INTRO: May 10 is due to see further cuts to Amtrak’s inter-city network as the operator tries to balance its books. Julian Wolinsky looks at operational changes and funding proposals announced in March
’WITHOUT DECISIVE action very soon, the United States will have no inter-city rail service’, according to the Republican Chairman of the House Transportation Committee. Rep Bud Shuster of Pennsylvania said on March 20 that Amtrak is heading for financial collapse unless Congress steps in to save it. Noting that ’the company is already borrowing to meet payroll costs, and even its own business plan will exhaust all available lines of credit by the middle of fiscal 1998’, Shuster announced plans to appoint a panel of experts to address the crisis.
The same day, Amtrak confirmed that it would cut two routes on May 10. The Pioneer from Denver to Seattle and the Desert Wind from Salt Lake City to Los Angeles will go, after local states expressed little interest in subsidising their future operation. Texas and Massachusetts are hoping to save the San Antonio - St Louis leg of the Texas Eagle and the Boston - Albany segment of the Lake Shore Limited, but Amtrak has made it clear that they will also end on May 10 should funding not materialise. All four were originally due to finish last November (RG 11.96 p717).
March 31 saw the demise of the New Orleans - Mobile Gulf Coast Limited launched last September. Initially subsidised by the states of Louisiana, Mississippi and Alabama, this has averaged just 25 passengers a day.
Rolling stock released from the Desert Wind and Pioneer will allow Amtrak to restore daily service to the Salt Lake City - Oakland portion of the California Zephyr, the Empire Builder from Chicago to Seattle, and the City of New Orleans between Chicago and New Orleans.
Amtrak West has commissioned a study into a tourist-oriented service between Los Angeles and Las Vegas, over the UP corridor now served by the Desert Wind. Three daily trains each way would be worked by the two extra Talgo Pendular sets to be assembled speculatively in Washington (below). Target journey time is less than 5h, compared to the present 6h 50min. The report due this month is expected to put the start-up costs at $15m, requiring a return fare of around $100 to make the service self-supporting. Amtrak is also seeking support from the private sector, including hotel operators in Las Vegas.
Tapping the freight market
Amtrak President & CEO Thomas M Downs is also looking for other traffic to boost revenue. The board of directors has approved plans to enter the premium freight market by leasing 617 Express Cars - boxcars with high-speed bogies to move mail and parcels in passenger trains, of which Amtrak already runs 150. As well as the 367 mechanical refrigerator cars and 250 insulated boxcars, Amtrak will lease 283 RoadRailers: 250 16m trailers, 20 side-door mail vans, eight refrigerated vans, and five ’auto railers’ to test auto-train service in new markets.
Mail is already a major contributor to Amtrak’s income; for example, it accounts for 42% of all revenue from the Chicago - Los Angeles Southwest Chief. UP has voiced objections to the proposals, claiming it would be unfair competition because Amtrak is subsidised: ’we don’t want them hauling freight on our line ... it’s a public institution competing against a private company that has to pay all its own bills.’ Downs counters that Amtrak plans to carry only time-sensitive shipments now moving by road or air.
Further east, Amtrak is reportedly close to a deal with Norfolk Southern to run fast freight trains over the Northeast Corridor from the southern USA to New York. This reverses its long-standing policy discouraging freight traffic on the route, following a 1987 collision between a passenger train and a Conrail freight which killed 16 people. To reduce the risk of accidents, NS would only be allowed to run at night.
Attempts to provide a source of capital funding for Amtrak restarted on March 13. US Senator William Roth, a Republican from Delaware, introduced a bill, co-sponsored by eight other senators, to transfer one-half cent of the 4·3 cent federal motor fuel tax now assigned to deficit reduction into a capital trust fund for the railway.
A day earlier, the General Accounting Office, the investigating arm of Congress, issued a report confirming that Amtrak’s capital needs have been neglected. It pointed out that in recent years the railway has been forced to take out commercial loans, resulting in a significant portion of its capital grants being used to service debts.
Testifying before the House Subcommittee on Railroads on March 12, Downs urged Congress to approve a dedicated funding source. ’That half-cent would enable Amtrak to upgrade its facilities and equipment, permit cost-saving productivity improvements, and allow high-return capital investments. The result would be improved equipment reliability, better maintained cars and locos, and better working conditions.’
Nextea offers alternative
Amtrak capital funding is one of the most controversial sections of President Clinton’s planned six-year extension of the Intermodal Surface Transportation Efficiency Act, unveiled on March 12. The $175bn plan, known as the National Economic Crossroads Transportation Efficiency Act (Nextea) includes proposals to divert between $4bn and $5bn of the highway trust fund to subsidise Amtrak, although the railway would prefer the half-cent fuel tax option.
Nextea is heavily tilted toward road spending, emphasising traffic safety and the environment. Total spending would be about 11% higher than the $157bn authorised in Istea’s six years, which end on September 30. For public transport there is only a vague promise to ’maintain mass transit investment at high levels.’ Federal transit funding would increase by 25% to $5bn a year.
There would also be a six-year, $600m grant programme to ’support flexible, innovative transportation alternatives for people trying to get to work and off welfare.’ President Clinton also wants to increase funding for the Congestion Mitigation & Air Quality Improvement Program by more than 25% to $1·3bn a year.
However, Congress must still appropriate the money for Nextea spending, and oppositon is growing. Republican Rep Jay Kim of California, a member of the House Transportation & Infrastructure Committee, noted that ’you and I are driving cars, so why should we pay for Amtrak?’
- The Amtrak board has approved an order for 30 more General Electric Genesis diesel locos and 21 F59PHs from General Motors. GE will supply 8 dual-mode diesel/electric P32DMs for New York’s Empire Corridor and 33 P42s, of which eight will be assigned to Amtrak West for the Coast Starlight. The F59s will all go to Amtrak West, including five dedicated to the new Cascade service (left). The 51 locos will replace all of Amtrak’s remaining FL9s and most F40PHs. o