Amtrak's answer to competition

Posted by Fred Frailey
on Thursday, June 21, 2012

Congress this week continues to wrestle with the highway reauthorization bill, which largely finances road and public transit spending. It’s like a Chrismas tree, with something for everyone. Railroads are a flea on the tail of this big dog, but three provisions in the U.S. Senate version of this legislation should be labeled “written by Amtrak.” They are simply bizarre, not to mention outrageous. I’ll describe them.

Section 35601 requires that all public agencies, private companies and states that operate passenger services be licensed by the Surface Transportation Board — except Amtrak and also the freight railroads, whose political arm, the Association of American Railroads, lobbied an exemption. What a lovely barrier to entry this is to those companies which compete with Amtrak to run commuter rail services for public agencies. In case you haven’t heard, Amtrak has a lousy track record keeping contracts it has to run commuter trains. This would surely help it get some of them back, by throwing red signals in the face of private commuter train operators, who routinely underbid and outperform Amtrak.

Section 35207 is a doozy. Let’s say a state chooses a company other than Amtrak to operate a state-supported passenger service, as is its right. Let’s also say that the federal government has invested money in the infrastructure of that route — for instance, the more than $11 billion awarded for so-called high-speed rail programs. Section 35207 would make the non-Amtrak train operator pay the government a fee that reflects the benefit of that federal funding. For example, if the $1.3 billion being spent between Chicago and St. Louis were to result in a 50 percent jump in ridership and revenues, the government could conceivably claim half of the revenues as its own. Amtrak is exempted, of course. But if you accept the logic of this provision, which I do not, then Amtrak should be just as liable. But if it were, this provision would never have appeared in the first place.

Section 35105 would pool all the passenger cars henceforth built for state-supported intercity trains into a new entity that Amtrak would largely control. As it stands, cars that California buys for trains in its state are under California’s sole control. As applies to cars built under the Next Generation design that Congress mandated be devised, this would no longer be the case. Next Generation cars that California buys could end up in North Carolina, just as cars North Carolina finances could end up in Michigan.  

None of these noxious provisions were contained in the highway bill passed by the U.S. House of Representatives. One House staffer tells me it’s as if the two pieces of legislation “were written on different planets.” Nor does anyone profess to know which senator or senators slipped these provisions into the bill, because there have been no hearings or public discussions on any of them.

A conference committee composed of members of both houses of Congress is trying to reconcile the two bills. They had better hurry. The current authorization expires at the end of June. At any rate, I’m told that House appointees to the conference committee are adamant that the three written-by-Amtrak sections be tossed aside. I hope they stand by that resolve.—Fred W. Frailey


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