we haven't 
always seen eye to eye. But one of the important 
characteristics to work through together is that we pay for the 
costs to operate the system that we are enjoying and those 
benefits, and then continue to work with Amtrak as they work on 
the long-range and long-distance service that also comes 
through our State.
    Mr. Denham. Thank you. Mr. Boardman, the Northeast Corridor 
route is the most profitable--the only financially profitable 
line in your business. How can you improve upon its success and 
how do you use its profits?
    Mr. Boardman. Right now we can call it profits if we talk 
about above the rail. If you look at the infrastructure 
necessary, capital investment in the infrastructure, there 
would be no profits. And I know you know that, Mr. Chairman, 
just to--but to be clear on the element of it.
    We are clearing between $200 to $300 million above the 
rail, in terms of revenue. And that revenue has gone right back 
into the subsidy for reducing our debt, and also reducing the 
amount of operating assistance money that the Federal 
Government--that you--have chosen to give us.
    We also receive a different set of dollars for investment 
in the infrastructure in the Northeast Corridor. What would 
help us improve the revenues is more capital infrastructure 
investment for the future, to allow us to have an increased 
capacity and to increase speed.
    Mr. Denham. Thank you. And how do you view the relationship 
between Amtrak and its State partners, especially with the 
implementation of 209?
    Mr. Boardman. I think that we have a very good working 
relationship with our State partners. It is especially so in 
the Northwest--and I think Ms. Hammond pointed it out. Kurt 
Laird, for example, who is our general superintendent in the 
Northwest, has a solid relationship with those States that he 
is responsible for. And that exists across the country in 
different locations.
    We have had difficulty, as she has identified, really 
identifying the charges for overhead, the necessities for us to 
cover our costs, and for them to make sure that they are paying 
the right costs. That has been a battle at Amtrak for probably 
40 of the 42 years that it has existed, just because of the way 
that railroads really account for their costs, and where we are 
going. But we have had a very transparent process, and I think 
we get closer and closer to the end of where we need to be to 
make this happen.
    Mr. Denham. Thank you. Ms. Brown.
    Ms. Brown. Thank you. My first question is for Mr. 
Hamberger. In 2013, American freight railroads planned to 
invest $24.5 billion in rail networks. And that is to be 
commended. That is a wonderful thing. But we in the Federal 
Government have done well with the TIGER grants. Many Members 
don't feel that it is a good investment of taxpayers' money, 
and we have three major projects, and one of them Ms. Hammond 
is talking about, but--one that I visited with. Can you tell us 
the importance of those kinds of investments?
    Mr. Hamberger. Thank you, Congresswoman Brown. To put it in 
context, the TIGER grants do not go to the railroads. The TIGER 
grants go to the States. And at least in the American Recovery 
and Reinvestment Act--ARRA--they were general fund revenues, 
not Highway Trust Fund revenues. So the argument is if there 
are general fund revenues going to the State, shouldn't the 
State have the right to make the determination where best to 
spend that money to get the best return on that investment in 
the area of transportation?
    One of the things that has happened in the past decade is 
the involvement of public-private partnerships. The poster 
child of a successful public-private partnership is the CREATE 
program in Chicago. It began about 10 years ago, when we, as a 
freight rail industry, stepped forward and said that we would 
put over $300 million of our own money on the barrel head. 
Since then both the State and the Federal Government have come 
forward with money, and some of that funding was through a 
TIGER grant.
    And so, what this money is is a way to enable the State to 
provide the public money into the public-private partnership 
project. It is important and particularly true in CREATE that 
the idea is for the private sector to pay for the private 
sector benefits and the public sector to pay for the public 
sector benefits, such as cleaner air, less congestion, more 
fluid movement through the city by building grade crossing 
separations, for example, which that money is used for, 
oftentimes.
    So, if indeed public-private partnerships are a way to 
increase investment in infrastructure--and I believe they 
should be--then TIGER grants are one way to provide that public 
money for public-private partnerships.
    Ms. Brown. Thank you. Mr. Boardman, there has been a lot of 
discussion about Hurricane Sandy and Amtrak involvement. And 
what did you do to recover, and whether or not the Federal 
Government provided the kind of assistance that Amtrak needed.
    Mr. Boardman. Well, we found out right away, Ms. Brown, 
that we were a private railroad. That is what the Corps of 
Engineers told us. And, as a result of that, we began recovery 
on our own, and we recovered as quickly as we could. Now, 
toward the end of the process we did receive some help for 
Substation 41--which is a pretty large concern--from the Corps 
of Engineers.
    But to get the tunnels pumped out, that was Amtrak's doing. 
And then, actually, in cooperation with some of the freight 
railroads and their assistance, and other commuter railroads, 
we moved forward quickly, restoring service by the next night 
into New York City. And within 3 days, back to Boston.
    Ms. Brown. So you were able to resume operation within 2 
weeks, or----
    Mr. Boardman. Oh, yes. And we were, actually, in operation 
within the next day or so. A limited operation, because of some 
of the difficulties we were facing.
    Ms. Brown. Everyone up here is talking about the sequester. 
And people at home are talking about jobs. Can you tell us how 
that is affecting your operation?
    Mr. Boardman. We began to look several months ago at how 
this might happen. Sequestration was not a new idea. It was 
going to potentially happen, and Amtrak always thinks that 
whatever the worst is, it probably will happen, so we need to 
do something about that. And we began immediately to look at 
how we would get through and what the numbers might really be 
for us.
    So, we looked at our capital program first. We now are 
reducing the inventory that we had available of ties, for 
example, and what we will do for the work this year. And as 
long as this doesn't go on for a long period of time, we are 
going to get through without any service cuts. It is anathema 
for Amtrak to start service cuts, because it becomes a double-
edged sword. We lose the revenues that we are receiving, and we 
lose the opportunity for continuing service.
    Ms. Brown. Thank you. I yield back the balance of my time.
    Mr. Denham. Before I recognize Mr. Duncan, while we are on 
sequestration, can you just tell us what, in your opinion, a 
``long period of time'' would be?
    Mr. Boardman. Well, what--we thought about it this way, Mr. 
Chairman, is if the--if the continuing resolution goes forward 
from fiscal 2012, then we think that our hole is somewhere in 
the neighborhood--and I know some new numbers have come out now 
that I haven't evaluated, and Mike might even help me on this--
but we were at around the $37 million amount that we would have 
to cover. Part of that was sequestration, and part of it was 
the losses we had because of Sandy that weren't reimbursed, and 
that may be reimbursed but may be sequestered, as well. That 
would allow us to get through, basically, this year with a very 
low level of cash and with a very low inventory.
    If we go to a 2013-style budget, where there was a 
reduction from what we received in operating assistance, which 
I believe in 2012 was $466 million, and we were working toward 
a $375 million level, and we don't have enough time to make 
adjustments, then we are probably going to be in trouble in the 
June/July timeframe. But some of those things may have to be 
answered in a more complete, written response--especially if I 
am seeing I might be off a little bit on numbers.
    Mr. Denham. Sure. And just to be clear, to give the 
committee a baseline, you know, obviously, every committee is 
talking about sequestration right now. But under the Senate 
budget, you would receive $400 million plus the $30.4 million, 
which was authorized by FEMA. Under sequestration, you would 
receive $442 million. So you would actually receive an increase 
under sequestration, above what the current budget levels would 
be.
    Mr. Boardman. If it stays in the 2012 amount, yes.
    Mr. Denham. So your bigger concern is not sequestration--I 
don't want to put words in your mouth, but your concern would 
be the CR, or the new appropriations bill coming out of the 
Senate.
    Mr. Boardman. Yes. And if that gets sequestered as well--
and I don't know the facts of how that really works--then we 
saw that as the worst case.
    Mr. Denham. Thank you. Mr. Duncan.
    Mr. Duncan. Well, thank you, Mr. Chairman, and 
congratulations on assuming the chairmanship of this very 
important subcommittee. And I want to thank all of the 
witnesses for their testimony.
    And I will tell Mr. Boardman this past weekend was my 
wife's and my 35th anniversary. And I rode the train up to New 
York City and met her on Friday, and rode back on Monday. I 
rode the regional train on Friday and the Acela train back on 
Monday. I had a very comfortable, pleasant, on-time experience. 
So I just wanted to tell you that.
    [Laughter.]
    Mr. Boardman. Thank you, Mr. Duncan.
    Mr. Duncan. Anyway, and I wanted to welcome my long-time 
friend, Mr. Hamberger. I have always said that I just don't 
think the freight rail companies toot their horn nearly enough, 
because they are important to everybody, even people that never 
think--who never think about the rail system in this country. 
You have told some interesting statistics. I never heard that 
about it being safer than working in a grocery store. I have 
worked in a grocery store all through high school, as a bag boy 
at the A&P. But anyway, and to think that you are moving twice 
as much now for half the cost as in 1980.
    Many people here today don't remember Congressman Staggers, 
but he was a leading Democratic chairman who led the 
deregulation--or at least partial deregulation--of the rail 
industry.
    And--but I have always heard that railroads are leading 
indicators, and I am curious as to what the next few months 
look like for your industry, Mr. Hamberger. And in light of 
what Mr. Stem said about how 20 percent of your business is due 
to coal, if we decrease the use of coal in this country, what 
happens to your industry? And if you have had any thoughts or 
predictions about that.
    Mr. Hamberger. Yes, sir. Let me answer those two separate 
questions.
    Mr. Duncan. Right.
    Mr. Hamberger. We are, indeed, a leading-edge indicator. 
Our weekly car loadings statistics are sought by policymakers 
throughout the Government. What we are seeing right now is slow 
but steady growth in the 2-percent range. We are hopeful that 
that will continue.
    Automobiles are growing very fast. We are looking at maybe 
15.5 million automobiles this year, maybe a little bit more 
than that. At the depth of the recession it was under 10 
million. But we are not yet back to where we were in 2006 and 
2007. Intermodal is growing at about 5 percent per year. We are 
seeing some growth in the movement of lumber for housing 
markets. So we are seeing--I hate to use the word ``green 
shoots,'' but things are starting to come back. We are hopeful 
that that will continue. Obviously, there is some connection 
between what happens here and the economy, and what consumer 
confidence will be. So we are keeping an eye on all of that, 
meanwhile investing with the idea that the economy will come 
back, so that when it does we are able to move the materials 
when they need to be moved.
    Coal has been an ongoing struggle. There are any number of 
regulations that are making it more difficult for coal-fired 
utilities to continue to burn coal or to open new coal-fired 
power plants. You combine that with the operation of the 
marketplace, where natural gas, because of fracking, is now in 
the $3.50 to $4 MCF range. It is, therefore, cheaper, more cost 
effective, for some utilities to burn natural gas. What we 
don't know is will that natural gas price stay down at $3.50 or 
$4. Right now I understand--I am told that the world market 
price of natural gas is over $10 MCF. If that eventually 
stabilizes above $5, $6, or $7, then we would see utilities 
wanting to move back to using coal.
    And that brings me back to the first issue. Would the 
regulatory environment allow that to happen? We are down 
somewhere in the 12- to 15-percent range in 2012 in carloadings 
of coal as an industry. And so that did have an impact, 
obviously. But we also had some sectors growing, like 
intermodal traffic. One that is growing fast but is still small 
in terms of the number of carloads, is moving crude oil by 
rail. There have been some recent articles about that I am sure 
you have read.
    Mr. Duncan. Well, my time is up, but I will just say this, 
that I have some concern that the improvements we have seen in 
the economy over the past several months are based primarily on 
pent-up demand. And so I hope we make some good decisions here 
so we can help this country to boom in the years ahead. But it 
is going to depend on what we do here, in large--in significant 
part. Thank you, Mr. Chairman.
    Mr. Denham. Thank you, Mr. Duncan. Mr. Nadler.
    Mr. Nadler. Thank you, Mr. Chairman. Let me begin by 
thanking all concerned for holding this hearing, and say that I 
am a direct--not conflict of interest, since I ride the Acela 
every single week back and forth on the Northeast Corridor. 
Having said that, I want to ask Mr. Hamberger about freight 
railroads.
    You have testified that since the Staggers Act the 
railroads have invested over $500 billion in plant and 
equipment and direct capital investment, and you are planning--
you did about $24.5 billion this year, planning about $24.5 
billion in direct capital investment next year. You have also 
testified that we are looking at--I think your testimony was a 
38--I don't remember, 38-percent increase in freight volume 
over the next--or 80 percent or 78 percent, I think it was, 
over the next 20 years.
    Mr. Hamberger. Yes.
    Mr. Nadler. Is there sufficient investment capacity to keep 
up with that? Or do we--in other words, are the railroads 
generating sufficient income to invest sufficiently to keep up 
with the growing demand? And especially to keep up with growing 
demand if we shift more from highways to railroad, as our 
energy efficiency would demand that we do?
    Mr. Hamberger. As always, a very penetrating question, Mr. 
Nadler. The answer is I hope so. A number of years ago we had a 
study done that showed that we would not be able to keep up 
with the demand. That was before the recession. And it 
predicted that there would be a delta of somewhere in the $48 
billion range of what we needed to invest just to maintain our 
current market share.
    We have gone back and taken a look at that study, post-
recession. The demand level has been pushed out a number of 
years, so we won't reach the same level that we thought we 
would in 2035, number one.
    Number two, we are investing more than we were at that 
time, so we are putting more money back into it, because we are 
able to.
    And, number three, we have taken a look at the productivity 
factor, and have adjusted that based on facts, so that the 
productivity, annualized, is about three-quarters of a percent, 
rather than a half-a-percent. That little change, along with 
the investment and pushing out of the demand, makes me feel 
that we will be able to, in fact, meet the demand. And, again, 
that will depend upon whether the current balanced regulatory 
system continues, so that we can continue to earn money to 
reinvest. So that would certainly be the caveat there.
    And just so there is no misunderstanding on economic terms, 
when we say $525 billion, that covers both CAPEX and 
maintenance money.
    Mr. Nadler. That figure that I couldn't remember a moment 
ago is an 88-percent increase in demand by 2035.
    Mr. Hamberger. By 2035, yes.
    Mr. Nadler. But I was intrigued by what you just said. You 
said that you are looking at--you have made a minor adjustment 
to the anticipated productivity increase from half-a-percent to 
three-quarters of a percent, the small change. That is a 50-
percent change. That is not a small change, it is a huge 
assumption. What justifies that 50 percent?
    Mr. Hamberger. I have already said more than I know, Mr. 
Nadler. Let me respond for the record, if I might.
    [The Association of American Railroads inserted the 
following information for the record:]

        The Federal Highway Administration in January 2013 
        predicted that total freight shipments will rise from 
        an estimated 17.6 million tons in 2011 to 28.5 billion 
        tons in 2040--a 62-percent increase.

    Mr. Nadler. OK, but where I am really leading, obviously, 
is the same question I have been asking for the last 15 years 
or so, which is what can the Federal Government do to help 
expand investment in rail? Because, frankly, the railroads have 
made a Herculean effort and a very positive Herculean effort to 
invest. I think the country could use more investment.
    Mr. Hamberger. As you know, at one point in the past we 
were advocating an investment tax credit focused on capital 
expenditures solely for the expansion of capacity. That did not 
garner majority support in the House and Senate. Given the 
discussion about the need to broaden the base and lower the 
corporate tax rate and not talk about adding more targeted tax 
provisions, we have lowered our voice on that.
    However, for the short lines, the investment tax credit 
still is very important--the 45G provision, which has helped 
the short lines invest. And, as you know, I believe the number 
is 26 percent of all rail traffic either begins or ends on a 
short line.
    Mr. Nadler. Thank you. Before my time runs out let me ask 
Mr. Boardman one quick question, and that is you testified 
about the very large percentage of the Northeast Corridor going 
through the tunnels into Penn Station. Now, if that shut down 
it would sever New England and New York from the rest of the 
country, basically, which it clearly would. You have only got 
two tracks. Governor Christie last year, I think it was, vetoed 
the new--what was proposed to be a new tunnel into Penn Station 
that would more than double capacity. What do you think we 
should be doing in the future to deal with that problem? 
Because, clearly, we have to deal with that problem.
    Mr. Boardman. Well, the--those tunnels were never planned 
to go into Penn Station. They went under Macy's and----
    Mr. Nadler. You mean the proposed ones.
    Mr. Boardman. Yes, the proposed tunnels. The tunnels that 
are part of the Gateway Project right now really would go 
directly into Penn Station, and will make a big difference in 
how we make connectivity, both for high-speed rail and for New 
Jersey Transit and Long Island Rail Road, and all those that 
need--and I know that Metro North wants to get into Penn 
Station at this point in time, too. The capacity just is not 
there without a couple of new tunnels and the lines all the way 
from Newark in to Penn Station itself.
    Mr. Nadler. Thank you.
    Mr. Denham. Mr. Barletta.
    Mr. Barletta. Thank you, Mr. Chairman. Mr. Hamberger, as 
you know, it won't be long before the widening of the Panama 
Canal is completed. What do you see as the economic 
opportunities and challenges upon the completion of that?
    And, two, I envision development of inland ports, 
obviously, to move this freight away from the ports and inland. 
Are we ready for that? And if you could, just shed some light.
    Mr. Hamberger. I am going to beg off on the first question, 
Mr. Barletta. In fact, the Senate Commerce Committee is 
contemplating a hearing in April on that exact issue, the 
Panama Canal. We are busy internally talking to our members to 
try to get their projections on what that might mean for their 
traffic. I suspect, from where you are headquartered, it might 
affect what your projections are. So, I would have a better 
ability to answer that, if I could, for the record in the next 
week or so.
    With respect to the ports, when you ask what can be done to 
help move more freight by rail, the good news is Burlington 
Northern Santa Fe just got their final environmental impact 
statement issued for their new intermodal facility at the Port 
of L.A.-Long Beach. The bad news is they started 8 years ago. 
Those kinds of permitting and regulatory issues have taken a 
lot of time. And this will be, as I understand it, a state-of-
the-art, clean, intermodal facility which is going to take 
thousands of trucks a day off the local interstates. I am sure 
Rep. Napolitano knows more than I do about this project. But it 
is that kind of cooperation that demonstrates we are just part 
of an international logistics chain. And so the investments at 
the ports, both dredging and portside, landside facilities are 
critical.
    I don't know whether or not the ports are ready. I suspect 
that my counterpart at the American Association of Port 
Authorities could answer that a little bit more precisely.
    Mr. Barletta. Mr. Stem, the United States Department of 
Transportation is currently conducting a 2-year study, the 
impact of longer and heavier trucks on the Nation's highways. 
Would you agree that Congress should await the results of this 
study before proceeding to consider any further legislation in 
this area?
    Mr. Stem. Yes, sir. We not only agree with that philosophy, 
but we think that that runs counter to the stated goals of the 
U.S. Department of Transportation itself. This committee, over 
the last 20 years, with my experience, has debated ways to use 
rail for highway congestion issues. It also runs--flies in the 
face of that. We think that the study would give this committee 
and this Congress the types of information that you can use in 
your decisionmaking process.
    Mr. Barletta. Yes. As a former mayor, I could tell you I am 
sure there is municipal interest in this, as well. As these 
heavier trucks get off the interstate they go on to local roads 
that are not built to the same specs as the interstate system. 
And that cost falls right on the local taxpayers. So I have my 
mayor's hat on, looking out for mayors across the country, as 
well. So I am interested in seeing what that study will show.
    Mr. Stem. If there were no viable transportation 
alternative for those heavy loads, then that would be one 
portion of the debate about public investment and rebuilding 
offramps and bridges. But there are viable options. Put the 
truck itself on a rail flat car and move it to point of 
destination.
    And the current sizes are programmed in to this 
international logistics chain that Mr. Hamberger referred to, 
which is another part of that conversation.
    Mr. Barletta. Yes. I agree with you, that we should wait 
until this study is completed so we have the information we 
need to make a good decision about the safety and end cost. 
Thank you.
    Thank you, Mr. Chair.
    Mr. Denham. Thank you, Mr. Barletta. Mr. Michaud.
    Mr. Michaud. Thank you very much, Mr. Chairman. And on the 
same vein of questioning, I--my question is for Mr. Hamberger.
    Regarding the rail diversion, in 2010 the American 
Association of Railroads hired MIT researcher Carl Martin to 
study the effect a higher truck weight limit would have on rail 
transportation. Are you familiar with that report?
    Mr. Hamberger. I believe that was more the American Short 
Line and Regional Railroad Association, but yes, sir.
    Mr. Michaud. Yes. In that report Martin predicted that a 
truck weight increase similar to the one that is before this 
committee would result in diversion of freight from rail to 
truck only if--and only if--rail did not respond by lowering 
their rates, increasing productivity, or improving service.
    Mr. Martin's report goes on to state that should rail 
respond to more productive trucks by reducing the rate, 
diversion would not only be minimal, but the trucking industry 
would actually see a greater reduction than rail, a 7-percent 
overall reduction in truck miles, and only a 5-percent 
reduction in rail traffic delivering the same volume of freight 
with fewer miles for both rail and trucks. That sounds like to 
be more efficient use of both rail and trucks in the system.
    AAR has used this study to charge that rail traffic would 
suffer. By reading this on page 18, is it true that the study 
also undercuts your argument that rail would suffer if you had 
a higher weight limit?
    Mr. Hamberger. Not in the least, sir, no. What you are not 
talking about is the subsidy. If you increase the subsidy to 
the truckers, then railroads are going to have to cut rates to 
compete with that increased subsidy. The point is it is not in 
the national best interest to increase the subsidy to heavy 
trucks. Make them pay for the damage they do. That is what this 
study is going to find out. Congress has already spoken and has 
mandated that that is what DOT should take a look at.
    Our whole argument is when we go from 263,000 pounds to 
286,000-pound railcars, that allows an increase in 
productivity. And this is a technical term--but those heavier 
cars ``beat the hell'' out of the track.
    Mr. Michaud. OK.
    Mr. Hamberger. But you know who pays for that increased 
maintenance? You know who has to pay for the increased----
    Mr. Michaud. OK, OK----
    Mr. Hamberger. We do. The railroads.
    Mr. Michaud. And my second question is when you look at--
there has also been DOT studies from going to a higher weight, 
that actually, with a six-axle, a higher weight, the impact on 
the highway--not bridges, but highway--is minimal. The safety 
issues are taken care of. The problem I see in that report and 
your argument is the--it is very clear that unless you reduce 
rate, increase productivity, trucks lose more by an increased 
truck weight, as far as capacity.
    The other concern I see when you talk about no subsidies, 
when you look at short-line rail, the problem being is because 
of the ineffective way that some short-line rails are running 
their operation they are losing more, and it is causing States 
to actually have to either abandon the rail line or purchase 
it. And, actually, that happened to Maine. Get back to the 
ranking member's question about the State taking over a short-
line rail, used TIGER grant funds, because the rail has not 
been able to reduce rates or increase.
    So, I guess my concern being is on page 18 of that report, 
you know, it is very clear that rail would--if you do not 
respond to rates, increased productivity, or improving 
services, then yes, it would affect what you would be getting 
for an increased volume. But this here says if you respond in 
this area it would not affect. Trucks will be hurt more. And 
why does that not undercut your argument----
    Mr. Hamberger. Well, because you are not looking at both 
sides of the equation, Congressman. The other side of the 
equation is the subsidy. The short line in Maine, you say they 
weren't running it properly. Maybe they couldn't compete with 
the subsidy of the truckers. And that happened in----
    Mr. Michaud. No, no. This was before the weight increase in 
the subsidy--see my time is running out. But it was before the 
increase in weights. And when you look at previous DOT studies, 
an increase in weight actually will reduce the CO2 emissions, 
would reduce the cost of fuel, would take off more trucks off 
the road if you had that higher increase in rate--weight, 
rather.
    So I see my time has expired, but we will be hearing a lot 
more about this particular issue, I am sure. Thank you.
    Ms. Brown. Mr. Chairman, can Mr. Hamberger have, if not the 
time to respond now, time to respond in writing? Because I 
think this is an important question for this committee. Maybe 
you can grant him an additional minute to respond.
    Mr. Hamberger. I would just say that Mr. Michaud has made 
these arguments, and Congress last year voted 33 to 22 to send 
it to DOT to take a look at the various sides of this whole 
issue. And, therefore, I think that Mr. Barletta has it 
correct, and Mr. Stem has it correct. When that DOT study comes 
back, perhaps it will be able to answer these questions once 
and for all.
    On the six-axle truck, you did say that it doesn't address 
the safety of bridges, and that is, of course, a very important 
part of the study that I hope DOT will be looking at. As the 
President said in his State of the Union Address, there are 
over 60,000 structurally deficient bridges around the country. 
So the impact of heavier trucks on bridges that were not 
designed to carry that load needs to be looked at, as well. 
And, of course, the sixth axle doesn't do much to mitigate that 
weight on the bridge. It is the gross weight of the truck that 
affects the bridge--unless it is a really short bridge.
    Mr. Denham. Thank you, Mr. Hamberger. And I would just 
remind Members as well as witnesses that we will be submitting 
questions at the end of this hearing, and ask witnesses to 
respond to those questions forthwith.
    At this time I would like to recognize Mr. Perry for 5 
minutes.
    Mr. Perry. Thank you, Mr. Chairman. And I appreciate all 
our guests' testimony, and your passion and dedication to what 
is arguably one of the foundations of the American landscape 
and our economy.
    With that, I am just wondering--and I think I would like to 
direct--seems like Mr. Hamberger has taken an unusual amount of 
the questioning, but he seems to have the overall purview. So 
maybe if not, somebody else can chime in, but if you could 
characterize maybe, like, what you would consider the three 
largest cost drivers for the industry as you see it, whether it 
is freight, whether it is passenger, whether it is both, the 
three largest cost drivers for the rail industry, in 
particular, whether it is regulation, whether it is labor, 
whether it is fuel, whether it is O&M. Tell me what you think.
    Mr. Hamberger. Well, the top two clearly are fuel. The 
larger railroads burn a billion-and-a-half gallons of fuel 
every year.
    Number two, we have a very well-trained professional 
workforce. Labor costs are, I would guess, number two.
    And number three would be technology and safety 
investments.
    Mr. Perry. With that--and I understand the significant 
investment that your industry has made to upgrades and 
modernization and safety, et cetera, over the years, as 
appropriate--and of course, the taxpayers--and I think they 
will be willing, as a matter of fact, happy, to support the 
upgrades and the foundational changes that you folks are 
advocating for, but I am sure they are going to want to know 
that it is being spent responsibly, and that we are getting the 
most efficiency for that.
    So I am wondering what kind of programs the industry is 
instituting to reform the cost drivers, the major cost drivers 
like fuel, like labor, like technology, if any?
    For instance, I am from Pennsylvania. The district I 
represent drills for Marcellus shale gas. We might have some 
Utica underneath or something like that. But are--seems to me 
that the locomotives are more simple conversion to natural gas 
than your passenger vehicle, because you can pull the tanks 
right behind you, but I don't know. So I am looking for some 
answers to those questions about gaining those efficiencies, to 
make sure that we are getting the most bang for the buck for 
our tax dollars.
    Mr. Hamberger. There is a test going on that Canadian 
National is running up in Canada. Liquified natural gas has 
been something that the industry has looked at on and off over 
the years. One of the concerns is, as you project, the cost of 
LNG. Will it stay where it is today or will it go down? Where 
will it end up?
    One of the challenges is, of course, that it requires a 
whole new network of distribution for liquified natural gas, 
and who bears the cost of making that conversion? But it is 
something that the industry is looking at.
    And I don't know, Joe, maybe you have something--but we 
have gone from 4,000 horsepower to 6,000 horsepower, 
distributed power. We have done a number of things to improve 
productivity. We have doubled our fuel mileage in the last 20 
years, so it is something that we are focused on.
    Mr. Boardman. Happy to help you out.
    Mr. Hamberger. Thanks, Joe.
    Mr. Boardman. You know, you have really been on the hook 
here for quite a while.
    It really drives the equation here that Ed is talking 
about. If you really put natural gas, you have got a lot less--
at least in my experience--a lot less BTUs, so you do have a 
considerable difference in what you are going to have to have 
for a locomotive.
    Of course in the passenger side of things--and those that 
are in the Northeast sometimes understand and sometimes they 
don't--is that everything between Boston and Washington that is 
passenger-related operates on electricity. Or most everything. 
There are a few others, some of the commuter lines that come 
in, that are diesel-operated, and there is some freight along 
the corridor that is diesel-operated.
    But even electric power begins to bring up questions. Is it 
electric that is generated by coal fire? Is it electric that is 
generated by natural gas? Or, in some cases, we are able to 
generate it in the Northeast by water power so that there is a 
hydro component to it, as well. But hydro and compressed 
natural gas today--which is growing, of course--is a small part 
of what we really need to do.
    One of the things that prevented us from getting back into 
operation as quickly as we needed to into New York City was 
that there was not sufficient power at the right cycles per 
second that really delivered the number of volts that we needed 
to operate more trains into New York City. And that is becoming 
a limiting factor for us on the Northeast Corridor, as well.
    So, we are using almost all the technology today with 
freight and with passenger, looking for these solutions that we 
can find. Such as the green diesels, where we are using 
electric locomotives in some of the yards, and some of the 
improvements that we are finding are the right things for us to 
do. But something beyond where the diesel really provides 
today, I think, is a major change in the infrastructure.
    Mr. Perry. OK. Thank you, Mr. Chairman. I see my time has 
expired. If I could get maybe written comments on the labor 
component from Mr. Stem, that would be great. And I appreciate 
your input. Thank you.
    Mr. Stem. I would welcome that opportunity, and I would 
just comment, as a perspective for you, that in 2013 we have 
half as many employees today moving more than twice the number 
of railcars around the country that were in existence in 1980. 
So we have been engaged in a long-term productivity improvement 
since 1980, and that continues. And Mr. Hamberger is correct, 
we do have a very professional workforce working on the 
railroads today.
    Mr. Denham. Thank you. Mr. Walz.
    Mr. Walz. Thank you, Mr. Chairman. And I would like to 
thank all of you with your participation in Mr. Denham's I Hire 
Veterans initiative. We know your commitment to that is strong, 
always been there. This isn't something new for any of you, and 
we understand that. And I am grateful for that. I also am 
appreciative of the work you do, the careers you create, and 
the way you move America.
    And I say this not in classic Minnesota passive-
aggressiveness, but in honesty amongst friends, that we need 
you out there, but I also have concerns in farm country and 
rural America. And I would be remiss not to bring them up. And, 
as you know, I have a long history with this, from the 2008 
Farm Bill, asking. I want the facts on this. And in classic 
Washington fashion it is either/or. We need rail and we need 
highways. We need multimodal and we need ports.
    What my concern is--and I understand clearly that you want 
as much traffic as you can get and as many customers as you can 
get, but I want to make sure the competition is there.
    And so, Mr. Hamberger, what do you say--and I know you hear 
this--you have been great in working with me on this issue of 
trying to figure this out. What about captive shipping? What 
about bottlenecks? What about paper barriers?
    And then, add into that, I would have to say I am a 
supporter of Mr. Michaud's position on truck weights. I too 
want to see what the studies are. But we have had them, we are 
out there. I really don't believe, no matter what that study 
says, that all of a sudden you are going to say, ``Well, the 
study is with us, go for that, raise those rates.'' I just 
don't see that.
    And I want to know if you can help me understand. How do we 
reach a compromise on this? You need the truckers, they need 
you. My consumers need both of you in a--in the best possible 
way. And we need the market to work. How do we do that?
    And anyone, if you want to. I don't want to put you on the 
spot, because I truly am--and not passive-aggressively--I am 
appreciative of what you have done, and the work you have done.
    Mr. Hamberger. And I appreciate that, and we have indeed 
had these conversations over the years. And thank you for the 
opportunity, again.
    You know, the classic issue is that our average rail rates 
have gone down 44 percent, and that has allowed us and allowed 
our customers to compete. Obviously, an individual captive 
shipper who may not have as many options may say, ``Well, that 
is nice, but my rates haven't gone down.'' That is why we 
continue to be regulated by the Surface Transportation Board, 
which we believe has a balanced regulatory approach. If there 
is not effective competition, then the Board can step in and 
cap those rates. And, as you know, they have instituted several 
layers of ratemaking, not just one that takes a year or two, 
but they have----
    Mr. Walz. Do you know if anybody has ever won an appeal, 
any of our shippers out there?
    Mr. Hamberger. Oh, absolutely.
    Mr. Walz. Have they ever won?
    Mr. Hamberger. Sure, yes. In fact, the scorecard that the 
STB publishes for the stand-alone cost is about 50/50. I 
believe several of our chemical customers have just settled a 
number of cases. My own view is that if there is a settlement, 
then somehow there has been some accommodation. And so I would 
consider that to be a process that, in fact, has worked, in my 
opinion.
    Your point about the cooperation between trucking and rail 
is actually going on out there, as you point out. J.B. Hunt 
Trucking, which is publicly traded--I may not have this number 
exactly right, but for the third quarter of 2012, over 60 
percent of their revenues came from intermodal. J.B. Hunt 
Trucking. No, it is not called J.B. Hunt Trucking anymore, it 
is J.B. Hunt Transportation. And so those are the kinds of 
partnerships that we are trying to build.
    With respect to the issue that I just discussed with Mr. 
Michaud on truck size and weight, again it is a matter of who 
is bearing the price of that increased productivity. If it is 
an increased subsidy from the general traveler, the general 
Highway Trust Fund, we think that that is unfair to us, since, 
as I tried to point out, we are entirely responsible for paying 
for the increased productivity on our own right of way.
    Mr. Walz. I want a----
    Mr. Hamberger. And I agree with you----
    Mr. Walz. I want a solution that works for you and works 
for our shippers. These are big folks, too. I mean these are 
major motor companies----
    Mr. Hamberger. Yes.
    Mr. Walz [continuing]. Chemical companies, rural electrics, 
and all of that. Do you have any objection to the Secretary of 
Ag sitting on that decision with STB as it impacts agriculture? 
I had an amendment in this year's languishing farm bill to add 
that, of just trying to make sure they have a say.
    Mr. Hamberger. Well, I think the question where we had some 
concern was, as I understand your language, right now the 
Secretary of Agriculture can participate in any proceeding that 
he wants. And I believe, in fact, he just filed comments on 
Friday. So a statutory requirement that he or she participate 
just seems to be a little too much. But we certainly have no 
objection to the Secretaries of Agriculture or Commerce or 
Defense or anybody weighing in as they see fit.
    Mr. Walz. Again, I appreciate all you do out there. It is 
important to rural America.
    Mr. Hamberger. Thank you.
    Mr. Massie [presiding]. Having assumed the chair, I will 
now yield myself 5 minutes. It is amazing what a freshman has 
got to do to ask a question around here.
    [Laughter.]
    Mr. Massie. My name is Thomas Massie. But Mr. Boardman, my 
question is for you. The Northeast Corridor, according to the 
information that I have, it is the only profitable route right 
now for Amtrak. And I would just like to ask you. What could 
you do on the other routes, how can you capitalize on that 
model of success there, if there is one, and--in order to 
improve the profitability of the other routes?
    And could you also just talk a little bit about ridership 
and general trends there, and what some of the weaker routes 
are? Thank you.
    Mr. Boardman. Sure, Chairman Massie. Did I pronounce that 
right? Massie.
    The first thing I think that I would like to engage you on 
is that it depends on defining profitability. And other people 
would engage me on this if I said the Northeast Corridor was 
profitable. And it is covering its costs above the rail and 
then beyond that, between $200 to $300 million above direct 
operating costs.
    But there is a report, and I gave all the committee a 
three-ring binder, which was basically a kind of primer of all 
the different kinds of things we thought might be helpful for 
the committee to understand. And one of the items in there was 
the critical infrastructure needs on the Northeast Corridor. 
This was just recently published. It is one of the best 
documents that provides an understanding of the projects that 
need to get done along the Northeast Corridor, and what the 
magnitude of cost is, and where we are in the process of doing 
that.
    This report probably documents in the neighborhood of $52 
billion worth of work. All the States of the Northeast, the 
Federal Government, and Amtrak are on this commission 
together--and really the report says this is how we could 
maximize the use of the corridor. So, for the Northeast 
Corridor--and I said it a little bit earlier--it is about the 
capital investment that improves the ability for us to raise 
revenues.
    When you begin to look at the rest of the system, there are 
some specific ones that are close to covering our operating 
costs. For example, the Auto Train. And then what is next up 
the list--and one of the slides that I had on there--you bring 
up, if you would, the slide on the most costly services, the 
second-to-the-last one, if you can, Rip. And what you will see 
there is when you really begin to look at all the services that 
we operate, the longer the trip, the longer the mileage, the 
lower the ability for us to make that a lower cost because of 
the labor cost, because of the time it takes--2 or 3 days, for 
example, to get across the country. Those become real 
impediments to being able to make an improvement.
    I think what we see there is we see a huge investment that 
is being made by the freight rail industry to really allow us 
to operate at a speed up to 79 miles an hour. But it doesn't 
give us the ability to have a business model that makes money.
    Mr. Massie. Given the infrastructure you have--I know we 
would all rather have some improvements--but focusing above the 
rails, I know you have said you would like to run Amtrak more 
like a business. And recognizing that it is not a business, it 
is actually a Government, you know, subsidized organization, 
what are some of the things you would do if you were running it 
like a business that you can't do right now? And please focus 
above the rails. Thank you.
    Mr. Boardman. Stop coming to hearings.
    [Laughter.]
    Mr. Massie. That is not an option.
    Mr. Boardman. I understand. What we really do, I think, 
is--and I think the reality here today is that Amtrak has been 
given many paths to go down over the years, whether it is from 
one Congress after another, or one administration and where 
they want us to go, all those different intersections.
    And I know you came in a little bit late, I don't know if 
you were here for my full presentation or not, but what I 
really tried to talk about is the place that Amtrak inhabits is 
the intersection of all those Congresses, the administrations, 
the DOTs, the labor unions, the freight railroads, all the 
supporters. And what you really find is that Amtrak never can 
be a private industry in the way that some private industry is, 
although I don't think Mr. Hamberger really has the opportunity 
to be that way today, either.
    But what we really have is an inability for us to grow 
anything because of a starvation of capital. For example, on 
any of our routes that you see out there, we can't replace 
equipment because there is not sufficient income to replace 
that equipment.
    Mr. Massie. Thank you. My time is expired. Yes?
    Mr. Nadler. What was the name of that document that Mr. 
Boardman referred to?
    Mr. Boardman. It is called the ``Critical Infrastructure 
Needs on the Northeast Corridor,'' Jerry, and it was published 
in January of 2013. And this committee, subcommittee, should 
have in your office a copy of this, along with our strategic 
plan, the vision for the high-speed rail, and the history of 
1971 to 1979's long distance system.
    Mr. Nadler. Thank you, thank you.
    Mr. Massie. Would you like to enter that as part of the 
record, or----
    Mrs. Napolitano. Request for the copy to----
    Mr. Nadler. Sure, why not?
    Mr. Massie. Without objection?
    [No response.]
    Mr. Massie. So ordered.
    [The report entitled ``Critical Infrastructure Needs on the 
Northeast Corridor'' can be found online at http://www.nec-
commission.com/wp-content/uploads/2013/01/
necc_cin_20130123.pdf.]
    Mr. Massie. I now yield 5 minutes to Mrs. Napolitano of 
California. Thank you.
    Mrs. Napolitano. Thank you, Mr. Chair. And this question is 
for all witnesses. This has to do with the quiet zones, 
something that is very key to my district, having--in my prior 
district, having most of the Alameda Corridor going through it, 
so 54 grade crossings and all that good stuff. And I am still 
hoping that maybe the railroads will increase their funding 
assistance to those grade separations, because it is the 
national corridor--the corridor of national significance for 
rail delivery of goods to the rest of the Nation.
    They are expensive. One of my cities had it installed 
several years ago, Pomona. And the train traffic and noise has 
abated in that area. Now I have two other cities who are 
looking at it. There is two trains of thoughts in the 
community. One, constituents say, ``Well, it is the constant 
noise of horns,'' especially if it is in the middle of a 
business district, or even a city compound. And they want maybe 
additional signs, gates, infrastructure to create those quiet 
areas.
    But then there is the other component of the family saying, 
``Well, it is a safety issue,'' with children that have to 
cross. As you well know, in California streets divide cities. 
It isn't the long stretches of emptiness.
    So, part of what I would like to ask is, what is your 
opinion of those zones? And how can we bring the cost of those 
zones down so that cities may be able to access? And are there 
programs that you know of? What about the safety issues? And to 
that I will also add you have a volunteer group in the railroad 
of information to schools by volunteers. And I would like to 
know eventually in writing to this committee of where are we at 
with that. OK? Anybody.
    Mr. Boardman. You guys want to go first? Well, I will go, 
then, because I was the FRA Administrator that was in place 
when we put the horn rule back in, if you remember that. Now I 
am volunteering that for the lightening rod that it takes.
    But what has happened to us since is we have had a great 
growth in the number of, even now, the number of trespass 
deaths, crossing deaths. And we are very concerned, as an 
industry today, about those growing deaths.
    Mrs. Napolitano. Are you talking about the right-of-way?
    Mr. Boardman. Yes.
    Mrs. Napolitano. Which is where the volunteer group would 
come in and teach those in the area to be able to be careful, 
and instruct the locals about it. But that is where we don't 
know where you are at with that volunteer group.
    Mr. Boardman. We have--that is the Operation Lifesaver 
group. And I just put our chief of police on that Lifesaver 
group with the specific request and direction to look for ways 
to reduce these trespass incidents and also the crossing 
incidents. And I am beginning to work right now with North 
Carolina, because they have been a leader in sealed corridors 
that make improvements for this, for safety across the country, 
to adapt the kinds of things that you are looking at today in 
California to try to prevent the incursion into the crossings.
    But part of the problem today is the same thing we are 
having in every mode and in every place, and that is the 
distractions that occur by listening to your iPod, being on the 
tracks, walking. We had a recent CNN clip----
    Mrs. Napolitano. Which, again, sir, going back to the 
original intent, is to be able to educate the public and the 
children in the schools and the families about what causes 
accidents.
    Mr. Boardman. That is correct. But you also need to let 
people know that you are there with the train. And that was 
where the horn rule came in. It took 11 years to get it done.
    Mrs. Napolitano. Right.
    Mr. Boardman. It was the first thing that came out when I 
was the FRA Administrator. They were ready to go forward with 
it, and there was a lobbying effort to stop me from doing that.
    Mrs. Napolitano. Right. It is only in certain areas, sir, 
not just--and I am talking about downtown areas, where there is 
a need to be able to protect the community, protect the 
business, protect City Hall. I have been here at meetings with 
City Hall, and there is a train going by, honking, while they 
are trying to talk openly. So there are things we need to 
mitigate.
    Mr. Boardman. I usually find that CSX, whenever I am trying 
to give a speech along the CSX, they come along and blow the 
horn. But, yes, I understand that. But clearly, today there is 
an ability for the quiet zone to exist, but it does cost money 
for the community to make that happen.
    Mrs. Napolitano. Amount? Do you have an amount, sir, any 
more? Is the cost coming down?
    Mr. Boardman. It really depends on the specific crossing 
that we are talking about.
    Mrs. Napolitano. Anybody else?
    Mr. Hamberger. If I could just clarify for the record, the 
grade crossing accidents and incidents continue to decline. In 
fact, I have the preliminary statistics here. For 2012, highway 
rail incidents are down 8 percent. The problem is primarily 
trespassers or pedestrians in the right of way.
    Mrs. Napolitano. Understood. My time is up, Mr. Hamberger. 
May I ask that you reply in writing on that issue?
    Mr. Hamberger. Yes ma'am.
    Mrs. Napolitano. And also on the issue of you have created 
a senior executive level position. When, where, and how? We 
haven't heard any more information on that. And with that, 
please would like to have a response on that.
    Mr. Hamberger. Yes ma'am.
    Mrs. Napolitano. Thank you, Mr. Chair.
    Mr. Denham [presiding]. Thank you. And we will be having a 
second round of questions. I will lead that off. I would like 
to switch a little bit to labor, starting with Mr. Hamberger.
    How important is labor to your industry? And what are some 
of the ways you believe the industry can grow jobs over the 
next decade?
    Mr. Hamberger. Well, as I mentioned earlier, we have and 
are blessed with a very professional, very well-trained labor 
force. The last number I saw was that the average tenure of our 
employee base is 13 years. We are faced with a major 
generational shift, however. Last year it was 15,000 new 
employees needed to be hired, to a great extent because of 
retirements. We are projecting hiring 11,000 new employees this 
year. But in 2011 we thought it would be 15,000 and it turned 
out to be 20,000.
    So, what we are hoping is that we can continue to recruit 
based on the same level of commitment. Once people join our 
industry, they do stay with it. As James Stem said in his 
opening statement, it is a career choice, not just a job. We 
are doing everything we can through job fairs to let people 
know that those jobs are out there. We hope to grow, obviously, 
the size of the employee base by growing the industry itself.
    Mr. Denham. Thank you. And, Mr. Stem, have members of the 
UTU been generally satisfied with their association with 
Amtrak?
    Mr. Stem. Yes, sir. We not only support Amtrak--that is a 
historic statement--I can say--and this is not a promotion of 
him, personally--Mr. Boardman and his staff have brought a new 
level of credibility and stability to Amtrak. And the 
relationship that Mr. Boardman has established with this 
committee, including the former chairman, is a direct 
relationship--a direct indication that Mr. Boardman has been 
good for Amtrak, has been good for our employees.
    Mr. Denham. Thank you. That is good to hear. How about 
freight rail? How about Mr. Hamberger?
    [Pause.]
    [Laughter.]
    Mr. Hamberger. You had to go there.
    Mr. Denham. This is--again, we are trying to get everything 
out this first hearing. We figure we would----
    Mr. Stem. Well, I hate not to give you the controversy that 
you are seeking, Mr. Denham, but labor has an agreement with 
our freight railroads. It lasts through the mid-2016 range. We 
have invested in many different types of partnerships with the 
freight industry. Mr. Hamberger has helped with that 
cooperation and that relationship himself, personally.
    And the way that we think we are going to increase 
employment in the industry is to utilize the industry as this 
committed intends. We grow the industry, we grow the 
opportunity.
    If we had a national transportation policy, there is no 
doubt in my mind, there are many people in this room that have 
been promoting a national transportation policy for decades. 
And if we had a national transportation policy, the utilization 
of our fuel resources would be given much more credibility than 
it is today. We would not be having the debate about highway 
congestion and truck size and truck weights and the size of 
intermodal containers if we had that national transportation 
policy.
    So, I personally believe and agree with many people on this 
committee, that we are on the verge of a rail renaissance. And 
that is good public policy for this Nation.
    Mr. Denham. Absolutely. Thank you. Mr. Michaud?
    Mr. Michaud. Thank you very much, Mr. Chairman, and thank 
you for allowing for questions to be submitted for the record, 
because I think that is very important. As we heard Mr. 
Hamberger actually talk to--respond to Mr. Walz's question when 
you were not in the room, I never talked about truck size and 
weight. It was just truck weight. There are two different 
issues.
    You also had mentioned the fact that you are being 
subsidized. Actually, in the bill that is being--bipartisan 
bill that is being supported, it actually increases the fee 
because of damage for the bridges. So there are two different 
issues here, Mr. Chairman. And I think it is important that we 
do not try to mix those questions, issues, because it is being 
paid for and it allows the States to decide, because every 
State is different. It is not mandating that the States have to 
go with that higher weight. Because each State is different. 
Because in Maine we do have a pilot program for 20 years 
because of the problem of trucks going down into cities. That 
was a huge safety issue, a huge problem. So I think States 
should have the flexibility to decide, and the option to 
decide.
    My question, actually, is for Mr. Stem. In your prepared 
testimony you indicated that all transportation, particularly 
the Bakken fields in North Dakota, has been a boon for the 
freight rail. At the same time you indicated your concerns that 
possible adjustment in truck weight laws would somehow result 
in more trucks on the road. Is that correct?
    Mr. Stem. Yes, sir. Both of those statements are included 
in my testimony that I submitted.
    Mr. Michaud. OK. So let me ask you this question. Are you 
aware what the truck weight limits hauling oil to your railroad 
terminals near the field is? Do you know what the truck weight 
limit is?
    Mr. Stem. No, sir. I can honestly say I am not aware of 
that.
    Mr. Michaud. OK. Well, it is over 105,000 pounds. So, under 
your scenario, if you go to the 80,000 limit, then actually you 
would be forcing more trucks onto the roads. And that is a 
concern that I have, is when I hear the discussion about safety 
issues, about who is subsidizing who, it depends on what State 
you are in. So under that very scenario, we would actually be 
increasing more trucks in that particular State. And that is a 
big concern that I have. And I believe strongly in freight. I 
come from the manufacturing sector, in a paper mill. So I know 
how important freight is. But I also know how important it is 
to have different options available. And what I have seen, 
quite frankly, in Maine, is because of the unreliability of 
freight rail, manufacturers are having to go to trucks. They 
don't want to, but they have to go there because of the 
unreliability of freight. And that is very concerning. And I do 
believe that we have to have the options.
    And on the rail, I believe one of the reasons why they are 
so opposed to increasing the weight limit is because they do 
not want to have that additional pressure to offer more 
competitive rates, or have to focus on reliability. And not all 
rail lines are at fault, but there are some that are terrible 
in that regards. And I think it is important that we focus on 
those particular issues.
    And if you go right back to the report that I was 
questioning Mr. Hamberger earlier that was done in 2010, it is 
contradictory, when you look at his statements, as far as it is 
very clear in this report that if rail has more competitive 
rates, they are more reliable, then actually, the trucking 
industry will lose, as far as overall customers. So I think 
that is very important. And I will be submitting questions, Mr. 
Chairman, for the record.
    And hopefully we can get answers to those specific 
questions, rather than trying to lump everything together, 
because there is a different issue with truck weight and size. 
I am not talking about the size. Mine is primarily the rates, 
allowing the States the option to deal with that on their own, 
if they would like. And I think it is also disconcerting when I 
hear people say, ``Well, you can't do it because it is going to 
allow more trucks on the road,'' when actually those who are 
speaking the loudest, they already have a much higher weight. 
This is a safety issue, it is an environmental issue, it is an 
economic issue. And I think it is very important that we look 
at it as that, and not be afraid to work out on compromises 
which are extremely important.
    And I see my time has run out, Mr. Chairman, so I want to 
thank you for allowing us to submit questions for the record, 
because I will have plenty of questions to actually get at the 
very issue of weight. Not the size issue, but the weight issue. 
And there have been plenty of studies done in the past from 
Department of Transportation, not only at the Federal level but 
also at the State level, that--but would be interested in 
making those public, as well. So thank you very much, and yield 
back.
    Mr. Stem. May I offer a brief response to the question?
    Mr. Denham. I will allow it, Mr. Stem.
    Mr. Stem. Mr. Michaud, thank you for the question. The--my 
inclusion of the mention of the Bakken oil field mobile 
pipeline was an indication of the flexibility of the industry 
dealing with the current needs of our industrial movement 
around the country. I was not aware that an oil tanker could 
leave Williston, North Dakota, weighing 105,000 pounds and 
deliver that oil to a refinery in Philadelphia, Los Angeles, or 
in Houston. I was not aware of that. That was never the point 
of that comment.
    My comment about truck size and truck weights also included 
a concern that the size of the truck would soon surpass the 
allowable international interchange, so that if the truck gets 
so large you can no longer load it on a ship to go overseas. So 
then you would start another problem of having multisized 
containers available. But I will be glad to provide written 
response to that.
    Mr. Denham. Mr. Massie?
    Mr. Massie. Mr. Stem, what role can the United 
Transportation Union play in reducing costs at Amtrak and at 
freight rail?
    Mr. Stem. Mr. Massie, thank you for the opportunity. We are 
participating in that now. Cost reductions and being cost 
effective are part of what we do. Our agreements that we have, 
both with Amtrak and with the freight railroads, provide 
economic viability for them.
    If you will check the freight railroad stock reports--and I 
am a stockowner--you will find that our freight railroads are 
doing very well, largely because of the workforce that they 
have that is very professional that is actually working for a 
mere pittance.
    Mr. Massie. What else can you do, though? Are there any 
plans for helping these gentlemen reduce costs?
    Mr. Stem. Well, increased productivity constantly is on the 
table any time you talk about career opportunities. That would 
include pay and benefits. We are always open to productivity 
improvements.
    Technology, along with downsizing of the industry, has 
significantly reduced employees. As I mentioned before, we have 
fewer than 50 percent of the employees moving--compared to 
1980, moving twice as many railcars around the country today. 
By any measure, freight and passenger rail employees--and that 
includes the maintenance employees--are the most productive 
members of the workforce that we have in this country.
    Mr. Hamberger. If I might add, Mr. Massie?
    Mr. Massie. Please.
    Mr. Hamberger. It is not my role, thank goodness, to 
negotiate the national handling contracts with the unions. But 
in this past round, as has been, I think, the historical norm, 
UTU reached a voluntary agreement. They were the first to reach 
a voluntary agreement with the freight railroads addressing 
pay, health care, and work rules. And so have most of the other 
unions all come forward with an air of trying to reach an 
agreement. So just like that to be on the record for Mr. Stem.
    Mr. Stem. Thank you, Mr. Hamberger. And, Mr. Massie, to 
translate that into a direct response to your question, Mr. 
Hamberger is correct. We did reach a voluntary agreement, which 
means that the railroads and the employees agreed on a long-
term package of continued employment, continuation of progress 
for the industry. That included many productivity improvements.
    Mr. Massie. Thank you very much. Next question is for Mr. 
Boardman. How does and can Amtrak maximize its real estate 
assets around the train stations and development to create 
additional revenue streams for Amtrak? Are there any creative 
ways to create more revenue so you don't have to come here and 
testify?
    Mr. Boardman. We are actually doing that now, especially 
along the Northeast Corridor. We have a plan for the Washington 
Union Station, an unfunded plan. We have a plan for Moynihan 
Station in New York City. It is a partly funded plan. We have a 
lot of real estate developers that are looking at and pushing 
us, especially in New York City, for access to the folks that 
we have, so they can build their real estate development. We 
have an interest by the 30th Street Station in Philadelphia, on 
a regular basis, for increases in real estate development and 
other activity. And we have it at Baltimore, and any station 
that we really own--Chicago being another one.
    We actually--when we look at what we cover, in terms of our 
cost, we cover about 79 or 80 percent of our operating costs 
through the fare box. And yet we cover about 88 percent of our 
costs with all of our revenue. Most of that additional revenue 
is real estate. We have done--and we did for the last 
chairman--we looked at all of the real estate available along 
the Northeast Corridor. And most of it is not developable real 
estate, from the standpoint of creating revenues for us. Most 
of it has to do with supporting the operations, whether it be 
some of the freight operations that operate along the Northeast 
Corridor, or our own operation.
    Mr. Massie. But is it safe to say you are maximizing 
opportunities for things in those locations? For instance, for 
cell tower leases and what not?
    Mr. Boardman. Yes. We have--when we find a place that we 
can do that safely, and it is a benefit for Amtrak, we 
oftentimes have to put it out for competition for others that 
might be interested for it. But yes, we are doing that.
    Mr. Massie. Thank you very much. My time has expired.
    Mr. Denham. Thank you. Mrs. Napolitano.
    Mrs. Napolitano. Thank you, Mr. Chair. I am sorry, I may 
not have made myself clear on the senior executive level 
position for Amtrak that was in the recent reorganization. I 
would like to know in writing, and will share it with the 
committee. Is it in place?
    And, of course, can Amtrak make sure that the State-
supported services program will continue to thrive? OK?
    Mr. Boardman. You want that back in writing?
    Mrs. Napolitano. Yes, please.
    Mr. Boardman. Yes, ma'am.
    Mrs. Napolitano. Because that is going to take a little 
more time, and I don't want to spend that much time on it.
    In California you have three of the most used services, 
ridership records. And the nine records--Amtrak has set nine 
ridership records in the past 10 years. You have done 
magnificent. You have decreased your operating needs in half 
since 2004 and cut your debt in half since 2002. But what other 
improvements do you have in mind, and how can we help you get 
there, to be able to increase and get people off the road?
    And talking about the impact on roads, the weight damages 
the infrastructure of the roads. And then the citizens have to 
end up paying for that, the States. So, if you would, please.
    Mr. Boardman. Thank you, Congresswoman. First of all, the 
investment in the Northeast Corridor infrastructure--and we 
have already got this in the record, so I won't bring it back 
again right this minute--but if those investments are made, our 
revenues will go up substantially, because we will have a 
greater capacity.
    The PRIIA legislation also has required not just the State-
supported services, which I will get back to you in writing, 
but we also have an obligation to begin to look at what the 
commuter operators along the Northeast Corridor really provide 
in covering some of the cost of the capital on the corridor and 
the capacity that they take. And that is ongoing right now. We 
are making those kinds of improvements.
    We work pretty solidly with operating agreements with all 
of the freight railroads. That is also coming due, and we are 
in the middle of talking and listening, quite frankly, to the 
freight railroads today about what they see for reauthorization 
for the future. So we are identifying the kinds of things that 
we think are necessary for us to make the kinds of improvements 
that are being looked for, for on-time performance and 
improvement for the investment and our fleet that is going to 
be necessary for the future.
    Mrs. Napolitano. And also the investment in the 
infrastructure, ensuring that it is going to be able to handle 
the additional capacity. Am I correct?
    Mr. Boardman. Yes, that is correct. That is one of the 
things that the freight railroads are particularly interested 
in. With the investments they are making in capacity, they want 
to know what that means in terms of what Amtrak might want for 
the future. And that becomes a rub, just kind of like the truck 
weight issue for the freight railroads.
    Mrs. Napolitano. Well, I would like to hear Mr. Hamberger's 
side of being able to allow some of the transit, Amtrak 
transit, on rail lines. I know that it doesn't pay off as well.
    Mr. Hamberger. Well, as you know, under the statute, Amtrak 
has a right of access for avoidable cost. And your point is 
exactly right on. Avoidable cost is not fully allocated cost. 
But that is the deal that was struck back in 1970 and 1972, so 
that we are good partners, I think, with Amtrak.
    And, of course, part of that deal also is preferential 
dispatching, which is also part of the way we operate the 
railroad.
    Mr. Boardman. And we fight about that regularly.
    Mr. Hamberger. Yes, yes.
    Mrs. Napolitano. Well, with the new technology, will it 
make it easier to be able to align both?
    Mr. Boardman. Absolutely. As a matter of fact, part of the 
discussion we really have today with the new technology we are 
using--and we have a much better idea today with WiFi and 
eTicketing where we are in terms of the schedule itself. And so 
do the dispatchers.
    And part of the discussions we have begun to have with the 
freight railroads is they want to simplify that, as well. They 
want to find a way to get us on their railroad and off their 
railroad as quickly as they can. Because in some ways, some of 
them really believe that Amtrak has kind of become the canary 
in the coal mine. If they can't move us, then they have a 
problem with their railroad.
    Mrs. Napolitano. Well, there had been at one point several 
derailments in my area, or at least close to my area, and I got 
into that very heavily several years ago. And I am hoping that 
the new technology has been able to allow the railroads, as 
well as Amtrak, to understand how critical the replacement of--
or actually, the identification of rail that may have hairline 
cracks or anything that is really critical to public safety, 
both on the rail and in Amtrak.
    So, with that, I thank you, Mr. Chair----
    Mr. Hamberger. As I recall, it is a broken angle bar that--
--
    Mrs. Napolitano. I still haven't seen that, sir.
    Mr. Hamberger. Yes, many years ago. Actually using laser 
and sonar, we now have reduced to a great extent the number of 
accidents caused by broken rail, as well as broken wheels and 
broken axles. So----
    Mrs. Napolitano. We would love to have a report on that, 
Mr. Hamberger.
    Mr. Hamberger. I would be delighted to do that. Thank you.
    [The Association of American Railroads inserted the 
following information for the record:]

        The railroad industry has made dramatic progress in 
        reducing the number of broken rail derailments. In 
        fact, broken rail train accidents on Class I main line 
        track have declined 62 percent since 2004.

        This progress begins with improved manufacturing 
        processes. The manufacturers of steel rails have 
        continued to improve the overall quality of the rails 
        to reduce the potential of internal rail defects.

        Next, in addition to improved rail quality, railroads 
        have contributed significantly to reducing the 
        potential for defective rails by increasing the amount 
        of continuous welded rail (CWR) installed throughout 
        the North American railroad network. Most main line 
        trackage and a significant percentage of secondary and 
        yard trackage is composed of welded rail rather than 
        jointed rail. This has led to a dramatic reduction in 
        the number of rail joints which could in turn result in 
        rail defects.

        Additionally, railroads attempt to mitigate rail 
        defects and service failures through regular rail 
        inspections. A general visual inspection of the rail is 
        usually performed several times per week over most main 
        line trackage; however, a visual inspection by a highly 
        qualified track inspector cannot detect all of the 
        internal and external rail defects. Thus, ultrasonic 
        testing is performed by railroads on a routine basis. 
        The ultrasonic method of testing rails in service 
        attempts to target a wide variety of internal and 
        external rail defects, including at least:

             LTransverse defects
             LDetail fractures
             LEngine burn fractures
             LCompound fissures
             LDefective rail end welding
             LBolt hole cracks
             LVertical split heads
             LHorizontal split heads
             LHead and web separations
             LPiped rail

        The industry will continue to do all it can to improve 
        safety by reducing rail defect accidents even further.

    Mrs. Napolitano. Thank you, sir. Thank you, Mr. Chair.
    Mr. Denham. I would like the committee to notice that we 
are going to finish exactly right on time today. It is a good 
way to start our first hearing. And certainly want to thank, 
once again, all of our witnesses here today. Certainly been 
informative for a lot of new Members. Appreciate all of the 
supplemental material that each of you has provided. And, as 
well, we are looking forward to having more questions answered 
in writing.
    At this time I would like to ask unanimous consent that the 
record of today's hearing remain open until such time as our 
witnesses have provided answers to all of the questions that 
may be submitted to them in writing, and unanimous consent that 
the record remain open for 15 days for any additional comments 
and information submitted by Members or witnesses to be 
included in the record of today's hearing.
    [No response.]
    Mr. Denham. Without objection, so ordered.
    I would like to thank again each of our witnesses, again, 
for their testimony.
    And if no other Members have anything to add, the 
subcommittee stands adjourned.
    [Whereupon, at 12:59 p.m., the subcommittee was adjourned.]
