Amtrak President Joe
Boardman was in St. Louis today to deliver the good news: a record year in
ridership for Amtrak; the eighth record year, in fact, out of the past nine.
This is especially noteworthy in light of declining gasoline prices in recent
months, a soft economy, and a mass of cancellations and extremely late arrivals
this past summer for such important long-distance trains as the California
Zephyr and Empire Builder.
But
I can’t help thinking
that Amtrak’s upbeat chief executive must wonder if he’s walking around these
days
with a target painted across his torso. Powerful Rep. John Mica wants to
strip
away Amtrak’s Northeast Corridor and peddle it on Wall Street. A U.S.
House
of Representatives subcommittee proposes an Amtrak subsidy for fiscal 2012, which began Oct. 1,
that
would cripple the company (the U.S. Senate hasn’t yet
acted). Rival
companies keep taking over operation of commuter services traditionally
run under contract by Amtrak. And last but not least, the Federal
Railroad
Administration is preparing to put up for bid to other interested
parties one
or two of Amtrak’s routes as an experiment.
I must admit that this
last bit takes me by surprise. The provision for awarding other railroads the
right to run Amtrak routes was a little-noticed (at the time) provision of the
Passenger Rail Investment and Improvement Act of 2008, commonly known as PRIIA.
Rumor has it that a certain Amtrak vice president wrote chunks of that law, but
certainly not this piece of it. Rep. Mica, R-Fla., and Rep. Bill Shuster, R-Pa.,
take credit for this section of PRIIA. Recently, FRA posted a rulemaking notice
in the Federal Register that outlines how it will all work, or not work, as the
case may be.
First
of all, FRA admits
it has no legal authority to subsidize another carrier and says it will go back to Congress to get it. But FRA is also more than two years late
implementing what was to be a five-year experiment due by statute to end
in2013, and authorization for an extension would be needed from
Congress, it
appears. Finally, the language of the law appears to limit bidders to
those railroads whose tracks are already being used by whatever route is
bid on.
But enough of those
piddling details. What’s the skinny on this provision? According to Bloomberg
News, commuter train operators Herzog, Keolis America, and Veolia
Transportation North America all are interested in bidding to run one of the no
more than two intercity routes FRA would put up for temporary adoption. Add to
that the rumored interest of FirstGroup PLC, which owns Greyhound, the
intercity bus company, and operates passenger trains in Great Britain.
Just which intercity
routes these companies might bid on is unknown. Veolia told Bloomberg’s Lisa
Caruso its eyes are on all three of the busy Amtrak corridors in California as
well as two radiating out of Chicago. Amtrak would be permitted to counter bid, and
whichever entity is judged by FRA to require the least subsidy and to possess a
sound business plan gets the nod. If Amtrak isn’t the winner, the PRIIA
legislation specifies that it must grant the operator access to its reservation
system, stations, and facilities, which I assume includes equipment.
I
spoke today to Bill Bronte, who runs the Rail Division of California
DOT, which subsidizes Amtrak
trains in that state to the tune of some $100 million a year. Obviously,
he would be interested in anything that would reduce the amount of that
subsidy
without sacrificing service quality. PRIIA also mandated that states pay
all
and not just some of the full costs of operating short-distance Amtrak
trains;
this provision goes fully into effect in 2014 and will cost California
an
additional $25 million a year on just the Pacific Surfliner corridor,
Bronte
says. “I want to see how all the details play out, including the
numbers,” he
adds. “I am concerned with continuing the way we are, versus having an
opportunity to address the costs.”
Normal
0
false
false
false
MicrosoftInternetExplorer4
But we’re getting ahead of
ourselves. Ray Chambers is executive director of the Association of
Independent Passenger Rail Operators, whose members include Herzog, Keolis, and Veolia.
He concedes that the law will probably need at least one change, extending the
time for a pilot to run, if this experiment is to ever get off the
ground. “Nobody is going make a bid for something that must end a year or so
after it begins,” he says. Chambers applauds FRA for recognizing this
fact in the proposed rule making. Plus, that eligibility requirement seems to
restrict potential bidders to Amtrak’s current roster of host railroads.
Every Class 1 contacted by Trains today expressed no interest in the
whole idea, although that could easily change. Presumably, a Class 1
could partner with one of AAIRO’s members.
Competition in intercity
passenger service is desirable, provided you come up with wise ground
rules that discourage lowball subsidy bids that lead to a collapse of
service
standards. But right now, this dog isn’t ready to hunt. If congressmen
Mica and
Shuster really want to experiment with competition, they need to revise
the legislation to allow more time and maybe widen the field of eligible
bidders. And next time, FRA had best not sit on its buns for two years
before starting to
implement the mandate of Congress. — Fred W. Frailey