[Senate Hearing 113-644]
[From the U.S. Government Publishing Office]
S. Hrg. 113-644
PASSENGER RAIL:
INVESTING IN OUR NATION'S FUTURE
=======================================================================
HEARING
before the
SUBCOMMITTEE ON SURFACE TRANSPORTATION
AND MERCHANT MARINE INFRASTRUCTURE,
SAFETY, AND SECURITY
of the
COMMITTEE ON COMMERCE,
SCIENCE, AND TRANSPORTATION
UNITED STATES SENATE
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
__________
DECEMBER 10, 2014
__________
Printed for the use of the Committee on Commerce, Science, and
Transportation
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SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
JOHN D. ROCKEFELLER IV, West Virginia, Chairman
BARBARA BOXER, California JOHN THUNE, South Dakota, Ranking
BILL NELSON, Florida ROGER F. WICKER, Mississippi
MARIA CANTWELL, Washington ROY BLUNT, Missouri
MARK PRYOR, Arkansas MARCO RUBIO, Florida
CLAIRE McCASKILL, Missouri KELLY AYOTTE, New Hampshire
AMY KLOBUCHAR, Minnesota DEAN HELLER, Nevada
MARK BEGICH, Alaska DAN COATS, Indiana
RICHARD BLUMENTHAL, Connecticut TIM SCOTT, South Carolina
BRIAN SCHATZ, Hawaii TED CRUZ, Texas
EDWARD MARKEY, Massachusetts DEB FISCHER, Nebraska
CORY BOOKER, New Jersey RON JOHNSON, Wisconsin
JOHN E. WALSH, Montana
Ellen L. Doneski, Staff Director
John Williams, General Counsel
David Schwietert, Republican Staff Director
Nick Rossi, Republican Deputy Staff Director
Rebecca Seidel, Republican General Counsel and Chief Investigator
------
SUBCOMMITTEE ON SURFACE TRANSPORTATION AND MERCHANT MARINE
INFRASTRUCTURE, SAFETY, AND SECURITY
RICHARD BLUMENTHAL, Connecticut, ROY BLUNT, Missouri, Ranking
Chairman Member
BARBARA BOXER, California ROGER F. WICKER, Mississippi
MARIA CANTWELL, Washington MARCO RUBIO, Florida
MARK PRYOR, Arkansas KELLY AYOTTE, New Hampshire
CLAIRE McCASKILL, Missouri DEAN HELLER, Nevada
AMY KLOBUCHAR, Minnesota DAN COATS, Indiana
MARK BEGICH, Alaska TIM SCOTT, South Carolina
BRIAN SCHATZ, Hawaii TED CRUZ, Texas
EDWARD MARKEY, Massachusetts DEB FISCHER, Nebraska
CORY BOOKER, New Jersey RON JOHNSON, Wisconsin
JOHN E. WALSH, Montana
(II)
C O N T E N T S
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Page
Hearing held on December 10, 2014................................ 1
Statement of Senator Blumenthal.................................. 1
Statement of Senator Blunt....................................... 2
Statement of Senator Ayotte...................................... 32
Statement of Senator Booker...................................... 34
Statement of Senator Klobuchar................................... 36
Statement of Senator Nelson...................................... 40
Witnesses
Hon. Peter M. Rogoff, Under Secretary for Policy, U.S. Department
of Transportation.............................................. 3
Prepared statement........................................... 5
Hon. Anthony R. Coscia, Chairman, Amtrak Board of Directors...... 11
Prepared statement........................................... 12
John Previsich, President, SMART--Transportation Division........ 16
Prepared statement........................................... 18
Ray B. Chambers, Executive Director, Association of Independent
Passenger Rail Operators (AIPRO)............................... 21
Prepared statement........................................... 22
Appendix
James P. Redeker, Commissioner, Connecticut Department of
Transportation; Chair, Northeast Corridor Infrastructure and
Operations Advisory Commission, prepared statement............. 47
Response to written questions submitted to Hon. Anthony R. Coscia
by:
Hon. John Thune.............................................. 49
Hon. Roy Blunt............................................... 49
PASSENGER RAIL:
INVESTING IN OUR NATION'S FUTURE
----------
WEDNESDAY, DECEMBER 10, 2014
U.S. Senate,
Subcommittee on Surface Transportation and
Merchant Marine Infrastructure, Safety, and Security,
Committee on Commerce, Science, and Transportation,
Washington, DC.
The Subcommittee met, pursuant to notice, at 2:35 p.m. in
room SR-253, Russell Senate Office Building, Hon. Richard
Blumenthal, Chairman of the Subcommittee, presiding.
OPENING STATEMENT OF HON. RICHARD BLUMENTHAL,
U.S. SENATOR FROM CONNECTICUT
Senator Blumenthal. I am very pleased to open this hearing
of the Subcommittee on Surface Transportation of the Senate
Commerce, Science, and Transportation Committee.
And I want to particularly thank Senator Blunt for his very
hard work, good work over the last couple of years as the
Ranking Member. This is undoubtedly the last hearing of this
subcommittee under our leadership, but it has been really our
leadership. It has been a great partnership and I want to thank
him. I have appreciated all of our work together.
And I want to also thank our staff who has done a
remarkable job of focusing on some of the key issues that
confront our infrastructure and transportation system around
the country. It is a challenge that will endure well beyond
this Congress, but hopefully will be better addressed during
the next Congress.
Passenger rail service is a critical link between people,
jobs, and opportunities. It is vital to economic growth and job
creation. And that is one of the reasons why it really has to
be viewed as an urgent and immediate priority of our Nation.
The benefits are enormous not only economically but rail also
reduces congestion and takes people off our roads. It connects
our major metropolitan areas, and it provides an economic
lifeline that is essential to many communities. Loss of rail
service would cost the economy $100 million a day. And right
now, while we have not lost rail service, we are failing to use
it as well and expansively as we should.
On the Northeast Corridor, Amtrak and the passenger rail
network have unmet needs and some estimate those needs at
nearly $50 billion. That is not just for convenience or luxury
measures. It is essential to keep our bridges, railroads,
equipment functioning as they have to do. Some of our bridges
are more than 100 years old. The Walk Bridge in Norwalk was
built during the presidency of Grover Cleveland. It regularly
stalls and is stuck in an open position paralyzing rail traffic
up and down the East Coast. One bridge built more than 100
years ago can paralyze the whole eastern corridor. And that is
why the rail system must be rebuilt and rejuvenated.
I am hopeful that the Congress will act expeditiously in
the new year to renew the surface transportation bill. I am
committed to ensuring that passenger rail is an important part
of it and included within that legislation. And I am hoping
also that the reforms that I proposed in the bill that I have
introduced regarding passenger rail, particularly safety and
reliability, will be addressed as well.
I am grateful for the testimony of our witnesses, and I am
looking forward to their advice as to how we can fix these
problems. It is not a luxury. It is an essential fact of
American economic and cultural life that we must rebuild our
railroads, provide safety and reliability, which is so sorely
lacking in many parts of the country.
Senator Blunt?
STATEMENT OF HON. ROY BLUNT,
U.S. SENATOR FROM MISSOURI
Senator Blunt. Well, thank you, Chairman. Thank you for
this hearing today. And thank you for your aggressive
leadership of this subcommittee. We have had a number of
hearings on many issues and particularly on the passenger rail
issues. You have brought a knowledge and understanding and a
commitment to these issues that has really defined the
discussions our committee has had, and hopefully those
discussions work into more long-term legislation in the future.
I know we are all frustrated that in recent years, we just
barely managed to kick the funding bills and the highway bills
and the transportation bills forward just a little bit rather
than deal with them as we should so that we can look at a long-
term, integrated system that works in the best possible way.
Passenger rail in this country worked extraordinarily well
and served the country well, and then as other means of
transportation came along, we probably did not pay as much
attention nationally to passenger rail as we should have. And
it is turning our attention back to that and the way that, Mr.
Chairman, you have helped focus this committee I think is a
really good thing. As we have challenges of people and
transportation in all systems, the railroad still is an
incredibly efficient way to move people and to move things
around and how we meet the balance between passenger needs and
freight needs, both of which are really important to our
economy and both of which have a real impact on the way the
rest of the transportation network works, is particularly
important.
Hopefully, we will learn some lessons from these hearings.
I think the Passenger Rail Investment and Improvement Act of
2008 created a way for passenger rail competition to be
introduced into the system with no disrespect for anything
else. We almost all benefit from competition. State
transportation agencies have increasingly looked at the
competitive model as one of their alternatives, and that
probably is a good thing for passengers as everybody tried to
think how can we provide a better service at the best possible
cost.
The competitive rail market has emerged. The Herzog
companies, headquartered in St. Joseph, Missouri, were the
first independent company to enter the competitive passenger
rail market in the United States. Now they provide services to
80 million passengers each year. And what they have learned
that can be shared with Amtrak and other providers and vice
versa is an important thing. I think that is one of the reasons
that hearings like this serve a real purpose so that
information can be shared, that we can understand how we can
look at better ways to do what we are doing. Competition is a
good thing, and I am pleased we have a witness on the panel
today to talk about the competitive model, as well as witnesses
to talk about the Amtrak model and other models.
But your leadership here has been important. It has been a
privilege for me to serve with you as the ranking member on
this committee. And thanks for having this hearing today.
Senator Blumenthal. Thanks very much, Senator Blunt.
Let me introduce the panel and then ask each of you to make
an opening set of remarks.
The Honorable Peter Rogoff, the Under Secretary for Policy
at the United States Department of the Transportation, a wealth
of experience in this areas who speaks not only for the
administration but also as a participant in the Northeast
Corridor Commission. Thank you for being here.
The Honorable Anthony R. Coscia, who is Chairman of the
Board, of the National Railroad Passenger Corporation, Amtrak.
Thank you for a lifetime of public service, Mr. Coscia, and for
your expertise and experience in this area and for speaking to
the need for a Federal partnership and the need to invest in
the system that you so ably head.
Mr. John Previsich, who is President of SMART
Transportation Division, S-M-A-R-T, who speaks for tens of
thousands of very dedicated, honorable, hardworking employees
in the rail labor workforce. Thank you for so ably representing
them and for being here with us today.
And Mr. Ray Chambers, Executive Director of the Association
of Independent Passenger Rail Operators. The companies that you
represent I know seek to improve their passenger service and
offer alternatives, including potentially the Hartford-
Springfield line expanded to accommodate even more passengers.
So we thank you.
So, Mr. Rogoff, if you could begin please.
STATEMENT OF HON. PETER M. ROGOFF, UNDER SECRETARY FOR POLICY,
U.S. DEPARTMENT OF TRANSPORTATION
Mr. Rogoff. Thank you, Chairman Blumenthal, and thank you
for inviting me here today to discuss the future of intercity
passenger rail service and the GROW AMERICA Act, the Obama
administration's surface transportation reauthorization plan.
Secretary Foxx formally transmitted the GROW AMERICA Act to
Congress in April of this year. It is a 350 page, $302 billion,
comprehensive, four year surface transportation reauthorization
proposal. Importantly, the bill includes its own title to
authorize and fund the improvement and expansion of our
passenger rail network. That title sits right alongside our
other titles to rebuild our highway system, expand our bus
networks, improve highway safety, streamline the environmental
approval process, and strengthen our Buy America laws.
This is the first time any administration has transmitted a
surface transportation bill to Congress that fully integrates
passenger rail programs and policies into its vision for the
future. We strongly urge the Congress to follow suit.
For too long, the debates over passenger rail have centered
solely around the funding needs of Amtrak while the broader
debates over highway and transit funding formulas and policies
have taken place in other committees and during different
years.
The GROW AMERICA Act is built around the policy imperatives
presented by the fact that the decennial census tells us that
our Nation will see an additional 100 million citizens by the
year 2050, 100 million citizens who will put dramatically
increased demands on our surface transportation system both in
moving people and freight.
The decisions Congress will make in the next few months
will determine whether we will have a transportation system
that allows our economy to grow and employ 100 million
additional citizens or a transportation system that drags down
our economy along with our quality of life.
As we face this challenge, passenger rail must be part of
the solution. Most states and cities across the country already
know that they simply cannot solve the problem of increasingly
punishing congestion by adding highway lanes or building new
runways. Indeed, most communities do not have the space or the
resources to do either.
That is why we are now seeing Governors across the country
of all political stripes significantly expand their state
contributions to improve or expand intercity passenger rail.
Just since 2009, 32 states and their partners have invested
more than $4 billion through the President's high-speed rail
initiative. Through this program, states have greatly over-
matched their Federal grants for the purpose of accelerating
the deployment of new or higher performing service. Governors
are also putting up additional funding to maintain or improve
their state-supported Amtrak service. Governor Malloy in
Connecticut, as the chairman pointed out, is contributing $175
million for improvements to the New Haven-Hartford-Springfield
project. Governor Quinn in Illinois has pledged more than $120
million for the Chicago-St. Louis corridor. And Governors like
Rick Snyder in Michigan, Mary Fallin in Oklahoma, Tom Corbett
in Pennsylvania, Nathan Deal in Georgia--they are committing
millions of their state dollars to maintain or expand passenger
rail service. They are not doing it simply because they like
trains. They are doing it because their people need the
mobility and the continuation or expansion of rail service is
essential to the future economic prosperity of their states. I
think it also plays into the efficiency issue that Senator
Blunt made reference to in his opening remarks.
For the fiscal year that just ended, Amtrak carried 30.9
million passengers and served more than 500 cities. The GROW
AMERICA Act authorizes $19 billion for 4 years to enable us to
continue to partner with the Governors and grow passenger rail
ridership as America's population continues to grow.
At the center of our proposal is the creation of a new rail
account within the Transportation Trust Fund to provide
predictable, dedicated funding for rail. Highways, transit,
aviation, inland waterways, ports, and harbors have all
benefited from dedicated trust funds. Rail is unique in that it
lacks a committed source of Federal revenue, and as a result,
passenger rail capital investments have generally failed to
keep up with the needs of the fleet or infrastructure.
The Northeast Corridor alone requires investments of nearly
$1.5 billion per year over 15 years just to bring the corridor
into a state of good repair and maintain it in that condition.
Yet, at the same time that the corridor investments have fallen
well short of that funding level, the ridership on the
Northeast Corridor just reached a new record of 11.6 million
passengers a year.
Chairman Blumenthal, you talked about the Walk Bridge. You
could add to that list of decaying infrastructure that needs
attention that is over 100 years old things like the Portal
Bridge in New Jersey, which was just featured on a Sunday news
section. There was a focus also, as we all know, on the demise
of the Arc Tunnel project, and that also leads to two rail
tunnels that are absolutely essential to mobility up and down
the Northeast. That also must be addressed. Those tunnels are
well over 100 years old.
By providing predictable and dedicated funding for rail and
placing rail on par with other modes of transportation, the
GROW AMERICA Act will give Amtrak states and localities the
certainty they need to effectively plan and execute the rail
networks we will need to support our future economic
prosperity.
I thank you for the opportunity to appear here this
afternoon, and I look forward to your questions.
[The prepared statement of Mr. Rogoff follows:]
Prepared Statement of Hon. Peter M. Rogoff, Under Secretary for Policy,
U.S. Department of Transportation
Chairman Blumenthal, Ranking Member Blunt, Members of the
Subcommittee:
Thank you for inviting me here today to discuss intercity passenger
rail and our comprehensive multimodal surface transportation
reauthorization plan--GROW AMERICA.
The GROW AMERICA Act is a $302 billion, four-year transportation
reauthorization proposal built around the policy imperatives presented
by the fact that the decennial census tells us that our Nation will see
an additional 100 million citizens by the year 2050--100 million
citizens that will put dramatically increased demands on our surface
transportation system, both in moving people and freight. The
legislation was formally transmitted to the House and Senate by
Secretary Foxx in April of this year.
The GROW AMERICA Act takes an integrated systems approach to meet
those transportation challenges facing the country today. As the
demands presented by this population growth increase every day, our
transportation system is forced to become more connected--from highways
and transit, to freight and passenger rail--to adapt.
Our intercity passenger rail system carries more than 30 million
passengers to more than 500 American cities each year. Over the last 35
years, travel by passenger rail alone has increased by 62 percent. In
forecasting growth over the next 35 years, investment in America's
passenger rail system is essential. The GROW AMERICA Act authorizes $19
billion over four years to invest in a National High-Performance Rail
System. One of the hallmarks of this proposal is the creation of a new
rail account within the transportation trust fund to provide
predictable, dedicated funding for rail.
State Support for Passenger Rail
Supporting the Nation's intercity passenger rail system has not
just been a solely Federal commitment or Amtrak endeavor, but it is a
priority that has also ranked high for states in recent years. Since
2009, 32 states and their partners have invested more than $4 billion
in matching funds against the FRA's primary intercity passenger
program, the High-Speed Intercity Passenger Rail (HSIPR) Program,
including Connecticut DOT contributing $175 million for improvements to
the New Haven-Hartford-Springfield project and Illinois DOT pledging
more the $120 million for the Chicago-St. Louis Corridor Program.
Altogether, 80 percent of the HSIPR Program did not require a state
match, yet despite the absence of a match requirement, states have
invested over $3 billion into the system. We have included a detailed
summary, in the form of an attachment, of these investments, organized
by state and the supporting governors who applied for these Federal
dollars.
Also, 18 states have demonstrated their commitment to intercity
passenger rail by contributing approximately $280 million annually to
continue operating Amtrak's 29 state-supported short-distance routes--
services that carry nearly half of Amtrak's annual riders and provide
viable transportation choices to the communities they serve.
Predictable, Dedicated Funding for Rail
Highways, transit, aviation, inland waterways, ports and harbors
all benefit from dedicated trust funds. Rail is unique in that it lacks
a committed source of Federal revenue. As a result, passenger rail
capital investments have generally failed to keep up with the needs of
existing fleet and infrastructure, leading to a backlog of state of
good repair and other basic infrastructure needs. There is currently a
multi-billion dollar backlog of projects required to maintain a state
of good repair on our Nation's rails, as well as a significant deficit
in the capital funding available for maintaining assets and adding
capacity for anticipated increases in demand. The Northeast Corridor
alone requires investments of nearly $2 billion per year to maintain
good repair.\1\ By providing predicable, dedicated funding for rail and
placing rail on par with other modes of transportation, GROW AMERICA
gives states and localities the certainty they need to effectively plan
and execute projects that will improve transportation infrastructure,
allow regions and states to achieve their long-term visions for rail
transportation, provide accessibility to destinations near and far, and
support economic growth.
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\1\ Amtrak. ``Northeast Corridor State of Good Repair Spend Plan.''
April 2009
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National High-Performance Rail System
Our nation has not shied away from doing big things to move people
and goods, and our rail system should be the envy of the world. In GROW
AMERICA, $19 billion is proposed to address the backlog of disrepair,
as well as maintain, expand and improve America's passenger rail
network. In addition to making necessary infrastructure investments,
these programs improve safety and provide accessibility to disabled
Americans, as well as invest heavily in long distance routes, linking
Americans in rural and suburban communities to urban areas. Our
National High-Performance Rail System proposal allocates funds to two
new programs aimed at promoting market-based investments to enhance and
grow rail:
Current Passenger Rail Service Program--Over four years, the
Act will provide $9.5 billion to maintain the current rail
network in a state of good repair and continue existing
services. A significant portion of these funds is intended for
``Fix-It First'' projects, a multi-modal GROW AMERICA
initiative directed at reducing and eliminating the massive
investment backlog caused by years of deferred maintenance on
our Nation's transportation infrastructure. The Current
Passenger Rail Service Program will also fully fund Amtrak and
organizes grants around Amtrak's main lines of business: the
Northeast Corridor, State Corridors, Long-Distance Routes, and
National Assets. This includes:
$2.6 billion to bring Northeast Corridor
infrastructure and equipment into a state of good repair,
thus enabling future growth and service improvements;
$600 million to replace obsolete equipment on state-
supported corridors and to facilitate efficient transition
to financial control for these corridors to States, as
required by Section 209 of the Passenger Rail Investment
and Improvement Act of 2008 (PRIIA);
$3.1 billion to continue operations of the Nation's
important long-distance routes, which provide a vital
transportation alternative to both urban and rural
communities;
$1.8 billion to improve efficiency of the Nation's
``backbone'' rail facilities, make payments on Amtrak's
legacy debt, and implement Positive Train Control (PTC) on
Amtrak routes; and
$1.4 billion to bring stations into compliance with
the Americans with Disabilities Act (ADA).
Rail Service Improvement Program--The Act provides an
additional $9.5 billion to expand and improve America's rail
network to accommodate growing travel demand, which includes:
$6.4 billion to develop high-performance passenger
rail networks through construction of new corridors,
substantial improvements to existing corridors, and
mitigation of passenger train congestion at critical
chokepoints;
$2.4 billion to assist commuter rail lines in
implementing positive train control (PTC) systems;
$500 million to help mitigate the negative impacts of
rail in local communities through rail line relocation,
grade crossing enhancements, and investments in short line
railroad infrastructure; and
$300 million to develop comprehensive plans that will
guide future investments in the Nation's rail system and to
develop the workforce and technology necessary for
advancing America's rail industry.
Transparency, Accountability, and Engagement
GROW AMERICA proposes additional measures to build upon
transparency, accountability, and engagement efforts under the
Passenger Rail Investment and Improvement Act of 2008 (PRIIA). Under
PRIIA, Congress sought to improve stakeholder collaboration and the
methods for appropriately allocating costs on the Northeast Corridor
and state-supported routes, develop standards for the next-generation
of passenger locomotives and rail cars, and apply Buy America
requirements to the High-Speed Intercity Passenger Rail (HSIPR)
Program. In addition to continuing these key initiatives GROW AMERICA
proposes to undertake new efforts to improve transparency,
accountability, and engagement, including:
Amtrak Business Line Structure--As stated, GROW AMERICA
organizes financial support for Amtrak's existing passenger
rail services by ``business lines.'' This structure improves
transparency and accountability for taxpayer investments by
aligning costs, revenues, and Federal grants to business lines
to better ensure that our investments are advancing the
Nation's goals and objectives for rail services.
Amtrak Business Line Planning--GROW AMERICA also requires
Amtrak to engage in annual five-year operating and capital
planning to focus on the long-term needs of its business lines.
Capital asset plans will describe investment priorities and
implementation strategies and identify specific projects to
address the backlog of state of good repair needs,
recapitalization/ongoing maintenance needs, upgrades to support
service enhancements, and business initiatives with a defined
return on investment.
Regional Planning--Planning at regional level facilitates
will consider the integration of rail projects with other
modes, promotes greater stakeholder involvement, and can yield
more cost-effective priorities for a limited pool of Federal
dollars. GROW AMERICA authorizes DOT to establish Regional Rail
Development Authorities (in consultation with state governors)
to undertake and coordinate these important planning
initiatives.
Buy America--GROW AMERICA will strengthen Buy America
requirements in current law by ensuring uniform applicability
to all of the Federal Railroad Administration's financial
assistance programs.
ADA Compliance--GROW AMERICA authorizes $1.4 billion to
bring all Amtrak-served rail stations into compliance with the
ADA. The Obama Administration is strongly committed to making
the Nation's rail system accessible and comfortable for all
Americans.
Platforms--GROW AMERICA standardizes passenger equipment and
platform heights to increase interoperability of services and
equipment, as well as better provide for safe boarding and
alighting.
Commuter Rail PTC Implementation--DOT recognizes the
significant technical and programmatic challenges facing
commuter railroads in meeting the December 31, 2015 deadline
for PTC implementation, as well as the limited capital
resources available to commuter railroads to fund these costs.
GROW AMERICA authorizes $2.4 billion to assist commuter rail
lines in implementing PTC systems. Commuter railroads play a
vital role in our Nation's transportation network, carrying
over 1.7 million passengers per day, and it is important that
Congress provide the resources necessary to meet this safety
mandate.
Opportunity for Investment
The programs and policies set forth in the GROW AMERICA Act
position intercity passenger rail to play a key role in addressing the
21st century transportation challenges facing the United States, which
include:
Population Growth--As stated, an additional 100 million
people are projected to reside in the United States by 2050.
The vast majority of this growth will be concentrated in a
small number of ``megaregions.''
Congestion and Mobility--Highway and aviation congestion
continues to rise, with an estimated economic impact growing
from $24 billion in 1982 to $121 billion in 2011 in lost time,
productivity, and fuel.\2\ In many places with the worst
congestion, expanding airports and highways is difficult, as
land is limited and environmental/community impacts are
significant.
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\2\ Texas Transportation Institute, 2012 Urban Mobility Report,
December 2012.
Energy consumption--In 2010, the United States used more
than 13 million barrels of oil every day for transportation.
U.S. citizens consume nearly twice the oil per capita as
citizens of Organization for Economic Cooperation and
Development (OECD) member nations.\3\
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\3\ U.S. Central Intelligence Agency, World Factbook: United
States, August 1, 2012.
Energy costs--The inflation-adjusted cost of oil increased
129 percent from 1990 to 2010. As a result, Americans spent
$630 million more per day on oil for transportation than they
did 20 years earlier--an average annual increase of nearly $750
for every American. The Energy Information Administration
expects crude oil prices to rise an additional 50 percent
between 2011 and 2035.\4\
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\4\ U.S. Energy Information Administration, AEO2012 Early Release
Overview, January 23, 2012.
Environmental Protection--In April of 2014, the Inventory of
U.S. Greenhouse Gas Emissions and Sinks found that the U.S.
emitted 7.6 percent more greenhouse gases in 2010 than it did
in 1990.\5\ In addition, 27.3 percent of all greenhouse gas
emissions are from the transportation sector. Many of these
emissions have serious public health implications, which can
have substantial impacts on quality of life and the economy.
---------------------------------------------------------------------------
\5\ U.S. Environmental Protection Agency, Inventory of U.S.
Greenhouse Gas Emissions and Sinks: 1990-2012, April 15, 2014.
While intercity passenger rail and the GROW AMERICA Act are
uniquely well-suited to help address these transportation challenges,
there has also been a clear demonstration that the American people want
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rail in their suite of transportation options:
Ridership--Demand for passenger rail continues to climb
across the United States. In FY 2014, Amtrak carried 30.9
million passengers and set a new ridership record on the NEC
with 11.6 million passengers. These ridership levels are being
achieved even before the substantial service improvements
funded in recent years begin to come online. Once new trains
are added and trip times and delays are reduced, the system
will attract even higher levels of ridership.
Changing Demographics--As the U.S. population grows, it is
also changing. A large number of Americans are entering their
retirement years and are choosing to drive less often,
particularly over longer distances. Only 15 percent of
Americans older than 65 drive regularly, and that rate declines
to just 6 percent for those older than 75.\6\ At the same time,
younger generations of Americans are choosing to drive both
less often and for fewer miles than previous generations, and
are obtaining driver's licenses at record low rates.\7\ This
cohort uses public transportation more frequently than older
Americans and has different expectations for the composition of
their transportation system.
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\6\ AARP, Travel Behavior by Age, 2012.
\7\ Dutzik, Tony; Inglis, Jeff; Baxandall, Phineas, Millennials in
Motion, Frontier Group/U.S. PIRG Education Fund, October 2014.
Funding Demand--Nearly every region in the U.S. has
demonstrated demand for investments in passenger rail services.
Between August 2009 and April 2011, FRA evaluated nearly 500
HSIPR Program applications submitted by 39 States, the District
of Columbia, and Amtrak, requesting more than $75 billion for
rail projects. In the absence of recent HSIPR appropriations,
prospective applicants have also turned to the Transportation
Investment Generating Economic Recovery (TIGER) program, which
has awarded more than $300 million for intercity passenger rail
---------------------------------------------------------------------------
projects since the passage of the Recovery Act.
Pipeline of Projects--Since 2009, investment among
stakeholders has reached approximately $75 million in planning
studies to establish a pipeline of much-needed, future rail
projects. The GROW AMERICA Act authorizes the funding required
to make market-based investments to turn these studies into
improved and new services.
Conclusion
Thank you for inviting me to appear before this committee and
discuss the future of intercity passenger rail in the United States.
Between the passage of PRIIA and the Recovery Act, as well as the
creation of the high-speed program and TIGER programs, the last six
years have been a busy time for intercity passenger rail. The
Administration is encouraged that Congress is continuing to contemplate
how to best advance the next phase of our country's network. Coupled
with investments in our highways, bridges, transit system and freight
network, we believe GROW AMERICA represents an opportunity to
strengthen the safety, efficiency and reliability of intercity
passenger travel across the country.
This plan will increase capacity to move people and goods. It will
connect Americans to centers of employment, education and services,
supporting millions of well-paying jobs. Finally, it will enable our
partners to invest in transformative transportation projects that
improve our global competitiveness, connectivity, and safety for all
modes of transportation.
Thank you and I am happy to respond to your questions.
______
Attachment
HSIPR Program Matching Funds By State
------------------------------------------------------------------------
State Governor Affiliation State/Partner Match
------------------------------------------------------------------------
AL Robert Bentley Republican $100,000
------------------------------------------------------------------------
CA Arnold Republican $2,840,490,031
Schwarzenegger
------------------------------------------------------------
Jerry Brown Democrat $530,773,600
------------------------------------------------------------------------
CO Bill Ritter Democrat $ 377,848
------------------------------------------------------------
John Democrat $1,500,000
Hickenlooper
------------------------------------------------------------------------
CT Dannel Malloy Democrat $174,702,904
------------------------------------------------------------------------
DC N/A N/A $4,370,500
------------------------------------------------------------------------
DE Jack Markell Democrat $3,892,942
------------------------------------------------------------------------
GA George Perdue Republican $ 752,000
------------------------------------------------------------
Nathan Deal Republican $1,025,000
------------------------------------------------------------------------
IA Terry Branstad Republican $2,325,503
------------------------------------------------------------------------
ID Butch Otter Republican $50,000
------------------------------------------------------------------------
IL Pat Quinn Democrat $177,452,082
------------------------------------------------------------------------
KS Mark Parkinson Democrat $450,000
------------------------------------------------------------
Sam Brownback Republican $25,000
------------------------------------------------------------------------
MA Deval Patrick Democrat $17,955,423
------------------------------------------------------------------------
MD Martin O'Malley Democrat $1,500,000
------------------------------------------------------------------------
ME Paul LePage Republican $150,000
------------------------------------------------------------------------
MI Rick Snyder Republican $54,873,092
------------------------------------------------------------------------
MN Mark Dayton Democrat $ 11,600,000
------------------------------------------------------------------------
MO Jay Nixon Democrat $19,484,835
------------------------------------------------------------------------
NC Beverly Perdue Democrat $22,878,420
------------------------------------------------------------------------
NH John Lynch Democrat $500,000
------------------------------------------------------------------------
NJ Chris Christie Republican $16,500,000
------------------------------------------------------------------------
NM Bill Richardson Democrat $100,000
------------------------------------------------------------------------
NV Brian Sandoval Republican $358,631
------------------------------------------------------------------------
NY David Paterson Democrat $4,100,000
------------------------------------------------------------
Andrew Cuomo Democrat $111,470,610
------------------------------------------------------------------------
OK Mary Fallin Republican $1,986,359
------------------------------------------------------------------------
OR Ted Kulongoski Democrat $5,924
------------------------------------------------------------
John Kitzhaber Democrat $6,991,808
------------------------------------------------------------------------
PA Tom Corbett Republican $4,988,000
------------------------------------------------------------------------
RI Lincoln Chafee Independent $750,000
------------------------------------------------------------------------
TX Rick Perry Republican $1,400,000
------------------------------------------------------------------------
VA Bob McDonnell Republican $11,077,000
------------------------------------------------------------------------
VT Jim Douglas Republican $20,462,455
------------------------------------------------------------------------
WA Christine Democrat $74,710,052
Gregoire
------------------------------------------------------------------------
WV Earl Ray Tomblin Democrat $666,662
========================================================================
Total $4,122,796,680
------------------------------------------------------------------------
Senator Blumenthal. Thanks very much, Mr. Rogoff.
Mr. Coscia?
STATEMENT OF HON. ANTHONY R. COSCIA, CHAIRMAN,
AMTRAK BOARD OF DIRECTORS
Mr. Coscia. Thank you, Chairman Blumenthal. And let me
start by acknowledging with gratitude your contribution as
chair of this subcommittee. The Amtrak family has certainly
benefited from your leadership, but far more importantly our
millions of riders have benefited from your leadership and
wisdom. And we are very grateful for that and look forward to
continuing to work with you in the future.
Senator Blumenthal. Thank you.
Mr. Coscia. This is a very interesting and opportune time
for us to be having this discussion. Amtrak recently finished
its Fiscal Year reporting for Fiscal Year 2014, and the results
were extremely positive from an operational standpoint. $3.2
billion in revenue set a record, 8 record years out of the last
9. And what is even more noteworthy is that our operating
deficit, the Federal requirement to cover losses in the system
dropped to $227 million in Fiscal Year 2014. That is the lowest
in the company's history in inflation-adjusted dollars, which
shows you that there is a real opportunity here that is
important for us all to sort of grab on to. We run a system
that essentially covers all of its operating costs to the tune
of almost 93 percent. It is an incredibly enlightening
statistic which has you asking the primary question of, well,
why is all of this changing.
And the reality is that Amtrak certainly has done a number
of things in the last several years that have made it a
stronger business. In the absence, candidly, of the kind of
resources that would give people the opportunity to do whatever
they want, Amtrak has had to force itself to do more with less,
and that is something that it has grasped and taken hold of in
a way of being a good steward of the assets that are given to
Amtrak to run.
But just as importantly, America is changing. Its reliance
on intercity travel is something that is far greater than it
has ever been. The kind of ridership we are seeing among
millennials and others shows that there is an increasing
interest in creating connectivity between cities, and it is
something that creates an opportunity that I think as a Nation
we should be embracing.
There is a broad opportunity available today to create
intercity travel not just on the Northeast Corridor, but among
city pairs that exist around the Nation, from Charlotte to
Atlanta, Tucson to Phoenix, Dallas to Houston. There are
multiple opportunities throughout the country to create a
national system that would allow these city pairs to function
and to function efficiently.
And we think that our experience in the Northeast Corridor
is showing us that that is absolutely possible. The kind of
mobility that we create along the Northeast Corridor, the kind
of demand that we see is an indication of just how much
interest there is around the country in passenger rail for a
whole series of reasons that reflect as much the changing
demographic of how people live and operate in the Nation as it
does the system itself.
But the truth is that as much as we have been able to make
great, great progress in operating the system, Amtrak as an
enterprise is seriously undercapitalized. Everyone understands
this and everyone knows it, but the reality is that we run the
risk of all the gains that we have achieved in the last decade
evaporating because of our inability to provide the kind of
capital investment that the system needs to be truly an
effective part of the Nation's transportation system.
Nowhere is that more evident than in the part of the system
that is the most successful, which is the Northeast Corridor.
There are a number of points of failure in the Northeast
Corridor that put the system in great jeopardy, and there are
things that we need to attack and we need to attack them very
aggressively.
There has been mention of the trans-Hudson tunnels. Some of
us have been working on that process for quite a long period of
time, and the reality is that the Gateway program that Amtrak
is proposing represents the kind of solution that has been
fully embraced by many but where there needs to be a sense of
leadership now in order to bring this to the next step. And we
believe that leadership has to come from the Federal
Government. A national system of intercity transportation that
connects cities throughout the country is not really possible
without the kind of Federal commitment that will provide
multiyear funding to the kind of capital investments that we
think will provide the level of leadership and bring together
not just Amtrak but our state partners as stakeholders, private
sector investors who may be interested, our labor partners.
Someone has to lead that effort, and it is our view that the
Federal Government's role in that effort is the level of
leadership that we believe will give us the kind of system that
is comparable to the systems that we all hear about in other
parts of the world where there has been that kind of a focused,
centralized effort.
We applaud the administration's proposal in the GROW
AMERICA Act. We believe it is the right way to start creating
the right emphasis on passenger rail, and we are hopeful that
we can play a part in that.
[The prepared statement of Mr. Coscia follows:]
Prepared Statement of Hon. Anthony R. Coscia, Chairman,
Amtrak Board of Directors
Chairman Blumenthal, Ranking Member Blunt, and distinguished
Members of the Committee, thank you for inviting me to testify on
Amtrak's behalf about the future of passenger rail in America. Today's
hearing is timely: Amtrak just completed its fiscal year and the
results clearly affirm that intercity rail plays an essential role in
America's transportation landscape. With unaudited annual revenues
totaling approximately $3.2 billion, Amtrak achieved its fifth
consecutive year of revenue growth and its eighth year of revenue
growth in the last nine years. These revenues, coupled with careful
cost management, have significantly reduced our reliance on taxpayers
for an operating subsidy: in Fiscal Year 2014, our Federal operating
funding requirement was $227 million, more than $100 million less than
in Fiscal Year 2013, and Amtrak's lowest operating requirement ever, in
inflation-adjusted dollars. Taken as a whole, the Federal operating
subsidy covers only 7 percent of Amtrak's operating costs, with the
balance covered by corporate revenue and state support. In recognition
of our strong financial performance, last month, Moody's Investor
Service affirmed Amtrak's A1/Stable debt rating.
The improvements in Amtrak's financial performance are not
accidental. Amtrak's record financial results have been aided by
significant ridership growth, particularly along the company's densely
populated intercity routes. The Northeast Corridor (NEC) experienced
its highest ridership ever in FY 2014, as did eight other intercity
routes. This increase in ridership is in turn attributable to
significant demographic trends, with travelers increasingly turning to
passenger rail as a way to move between cities quickly and safely, and
to avoid congestion on other modes. Passenger rail is especially
popular among members of the millennial generation. Recognition is also
due to Amtrak's investments in e-ticketing and broadband, all of which
improve the customer experience and drive revenue growth. Finally,
Amtrak's management has undertaken a number of initiatives in recent
years to manage expenses and improve the company's bottom line. We
understand that the continuity of Federal support for Amtrak is tied to
our ability to demonstrate that we are using taxpayer funds wisely.
We are pleased with Amtrak's recent performance but it would be a
mistake, in my judgment, to rest on our laurels. I believe that
intercity passenger rail, given financial support commensurate with
demand and a fundamental rethinking of our Nation's transportation
strategy, can do so much more for America. Amtrak's growth over the
past ten years is the tip of the iceberg compared with the true, unmet
demand for high-quality rail service connecting America's major
metropolitan areas. The success of many foreign systems, as well as our
own Northeast Corridor demonstrates that rail is optimally suited to
serve the needs of those traveling between major cities within 100-500
miles of each other. Across the globe, high-speed and higher-speed
trains are not only an essential mode of transportation in such
corridors, but also a significant driver of local development and
economic growth. This trend is clearly revealed in Amtrak's own
ridership results, where well over 85 percent of all trips are for
journeys less than 250 miles and less than 5 percent of trips are for
journeys more than 400 miles. Even on Amtrak's long-distance routes of
750 miles and longer, the vast majority of riders use our trains to
connect to intermediate destinations rather than the end points.
And yet America has yet to fully embrace investments in passenger
rail as a tool to grow our regional and national economies, reduce
traffic congestion on other modes, and create new travel opportunities.
Record Amtrak ridership in the country's mega-regions--not only the
NEC, but also the Chicago Hub area, California and the Pacific
Northwest--hints at the tremendous opportunity for truly modern
passenger rail service links between dynamic city pairs. Passenger rail
could be so much more, our economies could be stronger, and our lives
better, if trains were faster, more frequent and more reliable in these
regions. This is to say nothing of the regions around the country where
little or no high-quality rail connects metropolitan areas--regions
like Atlanta to Charlotte, Houston to Dallas, Miami to Tampa,
Pittsburgh to Cleveland, and Tucson to Phoenix. As a nation, we are
squandering opportunities to improve our economies and quality of life
by failing to make investments in the type of high-quality rail service
that Amtrak plans for the NEC and that we see in existence or under
development in nearly every other major economy in the world.
As we look ahead to the reauthorization of Amtrak and the Nation's
intercity passenger rail programs, and the expiration of the Highway
Trust Fund, I respectfully submit that Congress should focus on ways to
unlock rail's potential for America's major city pairs. As discussed at
further length later in my testimony, the development of intercity
corridors will require Federal leadership, expanded and predictable
funding, and a new policy framework. At the same time, we at Amtrak
must expand upon the successes that we've achieved with intercity rail,
especially in the NEC, to other regions around the country, and to
orient our business to serving such corridors. In order to achieve
this, we will have to continue to improve customer service, strengthen
our operations, rethink various aspects of our network, and improve
project delivery. We must also think creatively and proactively about
utilizing and developing our assets, so that we can harvest the latent
potential found in our stations, right-of-way and infrastructure.
Moreover, we need to consider opportunities to attract private sector
participation in order to access its capacity for swift project
execution and capital formation. I look forward to working with the
Members of this Committee to prepare Amtrak for this new challenge, so
that we can deliver the benefits of modern intercity rail to the
Nation.
Before turning to how we can realize the great potential for Amtrak
and intercity rail in our Nation's transportation future, it is
important to highlight a critical point: Amtrak's operating performance
in recent years obscures serious and growing capital challenges. To put
it bluntly, Amtrak does not have sufficient capital to sustain its
operating successes to date, let alone to build the sort of intercity
rail system that I described. The Federal investment in Amtrak is
currently and has always been extremely limited, compared with Federal
investments in other modes of transportation. To put this in context,
the Federal Government has authorized roughly the same amount of
funding for Amtrak, about $44 billion, over the company's entire 43
year existence, as the Federal Government spends on highways in a
single year.
As a result, to the extent Amtrak makes investments in its capital
assets, these investments tend to be incremental and largely confined
to repairing decades-old infrastructure and equipment. Amtrak has had
to defer or delay many capital improvements so that, today, we face
major challenges in merely sustaining the infrastructure, rolling
stock, and stations that have supported our performance thus far.
Unlike other modes of transportation that receive Federal funding,
passenger rail has never had access to predictable, dedicated, capital
funding and contract authority that would enable us to develop and
implement a long-term capital program. Despite the extraordinary growth
in passenger rail demand in recent years, the Federal Government has
declined to establish a funding mechanism for rail comparable to the
trust funds and multi-year authorizations that have supported other
modes of transportation. This inhibits our ability to take on multiyear
projects, and forces us to repair infrastructure that really ought to
be replaced,
In the absence of a dedicated sustainable funding mechanism, Amtrak
has made every effort to work with our partners to make incremental
investments in passenger rail. We have worked with state partners to
improve existing rights-of-way for higher speed services in places like
Illinois and Michigan. We have partnered with these states and
California to support the purchase of new equipment for corridor
services. And we have been at the forefront of attempts to deal with
freight rail congestion in the Chicago area--not only by working
proactively with the freight companies but also by convening a blue
ribbon panel to examine the problem in its totality and recommend
solutions.
In the Northeast Corridor, we have partnered with commuter
authorities and states to make incremental improvements in the aging
infrastructure that supports approximately 260 million annual commuter
and intercity trips. Thanks to one-time actions in 2009 and 2010 to
increase Federal investment in rail, Amtrak and state partners are now
undertaking improvements in places like Connecticut, New Jersey, New
York, Delaware, and Maryland to chip away at the years of deferment and
pave the way for improved and increased services. The availability of
meaningful Federal resources to improve the railroad helped create a
new collaboration and joint sense of responsibility among the
Corridor's users and beneficiaries. The Passenger Rail Investment and
Improvement Act (PRIIA), much of which was authored by this Committee,
has further supported this new partnership by creating the NEC
Commission as a forum to bring the NEC's stakeholders together, develop
a new cost allocation method for shared investments, and unite the
owners and operators of the NEC in a common vision and approach to
ensuring the future success of this essential corridor. Against this
backdrop of collaboration, Amtrak is working with our partners in
Philadelphia, Baltimore and Washington to create and advance plans to
expand and redevelop our stations in these cities, as well as the
surrounding neighborhoods. Our aim is to increase rail capacity and
enhance services for our customers, improve the company's bottom line--
while at the same time fostering development and economic growth in the
cities we serve.
All of the corridor-related initiatives I have described are
important, even essential, but they also reveal the truly incremental
nature of Amtrak's capital investment program. Without a greater,
sustained commitment of capital from the Federal Government, Amtrak is
on a path that will, at best, hold us in our current situation. The
more likely outcome, however, is a slide backward in our company's
operating and financial results, as passenger demand further outstrips
capacity and deferred investment begins to significantly impact
performance.
As Amtrak has previously reported to this Committee, our capital
investment deficit is most profound in the NEC. You have heard before
about the many major infrastructure assets that are presently at the
end of their useful lives and in need of immediate replacement, from
the B&P tunnel to the Connecticut River Bridge. The most urgent
challenge along the NEC is with the Hudson River tunnel linking New
Jersey and New York, where limited capacity, heavy congestion and
overburdened and aging infrastructure all converge. This tunnel--two
single track tubes built out of cast iron and concrete more than 100
years ago--handle all passenger rail traffic between the two states and
form a vital link for the entire Northeast Corridor. Such is the
deteriorating condition of the Hudson River tunnels that, since about
1999, Amtrak has closed one every weekend for repairs, on a carefully
choreographed 55-hour work outage. As a result, for many years,
transportation planners and officials have stressed the importance of
building new rail tunnels, together with an expansion of tracks and
platforms at New York's Penn Station, which is already the Nation's
busiest transportation facility.
The need to address this precarious state of affairs suddenly took
on even greater urgency two years ago, when Super Storm Sandy provided
us with an illustration of the perils of relying on such century-old
infrastructure. After Sandy, we discovered that destructive chlorides
from sea water caused and are continuing to cause extensive damage to
Amtrak's tunnel under the Hudson River, so major components needs to be
replaced as soon as possible. In order to perform this work, each of
the tubes must be closed for one year or longer, presenting Amtrak, the
states of New York and New Jersey, and passengers along the entire NEC
who rely on this tunnel a stark choice--either build a new tunnel to
maintain capacity to handle existing demand or otherwise significantly
curtail Amtrak and daily commuter rail services, impacting millions of
passengers every year. Fortunately, Amtrak has already done significant
planning to advance what we call our Gateway Program--our plan for
doubling capacity under the Hudson River with new and rebuilt tunnels,
expanding Penn Station, enhancing reliability and resiliency of this
essential infrastructure. What's needed now is Federal leadership and
investment to avert a crisis along the NEC and create the new capacity
needed to protect today's service and meet the demand for passenger
rail in the decades ahead. We critically need the support of this
Committee and Congress to advance the Gateway Program and I ask that
this be a central focus on your efforts in the coming Congress.
Projects like Gateway are so vast, and their impacts on people and
the economy so widespread, that they should not be regarded as ``Amtrak
projects,'' ``state projects,'' or even ``regional projects.'' Rather,
they are national projects, which can only be addressed effectively by
the Federal Government. As I described earlier, there is an enormous
opportunity in developing new intercity passenger rail services
throughout the country; if implemented, these services will have
profound transportation and economic benefits. What is critically
needed, however, is a Federal funding mechanism that will help us
achieve these attainable goals.
One might reasonably ask how Congress should think about designing
a Federal funding mechanism for passenger rail, alongside existing
funding programs for other modes of transportation. When the new
Congress convenes in January, it will need to address the Highway Trust
Fund authorization. I believe our country needs to fundamentally
rethink how it funds transportation projects of national significance.
We need to move away from mode-centric solutions and design a program
that can fund multi-modal utility designed to address congestion
challenges and support a competitive economy. A carefully redesigned
Transportation Trust Fund, acknowledging the Federal responsibility for
promoting interstate commerce, could at once address our aging
infrastructure and our growing travel demand, while generating
employment and long-term economic benefits. This is also the solution
for Amtrak's capital challenge: We need access to the predictable,
dedicated funding and contract authority, so that we may undertake
major multiyear projects to replace outdated, decaying, and
increasingly obsolete infrastructure with a passenger rail system
capable of meeting the needs of the 21st Century economy.
I believe the United States' transportation system is at a
crossroads, as the investments that brought our Nation into modernity
in the last century reach the ends of their useful lives. The story is
the same across our highways, airports, seaports, railways, and transit
systems. Members of this Committee will be responsible for designing
the blueprint that determines the transportation priorities for the
next century. As you undertake this important task, I respectfully urge
you to abandon any conception of passenger rail as an old and obsolete
mode of transport. Countries as diverse as China, England, Japan,
Spain, German, France, India and Brazil are making investments that
suggest that passenger rail is, in fact, a transportation mode of the
future. With help from this Committee and across the Federal
Government, Amtrak can play a vital role in helping America develop and
deploy a truly modern passenger rail network. The key is capital
investment--not just to sustain the services that underpin today's
business, but those that will help us to sustain America's future
transportation needs. We at Amtrak stand ready to build and operate a
passenger rail system that will transport our Nation's economy in the
decades ahead.
Senator Blumenthal. Thanks very much. You know, I have to
tell you your remarks about the high and growing ridership in
the Northeast Corridor is certainly substantiated by my own
experience. When I ride Amtrak, as I do frequently, often
seeing my colleague, Senator Booker, we are never able to sit
together because there are never two seats available. I am not
sure he would want to sit with me anyway.
[Laughter.]
Senator Blumenthal. But it is very heartening to me when I
ride to see that kind of high usage and demand.
I also want to mention that I am grateful to Senator Ayotte
for joining us today. I do not get to ride with her.
[Laughter.]
Senator Blumenthal. But I know she is very dedicated to
improving our rail service.
Mr. Previsich?
STATEMENT OF JOHN PREVISICH, PRESIDENT, SMART--TRANSPORTATION
DIVISION
Mr. Previsich. Thank you.
First, I will take this opportunity to thank you, Chairman
Blumenthal and Ranking Member Blunt and the members of the
Senate Commerce Subcommittee on Surface Transportation, first
for your service and leadership on this committee and also for
the opportunity to testify here today.
This hearing could not be more aptly titled. Public
investment in our Nation's passenger rail system is truly an
investment in our Nation's future. Passenger rail is a critical
part of our national transportation infrastructure, an
important driver of our national and regional economies, and is
a middle-class job creator.
I speak to this matter from personal experience. In my
capacity as a union representative, I have been involved on
passenger rail operations from coast to coast that have
leveraged various forms of public funding to provide excellent
service to the communities through which they operate. In my
home state of California, I have watched Caltrain in the San
Francisco Bay area leverage a combination of local and Federal
funding to revitalize the service from a low of 5,500 boardings
per day when operated by a private operator to today's figure
of over 53,000 in a public-private partnership.
In my home county of Santa Cruz, California, a planning
process is already underway that will identify transit
corridors for the purpose of leveraging Federal and local
funding to improve transportation, regionally reduce greenhouse
emissions, cut down on auto trips, and promote affordable
housing, a very important part of our community.
All of this cuts the use of fossil fuels and increases the
value to America of the funds that are invested. They get
leveraged locally and come back to the community and to the
country, much more than was ever invested in the first place.
All across America, communities are relying on transit
funding to invest in strategic planning. The investment will
pay itself back many times over through an increased tax base,
better utilization of local resources, community stimulus, and
again, job creation.
It is important to note for this conversation that for more
than 100 years prior to the creation of Amtrak, passenger rail
service was provided by private railroads. For at least 40
years prior to public funding, the private rail carriers were
unable to provide passenger rail service without sustaining
significant financial losses. It was because private operators
were unable to continue to provide that service without
sustaining huge losses that Amtrak was formed initially. Amtrak
was created to save rail passenger service, but it is important
to note that Amtrak was also created to save America's freight
rail industry. America's railroads were losing $1 billion per
year providing passenger service just prior to the creation of
Amtrak. That is $10 billion in today's dollars. Had Amtrak not
been established, America's rail system would have financially
collapsed.
Today Americans support and want more passenger rail.
Amtrak has set ridership records in 10 of the last 11 years,
and polling that our union has commissioned throughout the
country shows overwhelming support for more service and
increased funding for Amtrak. This is not a partisan issue. Our
polls show that Democrats and Republicans in red states and
blue all strongly support continued and improved Amtrak
service.
Unfortunately, this comes at a time when inadequate Federal
funding has allowed our Nation's passenger system to age and
deteriorate. As Amtrak's annual budget requests have
established, its aging fleet needs replacing and the system
needs significant renovations to tracks, bridges, tunnels, and
other infrastructure. Meanwhile, the rest of the world, China
most notably, is investing heavily in modern and efficient
passenger rail infrastructure, leaving American competitiveness
and American workers further and further behind.
Earlier this year, the House Transportation and
Infrastructure Committee reported out the Passenger Rail Reform
and Investment Act of 2014. My union, as well as other rail
labor unions, supported this measure and applauded the
bipartisan nature of the proposal. The 4-year bill does many
important things that will help strengthen our national
passenger rail network. However, it does not provide Amtrak
with the funding levels required to meet the needs of an aging
system. Most of all, it does not establish a predictable,
dedicated funding source so Amtrak and our communities can
adequately plan for future investments.
The last passenger rail reauthorization, PRIIA, signed into
law by President Bush in 2008 was bipartisan and provided
realistic multiyear funding levels for Amtrak and resisted
efforts to recklessly privatize the commuter industry. In fact,
the privatization pilot projects that were included in PRIIA
received virtually no private sector interest. Permitting
private companies to seize routes is a recipe for ending Amtrak
service across the country and would give investors the green
light to profit from assets paid for and invested in for over
decades by the American taxpayer and rail passengers.
The next passenger rail reauthorization bill should build
on the framework established by PRIIA in 2008. It should
include dedicated and adequate funding to upgrade and operate
the Northeast Corridor and to operate the regional and long-
distance trains that make up our national system.
I do want to emphasize that our union is not opposed to
private enterprise. The bulk of our membership works for
private freight railroads, and we have very good relationships
with those companies. But it is important that any Federal
funding also include an adequate level of protection for the
rail workers involved and a level playing field so that all
competitors in the industry will compete based on equal
standards, equal requirements, and that includes employee
protections and coverage under Federal laws, such as the
Federal Employers Liability Act, the Railroad Retirement Act,
and others.
Passenger rail reauthorization is an opportunity to make
needed investments in a critical segment of our transportation
system. And I look forward to working with the members of this
committee on the timely passage of a bill that establishes
dedicated, long-term passenger rail funding, supports the jobs
and rights of America's skilled and dedicated railroad
employees, and rejects unwanted and ill-advised privatization
proposals, and lays out a national rail policy that is
integrated with America's multimodal transportation needs.
Thank you for the opportunity to appear today.
[The prepared statement of Mr. Previsich follows:]
Prepared Statement of John Previsich, President,
SMART--Transportation Division
Chairman Blumenthal, Ranking Member Blunt and members of the Senate
Commerce Subcommittee on Surface Transportation, thank you for the
opportunity to testify today on the future of passenger rail.
My name is John Previsich. I serve as the President of the
Transportation Division of the Sheet Metal, Air, Rail, Transportation
Workers. We were formerly the United Transportation Union before we
completed our merger with the Sheet Metal Workers in 2011. We represent
tens of thousands of men and women railroad, bus and airline workers
across America.
This hearing could not be more aptly titled. Public investment in
our Nation's passenger rail system is truly an investment in our
Nation's future. Passenger rail is a critical part of our national
transportation infrastructure, an important driver of our national and
regional economies, and is a middle-class job creator. Amtrak is
America's passenger railroad, rising up from the ashes of a cadre of
bankrupt private service providers and charged with providing vital
rail passenger service across America.
I can speak to this matter from personal experience. I have been
involved on passenger rail properties from coast to coast that have
leveraged various forms of public funding to provide excellent quality
service to the communities through which they operate. In my home state
of California I have watched Caltrain in the San Francisco Bay Area use
a combination of local and Federal funding to revitalize the service
and move from a low of 5,500 boarding's per day when operated by a
private enterprise to the current figure of over 53,000 boarding's per
day. In my home county of Santa Cruz, CA a planning process is already
underway to identify transit corridors that will reduce the number of
daily auto trips, decrease our use of fossil fuels and promote more
affordable housing. All across America, communities are relying on
transit funding to invest in strategic planning that will pay back the
investment many times over through job creation, community stimulus, an
increased tax base and better utilization of local resources.
The value of passenger rail to travelers has been increasingly
shown at the fare box, and has been reinforced by polling that our
union has commissioned throughout the country. In every state and
district polled, voters overwhelming want increased funding for Amtrak
and want more service. Fare box number's back this up. Amtrak carried a
record number of passengers in FY 2013, and has set ridership records
in 10 of the last 11 years. Unfortunately, this comes at a time when
bare-bones Federal appropriations have allowed the system to age and
deteriorate. As Amtrak's annual budget requests have established, its
aging fleet needs replacing and the system faces significant and
disruptive renovations to tracks, bridges, tunnels, and other
infrastructure in the coming years. Meanwhile the rest of the world--
most notably China--is investing heavily in modern and efficient
passenger rail infrastructure, leaving American competitiveness, and
American workers, further and further behind.
It is with this backdrop that this committee and Congress as a
whole must consider passenger rail reauthorization and lay out a long-
term vision for Amtrak that includes a predictable dedicated source of
funding.
Congress has a choice between those who believe that we should end
the decades-long underinvestment in our passenger rail system, and
those who would pursue misguided attempts to dismantle Amtrak and run a
fire sale on its high-value assets. I firmly believe that the latter
would result in the destruction of passenger rail in this country and
threaten the 20,000 existing Amtrak jobs.
The last passenger rail reauthorization--PRIIA, signed into law by
President Bush in 2008--was an important milestone for passenger rail
in this country. This bipartisan law provided realistic, multi-year
funding levels for Amtrak, and resisted efforts to recklessly
privatize. In fact, the privatization pilot projects that were included
in PRIIA received virtually no private sector interest.
The next passenger rail reauthorization should build on the
framework established by PRIIA, and at the same time advance needed
reforms. First, Amtrak needs adequate funding to upgrade and operate
the Northeast Corridor (NEC) and to operate the regional and long-
distance trains that make up our national system. Too often Congress
has failed to actually appropriate the funds authorized by PRIIA,
making it difficult for Amtrak to complete major capital improvements
and modernize its network and equipment. More importantly, the rewrite
of PRIIA must recognize that the capital needs of the passenger rail
system are enormous and can no longer be ignored or deferred.
The urgency of these capital needs was put front and center in
October when Amtrak released an infrastructure report detailing that
the four one hundred year old tunnels leading into and out of Manhattan
were severely damaged during Superstorm Sandy. With extensive repairs
needed, service along the NEC will be badly curtailed, negatively
affecting hundreds of thousands of daily commuters and travelers.
It is critically important that Amtrak's proposed Gateway project
is funded immediately. Gateway would build new tunnels that would
provide the redundancy needed to repair existing tunnels without
serious service disruptions, and also build capacity at the busiest
commuter and passenger rail section in the country. It will also create
hundreds of new jobs. For too long, this looming infrastructure crisis
has been a political football. It is time for Congress to make the
investments needed to keep the NEC and commuter lines that millions of
people count on moving.
I also recognize that the investment needs of our passenger rail
system must be met in partnership with individual states and, where
appropriate, leveraged with private sector sources. However, states and
the private sector will not be reliable investors into passenger rail
without adequate Federal funding. The Federal role in investing in our
rail passenger system must be strong, committed and well-defined in
order to produce reliable regional partnerships.
PRIIA reauthorization must also reaffirm the national Amtrak system
as part of America's interconnected transportation infrastructure and
reject risky attempts to privatize Amtrak's NEC operations and long-
distance routes. Fortunately, the ideologically-driven privatization
agenda that has been pushed by some in recent years has not gained
momentum. Permitting private companies to seize those routes is a
recipe for ending Amtrak service across the country and would give
investors the green light to extract profits from assets paid for over
many decades by the American taxpayer and rail passengers. Further,
Congress should not micromanage Amtrak and arbitrarily pick and choose
which routes will survive.
I'll be clear on one point. Our union is not opposed to private
enterprises. The bulk of our membership work for privately held freight
railroads and we have good relationships with those companies.
But the facts are Amtrak has partnered with our private freight
railroads, and has negotiated operating agreements with them for more
than 40 years. Amtrak's employees, many of whom are federally
certified, know and understand the complex operating rules that govern
freight railroads, making Amtrak the right fit to operate this vital
nation-wide service.
We know the history of passenger rail in America because we and our
members have lived it.
Prior to the creation of Amtrak passenger rail service was provided
by private railroads for more than one hundred years. Private railroads
were unable to provide passenger rail service without sustaining
significant financial losses for at least 40 years prior to Amtrak's
founding. It was because private operators were unable to continue to
provide that service without sustaining huge losses that Amtrak was
created. Amtrak was created to save rail passenger service in America,
but more importantly Amtrak was created to save our freight industry
from economic ruin. America's railroads were losing $1 billion a year
providing passenger service just prior to the creation of Amtrak ($10
billion) in today's dollars. Had Amtrak not been established America's
rail system would have financially collapsed.
Congress must also reject previously offered proposals that would
force Amtrak to contract out food and beverage service. In fact, some
in Congress actually declared that Amtrak charges too much for
cheeseburgers. Amtrak should be permitted to run its business, sell its
services and concession items, and decide how to staff the railroad's
operations. Federal outsourcing mandates ignore the role of these
front-line employees, who not only serve food and beverage but act as
first responders during on-board incidents and emergencies. Those
attempts are another example of the kind of congressional meddling that
only interferes with Amtrak's ability to maintain a qualified workforce
and meet customers' expectations.
As Congress seeks to update and expand passenger rail, the
reauthorization must safeguard the rights, jobs and wages of front-line
workers. For rail workers, labor protections provided for in PRIIA
should be updated to ensure they apply to all rail workers when Federal
funds are used to create new services, or to add or transfer
infrastructure and equipment to a new entity. The PRIIA protections
should also apply when rail lines are sold to states but are still used
for interstate rail transportation. In addition, it must be ensured
that rail workers performing traditional rail work are covered under
the appropriate rail and labor statutes including the Railroad
Retirement Act, the Railway Labor Act and Federal Employee Liability
Act. Allowing employers, oftentimes foreign corporations, to circumvent
U.S. labor laws or to undercut wages and benefits and then claim the
private sector is more efficient or profitable is a game that must not
be played if we are serious about having a first-class rail system and
one that creates and sustains middle class jobs.
Additionally, Congress must resist attempts to cut workers'
overtime pay or limit pension payments as a condition of receiving
Federal funds. Overtime payments are an unavoidable aspect of a 24 hour
a day transportation network. Capping overtime pay or excluding it from
pension calculations would constitute an assault on the living
standards and rights of rail workers while making no worthwhile
improvement to passenger rail customer service or performance
efficiency.
PRIIA's investment in passenger rail is an opportunity to boost
U.S. manufacturing capacity and jobs. The next reauthorization must
uphold strong Buy America laws and emphasize smart procurement
policies. This will ensure that Federal investments are leveraged to
achieve the greatest possible economic impact and job growth. Amtrak
has already made strong efforts to increase the efficiency and
productivity of its procurement process through the work of the Next
Generation Corridor Equipment Pool Committee and a partnership with the
California High-Speed Rail Authority. Amtrak has also adopted a U.S.
employment plan as part of its bidding requirements for manufacturers
seeking to win the procurement for the next fleet of NEC high-speed
trains. This reauthorization must build upon these efforts to
incentivize the use of American made products throughout the production
process. Not only will this put more Americans to work faster, it will
ensure that we have a robust manufacturing sector able to supply the
products needed by the passenger rail industry for years to come.
Earlier this year the House Transportation and Infrastructure
Committee reported out the Passenger Rail Reform and Investment Act
(PRRIA) of 2014. My union, as well as the other rail labor unions
supported this measure and applauded the bipartisan nature of the
proposal. The four-year bill does many important things that will help
strengthen our national passenger rail network and create more diverse
and reliable options for the public. It also rejects the types of
reckless privatization measures that I spoke of earlier. However, it
does not provide Amtrak with the funding levels required to meet the
needs of an aging system and the increasing demands of passengers. Most
of all it does not establish a predictable dedicated funding source so
Amtrak can adequately plan for future investments.
As Amtrak's annual budget requests and recent infrastructure
reports have established, its aging fleet needs replacing and the
system faces significant and disruptive renovations to tracks, bridges,
tunnels, and other infrastructure in the coming years. The
authorization levels set in the House bill--which would level out
funding at current appropriations levels--do not provide the funds
needed for these long term improvements. Until these funding levels are
met, we cannot achieve the level of passenger service, reliability and
job creation that our Nation needs and deserves.
Passenger rail reauthorization is an opportunity to make a much
needed investments in a critical segment of our transportation system.
I look forward to working with the members of this Committee on the
timely passage of a bill that establishes dedicated long-term Amtrak
funding, supports the jobs and rights of Amtrak's skilled and dedicated
employees, rejects unwanted and ill-advised privatization proposals and
lays out a national rail policy that is integrated with America's
multi-modal transportation system needs.
Thank you for the opportunity to appear here today.
Senator Blumenthal. Thanks very much.
Mr. Chambers?
STATEMENT OF RAY B. CHAMBERS, EXECUTIVE DIRECTOR,
ASSOCIATION OF INDEPENDENT PASSENGER RAIL OPERATORS (AIPRO)
Mr. Chambers. Thank you. I am very pleased to be testifying
on behalf of the relatively new Association of Independent
Passenger Rail Operators, or AIPRO. Our five members operate
passenger service in the United States and around the world.
Internationally we carry more than a billion passengers each
year. In the United States, Herzog and the other members are
contracted by commuter authorities and carry approximately 80
million passengers each year on a quarter of a million trains.
Our members compete vigorously against each other and against
Amtrak to get that business. We submit that the commuter model
represents the best practice for a growing, first-class network
of high-performance passenger rail in America.
For the last 45 years, Amtrak has held a monopoly on
intercity passenger service. Amtrak should be commended for its
stewardship of maintaining a basic national passenger network
against some very difficult odds. Yet, despite their best
efforts, the underfunded Government structure operated by
Amtrak is in serious difficulty, and I hope in the next
Congress we can find together the ways and means to fix that.
The Northeast Corridor, by any accounting practices,
operates at a loss if the underlying structure is included in
the ledger. The NEC subsidizes the long-distance routes that
also operate at a significant loss. For the 27 state-supported
routes of fewer than 750 miles, Congress and Amtrak have pushed
the entire operating subsidy over to the states. But it is
these state-supported routes that are now showing the greatest
growth, largely thanks to state investment. These routes
represent about 50 percent of intercity ridership.
We believe it is time for Congress to enact a new
legislative paradigm that will restructure intercity passenger
service, that the time is ripe for such action. To accomplish
this passenger reform, we must bring rail to the investment
table with highways and transit. The next Congress should
address passenger rail legislation not as a standalone bill but
in the context of the highway/transit trust fund
reauthorization.
As a little aside here, I have known Peter Rogoff for a
very long time, and I think he and the administration have done
a good job with their proposal. And I hope that some serious
consideration will be given to the administration's funding
proposals for passenger service.
In our view, Congress should establish a unified funding
program that includes highway, transit, and rail.
We suggest Congress should establish a long-term vision for
the future growth of urban and passenger rail.
Now, for the rest of this testimony, as requested by the
letter from Chairman Rockefeller, I am going to focus on our
area of primary interest, which is the need to build the state-
supported corridors.
We believe that Congress should create a new approach to
these corridors through reforms of the existing PRIIA law.
These reforms should promote competition and private sector
participation under Government authority. The bipartisan 2008
law which, I agree, was a good step forward, was signed by
President Bush, and it opened state-supported intercity routes
to competition. Sadly, many of those provisions were ignored.
The exception was section 209 that resulted in the states
assuming full responsibility for operating subsidies, which in
turn greatly raised the state costs. But nonetheless, the
states are now looking at the competitive option to build their
corridors in order to reduce costs and improve service. PRIIA
reform should build on the 2008 bill in a way that is going to
make these reform provisions workable. And that is the
challenge you face.
Specifically, we think that there should be clear
responsibility given to the states for the corridors. We think
there should be access to a robust capital program of grants
and innovative finance to help the states with the task that
they have. We talked about the PRIIA pilot project. It did not
work, but we think it could be streamlined and made to work
with full protection of the type that you are talking about for
employees in the event of a transfer.
We believe that the future of intercity passenger rail
service should be based on commercial negotiations to the
maximum possible extent. The hosting freight railroads have got
to be treated as full partners. On a similar note, rail labor
and construction labor are strong partners in the building and
the operation of American railroads, and their legitimate
interests must not be diminished in an effort to achieve a
high-performance network. And our organization has been working
very hard to achieve that goal.
We have specified, detailed recommendations for each of
these proposals, and I ask your permission that once we get
them together a little bit better, that we can include them in
this record.
Senator Blumenthal. Without objection.
Mr. Chambers. Thank you.
Well, our focus today has been on the vision for the future
and the importance of the state-supported routes, but I want to
be clear. I hear all of you. We hear all of you. AIPRO is
concerned that Amtrak has adequate funding. The long-distance
routes are very important. We need new ways to develop the
Northeast Corridor. The National Association of Railroad
Passengers, NARP, is submitting testimony on Amtrak funding, as
well as long-distance requirements, and we generally endorse
the NARP approach and will be working with them to craft
specific legislative recommendations, as well as we are going
to be working with labor and the class I railroads and Amtrak
to try to find the kind of solution I think we are all
struggling to get to.
So we look forward to working with you in the next Congress
in the effort to bring America a high-performance, integrated,
urban and intercity passenger rail network that we can be proud
of as Americans when we travel in Europe and Asia.
Thank you.
[The prepared statement of Mr. Chambers follows:]
Prepared Statement of Ray B. Chambers, Executive Director, Association
of Independent Passenger Rail Operators (AIPRO)
I am pleased to testify on behalf of the Association of Independent
Passenger Rail Operators (AIPRO). As I understand it this is not a
legislative hearing on a specific proposal, but rather a forum entitled
``Passenger Rail: Investing in our Nation's Future.''
Our five members, listed in an attachment, operate passenger
service in the United States and around the world. Internationally
these companies carry more than a billion passengers a year. In the
United States the independent operators are contracted by commuter
authorities to carry more than 80 million passengers on a quarter of a
million trains. Our members compete vigorously against each other and
Amtrak to get that business. Competition in the American commuter rail
marketplace has allowed for rapid expansion and innovation of urban
passenger rail service. We submit this commuter model represents the
best practice for investing in Passenger Rail for America's Future.
For the last nearly 45 years Amtrak has held a monopoly on
intercity passenger service. Indeed when it was created there weren't
alternatives available, and Amtrak should be commended for its
stewardship of maintaining a basic national passenger network against
very difficult odds. Yet, despite their best effort, the underfunded
government mandated structure operated by Amtrak is broken and our
passenger system has almost become an embarrassment around the world.
The Northeast Corridor, by any standard accounting practice
operates at a large loss when the underlying infrastructure is included
on the ledger. The NEC reportedly subsidizes the long distance routes
that also operate at a significant loss. For the 27 state-supported
routes of fewer than 750 miles, Congress and Amtrak have pushed the
entire operating subsidy to the states. It is these state-supported
routes that are now showing the greatest growth thanks to state
investment. They represent nearly 50 percent of intercity ridership
while the NEC and long distance routes are stagnant. Clearly change is
in order.
Some supporters of the current system in this country submit the
only way to operate an interconnected national network is through a
sole-sourced monopoly. Yet, pre-Amtrak multiple rail carriers regularly
interfaced before being driven down by overregulation and bad
economics. Domestically, the aviation industry allows for competing
operators with clear rules for interconnectivity. In Europe competition
has resulted in vastly increased ridership and equipment renewal. As a
result recent European Union law requires competition for the operation
of rail passenger service.
Thus, Congress should enact a new legislative paradigm that will
restructure intercity passenger rail service through a clarification of
Federal and state roles, a restructured base for capital financing,
increased transparency and the introduction of competition.
The time is ripe for such action. The two basic Federal laws that
impact passenger rail have expired. They are MAP-21 that authorized the
highway/transit trust fund and the Passenger Rail Investment and
Improvement Act of 2008 (PRIIA) that authorized Amtrak and intercity
passenger rail service. AIPRO recommends four primary objectives for
the next passenger rail program:
1. Congress should address passenger rail legislation not as a
stand-alone bill but in the context of the highway/transit
trust fund reauthorization.
2. Congress should establish a long-term vision for the future
growth of rail passenger service.
3. Congress should create a new approach to state-supported
corridors.
4. Congress should establish a unified funding program that includes
highway, transit and rail.
Our first recommendation is that the intercity rail passenger
authorization should not be a stand-alone bill, but a Rail Title to
next year's MAP-21 reauthorization.
A question before Congress is whether PRIIA should move as a stand-
alone bill as has been suggested in the House. Our view is that in the
face of population and other demographic trends, enlargement of the
rail mode can serve a major public interest. Thus when future Federal
surface transportation investment is considered rail should be at the
same table with highways and transit. Thus instead of a stand-alone
rail bill, there should be a Senate Commerce Committee Rail Title as a
part of next year's MAP-21 reauthorization.
Our second recommendation is that Congress should adopt A New
Vision for Passenger Rail Service
The new Rail Title should make a commitment to establish a High
Performance urban and intercity passenger network over time. The Vision
should call for infrastructure investment that will achieve a High
Performance passenger network that will continuously improve with clean
attractive equipment, travel times that rival auto travel in any given
corridor and on time performance. The integrated network should include
high-speed trains, long distance and corridor trains commuter passenger
service right down to the streetcar level. The Vision should clarify
the Federal role in assuring safety and interconnectivity. The Vision
should clearly define the state role in the operation of intercity
routes.
Our third recommendation is that Congress should create A New
Approach to State Supported Intercity Passenger Rail Service
AIPRO is concerned that Amtrak have an adequate funding
authorization for its long distance services and for development of the
Northeast Corridor. However, as requested in the invitation letter by
Chairman Rockefeller we will focus on our area of primary interest,
which is the future of the state, supported corridors. The National
Association of Railroad Passengers (NARP) is submitting testimony on
Amtrak funding as well as long distance and NEC requirements. We
generally endorse the NARP approach and will be working with them to
craft specific legislative recommendations.
The specific goal put forward by AIPRO is to improve the
performance of intercity passenger rail corridors through competition
and expanded capital investment. The bipartisan 2008 PRIIA law, signed
by President Bush, did a good job of opening state-supported intercity
passenger routes to competition. Unfortunately, key provisions of that
law, which promote competition, were simply ignored. The exception was
Section 209 that resulted in the states assuming full responsibility
for operating subsidies. As a result the cost to states has gone up
dramatically and many states are now looking at the competitive option
to build their corridors. Rail Title PRIIA reform should build on the
2008 bill in a way that will make the reform provisions workable. We
make the following recommendations for PRIIA reform:
States Should Be Given Clear Responsibility for the Corridors.
The result of PRIIA section 209 is that 19 states have
essentially taken on the responsibility for 100 percent of the
operating subsidy in 27 corridors under 750 miles. Together
with the primary stakeholders, states should be responsible for
the governance of passenger operations in those corridors. The
states together with key stakeholders, including host
railroads, labor and selected operators should set standards
and metrics for corridor service.
The Federal Railroad Administration should continue
responsibility for safety and interconnectivity.
The States Should Have Access to a Robust Capital Program of
Grants and Innovative Finance. The Federal shift of financial
responsibility for intercity corridor service under 750 miles
is a clear unfunded mandate on the states. In return, using the
model of the highway program, the states should have access to
grant funding to build state management and planning capability
as well as construction of capital projects. This was the exact
purpose of the PRIIA Section 301 program now on the books.
Unfortunately, the High Speed Rail Stimulus program that spread
$11 billion all over the country bypassed the PRIIA mechanism.
The PRIIA Section 301 program should be reauthorized and funded
at a minimum of $1 billion per year. In addition a special
program of innovative finance based on RRIF loans should be
authorized. As a part of this program Section 301 grants should
be available to expand RRIF loan viability.
Sec. 301 Grants should continue to be tied to High Performance
Passenger Reform including a requirement for competition. PRIIA
301 requires that any state receiving capital assistance would
select the operator competitively. This was ignored because the
Sec 301 program was ignored in favor of the Stimulus High Speed
Rail grants that had no such provision. This mandate should be
strengthened. Similarly, when a state selects an alternative
carrier, PRIIA Sec. 217 provides a dispute resolution process
at the Surface Transportation Board to give the states smooth
access to Amtrak equipment facilities and services. Section 217
is essential to fair competition.
The PRIIA Alternative Pilot Program Should be Streamlined. The
2008 PRIIA contains a Pilot for Alternative Operations to
Amtrak. It was far too complex with unrealistic timeframes and
a lack of interest by FRA. Essentially it was designed to fail.
Despite that, over 120 expressions of interest were submitted
to FRA on how to make the program work. There is no role for
the states in the statute. The states in combination should be
encouraged to participate in the design of long distance
corridors. Independent Operators, such as those represented by
AIPRO, should explicitly be authorized to participate in the
Pilot Program with approval of the host railroads. AIPRO is
working on changes needed in order to make the Pilot Program
viable.
The New Law Should Establish a Commission to advise on the
creation of a Competitive Intercity Passenger Service. We
believe such a panel would serve a strong public interest in
refining issues that must be addressed if the Nation is to
embark on a new paradigm that will result in a High Performance
Passenger Rail Network of which Americans can be proud. Primary
stakeholders should serve on the panel. State participants
should be nominated by AASHTO, and there should be
representatives of Labor, Host Railroads, Amtrak as well as
Alternative Operators. The Commission should address issues
such as rail funding, minimal standards to qualify as an
intercity passenger rail operator and the critical issue of
insurance and liability. The 2012 Senate Rail Title to the MAP-
21 bill contained a useful provision on liability. It suggested
guidelines that increased the liability cap by inflation but
cut off any potential for third party liability above the cap.
Taken together such efforts will drive down costs for operating
rail passenger service to the benefit of all stakeholders,
taxpayers and riders.
There are several additional principles that we would like to see
established:
The future of intercity passenger rail service should be
based on commercial negotiations to the maximum possible
extent. The goal of High Performance Passenger Service can only
be achieved if the hosting freight railroads are treated as
full partners in a market environment and have access to
capital funding that will assure freight throughput is not
diminished as passenger traffic increases. On a similar note
labor is a strong partner in the building and operation of
American railroads. The legitimate interests of railroad
workers as we open the system to competition and of
construction workers as we improve the system must not be
diminished in the effort to achieve a High Performance urban
and intercity passenger network.
Except for a Federal subsidy for long distance routes and
the right of forced access on host railroads, Amtrak should not
enjoy any special statutory privileges unavailable to
alternative passenger operators selected by state authorities.
Amtrak should evolve into a true private sector operator that
can compete fairly with the independent passenger rail
operators represented by AIPRO.
Our fourth recommendation is that Congress should adopt a New
Program for MAP-21 Sustainable Funding that includes creation of an
Urban and Intercity High Performance Passenger Rail Network that we can
look to with pride as we travel in Europe and Asia.
A primary objective of the MAP-21 reauthorization should be to
permit greater parity between highway and rail modes in state
infrastructure investment decisions. We understand this will take
coordination between the Senate Commerce, Environment & Public Works as
well as the Banking Committee. We urge Senate Commerce to take the
lead.
For the last 50 years rail freight and passenger infrastructure
investment has not been at the table along with highways, waterways and
airports in any significant fashion. Yet, we have reached a point in
time where solid rail construction projects will do more than many
alternative transportation projects to rebuild America's transportation
network and assure our future competitiveness. This is the time to
bring it all together.
Specific goals for MAP-21 Reauthorization are:
MAP-21 Goal #1 Increase state/local flexibility in all existing
trust fund programs to include public interest rail projects.
This should include the Surface Transportation Program (STP).
MAP-21 Goal #2 Establish a National Multi-modal Freight
Program.
MAP-21 Goal #3 Create a Unified Transportation Trust Fund that
includes corridor capital funding available for the states for
improving designated High Performance Passenger Rail Corridors.
Attachment
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Senator Blumenthal. Thanks, Mr. Chambers. I think you and
Mr. Coscia and Mr. Rogoff and Mr. Previsich have all raised one
of the key challenges here. In a way it is kind of the elephant
in the room: not how to spend money but how to raise it. And
the need for capital investment is clear to everyone. There is
a consensus that we need to invest and we need to make the
capital investment in our rails, our equipment, our training
for workers, the spectrum of needs for a 21st century rail
transportation strategy. The question is how to raise the
money.
I have proposed a rail trust fund. I am grateful that the
administration has included rail in its legislative proposal.
We have other models like RRIF, which has proved to be
cumbersome and inefficient. There is the TIFIA program. The
Transportation Infrastructure, Finance, and Innovation Act may
be a helpful model, as has been suggested.
But let me begin with you, Mr. Coscia. You are an attorney.
You are a finance expert. You are a transportation expert. And
perhaps you can address what you see as the ways to provide the
financing maybe through a financing authority. My colleague,
Senator Blunt, and I have made such a proposal. I am a
supporter. What do you see as the best way to raise the capital
from private as well as public sectors?
Mr. Coscia. Thank you for that introduction to the question
although I have to admit with some level of humility that given
the lack of investment in passenger rail infrastructure for the
past 40 years, I am not sure that my level of expertise really
is sufficient.
But having said that, I will, first of all, applaud you for
the efforts you have made because your proposals get to the
heart of the issue, which is that absent some kind of a
multiyear funding, contract authority obligation that allows
someone to create an efficient financing structure that will
permit capital to come into the system not in year 1 or year 2
but over an extended period of time, we are always going to
sub-optimize investments because we will be managing the way
those capital investments are made and the way we fund them
will always be less than efficient because there will be a
level of uncertainty relative to where the funding comes from
in the out-years.
Having said that, our belief--and the reason why in my
opening statement I focused on the operational success at
Amtrak--is because we think we have proven that an
operationally sustainable model is possible in passenger rail.
We think there is demand for this product. We just have to be
able to put the right product into place. And so the system
allows for sort of redefining where the public sector and
private sector come together, and we believe that some kind of
a funding mechanism that combines Federal grants along with
credit advancement from the Federal Government will create the
right kind of system to allow the operating successes that we
have seen in the system to turn into a stable, long-term
funding source. We think anything that does not create a long-
term funding source is not going to be effective. So our view
is that the likely answer to this will be a hybrid of some kind
of Federal grant program supported by contributions from our
state stakeholders, but with a level of credit enhancement from
the Federal Government that will allow that transaction to be
structured more efficiently.
Senator Blumenthal. Perhaps some financing authority that
makes use of the Federal Government's----
Mr. Coscia. Guarantee capacity. Yes, that is correct.
Senator Blumenthal. Thank you.
Mr. Rogoff and others on the panel, if you have anything to
add on that point.
Mr. Rogoff. Well, I will, first, point out obviously that
the President has put forward a funding proposal and
transitional revenues from pro-growth business tax reform and
identified three specific tax proposals in our submissions to
the Finance and Ways and Means Committees on how that money
could be found.
We have also said that we are open to other alternatives
and would welcome a dialogue with Congress on them.
I think importantly I want to echo something that Tony
Coscia said. Uncertainty is going in the wrong direction. He
pointed out that rail and especially passenger rail and the
Amtrak system has always suffered from the uncertainty of
future funding, and therefore, we have fallen increasingly
behind in part because of the inability to plan and the
inability to take on or, frankly, garner enough cash to take on
some of these bigger projects that have to happen both in the
Northeast Corridor and elsewhere.
Well, that is frankly what we are now seeing happening on
the highway and transit side by the fact that we keep kicking
down the road the need to get an authorization on highways and
transit. One of the concerns that Secretary Foxx as a former
mayor has been very articulate about is sort of the loss of
vision and the unwillingness of both State DOT's, MPO's, cities
and communities to really start planning those bigger projects
when they are told that they should be grateful for just 9 more
months of funding, which is one of the reasons why we think it
is absolutely imperative with this deadline coming up at the
end of May that we take this on in earnest. We need to do a
comprehensive multiyear bill, pay for it, and not only provide
some certainty for Amtrak, but of course our highway and
transit planners and service providers across the country.
Senator Blumenthal. Thank you.
My time has expired. So I am going to yield to Senator
Blunt.
Senator Blunt. Thank you, Chairman.
Mr. Chambers, would you explain a little further how the
private sector competition model has worked and what has been
successful and maybe where things have happened that did not
work out and if that is the case, why they did not work as well
as they might have?
Mr. Chambers. Yes. We have a lot of examples of both
successes and failures. One of the biggest failures was in
Britain early on when they tried to go whole-hog by taking the
entire rail network and putting it into complete privatization
without sufficient resources and that failed. They fixed that
problem.
Since that time, in England and in Germany and a lot of
other places, they have begun to experiment with the
competition model. It has become very prevalent, and in almost
all circumstances--I can provide you some material for this,
but in almost all circumstances, you will see that ridership is
growing dramatically. Equipment is being renewed, and it has
been quite a good success to the point that the EU has now
mandated that all European services, including those that are
like Amtrak that are basically government-owned and subsidized,
will have to yield to competition in a period of time.
In the United States, it has been a little bit different.
It is absolutely correct that when Amtrak was created, there
was no alternative. The first to jump into that, as you pointed
out, Senator, and into competition was Herzog that bid in
Florida on a line and won it to operate it. Since that time,
several other actors have become involved which form my
association, and now it has become kind of the standard in the
commuter operations around the country that most of the new
ones are going to the competitive model and it is very
successful. One of the most recent ones is in California, the
Caltrain operation, where Herzog was the victor in that
competition.
And in all these cases my members have worked out, I think,
very good relationships with the unions in the transition. That
is the model.
Now, in the states, you have the 27 corridors----
Senator Blunt. I am running out of time here in just a
second.
Mr. Chambers. I am saying that is basically the model, and
I think that model can be applied to State authorities on the
27 corridors.
Senator Blunt. Mr. Previsich, if I have time, I am going to
come back to you and just let you talk a little more about your
concern about recklessly moving toward competition I think was
the term you used. And of course, the good thing about a term
like that is nobody wants to recklessly move toward it. So it
is hard to argue with that. But I would like to think about
what you mean by that.
Mr. Coscia, the Missouri River Runner runs from St. Louis
to Kansas City, and I have a concern there that I want you to
look into for me. And if you can talk about it today, that
would even be better. The concern is about who is going to pay
for positive train control on that line. Your agency wrote the
State of Missouri on November 14 saying that there would be
potential discontinuance of this service unless the state
agreed by December 1 to cover the cost of the positive train
control. I have been told--and you can verify that or not--that
this was the first formal communication between Amtrak and
Missouri on this issue. And it seems like a pretty quick
deadline to set.
Do you want to talk to me about that and what you think the
state should do as opposed to the people that own the rail line
and Amtrak is the operator?
Mr. Coscia. Of course, Senator, I would.
I am very much aware of the issue. The letter that you are
referencing I will admit I only became aware of probably
earlier this morning, anticipating to some degree that we might
be having this discussion, not surprisingly.
Let me speak to the larger issue first, and then I will get
to the specific issue related to the letter.
The larger issue raises a concern that I think we all have,
which is that positive train control is an important
initiative, one that Amtrak embraced very early on and became a
leader in the Northeast Corridor and other places where our
system operates. And for obvious reasons, it is something that
needs to be taken very seriously, and we take that obligation
very seriously.
Having said that, the facts and circumstances surrounding
the impact on the installation of positive train control around
the terminal company operations that you are referring to in
Missouri we believe is an obligation that falls to either
Amtrak or the state users of that system. It is not something
that we are comfortable with, and it is something we are
addressing with the freights directly.
We think that positive train control is something that is
an important part of the system, but it needs to be
intelligently implemented. And certainly we believe that it
should not be a deterrent to use of the system by either Amtrak
or the states because of what we view as anomalies in the law
that permitted the freight companies to seek an effort to avoid
their responsibility for whatever financial contribution that
needs to be made to install positive train control.
Having said that, I can certainly empathize with the State
of Missouri and the users of that system for having this
expense be something that is put toward them. We are working
with the State of Missouri and we are working with our partners
there to try to find a solution to the issue. The letter that
you referred to--I will tell you that, no, that is not enough
time to respond to a question like that. And it was my
understanding that there might have been prior conversations,
but be that as it may, I would agree with you that our partners
are very important to us and this is a hurdle we both have to
overcome together. And I will commit to you that we will make
every effort to do exactly that.
Senator Blunt. Do you have other states that have any
obligations similar to that?
Mr. Coscia. We do. We do.
Senator Blunt. Have they got PTC in place?
Mr. Coscia. The timeliness for that to happen has not quite
gotten there, but it will shortly.
Senator Blunt. Have you sent any similar letters to other
states?
Mr. Coscia. I will tell you I asked that exact same
question not long ago, and I do not have the answer for you yet
but I will find that out.
Senator Blunt. I would like to know the answer to that.
Mr. Coscia. Let me address, though, the sort of broader
issue, which is that our State partners are absolutely critical
to us. And I cannot sit here today and tell you that everything
we have done with our State partners previously is something
that we should be completely proud of. But I will tell you that
the board and current leadership at Amtrak is very committed to
recognizing that the only way we can build this national system
that I spoke about in my opening comments where we are
connecting cities is not for Amtrak to somehow think it can do
this completely on its own. The states are our partners, as
well as our partners in the private sector, they are incredibly
important to that entire process, but we as a company have to
prove to them that we are competent partners and reliable
partners to do that. And part of this is an effort to get to
that point.
Senator Blunt. I may have some more positive train control
questions and others later if we have a second round. But thank
you, Mr. Chairman.
Senator Blumenthal. Thank you.
Senator Ayotte?
STATEMENT OF HON. KELLY AYOTTE,
U.S. SENATOR FROM NEW HAMPSHIRE
Senator Ayotte. I want to thank the Chairman and the
Ranking Member and thank all of you for being here today.
Currently in New Hampshire, there is actually a study that
is being conducted, part of which has been released but there
is some additional review being done, to look at the
possibility of using rail to connect Concord, New Hampshire,
which is our capital, through Manchester, and Nashua, which is
in the southern part of the state, to Boston. As you know, many
people in New Hampshire do commute to Boston from areas of
Nashua and Manchester to Boston and Concord.
So I wanted to talk to you about--some of the options that
are being looked at such as a possible option of extending
commuter rail from Boston to Nashua or Manchester and then
Concord, as well, which would be more northern than Manchester,
or extending Amtrak intercity rail service through Concord.
How do you link emerging corridors with more established
lines such as the Northeast Corridor? And what are your
thoughts on how that happens not only in New Hampshire but how
do we better serve the transportation needs of our large
commuter population?
Mr. Coscia. As I mentioned, we embrace the idea of being
able to extend our network to cover other city pairs. A large
part of determining the viability of that is understanding the
demand that truly exists for passenger rail.
Senator Ayotte. And that is one of the reasons for the
study and why the state has commissioned the study as well, to
understand what the passenger volume would be and who would use
it and how it would be used.
Mr. Coscia. But I think the results of that study and
whatever additional input we could provide to that process
would be very helpful in informing what options are available
to us, which lines can be extended and in what form. And then
obviously that would have to be overlaid in terms of rights-of-
ways that are available to serve those populations and who
controls those rights-of-way. But that type of analysis is
something that we are extremely interested in, and we very much
welcome being a part of and, in fact, happy to join in that
effort immediately if that is something that is helpful.
Senator Ayotte. Thank you, I really appreciate that, and we
will follow up on that.
As I understand it, the Northeast Corridor, a surplus that
has been obtained from that corridor--I understand the needs
that we have been talking about today in terms of maintaining
the corridor, investments that need to be made. But as I
understand it, the House of Representatives is also looking at
some measures that are going to sort of regionalize funding
based on the viability of how many passengers are using it,
population. What are your thoughts on it?
Mr. Coscia. Well, there is no question that we have a very
sort of mixed issue in the Northeast Corridor in the sense that
it has become a very, very viable passenger rail system. And in
Fiscal Year 2014, the net operating income from the Northeast
Corridor was about a half a billion dollars, which to put that
in some perspective, that number was zero probably less than a
decade ago. So it shows you just how much additional
profitability has been contributed by the Northeast Corridor.
So on the one hand, it is a very good news story because it is
a way of generating a significant amount of capital that could
be used throughout the system.
Senator Ayotte. But obviously, the challenge is there are
other parts of the system that are not as strong.
Mr. Coscia. Well, and the challenge actually becomes more
complicated than that, Senator, in the sense that what we are
doing is that we are the beneficiaries of all this demand in
passenger rail. So there are enormous numbers of people who
want to move between these cities. There has been a significant
demographic change in who wants to use passenger rail. We are
the benefit of all of it. But essentially what we are doing
with our asset is we are using it much more than we ever did,
and the asset is getting older. So what is happening is that as
we are using it to a larger degree, as we are making more money
from it, it is also deteriorating that much faster.
So to the extent we take that operating surplus and we do
not use it to replenish the system, to rebuild it, we are
basically allowing our asset to deteriorate. So that number
will come down and it will come down very rapidly. So the
challenge in taking money off the corridor and using it in
other places is that we are just adding to the deficit of
capital expenditures that are necessary to maintain that cash-
flow in the first place.
So the challenge that we have at Amtrak is finding the
right way to balance those different needs and yet creating a
source of capital to reinvest in the system, which is why we
are so supportive of a notion of creating a recurring,
sustainable source of capital so that as we get better and we
are held accountable for operating the system efficiently, we
are able to have an external source of capital that will allow
us to maintain it.
Mr. Rogoff. Can I just add very quickly to that? The key
word that Tony used in terms of the profitability of the
Northeast Corridor is the ``operating profits'' because it
really--it is operating net revenues. But even with that
additional investment and if they just turned it right back
into the corridor, we would still be short of the necessary
investments that we would need in the corridor over the long
term.
I did want to quickly go back to your first question,
though, because I think we can be helpful in other ways.
The MBTA in Boston has extended commuter rail service into
other states, specifically Rhode Island. That was the subject
of considerable work between the states, the Governor's office
in Providence and others to bring together that funding
partner. And it was funded in part with funds not from the
Federal Railroad Administration but from the Federal Transit
Administration.
So I think the upshot of your study should really look at
both options, see which one pencils out, and then kind of pivot
in terms of where the greatest opportunity is. And the
administration is certainly happy to help. We have dollars in
the GROW AMERICA Act specifically for that kind of State-
partnered corridor expansion. So we are interested in helping
if we can.
Senator Ayotte. Thank you. And I think one of our
challenges here also as policymakers is how do we not only look
at the long-term funding issues, which I appreciate that you
have identified, but also which areas of this are most viable
and where are we going to invest in terms of the long-term
viability where we have the passenger base that is going to use
it. I think that is an important question for us as well.
But I really appreciate your insight today on what we are
looking at in New Hampshire, and we will follow up with you on
that. Thank you.
Senator Blumenthal. Thanks, Senator Ayotte.
Senator Booker?
STATEMENT OF HON. CORY BOOKER,
U.S. SENATOR FROM NEW JERSEY
Senator Booker. I want to thank the Chairman and the
Ranking Member for having this hearing. It is very important.
I also want to thank the Chairman for really asking the
pointed question that I did about the funding structures that
we are going to need. And clearly, the response that was given
about Federal grants, State contributions, credit enhancement
is one way to go and something we should be exploring.
Before I ask just really one question, I want to take note
and give my reverence and respect to a friend, Tony Coscia, who
has been a longtime advisor of mine and really someone,
especially for the state of New Jersey--we owe you a lot for
your service to our region and our state. And I thank you for
that.
I want to really focus in real quick. Clearly, as we have
seen with the Portal Bridge and the most recent CBS expose on
that and the urgency of infrastructure investment, the common
sense analysis, that if we are about growing jobs as a country,
the dollars invested in infrastructure, dollars invested in
rail produce a tremendous benefit that anybody on Wall Street
would salivate over, about a buck 70 for every dollar that is
invested.
I think that we are, in New Jersey, really being choked by
an inadequate infrastructure. Clearly, Amtrak is showing that
this is a very, very high-demand region, and if you build it,
people will use it and grow their economic activity.
I am really concerned about the Gateway Project. We have
the busiest river crossing in the entire United States of
America, and it is woefully inadequate for the economic,
commuter, and overall needs of that region. And I see clearly
that we had a pathway to get there that has failed because of
the lack of action by the Governor of New Jersey, a decision
not to go forward with that.
But I want to drill down on my concerns of the impact or at
least what we see coming. The tunnels between New York and New
Jersey that service these thousands and thousands of commuters
every day have now reached a peak point where they are having
severe structural challenges. And I know Amtrak has noted that
one or both of the tunnels is going to have to be closed down
for repairs in the coming years. This is an immediate concern
for everyone. It is going to cause a ripple effect that is
going to affect tens of thousands or hundreds of thousands of
people in that region.
And so, Mr. Rogoff, I want to know what role can the DOT
play in averting what I think is going to be a major commuter
crisis of monumental proportions in the region and what can
Congress do to help.
Mr. Rogoff. Well, Senator Booker, first, thank you for your
leadership on this particular question. They really are more
related I think than you know because under the full funding
grant agreement that we were negotiating and working with New
Jersey Transit, one of the requirements of New Jersey to pull
down $3 billion in Federal funds for the Arc Tunnel project
would be that they also rebuild the Portal Bridge project
because, frankly, you do not get the efficiency benefits of the
new tunnels and the additional ridership if you do not fix
Portal Bridge. It is really one system and one very congested
and one very old system.
We have been in conversations through the FRA, and I will
say we hope and expect to amp up those conversations
considerably going forward because we are now at a point where
the states are cooperating at least to the tune of coming
forward with some money for design work. But we are at a point
now where we really need to attack the bigger question about
who is paying how much, when and how.
And the wake-up call that we recently got from Amtrak
regarding the greater than known impact of Hurricane Sandy
flooding on the existing tunnels and the degradation of the
existing tunnels--that wake-up call I hope is not just being
heard here in Washington but is also being heard in Trenton and
Albany because we need to reform the partnership that we
thought we had for the Arc Tunnel project between a Federal
partnership that includes both states to make the Gateway
Project happen.
We have done and took, I would say, extraordinary measures
to make sure that at least the option for the Gateway Project
remained open by transferring Sandy recovery money to the FRA
to do the Hudson Yards Tunnel project so that that could be
restored. But that really is not going to be put to its utility
unless we get a real replacement. And time is running short.
And the Portal Bridge project is a very good example of why we
need to get on with this need to do a multiyear authorization
with real money behind it that lets us do big projects. Amtrak
has put--I am sorry. Go ahead.
Senator Booker. No. My time has expired. So I just want to
say in conclusion I know we have been talking a lot on the
specifics of what I think is going to be unimaginable
nightmares for the Hudson River crossing that this is going to
cause. We have got to start doing more to prevent what is going
to, I think, be inevitable if these bridges have to go under
the inevitable repairs that they must have. That is going to
affect commuters.
And then in addition to that, to have such a profitable
region choked by its infrastructure is utterly unacceptable. It
is the height of irresponsibility. Nobody would run a business
this way, a household this way. We are wounding ourselves as a
Nation in one of the most profitable economic regions on the
globe by how we are conducting ourselves right now, and we have
to have more dialogue about how we are going to fix this
problem.
Thank you.
Senator Blumenthal. Thanks, Senator Booker.
Senator Klobuchar?
STATEMENT OF HON. AMY KLOBUCHAR,
U.S. SENATOR FROM MINNESOTA
Senator Klobuchar. Thank you very much.
Thank you to all of you.
I first wanted to mention the important role that Amtrak
has played in my state. It is critical to moving passengers.
And this spring an important milestone was reached. Amtrak
began running service to Union Depot, which as Mr. Rogoff is
well aware of, has helped us with getting our light rail and
everything that has been happening in Minnesota. We are really
excited. This is a 21st century multimodal facility right in
St. Paul and hooking up with Minneapolis. So I want to thank
you all for that.
I had a question first that I know a few people have
touched on, but we are, of course, seeing delays in Amtrak, Mr.
Coscia, like we are seeing across the country. But what we are
seeing with oil, of course, from North Dakota--we are happy
that we are getting more energy out of North Dakota, both
natural gas and oil. But it has created some severe rail
congestion and affected the on-time performance of the Empire
Builder to the point where the Empire Builder was arriving on
time only l9.9 percent of the time. So only 20 percent of the
time is it on time, and you can imagine how that hurts
ridership.
Have we seen any improvement since last September when that
figure was announced, and how is Amtrak working with Burlington
Northern? Those are the tracks that the Empire Builder runs on.
Mr. Coscia. Thank you, Senator. In fact, thank you for
raising the question because I think this is a vital issue that
we are dealing with at Amtrak.
There is clearly a confluence of issues that have come up
between the mobility of people and the mobility of goods. I
mean, we are sharing infrastructure between two vital things,
moving people around the country and moving goods around the
country. And I do not think it is an effective argument to
argue that one is more or less important than the other. The
reality is that the Nation needs to somehow find a way to work
together and cooperate and optimize the system.
I would submit to you, Senator, that it is a work in
progress for Amtrak working with the freight industry to try to
find the point where we are doing all we can do to make those
numbers better than they are. Those are unacceptable numbers,
and it is at least step one that Amtrak and the class I freight
railroads are going to need to work together to try to improve
their operating performance. We see a lot of this around the
Chicago hub. In fact, our president, Joe Boardman, has convened
a group of senior individuals to try to find solutions to that
problem.
But in addition to that, there is undoubtedly going to be
need for investment in the system that creates improvements in
places where the infrastructure that exists is not adequate for
the needs of the system overall. Some of that will fall to an
obligation that we would encourage the freights to undertake
and some of it will be an obligation that Amtrak will have to
undertake.
But the bottom line is that those kinds of on-time
performance levels are unacceptable and are a negative to the
system overall, and the solution is something that is going to
require a re-imagining of the relationship that exists in the
United States between the freight railroads generally and the
passenger rail industry. We need to, for a second, put aside
Amtrak and put aside any of the individual players. There is an
issue on multiple levels of delivering effective passenger rail
in the United States. One of those issues is a better alignment
between the passenger rail industry and the freight rail
industry, and there is a lot of work that needs to be done on
that issue.
Senator Klobuchar. Very good. Thank you.
Mr. Rogoff, I want to thank you again for your leadership.
We were so pleased to have you out there for the opening of the
11-mile line that finally connects downtown Minneapolis and
downtown St. Paul. It was good to see you there. And could you
talk about the importance of expanding transportation options?
And then also I wanted to ask you about the rail inspector
program? And this came out of a GAO report in 2013 on rail
safety challenges that found that the FRA inspectors only have
the capacity to inspect less than 1 percent of all railroad
activities. And do you think there are enough rail inspectors--
this is, of course, different than light rail--to oversee the
tens of thousands of railroad tracks in our country?
Mr. Rogoff. Well, thanks for the question. A couple of
things.
To your first point on transportation options, it was not a
coincidence that when the President went out to announce the
GROW AMERICA Act, he went to Union Depot in St. Paul. It was
the coldest Anthony Foxx has ever been in his life. If you ask
him, he will tell you about it.
[Laughter.]
Mr. Rogoff. The Twin Cities, in part because of the
leadership of several mayors and your leadership and others,
have really figured out there is the mix of options. Even in a
community where parking is, as urban centers go, relatively
inexpensive, folks want to use light rail, and they are
flocking to it and they are also now increasingly flocking to
intercity rail. One of the things I said in my opening
statement really had to do with population growth and how we
are going to accommodate that growth. And that is why we feel
it is imperative that rail be part of the solution.
Senator Klobuchar. You can also add to that now our
metropolitan area has the lowest unemployment rate of any metro
area in the country.
Mr. Rogoff. And they are not unrelated.
Senator Klobuchar. And we are doing all of this with the
rail, and I think it is interesting.
Mr. Rogoff. And I think it even goes beyond that. It
becomes somewhat of a magnet for people, a magnet for both jobs
and technological workers because they know the rail is going
to be there. And increasingly, we are now building rail on
college campuses, and those graduates leave the campus and want
to know where they are going to relocate and they want to know
where the rail is.
On the rail inspector question, I would like to get back to
you, consult with the Federal Railroad Administrator, and give
you a more thorough answer, other than to say that one of the
things that the Secretary has increasingly been moving us to is
certainly we need additional resources for safety.
We are revisiting our budgets for that especially in the
light of crude by rail. There are some additional dollars
specifically for the safe movement of energy in the omnibus
just filed last night. But we also need to move to a more risk-
based inspection regime, and that is not just in rail but
across all of our safety functions.
Senator Klobuchar. I hope when you hear this only 20
percent on time--obviously, we do not have nearly the traffic
of Connecticut where Senator Blumenthal is, but anyone that
would have 80 percent of trains late, it is not just a safety
issue. It feels like we are almost getting cut off.
Mr. Rogoff. This is a very critical issue that quite
frankly is getting demonstrably worse.
Senator Klobuchar. Yes.
Mr. Rogoff. I happen to have--this is actually Amtrak's
document, but you may wish to put it in the record. I will
invite Tony to put it in the record because it is his document.
But it just compares the on-time performance by train for
October of last year till October of this year, and on some of
these trains, the numbers have really plummeted. We are talking
upwards of 30-40 percent. And it is in part why we need the
investments that are in GROW AMERICA and that is to de-
conflict--if passenger rail is really going to be successful
nationally, we need to make the investments to de-conflict,
where possible, the freight rail operations which we also want
to grow with the passenger rail operations.
Senator Klobuchar. Thank you.
Senator Blumenthal. We will take that document for the
record, without objection, and call on Senator Nelson.
[The information referred to follows:]
STATEMENT OF HON. BILL NELSON,
U.S. SENATOR FROM FLORIDA
Senator Nelson. Mr. Coscia, the Northeast Corridor has been
very successful, 260 million passengers. You have an operating
surplus of $500 million. So what is the incentive to really get
to high-speed rail?
Mr. Coscia. Well, Senator, there is an enormous amount of
incentive to get to high-speed rail. In fact, I will tell you
that I feel as though every day that goes by that we do not
find a way to make tangible progress on the Northeast
Corridor--I feel as though we are allowing an opportunity to
slip through our fingers and one which we may or may not get
back.
I do not really see that there is a distinction between the
Northeast Corridor and any other city pair around the country.
It is just this is where we have made our initial stand, and
this is where we have proved that the concept is viable. But to
the extent that we do not invest in that system, that operating
surplus will decline for certain because the kind of on-time
performance statistics that we have on the Northeast Corridor
will start to look a lot more like the kind of on-time
performance statistics that we were just talking about relative
to some of the long-distance lines.
The reality is that the viability of the Northeast Corridor
is because there is an enormous amount of demand. We are
selling a lot of product because there is a lot of demand for
that product. But that demand will go away to the extent we
cannot deliver a service that is commensurate with what the
public needs. If we do not invest in rail to a point where it
gets better and does not deteriorate, then you will see
ridership start to decline.
We are a preferable mode. If you look at the numbers, the
comparison between those who use aviation as a mode of
transportation on the corridor and those who use rail, within
the last 10 years they have essentially flipped. And that is
something that is important because we are a more efficient
mode for those kinds of distances, but in order for us to hold
onto that kind of advantage, we are going to have to invest in
the system and keep it viable.
So I think there is plenty of incentive for us to invest in
the Northeast Corridor, to develop higher-speed programs not
simply because of the Northeast Corridor because we think it is
also a model that can be transported to other parts of the
country. And in fact, we have had an enormous amount of success
in developing systems around the Chicago hub, in the Northwest,
and even the success you have seen in connecting cities in
California.
Senator Nelson. What is the average speed on the Acela
between Washington--and if you take all of the stops, what is
the average speed between there and Penn Station?
Mr. Coscia. The average speed in the southern half of the
route is somewhere in the 120 mile an hour range. I would have
to confirm that for you. But obviously, the system can achieve
higher speeds, but in multiple places the rail infrastructure
does not support that.
Senator Nelson. So overall the average speed is what?
Mr. Coscia. It is about 110 to 120 miles an hour.
Senator Nelson. From Washington to New York.
Mr. Coscia. From Washington to New York.
Senator Nelson. Including the stops.
Mr. Coscia. Including the stops, it would be less than
that. The operating speed is at that level. The time that it
takes to get from Washington to New York is about 2 hours and
45 minutes.
Senator Nelson. OK.
Now, have I not ridden on some trains in Europe that go in
excess of 200 miles an hour?
Mr. Coscia. You have indeed.
Senator Nelson. Did I not ride on an experimental one
outside of Shanghai that went up close to 300?
Mr. Coscia. I think we both may have. Probably not the same
train, but yes, I am sure you have.
Senator Nelson. So when can we start getting that kind of
technology that is available today into the United States? And
it would seem to me the Northeast Corridor is a good place to
start. No. Let me amend that. The good place to start was
between Tampa and Orlando right down the middle of the I-4
interstate corridor, but our Tea Party Governor would not
accept the $2.4 billion that we had on the table to build it 4
years ago. And it would be being completed now, and it would be
the showcase for the entire country to do it. But since that is
not the case, what is the case in the Northeast Corridor?
Mr. Coscia. Well, Senator--and I will not comment on the
last part of your question because it would require a lot of
other discussions that we do not have time for.
Senator Nelson. No. I am just talking about a fact. I am
talking about a fact.
Mr. Coscia. But I will tell you that we are paying the
price for under-investment in the system for the last 40 years.
So the answer to your question is that I agree with you that we
should be sprinting. We deserve to sprint. If anyone in the
world should be sprinting, it should be this country, but we
are not sprinting because we have to first learn how to walk
correctly given the fact that we have put so little effort into
it for the past 40 years.
So the proper response to your question is that we are
working very, very hard at Amtrak to make the Northeast
Corridor the model of what intercity passenger rail service
should look like and could look like in this country in the
hope of making the case to the American public generally that
investment in intercity passenger rail is worth it, that it is
worth it for us to put significant resources into it because we
can connect cities that would ultimately have an enormous
economic and quality-of-life benefit.
The truth is, Senator, at the end of the day, this is
really not about the trains and whether they go fast or they go
slow. It is about the people on the trains. And with every
delay, we are wasting money, we are wasting time, and we are
not going to get it back. So the reality is that this is not an
argument about Amtrak. In fact, Amtrak needs to prove to the
general public that it is capable of taking on this mission,
but it is about passenger rail service. And unless we make the
kind of investments that will upgrade the system on the
Northeast Corridor to show that we can run at operating speeds
in excess of 150 miles an hour, then we will never be able to
actually create the kind of true high-speed network that you
are referring to not because it is not possible, not because we
do not know how to build it, but because we sort of lack the
will to install the system.
Senator Nelson. Well, what I want to work on is the will.
Senator Blunt, over 30 years ago when I was a young
Congressman in the House just before you arrived, Congressman
Don Fuqua, the Chairman of the Science and Technology Committee
of the House, took us all to France, and we rode in the
engineer's compartment on the high-speed rail from Paris to
Lyon, 180 miles an hour. I remember that. It looked pretty
fast. That was over 30 years ago, and here we are in America
without high-speed rail.
Mr. Rogoff, let me say that there is one bright spot in
Florida--and you were involved in this and we thank you--and
that is a commuter rail system for the first time being done in
the Orlando area called Sun Rail. We need to complete some more
of that now to take it to the Orlando airport. I sure would
appreciate you continuing to help. And that Sun Rail, the first
time in the metropolitan area of Orlando that it has been
established--hopefully they will get going over in the Tampa
area, another dense urban area. Of course, they have had it
thanks to the wisdom of Congressman Bill Lehman, Senator Blunt,
that you and I had served with, who got that commuter rail
system in Miami.
But we need that extension, and it is wildly popular--Sun
Rail in the Orlando area. Started from scratch. For a couple of
weeks, they let everybody go out and ride it for free. I mean,
you could not get on it it was so packed.
Mr. Rogoff. It is a system that holds great up-side
potential especially with all the economic dynamism in and
around Orlando. You have our commitment to continue to work
with you on it. I know FTA is in regular dialogue with FDOT
about it. And it was great to see phase one get off the ground,
but we certainly know that there are more phases to come.
Senator Blumenthal. Thanks very much. Thanks, Senator
Nelson.
Senator Blunt. Mr. Chairman, I would like to note for the
record that since he has been in a spaceship, Mr. Nelson knows
a lot more about speed than most of us do. So his speed
comparisons are much greater than our speed comparisons.
Senator Blumenthal. He is truly a world traveler.
[Laughter.]
Senator Blunt. Intergalactic mode.
Senator Blumenthal. But speaking of world travel, I am
hoping that during the next session when I hope Senator Blunt
will be Chairman of this subcommittee, but whoever is maybe
will take us on another trip to Paris.
[Laughter.]
Senator Blumenthal. I have just a couple of quick
questions. You have been very patient and very, very helpful
and informative, and I want to really thank the panel.
Mr. Coscia, Senator Booker rightly focused on the Northeast
Corridor, specifically the Gateway Project. And you know, I am
sure that my constituents in Connecticut are wondering why
should I care about this tunnel under the Hudson. And of
course, the tunnel under the Hudson is vital not only to
Connecticut but to Delaware, Pennsylvania, every state that is
served by that corridor. My understanding is that this project
would allow for eventual doubling of passenger trains into
Manhattan. It would add new tunnels under the Hudson River,
replace the Portal Bridge east of Newark, New Jersey, and
expand the station facilities in New York City.
The cost estimates range from $14 billion to $16 billion,
which seems like a staggering amount until you consider what it
costs to put men on the moon or what it costs to put satellites
into orbit. And by no means am I suggesting that we should not
continue with that space exploration effort, but in terms of
getting people safely and reliably to destinations for pleasure
or work or moving freight, I happen to believe it is well worth
moving forward.
I would just ask you and any of the other panelists to
comment on how its ramifications are so sweeping for our Nation
and most especially for our economy, job creation, which are a
priority for me.
Mr. Coscia. Yes, Senator. Well, I would say at the risk of
being redundant, your question gives me the perfect opportunity
to make the point that I have been making in my testimony and
in a number of the responses here, which is that the Nation
needs a robust passenger rail system to connect cities not
because we think it is an interesting idea, but because the
future of the Nation's economy largely depends on it. The
Northeast Corridor has given us this perfect opportunity to
create a system that we can then spread throughout the country
to city pairs not just in the Northeast of the United States,
but throughout the country. But we are heavily dependent on the
success of the Northeast Corridor as being able to sustain that
system because it is the element that we will use to be able to
generate the kind of system creation capacity that will allow
us to go to other parts of the country as well, not to mention
the fact that the Northeast Corridor obviously represents a
vitally important part of the entire U.S. economy.
Now, the project that you speak of, which highlights the
fact that every opportunity also has its points of failure, is
that on the Northeast Corridor, which is currently the bulwark
of the Nation's passenger rail system--once you get to the City
of Newark, you go from a four-track system to a two-track
system. You go over a bridge that crosses the Hackensack River
that was built 120 years ago that is a swing bridge that is
something that fails on a regular occurrence. It goes under
tunnels that we built out of concrete and cast iron over 100
years ago, emerges into Penn Station which is clearly the
busiest train station in North America and nowhere near able to
meet the needs that it has, and then emerges from Penn Station
again in rail infrastructure that was built many generations
ago.
The reality is that is just purely unacceptable. That half
a billion dollars in net operating income that I mentioned is
coming from the Northeast Corridor is all at risk. But what is
even at greater risk is shutting down that tunnel for even a
day has a horrendous impact on New York's economy and the
Nation's economy.
So my argument to you on all of this and my argument
generally on all of this is that we believe that a national
passenger rail system is heavily dependent on the success of
the Northeast Corridor. And the Northeast Corridor will not be
successful unless we do something about this problem and we do
something about it very quickly.
Senator Blumenthal. Thank you very much.
Senator Blunt?
Senator Blunt. Well, thank you, Chairman. Thanks, panel,
for your patience. I may submit some questions in writing.
Let us talk about positive train control just a little bit
longer. Mr. Coscia, is there any part of the Amtrak system that
will meet the 2015 deadline? And if there is, what percentage
of your system would be able to comply with that deadline?
Mr. Coscia. Senator, I do not think I can give you that
answer off the top of my head, but I would be happy to get you
that information.
Senator Blunt. You could give me the answer but you will
not be fully----
Mr. Coscia. I am not certain that I would be 100 percent
accurate and I would not want to guess at that.
Senator Blunt. All right.
Mr. Rogoff, since it is my belief that almost nobody will
meet that deadline, what is the best way for your Department to
deal with that? On a case-by-case basis or would you like some
guidance from the Congress as to a reasonable date that then we
would try to encourage that people meet that date?
Mr. Rogoff. Well, I do not want to be cheeky, Senator
Blunt, but what we would really like is the $6.4 billion we put
in our request for multiple years to help facilitate the
installation of PTC.
But on your specific question on the deadline, we have come
at this on a case-by-case basis. We do think that is the most
reasonable. We do think that at least the Metrolink system out
in California has a fighting chance of meeting the deadline,
but we are working with everyone individually as it is. If GROW
AMERICA were to be adopted and we were able to bring in $6.4
billion over multiple years to help finance that investment, we
think things will go a lot more quickly.
As you know well, there are other issues that we are
working through, including issues with the FCC--on tower
installation. But I think we are making some progress there
now, and we feel good about the partnership allowing things to
move more quickly. But financing is still a challenge.
And you are correct that a very small portion of the
universe will comply with the deadline, but we think working
with each railroad individually is the best way to move them
forward.
Senator Blunt. You know, I do have some problem with the
railroads that have somehow worked to comply being under the
law without maybe time to try it out, see how it is working.
Those are the kind of things I want to follow up with you on.
Mr. Rogoff. We would welcome the inquiries. That is
precisely among the reasons why we would like to come at this
from a somewhat--flexible on the installation, recognizing
other things, flexible somewhat on the enforcement but keeping
everyone's feet to the fire to move forward quickly. We think
being able to do this on a case-by-case basis gets us to
recognize those who have really made an effort and made the
expense to move out rapidly and also recognize those that have
perhaps dragged their feet and be able to recognize the
distinctions between them rather than have sort of a one-size-
fits-all legislative solution.
Senator Blunt. We will continue to talk.
Again, Mr. Chairman, thank you for your leadership on these
issues and for having the hearing today.
Senator Blumenthal. Well, thank you, Senator Blunt, for
your partnership and your leadership both here and in the great
State of Missouri and throughout the Midwest.
And again, I want to thank our panel. Please convey my
thanks to Secretary Foxx for his vision and leadership. And to
all of you, I look forward to working with you as we continue
this very important work. Thanks so much.
This hearing is adjourned and the record will be kept open
for two weeks.
[Whereupon, at 4 p.m., the hearing was adjourned.]
A P P E N D I X
Prepared Statement of James P. Redeker, Commissioner, Connecticut
Department of Transportation; Chair, Northeast Corridor Infrastructure
and Operations Advisory Commission
The Northeast Corridor
The Northeast Corridor (NEC) is one of the great railroads of the
world. Its 457-mile main line between Boston, Massachusetts and
Washington, D.C. carries 710,000 commuter rail riders and 40,000 Amtrak
riders each day on over 2,000 trains. It supports a workforce that
contributes $50 billion annually to the United States gross domestic
product. It provides high capacity and reliable access to core
employment centers that contain one out of every three jobs in the
larger NEC Region, whose overall economy is the fifth largest in the
world. The NEC plays an important role in supporting the broader
transportation system. An unexpected loss of the NEC for one day alone
could cost the Nation $100 million in additional highway congestion,
productivity losses, and other transportation impacts.
The NEC spans eight states and the District of Columbia, supports
nine passenger rail operators--including four of the five largest
commuter rail services in North America--serves four freight railroads,
and has four separate infrastructure owners. Amtrak owns the railroad
between Washington, DC and New Rochelle, NY, and between New Haven, CT
and the Rhode Island-Massachusetts border. The New York Metropolitan
Transportation Authority (NYMTA) and the Connecticut Department of
Transportation (CDOT) own their states' respective portions between New
Rochelle and New Haven. The Massachusetts Bay Transportation Authority
(MBTA) owns the railroad from the Massachusetts-Rhode Island border to
Boston South Station.
Portions of the NEC date back as far as the 1830s. A great number
of critical assets date back to the period between the Civil War and
the New Deal. As infrastructure deteriorates and service levels reach
the NEC's practical capacity, we must choose to cope with declining
reliability and limited economic growth, or to invest in the next
generation of the railroad.
The NEC is at an historic turning point. The decades since
stewardship of the NEC was placed in public hands have been marked by
record-breaking commuter and intercity rail ridership growth--and
insufficient capital investment. But unprecedented collaboration is
underway to take responsibility for this vital asset and position the
Northeast for a globally competitive economic future.
The Commission
I serve as Chair of the Northeast Corridor Infrastructure and
Operations Advisory Commission (the Commission), established by Section
212 of the Passenger Rail Investment and Improvement Act of 2008 to
create a new forum for collaborative planning and decision-making for
the Northeast Corridor. The Commission is composed of one member from
each of the NEC states (Massachusetts, Rhode Island, Connecticut, New
York, New Jersey, Pennsylvania, Delaware, and Maryland) and the
District of Columbia; four members from Amtrak; and five members from
the U.S. Department of Transportation (USDOT). The Commission also
includes non-voting representatives from freight railroads, states with
connecting corridors, and commuter authorities not directly represented
by a Commission member.
The Commission has nearly completed its statutory mandate to
develop a cost-sharing arrangement for NEC infrastructure used for
commuter and intercity rail services. The draft agreement contains the
required cost-sharing methods, policy recommendations to support them,
and new practices to enhance collaboration on the Corridor.
Congress will consider authorizing laws for both surface
transportation and intercity rail in the coming months. Federal policy
should treat the Northeast Corridor as a single system. The success of
the Corridor, and passenger rail in general, is possible only through a
unified vision for the entire network.
The Commission is part of a regional partnership that has been
years in the making and is growing stronger. Though far below even the
bare minimum level of necessary investment, the Northeast states and
commuter agencies have gone nearly dollar-for-dollar with Amtrak over
the last ten years with approximately $2.4 billion in NEC capital
investment, paired with approximately $2.6 billion from Amtrak and $1
billion in Federal American Recovery and Reinvestment Act (ARRA) and
High-Speed Intercity Passenger Rail (HSIPR) program grants.
Coordination is especially strong in planning for the future. In
2010, the Northeast states, commuter agencies, and Amtrak published the
Northeast Corridor Infrastructure Master Plan that identified the level
of investment required by 2030 to restore the Corridor to a state of
good repair and accommodate modest forecasts of ridership growth. In
2013, the Commission convened the same group of stakeholders to publish
a report entitled Critical Infrastructure Needs on the Northeast
Corridor to highlight the highest priority infrastructure investment
needs in the region.
Since then, Commission stakeholders have been at work on the first-
ever Northeast Corridor Five-Year Capital Plan--due for publication in
spring 2015--which will be a near-term action plan to address the
investment needs identified in previous reports. Development of the
Northeast Corridor Five-Year Capital Plan is analyzing how to feasibly
ramp up investment levels over the next five years to reverse decades
of deterioration and modernize our shared national asset for future
economic growth.
However, funding availability will be the largest obstacle in
implementing the Northeast Corridor Five-Year Capital Plan. Aggregate
funding levels from traditional sources are far below those required to
stabilize the infrastructure's condition and prepare it for the future.
The Northeast Corridor Five-Year Capital Plan will identify these
funding gaps and define how additional resources would build a stronger
railroad.
Though the draft cost-sharing agreement lays out a framework for
collaboration, it will not fully address the funding gaps facing the
NEC. Once it transmits an adopted cost-sharing policy to Congress, the
Commission looks forward to partnering with Congress to ensure the
success of these new approaches to collaborative planning, funding, and
financing of rail services and infrastructure improvements.
Railroad investments involve complex planning, engineering,
contracting, and construction activities that take place over a number
of years--processes that benefit from predictable and stable capital
funding resources which is generally lacking due to the current
reliance on annual budgeting and appropriations and one-time
competitive grants.
Rail deserves the predictable and sustainable funding offered to
other modes so it can reach its potential for the American public. A
long-term Federal capital funding program is needed to advance
intercity passenger rail service throughout the United States. Funding
is needed for capital investments in new equipment and infrastructure
improvements. These capital investments are needed for increased
frequencies, speeds, and passenger amenities, as well as for improved
schedule reliability in the face of heavy freight traffic.
In addition to Federal funding, we will also need to be creative in
ways to stretch the Federal dollars by leveraging private sector
funding for passenger rail infrastructure. However, it is worth noting
that the risk-averse private sector desires a predictable, sustainable
Federal funding partner prior to investment. All European Governments
finance railways to provide services beyond those that a stand-alone
commercial railway would offer, in terms of the geographic coverage of
the network, the location of stations and the frequency and speed of
services. They do this on the theoretical economic grounds that the
long asset lives, lumpy investment patterns and large sunk costs that
characterize rail prevent purely private provision of an optimally
dimensioned rail system.
Such a program must include a mechanism to insure that funding can
be reliably provided over multiple years. Like other major
transportation infrastructure projects, passenger rail corridor
improvements can take several years and new equipment can take up to
three years from order date to delivery.
Many public and private sector stakeholders have long advocated for
improvements to the policy framework and funding models that support
the NEC. These initiatives have rarely translated into sustained focus
and action. Now, confronted with aging infrastructure, rising demand,
and constrained capacity, NEC service providers, Northeast state and
local governments, and the Federal Government must continue to forge
this new partnership to modernize the NEC and build a foundation for
economic growth.
The Commission has made great strides in bringing the Corridor's
key stakeholders to the table to develop a framework for greater
collaboration. We look forward to working with Congress to build upon
this progress and to develop a stronger federal-state partnership to
address the Northeast Corridor's significant infrastructure challenges.
______
Response to Written Question Submitted by Hon. John Thune to
Hon. Anthony R. Coscia
Question. It is my understanding that as railroads develop PTC
systems in response to the 2008 Passenger Railroad Investment and
Improvement Act Congressional mandate, some freight lines will now
require PTC only because a passenger rail system shares their tracks
and therefore is asking the passenger rail systems, most notably
Amtrak, to cover these costs. It is my understanding that you have now
decided to pass these costs along to the states that support these
passenger rail programs and that many states were unaware and
unprepared for these additional expenses. Can you explain your planning
and communications efforts?
Answer. For Amtrak and the states, the most critical PTC-related
issue has been the installation of PTC on terminal railroad trackage in
St. Louis and Kansas City. The cost allocation methodology stemming
from Section 209 of PRIIA requires that allocated costs for PTC on
state-supported routes must be borne by the states, although a portion
of these costs will also be borne by Amtrak, as these terminals are
used by our Southwest Chief and Texas Eagle services. In both cases,
states would be required to bear both the initial installation cost and
the annual maintenance costs for the system. Because the scale of the
cost is significant enough to impact services supported by the states
of Illinois and Missouri, Amtrak has been in close and continual
communication with both state departments of transportation on this
issue. While we don't have agreement yet with Missouri or Illinois on
this, these states have been made aware of their exposure. We do not
expect that either installation will be complete by the end of calendar
year 2015.
______
Response to Written Questions Submitted by Hon. Roy Blunt to
Hon. Anthony R. Coscia
Question 1. I understand you have served as Chairman of the Amtrak
Finance and Audit Committee since 2011. Both your financial reports and
your audited financial results are due every year by February 15, as
required by statute. These documents will be important in considering
the Amtrak reauthorization. Have these reports been submitted, and if
not could you please provide explanation?
Answer. Our Legislative and Grant Request (budget request) is
required every year on February 15, with some deadline concessions for
delayed appropriations, and this is a forward looking document.
However, the financial reports and audits are a separate matter. We
will not have our FY 2014 audit complete for several more months due to
a delayed schedule from one-time audits that were finalized just a few
months ago. On a normal schedule, our audits are finalized by the end
of January. We expect to get back to the schedule for the FY 2015 final
audit.
Question 2. State-supported routes like the St. Louis to Kansas
City route, the River Runner, carried almost half of Amtrak riders last
year. Some of these routes are the fastest growing segments for
ridership. How are you working with the states to continue to improve
ridership of these routes?
Answer. Amtrak has been working closely with the states to ensure
that state-supported ridership continues to grow. To sustain our
pattern of growth, we are working to address the single most important
issue for travelers, on-time performance (OTP). OTP has fallen
significantly in the past two years, and we have engaged the freight
railroads to address those components of OTP for which they are
responsible. We have also worked to improve those components for which
we are responsible, particularly those that have historically hindered
service in our Chicago hub. We have worked to address the issue of snow
interference with locomotive traction motors, and snow and ice
infiltration into cars; we have also pursued the more effective
installation of heat-tape wrapping on cars, to avoid problems with
freezing water; all of these have helped us to address this challenge.
We have worked closely with the states to promote specific state
marketing initiatives aimed at boosting ridership and cost recovery.
Collaborative marketing initiatives involving Amtrak and the states
have aimed to boost both. To ensure that ridership does not drop off
while we experience service disruptions during the improvement programs
on the Chicago-Detroit and St. Louis routes, we have worked with the
states to publicize the improvement program so that passengers can
understand both the need for delay, and the improvements in OTP and
trip time that can be expected once the work is done.
For our sales systems, Amtrak has recently embarked upon a
modernization of all of our customer-facing sales systems, including
Amtrak.com, mobile apps, and contact center and station sales systems
(including Quik-Trak). Building on the momentum of our recently
launched eTicketing system, these systems will extend the reach and
improve the ease of purchasing Amtrak services across the system.
Amtrak will be launching the first wave of these new systems starting
in late spring of 2016.
In marketing, in addition to traditional advertising, Amtrak has
many tools to support growing sales, including promotions, partner
programs, and our loyalty program, Amtrak Guest Rewards. Amtrak also
supports pricing and revenue management strategies for state routes
with advance systems and ad hoc analyses for our state partners.
Amtrak.com today already supports customization and geo-targeting
of state services messaging to target markets in support of those
routes' unique needs, including by utilizing Amtrak marketing and
communication channels such as home page banners and ``deals'' pages on
Amtrak.com, Amtrak Guest Rewards member e-mail and website, non-member
e-mail, and social media channels messaging (Facebook, Instagram,
Amtrak blog, Twitter). State routes are also integrated into promotion
of national, system-wide marketing partnerships and programs including:
AAA, Student Advantage, Veteran's Advantage, Amtrak Vacations, Amtrak
to Parks, and Amtrak Train Days. Amtrak aggressively promotes state
routes at consumer trade shows regionally, nationally, and
internationally and through travel industry partnerships at the local
and regional level, including convention and visitors' bureaus, travel
agencies and tour operators, state travel bureaus, and other strategic
destination and sponsorship promotions.
Importantly, of course, Amtrak also supports our state partners
with advertising. This can be part of a state-supported and directed
program or through Amtrak's own integrated national advertising
campaigns. These campaigns appear in print, on TV, online, in sports
venues, and other channels. In 2015, Amtrak is developing a new
national brand campaign to drive consideration for Amtrak travel across
all services and within key segments such as millennials and students,
families, and boomers. This campaign, which will launch mid-year,
utilizes the tagline ``See Where the Train Can Take You.'' The dual
message of this tagline speaks to Amtrak's ability to transport its
customers--both in the physical sense to a specific destination, as
well as to transport them emotionally during their trip. We plan both
television and digital platforms for release and expect state-supported
services to benefit directly.
Amtrak's communications team also supports daily messaging through
the media and directed communications to ensure that customers are
aware of track work, service disruptions, and service development
programs that could have an adverse impact on services. The goal is to
ensure that our customers remain informed and ridership does not drop
off while we experience service disruptions during the improvement
programs on the Chicago-Detroit and St. Louis routes, for example, our
communications team has worked with the states to publicize the
improvement program so that passengers can understand both the need for
delay, and the improvements in OTP and trip time that can be expected
once the work is done.
Together, these programs are designed to drive awareness,
consideration and trial for new customers, and to increase use by
existing customers. These actions, coupled with both operational
actions for improved reliability as well as on-going improvements to
schedules, frequencies, and services, are designed to ensure the long-
term sustained growth of our state-supported services.
Question 3. To follow up from my question in the hearing, is there
any part of the Amtrak system that will meet the 2015 Positive Train
Control deadline? If so what percentage of your system would be able to
comply with that deadline?
Answer. Amtrak's PTC installation program has two components--
installation on our infrastructure, and installation on our equipment.
PTC systems are currently in service on the 156 mile Amtrak line
between New Haven and Boston, and the 97 mile Amtrak-owned Michigan
Line. PTC systems have been installed on the 245 mile segment between
Washington, D.C. through New York Penn Station to New Rochelle, New
York, and on the 104 mile line from Philadelphia to Harrisburg; these
systems have not, however, been turned on, because of issues associated
with radio frequency that have required installation of new radios in
locomotives to ensure compatibility. That installation process is
ongoing, and when it is complete later this year, Amtrak expects to
have an operable PTC system on 602 route-miles of our system. Work is
currently ongoing on the 135 mile segment of the Michigan Line between
Kalamazoo and Dearborn that is owned by the state, but maintained by
Amtrak. We hope to finish this line by the end of 2015, but our ability
to turn on the PTC system there will depend on an agreement with the
freight carrier to turn over dispatching, and at this time that issue
is unresolved. We expect to complete the installation of PTC systems on
all Amtrak-owned locomotives that require it for NEC operations by the
end of the year, and we expect to have the installation of freight-
compatible PTC systems on our diesel fleet completed at the same point.
We expect to have completed PTC installation on approximately 80
percent of the route-miles for which Amtrak is responsible by the end
of the calendar year.
The exceptions to this will be our 62 mile Springfield Line, which
is undergoing significant upgrading in partnership with the State of
Connecticut, and the 86 mile segment of the Empire Corridor between
Poughkeepsie and Schenectady, New York. In the former case,
installation has not yet proceeded because of the scale of the ongoing
construction work on the Springfield Line; in the latter case, design
work is ongoing, but installation work will not be able to proceed
without funding from the state.