(The following article by Don Phillips was published by the Washington Post on April 30.)
WASHINGTON — The Bush administration yesterday unveiled a six-year plan for national passenger rail service in which the federal government would pay about half the capital costs for passenger routes, mainly new short-distance corridors between urban areas, and states would assume liability for operating costs nationwide.
Deputy Transportation Secretary Michael P. Jackson said the plan is not a “Trojan horse” to abolish passenger rail. “When this model is embraced, I personally think that the nation will see more rather than less passenger service,” Jackson told the Senate Committee on Commerce, Science and Transportation.
The long-promised bill is the administration’s effort to solve Amtrak’s continuing budget problem. Amtrak is dependent on federal subsidies, with the government providing a little more than $1 billion in the current fiscal year. Amtrak President David L. Gunn has said he will need $1.8 billion next year to continue operating the system and begin refurbishing the run-down Northeast Corridor.
Under the administration’s plan, the badly deteriorated rail infrastructure between Washington and Boston would be leased for 99 years to a federal-state compact that could apply for capital-improvement grants and could also finance improvements through private debt markets.
The plan is not in final legislative form, and several key questions remain unanswered, including how much money the administration would be willing to commit. If the federal government funds half the capital costs of only a moderate number of the urban corridors that states already have in the planning stages, it will spend many billions of dollars more per year on passenger service than it does now in subsidizing Amtrak.
States are likely to view the program in sharply different ways. For California and Oregon, which are already paying most of the capital and operating costs of their expanding passenger rail systems, the plan could provide a windfall of new capital funds.
But the states of the Northeast Corridor, which now pay for a minor portion of capital improvements, would be expected to pay for 50 percent of such improvements, potentially a new multibillion-dollar liability. Some estimates put the cost of making the deferred capital improvements as high as $12 billion. Almost 90 percent of trains in the corridor are commuter trains serving Maryland, Delaware, Pennsylvania, New Jersey, New York, Connecticut and Massachusetts.
Jackson said that the bill’s financing requirements would be phased in over the six-year authorization period, apparently meaning that the federal government would pick up a major portion of that initial capital investment. The plan faces an uphill battle in Congress, which has repeatedly voted to keep Amtrak running in its present form but has provided far less money than needed to keep the system in good repair.
The committee asked almost no questions about the Jackson plan. Instead, the hearing evolved into the familiar argument among committee members over whether Amtrak should operate a “national system” — code for long-distance trains.
The hearing sometime grew testy as the committee chairman, John McCain (R-Ariz.), repeatedly asked why some long-distance trains, such as the Orlando-Los Angeles Sunset Limited, are allowed to run at all, and Sens. Kay Bailey Hutchison (R-Tex.), Trent Lott (R-Miss.) and Ernest F. Hollings (D-S.C.) saying a “national system” is necessary. Under the administration plan, states would be allowed to form compacts to continue operating long-distance trains, with the states paying all operating costs. For the planned new short-distance corridors, the federal government would provide passenger-train grants to states and state compacts, much as the Transportation Department’s Federal Transit Administration now funds new rail transit systems. Because the federal government owns most of the Northeast Corridor, it would be treated differently, with a new federal-state organization handling financing and applying to the federal government for grants. Initially, Amtrak would be broken into two companies — one handling operations and the other doing maintenance.
But the compact would eventually be required to put out operating and maintenance rights to competitive bidding to other entities, in addition to Amtrak.
In areas where Amtrak trains now run on freight railroads, the Federal Railroad Administration eventually would accept competitive bids from operating companies, including Amtrak, and award operating rights. Amtrak’s current “preemption” rights to run on freight railroads would be transferred on a route-by-route basis to any new operator.
In an effort to ease the staunch opposition of freight railroads to any such idea, Jackson said the preemption rights would be awarded to only one operator.