schlimm Sam1The most important questions are where does passenger rail make sense, what should it look like, and how will it be paid for. What truckers and airlines do is immaterial to answering the questions. Equally important, what they do in Japan or Europe is also immaterial to what we should do in the United States with respect to passenger rail. The first statement as to the questions relevant makes good sense. The second and third statement are stated as though they were facts when they are your opinions and clearly quite subject to debate.
Sam1The most important questions are where does passenger rail make sense, what should it look like, and how will it be paid for. What truckers and airlines do is immaterial to answering the questions. Equally important, what they do in Japan or Europe is also immaterial to what we should do in the United States with respect to passenger rail.
The first statement as to the questions relevant makes good sense. The second and third statement are stated as though they were facts when they are your opinions and clearly quite subject to debate.
The second and third statements are my opinion. I did not intend them to be read otherwise.
From time to time my company was faced with the problem of how should we meet the increased demand for electric energy. Should we increase generation, co-generation, transmission, distribution, conservation or some combination thereof? Whatever they were doing in North Carolina or Florida was immaterial to what we should do in north Texas. Our situation was unique; it call for framing the problem in terms of our service area and fitting an optimum solution to the problem.
Co-generation is a good option for increasing power production in Texas because we have numerous petrochemical plants along the Gulf coast. These plants can generate more power than they use, therefore being able to sell their excess generation back into the grid. But co-generation is not a good option in many areas of the country because of a lack of industrial generation.
The same idea applies to transportation solutions. We may get some ideas from what they do in Japan or Europe, but the solutions need to be tailored to our problem(s).
I believe where US population densities in multi-city corridors under 500 miles in length are similar to current successful HSR routes in Europe, their models may become useful to us in terms of frequency of service, rate structures, equipment, marketing, cost comparisons, etc..
C&NW, CA&E, MILW, CGW and IC fan
Sam1Alfred Perlman could hardly be described as an objective, disinterested observer.
All fr profit corporations pay taxes. That includes property tax and income tax and other taxes. With income tax all use legal deductions. For profit railroads pay property taxes on their tracks and they pay all maintenance of way expenses. To the extent that railroads own vehicles that use public roads they pay motor fuel taxes. To require them to pay a motor fuel tax on locomotive fuel would even further skew the subsidy their taxes pay to trucking companies.
Trucking companies operate over roads. Yet when it comes to paying property taxes for the roads they pay none at all. They get a free pass.
I admire of Alfred Perlman. I gather you don't.
If the post concerning property taxes for NS is to be believed, they have millions in deferred property taxes, meaning they aren't paying them, for whatever legal reason.
schlimm If the post concerning property taxes for NS is to be believed, they have millions in deferred property taxes, meaning they aren't paying them, for whatever legal reason.
The deferred property taxes figures is located on Page K49 of NSC's 2011 10K. Deferred taxes does not meant that they won't be paid; they are deferred for a variety of reasons. Ultimately, some of the taxes will be paid. What is not certain is the amount.
Appraisal districts assess property values, i.e. real property, inventories, etc., and the taxing authorities set a rate for ad valorem taxes. In the case of a large organization, with multiple property appraisal and taxing districts, the outcomes can be very complex.
In many instances, as was the case with the large corporation that I worked for, corporate management and the taxing authorities disagree on the appraisal values. This can result in lengthy litigation to determine the true value of the property and, therefore, the tax liabilities. Meanwhile, the corporation will accrue the taxes, i.e. charge them to taxes, which impacts net income, but it does not pay them until the litigation has been resolved. Instead, it places the potential payments in a deferred tax account.
Roads attract no property taxes.
To those who believe that they should, how would you determine the tax rate for I-10 in Culbertson County, TX? The highway occupies scrub land that had no value prior to the coming of the highway and, as a matter of fact, has little if any value today. Very few people using the highway stop in Culbertson County. There is nothing to stop for. The argument that roadways should pay property taxes is an unsupportable stretch. No politician in his or her right mind is going to propose taxing highways, which would be akin to the tax collector collecting taxes from himself.
Al Perlman may have been correct for his time. But conditions have changed dramatically since he was in charge of the New York Central. The key questions should address today's dynamics. At one time the railroads paid exorbitant property taxes because they were viewed as cash cows. That has changed. So the question is how much do they pay in property taxes today. Not what they paid 50 or 60 years ago.
As noted, the real question regarding tax liabilities, although none of this discussion has anything to do with intercity passenger rail, since the railroads are prohibited from passing any tax burdens through to Amtrak, is whether the net tax bill for the railroad rights-of-way is greater than, less than, or equal to the net tax bill for the trucking companies' proportional use of public rights-of-way.
I have figured out what the truckers probably paid in 2011 for federal and state fuel taxes. Getting the sales taxes, excise taxes, and license taxes would be a daunting challenge. So far I have not been able to get a good handle on what the railroads paid in property taxes for their rights-of-way. But I am working on it for grins.
I do not argue that property taxes should be assessed on highways because there is no way to get a political consensus for that. However, while it is politically impossible it is not technically impossible. With E-Z pass we could assess a property tax on vehicles based on the extent they use the roads. But I don't see that happening in our society.
What we could do is to treat railroads as we treat roads for property tax purposes and not assess property tax on the tracks. That would simply move toward a level playing field.
Were railroads not assessed property taxes it might be possible for the private sector to operate profitable passenger service. I don't know if it would be or not but there is the possibility. Also, property tax would no longer give railroads an incentive to tear up some of their tracks and sell the land.
Like all of us, Sam, you have opinions. However, you are not writing a PhD thesis here. If you enjoy research certainly you can do it but I don't expect you to undertake research for my benefit.
Sam1 Roads attract no property taxes. To those who believe that they should, how would you determine the tax rate for I-10 in Culbertson County, TX? The highway occupies scrub land that had no value prior to the coming of the highway and, as a matter of fact, has little if any value today. Very few people using the highway stop in Culbertson County. There is nothing to stop for. The argument that roadways should pay property taxes is an unsupportable stretch. No politician in his or her right mind is going to propose taxing highways, which would be akin to the tax collector collecting taxes from himself. ...
...
A 165' wide divided highway ROW is 20 acres per linear mile. In Michigan, cities have a say-so on highways. When an expressway was planned toward a nearby city, the city told MDOT to route it around outside city limits, as they did not want to loose tax base.
Northern Michigan also has a lot of state forest land that was not paying local property taxes. The local pols complained they lost considerable tax base. Even though state forest fire and conservation officers provided their own basic services, the locals provided ambulance service, local road maintenance, etc. The state legislature passed a law that now provides partial prop tax payment to the local government units. With locals providing police, fire, ambulance, etc to highways, I am surprised that they haven't started demanding partial prop taxes for expressways also.
John WR What we could do is to treat railroads as we treat roads for property tax purposes and not assess property tax on the tracks. That would simply move toward a level playing field. Were railroads not assessed property taxes it might be possible for the private sector to operate profitable passenger service. I don't know if it would be or not but there is the possibility. Also, property tax would no longer give railroads an incentive to tear up some of their tracks and sell the land.
As in some/many nations, let the ROW be government owned. Contract maintenance and upkeep out to private companies and lease operating rights out to private freight forwarding companies and private passenger operators. Of course this would never happen.
schlimmAs in some/many nations, let the ROW be government owned.
Bulls Eye.
Sam1 Roads attract no property taxes. To those who believe that they should, how would you determine the tax rate for I-10 in Culbertson County, TX? The highway occupies scrub land that had no value prior to the coming of the highway and, as a matter of fact, has little if any value today. Very few people using the highway stop in Culbertson County. There is nothing to stop for. The argument that roadways should pay property taxes is an unsupportable stretch. No politician in his or her right mind is going to propose taxing highways, which would be akin to the tax collector collecting taxes from himself. Al Perlman may have been correct for his time. But conditions have changed dramatically since he was in charge of the New York Central. The key questions should address today's dynamics. At one time the railroads paid exorbitant property taxes because they were viewed as cash cows. That has changed. So the question is how much do they pay in property taxes today. Not what they paid 50 or 60 years ago. As noted, the real question regarding tax liabilities, although none of this discussion has anything to do with intercity passenger rail, since the railroads are prohibited from passing any tax burdens through to Amtrak, is whether the net tax bill for the railroad rights-of-way is greater than, less than, or equal to the net tax bill for the trucking companies' proportional use of public rights-of-way. I have figured out what the truckers probably paid in 2011 for federal and state fuel taxes. Getting the sales taxes, excise taxes, and license taxes would be a daunting challenge. So far I have not been able to get a good handle on what the railroads paid in property taxes for their rights-of-way. But I am working on it for grins.
Agreed that the scrub land has minimal value. But it is not scrub land, rather land that has now been developed with an improvement, namely the Interstate Highway. And if you consider what they cost to build, that is now quite valuable property. No doubt there are some bridges along the route, with even higher value. Same thing would happen if you build a mansion on 5 acres of scrub - taxes would go up as the local authority celebrates the increased source of revenue.
While I am sure that the approach to railroad property evaluation varies considerably among the States and Municipalities, as it does in Canada, I am equally sure most jurisdictions include a value for the tracks and structures when they make their assessment. At least one province factors in the annual tonnage on the line.
Nor am I convinced that things have changed much from 50-60 years ago. The railroads are all too often still seen as cash cows. There have been occasional small victories but with the trade off between raising taxes slightly for the voters (unpopular) to reduce the railroad's tax burden (why - aren't they rich) little has actually happened. Of course once the golden goose is killed, ie the railroad abandoned, the county is struggling to find replacement income to maintain their road network. And if the heavy traffic has switched to the roads, those costs can become a lot more significant.
John
All I would add to the previous post is that the thing that gives land value is acess, not agricultural productivity.
When a highway is built the land abutting the highway is no longer land locked. It now can be developed so it gains value. Of course, some land is more valuable than other land but all of it will gain value.
John WR All I would add to the previous post is that the thing that gives land value is acess, not agricultural productivity. When a highway is built the land abutting the highway is no longer land locked. It now can be developed so it gains value. Of course, some land is more valuable than other land but all of it will gain value.
What some often lose sight of is the increase in wealth through economic development, which is often brought about through improvements such as interstates, new rail lines (HSR and other), new transit lines, bridges, etc. Investment in improved infrastructure is a major way growing economies grow, rather then living in a siege mentality. But to each his/her own.
Clearly, this discussion has strayed a long way from whether it makes sense to assess property taxes on roadways. No one is questioning the need for roadways and the benefits associated with them. This is especially true in Texas, where our excellent road system has been a major factor in the economic growth of the state.
Your are correct in that highways help develop adjacent property. And as I mentioned in a previous post, the increased value of the adjacent property usually generates enough tax revenue to cover any loss associated with the property that was removed from the tax rolls for the highway. Each adjacently located business, residence, etc. pays taxes into a general fund. To the extent that direct user taxes (fees) don't cover the cost of the highway, monies are transferred from the general fund(s) to make up the shortfall.
Assessing roadways for property tax purposes is a nonstarter. Moreover, the property taxes paid by America's freight railroads have nothing to do with passenger trains in the U.S. Amtrak pays no taxes, and the freight railroads are not permitted to pass any taxes through to it.
Would passenger trains be profitable if the railroads paid no property taxes? Based on Amtrak's NEC track record, it does not appear so. Amtrak or a public agency own the NEC. They pay no taxes on their infrastructure or their operations. They have not been able to gin sufficient revenues to cover their costs.
From what I understand, Amtrak does make payments to support school districts and essential services along the NEC in lieu of real-estate taxes. Not the same thing, not as much, but something in any case.
daveklepper From what I understand, Amtrak does make payments to support school districts and essential services along the NEC in lieu of real-estate taxes. Not the same thing, not as much, but something in any case.
There is no mention in any of Amtrak's financial statements, reports, etc. that it makes payments to support school districts and essential services along the NEC in lieu of property taxes.
Amtrak may pay for certain government provided services, i.e. water, electricity, sanitation, etc., but these are covered by rates and not property taxes. For example, in NYC it contracts with a private sanitation service to pick-up its Penn Station trash. If you have any information to the contrary, I would like to see the numbers.
Having a taxpayer supported entity that loses more than $1 billion per year transfer money to another taxpayer entity does not make sense.
Moved down to make sense
On Property Taxes:
Do the posters realize that NS’s STB R-1 document, I linked to earlier, has a lot more information than a normal company’s SEC filings, as the STB still has some purpose and needs to know?
Property Taxes for NS are $113.4 Million per the STB R-1, Schedule 410, Line 614 “Property Taxes”. If they are not the STB might be a bit upset. Also per Schedule 450, Line 1, “Other than US Government Taxes”, they paid $202.9 million, which would include sales and the property tax above. From the same Schedule, Line 4, they paid $503.1 million in income taxes. Of course they also fully funded their workers retirement instead of Social Security’s situation but let’s set that aside.
Given that a large portion of NS’s costs are used for the mainline Way and Structures, roughly ($1.85B/$8.19B = 22.6%), wouldn’t it make sense to refund all the tax on that portion? I had suggested at least the property tax earlier which is comprised of Way and Building site taxes. But when you think about it they really should have the investor required profit on the Way and Structures investment as well as sales tax on those items refunded as well. A simple way to do that is prorate total Way and Structures costs to total costs and then multiply that by total taxes.
So 22.6% x ($202.9 + $503.1) = $159.6 Million of tax refunds a year to get to an equitable funding with roadways just in tax treatment. Quite a lot of double tracking and sidings (massive capacity gains) if a bargain is made, but on the Federal level our government still sees them as a private industry while roads are worthy of “economic investments” with no financial reality. I still view Amtrak as a “visibility” tool to get to an equitable treatment. The report below is the AASHTO report that identifies the funding gaps rail freight faces if anybody hasn’t seen it.
http://rail.transportation.org/Documents/FreightRailReport.pdf
What I am proposing is pretty much what the AAR wants, included extra capacity tax incentives, just more detailed and by a different methodology:
http://www.ncrr.com/wp/wp-content/uploads/2011/11/Jennifer_Macdonald.pdf
When I estimated the cost of Amtrak operations over the investor owned railroads in an earlier post, I prorated the Total Way and Structures cost and then multiplied it by 1.3. It was not the marginal cost as some claimed which is about half or less. My point is still that while it may only be tens of millions of dollars per Class I, the fee seems reasonable based a prorated Total Way and Structures costs. This does assume the Class I’s do not have other use of the asset, no capacity constraints, which is why I am suggesting ways to induce additional capacity on an equitable bases to roadways for the benefit of both freight and passengers through tax refunds.
For Reference: Here is NYDOT’s brief history with a good property tax explanation:
https://www.dot.ny.gov/divisions/operating/opdm/passenger-rail/freight-rail-service-in-new-york-state
Also, yes, railroads still pay property taxes, $625 million in 2008 per the AAR.
On a somewhat related note, I recently read about a small trucking firm that defaulted on its property taxes this year and stuck the city of Memphis with a decades old mini-super fund site on their groundwater. I can assure you that this is not counted in any subsidy number, but it is indeed a cost of the system we have developed. The city will be out a million or so (small lot) if they do anything about it or will lose the tax base forever. A small example repeated many times over even today. Also, don’t forget that if Medicaid was reimbursed for the cost of government borne care for roadway accidents the HTF would never have any money. It is all about silos of funding. My paper ignores some of these other questions as the financial cross-subsidy is the largest effect in my analysis.
On the existence of an Interstate Road Cross-Subsidy
One poster was questioning whether Amtrak’s new Virginia trains are still a good investment even if they pay for operating expenses and then some, but depreciation is not added to the tab. I have suggested the historic Interstate Cross-Subsidy for automobiles is around $0.08/VM for capital and $0.03/VM for government borne accidents at a corporate bond rate in the Intercity Marketplace thread on the main discussion board. I also know through my work that these costs are going up.
In Virginia, the DOT (VDOT) is looking to toll I-95 to pay for its reconstructing and a lane-mile expansion. This was alluded to in the recent post on Virginia’s Amtrak service. They are proposing a toll of $0.02/VM per Page 9 of this link:
http://virginiadot.org/VDOT/Projects/asset_upload_file435_62288.pdf A quote…
If Virginia attempted to fund the entire $9.6 B gap over 25 years by tolls alone, the toll rate required would be:
Using a closed system where all trips were charged based on actual miles traveled, the toll rate would be ~ $0.14 per mile
VDOT analyzed rates from $0.02 to $0.15 per mile. VDOT is requesting approval to initiate tolling at a reduced rate of ~ $0.02 per mile
So here is another independent verification that there will be an Interstate capital Cross-Subsidy of ($0.14/VM - $0.02/VM) = $0.12/VM even after the tolls, plus accident costs. The deficit will be made up from Federal borrowing through the HTF general fund bailouts and in Medicaid spending. This would be more than $20 an equivalent train-mile. If you had 8 passenger trains on the corridor the Way & Structures and Equipment capital depreciation is less than the interstate alternative.
Virginia has simply demonstrated that you can indeed make a longer-distance (Norfolk to Boston is 679 miles on Regional 174) intercity train work. Some might know that the original 1960’s ICC reports defined the future intercity rail market to be for trips of less than 1000 miles even in the jet age. This was perhaps more of a recognition that automobiles were the true competitor.
We are currently sitting at a point where roadway construction costs are (1.7 to 2.0 x) where they were a decade ago, despite supposedly minimal consumer inflation over the decade. When fuel super spiked around 2008 they were at (2.5 x) the cost of just a few years prior to then. This effect has continued to work its way through the industry. Asphalt is not being placed at anywhere near the volume it was a decade ago, and as some of you know the asphalt life cycle is 8-10 years. So that means by 2016-2018 we will be seeing some real problems on lower volume roads.
A lot of Engineers have questioned whether we have built more roadways than the user can efficiently consume/pay for or would ever be able to without the Federal government borrowing and “investing”. To a large extent the intercity marketplace is skewed. At the very least we should recognize this by computing a Shadow Toll (Government Pays the computed toll not the User) for the Interstates to aid in planning for the future as an alternative to pots of money.
V.Payne On the existence of an Interstate Road Cross-Subsidy One poster was questioning whether Amtrak’s new Virginia trains are still a good investment even if they pay for operating expenses and then some, but depreciation is not added to the tab. I have suggested the historic Interstate Cross-Subsidy for automobiles is around $0.08/VM for capital and $0.03/VM for government borne accidents at a corporate bond rate in the Intercity Marketplace thread on the main discussion board. I also know through my work that these costs are going up. In Virginia, the DOT (VDOT) is looking to toll I-95 to pay for its reconstructing and a lane-mile expansion. This was alluded to in the recent post on Virginia’s Amtrak service. They are proposing a toll of $0.02/VM per Page 9 of this link: http://virginiadot.org/VDOT/Projects/asset_upload_file435_62288.pdf A quote… If Virginia attempted to fund the entire $9.6 B gap over 25 years by tolls alone, the toll rate required would be: Using a closed system where all trips were charged based on actual miles traveled, the toll rate would be ~ $0.14 per mile VDOT analyzed rates from $0.02 to $0.15 per mile. VDOT is requesting approval to initiate tolling at a reduced rate of ~ $0.02 per mile So here is another independent verification that there will be an Interstate capital Cross-Subsidy of ($0.14/VM - $0.02/VM) = $0.12/VM even after the tolls, plus accident costs. The deficit will be made up from Federal borrowing through the HTF general fund bailouts and in Medicaid spending. This would be more than $20 an equivalent train-mile. If you had 8 passenger trains on the corridor the Way & Structures and Equipment capital depreciation is less than the interstate alternative. Virginia has simply demonstrated that you can indeed make a longer-distance (Norfolk to Boston is 679 miles on Regional 174) intercity train work. Some might know that the original 1960’s ICC reports defined the future intercity rail market to be for trips of less than 1000 miles even in the jet age. This was perhaps more of a recognition that automobiles were the true competitor. We are currently sitting at a point where roadway construction costs are (1.7 to 2.0 x) where they were a decade ago, despite supposedly minimal consumer inflation over the decade. When fuel super spiked around 2008 they were at (2.5 x) the cost of just a few years prior to then. This effect has continued to work its way through the industry. Asphalt is not being placed at anywhere near the volume it was a decade ago, and as some of you know the asphalt life cycle is 8-10 years. So that means by 2016-2018 we will be seeing some real problems on lower volume roads. A lot of Engineers have questioned whether we have built more roadways than the user can efficiently consume/pay for or would ever be able to without the Federal government borrowing and “investing”. To a large extent the intercity marketplace is skewed. At the very least we should recognize this by computing a Shadow Toll (Government Pays the computed toll not the User) for the Interstates to aid in planning for the future as an alternative to pots of money.
Your analyses appear to miss several key points. First, although the U.S. has undoubtedly made transport funding mistakes, i.e. skewed outcomes because of politics, as opposed to pure analytics, the costs are sunk, and the decisions are not going to be reversed. Second, your analytics don't appear to consider what most people want. Engineers, accountants, economists, financiers, etc., tend to over focus on their models and analytics. Frequently they fail to see that their analytics are meaningless unless set in a realistic political context. And third you reference variables that have noting to do with today's passenger rail environment, i.e. how much the freight railroads pay in property taxes is immaterial because they cannot pass the taxes on to Amtrak.
Most Americans don't want to ride on a train or a bus or public transit. They don't want to sit beside someone who is shouting into a cell phone, hasn't had a bath for a week, or is hung over. Given an alternative most middle class Americans, that's 85 per cent of us. don't want public transport of any sort.
Americans opted for the convenience of the car decades ago. They are not going to change. We can afford cars; we are going to have them. They are a vastly superior option to taking a bus, train, etc. Oh, we'll fly if the distance is too great for auto travel. And we will use commuter rail in highly congested areas where driving is unduly frustrating. But there is a reason why 88 per cent of intercity travel in the U.S. is by car. That is what the people in this democratic republic want! And as they have demonstrated, they can pay for it even if it costs more than hopping on a train.
I lived in Australia for five years. I have also lived in Canada. Before moving to those countries, I thought the preference for the car was an American thing. No so! People in Australia loves cars. They want them as much as Americans. And once they get them they want a better one, then two, then one for everyone in the family. As a result passenger trains in Australia, with the exception of commuter operations, have gone in the tank.
Most shippers in Texas find it more economical to ship by truck. If a shipper in El Paso has a load for San Antonio, a trucker can pick it up at dockside, run it to San Antonio overnight, and deliver it to the customer's dockside in the morning. By comparison shipping it by train would require in most instances picking it up by truck, taking it to a loading station, putting it on a train, running it to San Antonio, off loading it to a truck, and delivering it to the customer. This is why trucks haul most of the intercity freight in the United States.
You could require the truckers to pay for the full cost of their wear and tear on the highways, and they would still come out a winner. They should pay the full cost, but they have a technological advantage that railroads cannot match in most markets.
Subsidies and cross subsidies distort the optimization of transport decisions. But at the end of the day Americans pay for their highways, airways, etc. The monies are not coming from the tooth fairy. Some of them, it can be argued, are coming from overseas investors, although the amount has been overstated, but one should not lose sight of the fact that Americans pay for what they use. One way or the other!
Sounds a bit like you have already made up your mind despite the finances.
So the Virginia residents who chose the train just don't get it? No they are choosing based on their perception of utility during the journey. Look, I am not saying all intercity trips will be made by train but the opposite also is true, automobiles are not suitable for all trips, particularly longer trips with a single occupant. Most Western democracies have realized this. The two countries that you gave as examples largely finance their roadways as we do as a matter of policy. Also, a lot of the rural interstates are dropping below a LOS of B, so much of the network is indeed congested.
Once you have people pay the financial cost of the infrastructure on a per use basis at the time of use they choose the cheaper option. This is the difference, if you pay at the time of use you consume less or choose an alternative, if you pre-pay or post-pay you consume more. If you have ever driven more than a mile looking for cheap gas you have proved the point.
Add $0.20 to $0.50 a mile to a truckers cost to recover the capital and damages and the breakeven distance on intermodal changes quite a bit for a lot of loads.
What percentage of Virginia residents travel by train?
Frankly, your numbers are suspect. For example, in one of your previous posts you claim that the changes in the Consumer Price Index have been minimal for the referenced decade. Between November 2012 and November 2000 the CPI, which is not a measure of construction costs, has increased by 36.79%. This does not strike me as minimal. Actually, it has little connection with construction costs.
You also claim that the people in most western democracies realize that autos, especially those carrying just one passenger, are not suitable for long distance trips, but you don't provide us with any facts to support your contention. Actually, most people in this country, if they are traveling on business, will fly if the distance is more than 250 miles.
You claim that Amtrak's Newport News to Boston train is a success, presumably because it had an operating profit of $3.8 million in FY12. But you are not including the cost of the capital structure, which in the case of the NEC is substantial.
When all is said and done, virtually all means of transportation are subsidized. There will of course be a few localized exceptions. That subsidy comes out of taxes, whether it is visible in the form of Amtrak, or invisible in the form of our "free" sidewalk". Even the freight railroads are not completely immune, mostly in the form of state assistance for short lines. And that assistance is justified as being the most economical option, since the hidden subsidies for the alternative are usually greater.
It is also true that people love the convenience of driving, since it is one conveyance door to door, to a preferred schedule, and a vehicle is available for use at the destination. The only visible cost is filling up at the gas pump, since the rest is hidden in various taxes, often already paid.
Amtrak is crippled by its nature. Rail works best with volume, which is a function of both train size and frequency of service to share the fixed costs. But limited resources means expansion is virtually impossible. Corridors where additional schedules have been added, such as in Maine or the west coast, have been rewarded by far greater ridership. People will indeed leave their cars at home if there is a CONVENIENT rail service. Similarly in urban environments many (admittedly not all) rail projects have surpassed their projected 2-year out commuter ridership levels in a matter of only months, silencing the local skeptics.
While corridors should be the major role, the long distance trains still serve a valuable function. As well as the end terminals, countless smaller towns are also provided with public transportation for portions of the route. (A second schedule that stopped in the daytime instead of 3am would no doubt encourage more use too.) At the terminals the support facilities are often already in place and will remain so for the corridor trains so that cost arguably could be ignored for the balance sheet of the trans-con.
cx500When all is said and done, virtually all means of transportation are subsidized. There will of course be a few localized exceptions. That subsidy comes out of taxes
Also that subsidy comes our of lives spent in our wars so we can keep mid east oil flowing.
Sure, I can give even more backup than the many links I included to AASHTO and such, but since you made a unsupported claim first maybe you should?
"Given an alternative most middle class Americans, that's 85 per cent of us. don't want public transport of any sort." AND/OR "Actually, most people in this country, if they are traveling on business, will fly if the distance is more than 250 miles."
Please provide a quote for these statements.
I will direct you to a poll supporting my position when I locate it again. Clearly, the experiential evidence is showing the Virginians are riding the train.
I don't see how a 70% to 150% highway construction cost inflation over a shorter period versus 36% over 12 years does not make sense as a valid concern.
According to Table 1.41, U.S. National Transportation Statistics, in 2009 86.1 per cent of Americans commuted to work by personal vehicle. Approximately five per cent commuted by public transport, with the remainder walking, riding a bicycle, etc. As noted in a previous post, the per cent of the population using public transport to commute to work has not changed significantly over the past 10 years. At the end of the day, although people say many things in public opinion surveys, i.e. "I favor public transport", what really counts is what they do. They drive.
According to Table 1.42 of the aforementioned publication, 89.3 per cent of Americans traveling between cities at least 50 miles apart chose to use their personal vehicle. Only .8 per cent chose to travel by train. Again, although Americans are reputed by NARP, as well as other passenger rail advocates, to want intercity passenger trains, when it comes down to voting with their wallets they choose to drive or fly or take a bus.
Based on the aforementioned statistics, I am quite comfortable inferring that roughly 85 per cent of Americans, as indicated by their behavior, don't want anything to do with public transport.
With respect to a preference for flying, I should have said most business people. Due to the tightened airport security procedures, at least in Texas, many business people are driving legs that they would have flown prior to 9/11, i.e. Austin to Dallas, Tyler to DFW, etc.
Wanna see the preference for flying. Just go to any of the nation's major airports, as well as some not so major ones, and watch the activity. Then go to a typical passenger station. Outside of the stations along the NEC, the nation's passenger railway stations don't support a lot of traffic. For a very good reason! Comparatively they don't have much traffic.
My challenge was not your estimates of highway construct costs. It was pointed to your statement that the increase in the CPI has been minimal. A 36 per cent increase in the CPI over 10 to 11 years does not strike me as minimal. It means that a person living on a fixed pension or having issued fixed debt would have lost nearly 40 per cent of the purchasing power of that pension or debt due to compounding.
Frankly, an estimate of 70 to 150 per cent is worthless. I don't know what regression parameters you used to get to that broad of an estimate range, but they must have been pretty loose. Moreover, if you want to estimate highway construction costs, I would think that the regional Producer Price Index(s) would be a more valid tool.
John WR cx500When all is said and done, virtually all means of transportation are subsidized. There will of course be a few localized exceptions. That subsidy comes out of taxes Also that subsidy comes our of lives spent in our wars so we can keep mid east oil flowing.
That's probably true, although it is changing daily.
According to the Energy Information Agency (EIA), America has reduced significantly its dependence on foreign oil for a variety of reasons. The most notable has been increased oil production in the U.S. due to improve production methods and new finds of oil. The EIA estimates that the U.S. may important less than 30 per cent of its oil by 2015 if the current trends continue. ExxonMobile believes the U.S. could be free of foreign oil by 2020, although the EIA is suspect of that claim.
Equally important the U.S. does not import the bulk of its off shore oil from the Middle East. Of the three major sources of overseas oil for the U.S., Canada, Saudia Arabia, and Mexico are the major suppliers.
U.S. military operations in the Gulf stemmed from a variety of reasons. I am hard pressed to believe that Iraq oil did not play a part. But there is no oil in Afghanistan.
What do U.S. military operations in the Middle East have to do with where the country should place its transport investment dollars? The problem should be framed in a U.S. context and the solutions should be optimized for this country.
Sam1What do U.S. military operations in the Middle East have to do with where the country should place its transport investment dollars? The problem should be framed in a U.S. context and the solutions should be optimized for this country.
Since you ask, for a great many years we have have increasingly convoluted relations with the whole mid east area. A very big part of these relations revolve around our traditional dependency on mid east oil although other factors are also involved. And in return for the oil we have sent a steam of dollars to that area which, over years, has altered the culture in ways that we do not even understand. In my personal opinion the more we can reduce our dependency on the whole area including Saudi Arabia the better.
Certainly today we are more aware of the issues than we have been in the past. It would be nice to believe that we can resolve them within the foreseeable future. I don't know whether or not we can but I sure hope so.
You point to increasing our domestic sources of oil as a solution. Certainly we must do that. I believe we also need to reduce our oil consumption. And part of this is looking to other non polluting sources such as wind and solar. Some people argue we need to use nuclear energy for part of the solution too.
From a personal perspective of "think globally act locally" I've tried to reduce my own oil consumption by using public transit to the degree that it is available to me. I hope it shall continue to be available for me and others who are willing to give up the convenience of a private vehicle, at least for some purposes. Is that an optimum solution? I don't know. But I hope it is a step in the right direction.
oltmanndThe big issue is how to we accommodate growth? Queue up the alternatives, do the math (including sensitivity analysis) and rank'em. May the best bang of the buck win!
In the first half of the 19th century "the best bang for the buck" was water transportation. After all, the lakes, oceans and rivers as as close to free as you can get and canals, which were expensive, were relatively short relative to the natural waterways. Charles Francis Adams pointed to foolish people who believed it cost less for steam to run up hill than it cost for water to run down hill. With water you build some canals and dig out some harbors; with a railroad you must lay down a track over every inch of distance you wanted to travel on. Railroads were mainly useful for connecting interior points with navigable waterways. Before the Civil War all of the smart money was on canals.
Today there are very few of those canals left. The most famous and successful of all, the Erie Canal (now the New York State Barge Canal), is now mostly used for pleasure boats although another waterway, the St. Lawrence Seaway, has replaced it. Other than that few canals exist. And railroads have proved their worth even if they were not the optimum solution.
http://www.texasrailadvocates.org/presentations/My-35%20UT%20survey%20powerpoint.pdf
From the above a mere 78% of Texans support increased resources for passenger rail, though specified to not be Amtrak for what it is worth, per the above UT academic poll. The existing use argument is a favorite of ol Wendell, even though the existing corridors where trips are possible are a minute percentage of total intercity city pairs. If you did the survey in 1930 would you say don't build highways that make sense due to the existing travel patterns?
Air travel is moving away from shorter routes for financial reasons. I had a long section in my draft paper on fuel burn per stage length which is driving the shift as well as the marketplace returns.
From: ftp://ftp.dot.state.tx.us/pub/txdot-info/my35/advisory_plan.pdf
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