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Posted by Paul Milenkovic on Tuesday, February 16, 2010 11:05 PM

schlimm

I don't think most folks expect train revenues to cover the operating costs,

Why can't train revenue cover operating costs?  The fares aren't substantially different (with sleeping cars more expensive) than competing modes, which suggests that trains are expensive.  Forget about how you pay for the train costs.  Why are train costs as high as they are?

If GM "killed the electric car", what am I doing standing next to an EV-1, a half a block from the WSOR tracks?

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Posted by blue streak 1 on Tuesday, February 16, 2010 11:42 PM

Do not want to get into the operating subsidity debate but:

Below rail and above rail costs are not entirely separated.

1. Who owns the station?

2. Does AMTRAK have to pay any operating costs of the station? If so is the station energy efficient?

3. Is station layout such that quick loading and unloading possible? Many larger stations are not!

4. reference to #3 is station well lit and laid out for quick passenger ingress and egress?

5. Are intermediate service stations (water, catering, fueling,maintenance, etc) laid out so as to be able to service quickly? Almost forgot termination stations.

6. Are the approach tracks to the station difficult with long restricted speed approaches, puzzle switches, curves, etc; or are the statoin tracks laid out for quick deceleration and acceleration?

7. Is the station track layout such as to allow quick turns, addition, or deletion of some cars?

8. Are the main line tracks smooth, with gentle curves to reduce cant deficiency, etc to the reduce rough track wear on the rolling stock? Would also apply to station tracks.   

9. Is the track speed consistent or are a lot of permanent slow orders in place? 

10. Is track capacity such that there are not slow downs due to conflicting traffic?

11. Is the track a hogback or essentially a gradual grade? 

 All these items and many more will have the effect to increase or decrease crew duty time and fuel/electric consumption, maintenance, turn times, which are certainly a measure of operating costs. I feel that many stations have one or more of the above noted deficiencys. Certainly many route tracks do. 

 

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Posted by oltmannd on Wednesday, February 17, 2010 6:37 AM
Paul Milenkovic
every once in a while you need to sit next to a fat dude.
That made my day! (Don't stop writing!)

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Posted by oltmannd on Wednesday, February 17, 2010 6:45 AM
schlimm
I don't think most folks expect train revenues to cover the operating costs, because there are other benefits.  Ditto with transit systems
I think you are dead wrong. Most folks who ride my commuter bus are shocked to find out that their $4 fare doesn't even come close to covering the operating costs. They know their tax dollars went to buy the buses, but they think the fares cover the operating costs, and then some. Even when they do the mental math, they only take into account driver's wages and fuel....

-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/

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Posted by oltmannd on Wednesday, February 17, 2010 6:59 AM
Paul Milenkovic
For one thing, I am looking for some manner of social contract, some "engineering system boundary around the subsidized portion of the system", so people would just plain give up on the complaint, "why are people complaining about Amtrak subsidy and don't-get-me-started-about-the-airlines!"  Put the modes on a level playing field and call it a day.  But once you do that, don't come back complaining about how the low level of support for Amtrak is "unfair" and how rail is "underfunded."
I think that is a very astute way of thinking. It's all about "the rules of the game". There are never really any truly "fair" rules or "wholly level playing field". I think the suggestion that construction can be subsidized and operations should cover costs is about as good a set of new rules as we can expect. Of couse, it still isn't perfect. There very well may be cases where their are more total monetized benefits to running subsidized service than an unsubsidized one, but if you make the rules too difficult to understand and apply, the game becomes too hard to play and everyone loses.

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Posted by oltmannd on Wednesday, February 17, 2010 7:10 AM
blue streak 1
All these items and many more will have the effect to increase or decrease crew duty time and fuel/electric consumption, maintenance, turn times, which are certainly a measure of operating costs. I feel that many stations have one or more of the above noted deficiencys. Certainly many route tracks do. 
Sure. There is a trade-off between capital cost and operating cost. IIf there was a situation where the capital costs, operating costs and monetized value of all the benefits wound up in the same pocket, it would simple to find the optimum point. It's the third part that's tricky. Suppose you place a value on "carbon reduction" and decide to pay the operator some money for each passenger mile operated. Sounds simple but what if the mere presence of the service induced the trip? There is no "carbon reduction" in fact, but a "carbon expenditure".

I think the best time to make these judgments is during planning. Pick the projects and plans that provides the most benefits for the buck that have a shot at turning an operating "profit". It's easy to understand and most politically palatable, I think.

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Posted by henry6 on Wednesday, February 17, 2010 8:56 AM

This is a note I put on another adjacent thread but has pertinence to this conversation...

TRAINS' Newswire 2/16 story on Lynchburg train making a profit is quite intrestng on several notes. First that it is making a profit in its second month negating the need for a state subsidy.  Second that because of this train seats have opened up on the Crescent which has gone to the Crescent's bottom line making it's economics more favorable.  I think it underscores the fact that if you think of running passenger trains as a service rather than merely running trains, it will work.  The train makes one round trip a day but it is in addition to other trains on the route.  Maine's Downeaster service and California's San Diego service, among others, have proven this point in the past,  It is just not a point that gets through the crania of politicos!

RIDEWITHMEHENRY is the name for our almost monthly day of riding trains and transit in either the NYCity or Philadelphia areas including all commuter lines, Amtrak, subways, light rail and trolleys, bus and ferries when warranted. No fees, just let us know you want to join the ride and pay your fares. Ask to be on our email list or find us on FB as RIDEWITHMEHENRY (all caps) to get descriptions of each outing.

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Posted by schlimm on Wednesday, February 17, 2010 8:58 AM

Paul Milenkovic
Why can't train revenue cover operating costs?  The fares aren't substantially different (with sleeping cars more expensive) than competing modes, which suggests that trains are expensive.  Forget about how you pay for the train costs.  Why are train costs as high as they are?

 

Good question.  What are the actual operating expenses for a train?  Labor, fuel or electricity for sure, maintenance, but also signaling charges from the home rail line and the reservation system.  What else?  Does Amtrak or do the states pay rent to the host railroad?  It still seems to me that more passengers and greater equipment utilization through much higher speeds would lower the per passenger mile costs a great deal.  Perhaps a better analogy would be if an airline only used a plane for 1-2 round trips on a short (under 500 mile) flight per day.

Along those lines, how is an Acela crew paid?  Do the steam age labor rules about a short distance (150 miles?) = an 8 hour day still apply? And if so, why?

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Posted by schlimm on Wednesday, February 17, 2010 9:03 AM

henry6
TRAINS' Newswire 2/16 story on Lynchburg train making a profit is quite intrestng on several notes. First that it is making a profit in its second month negating the need for a state subsidy.  Second that because of this train seats have opened up on the Crescent which has gone to the Crescent's bottom line making it's economics more favorable.  I think it underscores the fact that if you think of running passenger trains as a service rather than merely running trains, it will work.  The train makes one round trip a day but it is in addition to other trains on the route.  Maine's Downeaster service and California's San Diego service, among others, have proven this point in the past,  It is just not a point that gets through the crania of politicos!

 

That is certainly good news.  Yet sam1 states last night that the Surfer needs a subsidy of ~10 cents per passenger mile. Some discrepancy there, because I also thought I had read in the past that the Surfer was at least breaking even.  I would like to see a citation for those numbers.

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Posted by oltmannd on Wednesday, February 17, 2010 9:13 AM
schlimm

Good question.  What are the actual operating expenses for a train?  Labor, fuel or electricity for sure, maintenance, but also signaling charges from the home rail line and the reservation system.  What else?  Does Amtrak or do the states pay rent to the host railroad?  It still seems to me that more passengers and greater equipment utilization through much higher speeds would lower the per passenger mile costs a great deal.  Perhaps a better analogy would be if an airline only used a plane for 1-2 round trips on a short (under 500 mile) flight per day.

Along those lines, how is an Acela crew paid?  Do the steam age labor rules about a short distance (150 miles?) = an 8 hour day still apply? And if so, why?

Amtrak crews get paid by the hour. That change was made after Amtrak took ownership of the crews from the host roads somewhere in the early 80s (?) But, the hourly rate leaves them with pay equivalent to the old mileage/"days pay" system.

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Posted by henry6 on Wednesday, February 17, 2010 9:26 AM

One of the slight of hands here is how the cost is determined.  Out of pocket costs is what costs are attributed just to the train: crew, fuel, equipment, for starters.  But, if you add track time, supervisory time, etc.in porportion to the rest of the trains, crews, and railroad operation, then you will get a different figure.  So a train pays for itself out of pocket only if consider the fact that the railroad and its infrastructure of people and track already exists.  When you apply track time (doesn't matter that the track is already there and maintained), dispatcher time (doesn't matter dispatcher is already working and being paid), and supervisory time (doesn't matter that the Trainmaster, et al. are already working and being paid), and any other already on going costs and charges, then the actual costs and profits may change.  No one has discerned such cost and profit allocations in any of these arguements including the Lynchburg train story.  So the question arises: when do you take into account...and what do you take into account...when deciding profit and loss of existing service(s) and new service(s)?

RIDEWITHMEHENRY is the name for our almost monthly day of riding trains and transit in either the NYCity or Philadelphia areas including all commuter lines, Amtrak, subways, light rail and trolleys, bus and ferries when warranted. No fees, just let us know you want to join the ride and pay your fares. Ask to be on our email list or find us on FB as RIDEWITHMEHENRY (all caps) to get descriptions of each outing.

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Posted by HarveyK400 on Wednesday, February 17, 2010 9:44 AM

oltmannd
schlimm
I don't think most folks expect train revenues to cover the operating costs, because there are other benefits.  Ditto with transit systems
I think you are dead wrong. Most folks who ride my commuter bus are shocked to find out that their $4 fare doesn't even come close to covering the operating costs. They know their tax dollars went to buy the buses, but they think the fares cover the operating costs, and then some. Even when they do the mental math, they only take into account driver's wages and fuel....

 

Let's see, assuming 35 bus commuters paying a $4 fare comes to $70k a year.  That seems pretty close to me.  Now if you transfer to or from another bus, that adds cost.  If the buses make other trips, that adds revenue.

Metra mental math:

Even if I'm a little off, it looks like Metra should be making money at least above the rail.  Things like terminal and station operation and track, signal, and building maintenance costs may be scaled to volume in some cases and benefit by economies of scale in others; but one still is left wondering where does all the revenue go?

Zone C monthly pass $90.45 and 500 passengers comes to $482,700 annually.

Zone D monthly pass $102.50 and 750 passengers comes to $922,500 annually.

Zone G monthly pass $139.05 and 1,260 passengers comes to $2,102,400 annually.

I don't rally know what Metra wages and crew sizes average; but l'll assume annual wages and benefits comes to $450k for a crew of three (engineer included), $600K for four, and $750K for five.

If a four car train carrying 500 passengers makes two Zone C trips with a short turn, crew is only 47% of the revenue.

For a six car train carrying 750 passengers and averaging Zone D revenue, crew comes to 65% of the revenue.

For a nine car express carrying 1,250 pasengers and averaging Zone G revenue, crew comes to just 36% of the revenue. 

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Posted by CSSHEGEWISCH on Wednesday, February 17, 2010 10:19 AM

Equipment costs can be a killer in suburban service.  A rule of thumb that I've often run across is that two-thirds of the equipment makes only one round trip per day, it's operated to cover the peak service periods and sits the rest of the day and on weekends.  Also, labor contracts govern crew sizes and hours, split shifts may not be allowed which can make it difficult to get more than one or two trips out of a crew.

The daily commute is part of everyday life but I get two rides a day out of it. Paul
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Posted by henry6 on Wednesday, February 17, 2010 10:49 AM

I haven't been able to really get into the complete and thorough use of equipment on NJT but do see a lot of equipment seemingly underutiziled...one 7 car MU set for instance leaves Hoboken at 5AM and is back before 8AM then split 4 and 3 for evening trips 6 minutes apart to Gladstone returning to Hoboken after midnight and recombined for the 5AM cycle to repeat.  However, the train lies dormant from 8AM until 6PM while one would think it could cover or or two midday schedules to Montclair, Summit, Gladstone or Dover which would release the need of other equipment.  But as I said, there has to be a rhyme or reason which I cannot decypher from materials available to me.  Plus there are other equipment moves that behoove me!  As for crews, there are some assignments which concentrate the turn arounds, etc. into an 8 to 10 continuous hour day and others that are broken into two split shifts up to 6 hours apart giving plenty of rest time between runs, but still...not nice.  Also some cycles give two days pay, maybe even enchroach on rest time requirements, and therefore are every other day work.  Again...the AM/PM peaking of traffic causes all kinds of equipment and crew logistics.

The DL&W reportedly had a morning crew out of Washington, NJ which arrived in Hoboken about 8:30A and then off until the 5:30P departure for home arriving around 7:30P. So the crew changed clothes in the crew room and hopped the Ferry to Barclay St. and played  worked the stockmarket all day! 

RIDEWITHMEHENRY is the name for our almost monthly day of riding trains and transit in either the NYCity or Philadelphia areas including all commuter lines, Amtrak, subways, light rail and trolleys, bus and ferries when warranted. No fees, just let us know you want to join the ride and pay your fares. Ask to be on our email list or find us on FB as RIDEWITHMEHENRY (all caps) to get descriptions of each outing.

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Posted by schlimm on Wednesday, February 17, 2010 11:06 AM

One of the problems I recall in cost accounting is allocation of relatively fixed (unavoidable) overhead/administrative costs, as well as trackage use charges.  Many games have be played within this arena.  But this is clearly a place where higher frequencies of operation and more passengers can improve the picture.  Recall the pre-Amtrak days where a train on a line only slightly used for passenger trains often bore a disproportionate allocation share of expenses for track maintenance and other expenses.  SP and others used that ICC formula to show a "loss" to justify d/c'ing service.

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Posted by Paul Milenkovic on Wednesday, February 17, 2010 11:07 AM

blue streak 1

Do not want to get into the operating subsidity debate but:

Below rail and above rail costs are not entirely separated.

1. Who owns the station?

2. Does AMTRAK have to pay any operating costs of the station? If so is the station energy efficient?

3. Is station layout such that quick loading and unloading possible? Many larger stations are not!

4. reference to #3 is station well lit and laid out for quick passenger ingress and egress?

5. Are intermediate service stations (water, catering, fueling,maintenance, etc) laid out so as to be able to service quickly? Almost forgot termination stations.

6. Are the approach tracks to the station difficult with long restricted speed approaches, puzzle switches, curves, etc; or are the statoin tracks laid out for quick deceleration and acceleration?

7. Is the station track layout such as to allow quick turns, addition, or deletion of some cars?

8. Are the main line tracks smooth, with gentle curves to reduce cant deficiency, etc to the reduce rough track wear on the rolling stock? Would also apply to station tracks.   

9. Is the track speed consistent or are a lot of permanent slow orders in place? 

10. Is track capacity such that there are not slow downs due to conflicting traffic?

11. Is the track a hogback or essentially a gradual grade? 

 All these items and many more will have the effect to increase or decrease crew duty time and fuel/electric consumption, maintenance, turn times, which are certainly a measure of operating costs. I feel that many stations have one or more of the above noted deficiencys. Certainly many route tracks do. 

 

All of those cited reasons are why it is "hard" (i.e. expensive) to run a train.  It is also "hard" (also expensive) to operate steam locomotives in mainline passenger service, and we aren't doing that anymore either.

What if a rubber-tire mode (motorcoach bus) is much "easier" (the Babler Family with those shiny blue-and-white motorcoaches they park in the cow barn).  The Bablers have loan payments on the "rolling stock", wages, insurance, fuel, maintenance, administration, etc.  And yes they are subsidized in the sense that the "tracks" are "for free."  Apart from the tolls going into Illinois.  And the tax on their diesel fuel.  And they have to fight Chicago traffic.

But somehow our neighbors the Bablers are able to eke out some slim profit as owner-operators of a small bus fleet, but small rail operations need subsidy.  And yes, there are trackage payments, but for the Hiawatha train, these payments are a small slice of the budget.

How about this thought experiment.  Contract with the Babler Family to run some kind of connecting bus service between Sturgeon Bay and Chicago Union Station.  Make some arrangement for trackage rights and pay that out of another budget.  How much would it cost to contract with somebody to run a train with the same number of seats?  Which costs more and why?

If GM "killed the electric car", what am I doing standing next to an EV-1, a half a block from the WSOR tracks?

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Posted by schlimm on Wednesday, February 17, 2010 11:09 AM

CSSHEGEWISCH
Also, labor contracts govern crew sizes and hours, split shifts may not be allowed which can make it difficult to get more than one or two trips out of a crew.

 I recall talking to a Metra conductors/trainman who worked a day job in the Loop between rush hour runs.

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Posted by Deggesty on Wednesday, February 17, 2010 11:15 AM

oltmannd
Amtrak crews get paid by the hour. That change was made after Amtrak took ownership of the crews from the host roads somewhere in the early 80s (?)

Don, I do not remember the exact year, but the change was between September, 1984, when I took a three-week trip, and October, 1987, when I took my next trip.

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Posted by HarveyK400 on Wednesday, February 17, 2010 11:19 AM

oltmannd

...Suppose you place a value on "carbon reduction" and decide to pay the operator some money for each passenger mile operated. Sounds simple but what if the mere presence of the service induced the trip? There is no "carbon reduction" in fact, but a "carbon expenditure".

I think the best time to make these judgments is during planning.  Pick the projects and plans that provides the most benefits for the buck that have a shot at turning an operating "profit". It's easy to understand and most politically palatable, I think.

 

Society benefits and costs should not be just a well-intended planning decisions; but should be a part of well-considered, understood, and more stable public policy enacted by elected officials and referendum.

The case of induced travel and carbon expenditures needs to be weighed against the value of increased economic benefit through personal spending for other purposes.

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Posted by oltmannd on Wednesday, February 17, 2010 11:25 AM
Paul Milenkovic
How about this thought experiment.  Contract with the Babler Family to run some kind of connecting bus service between Sturgeon Bay and Chicago Union Station.  Make some arrangement for trackage rights and pay that out of another budget.  How much would it cost to contract with somebody to run a train with the same number of seats?  Which costs more and why?
I'll start with a piece of it. A new MCI 45 ft bus with 50 seats and bathroom is about $300,000 or so. A new RR coach is about $2.5M. To make things even, lets assume the bus has the same seating density as the RR coach - 25 for the bus and 80 for the train. That works out to $12K per seat for the bus and $31K for the train. ...for starters. I still have to pay for a locomotive for my train. Lets assume $3M for the loco and a five car train. That's an additional $8k per seat for the train.

But wait! You say, " that RR equipment will a last 3 decades vs. 5 years for the bus!" True enough, but the reason for that has to do with the high initial cost, not the other way around. Both the rail equipment and the bus will be worn out in 5 years. To rebuild the bus might cost 80% of a new one - and in 5 years the state of the art will have advanced, so it's "cheaper" to buy new. The rail equipment can be rebuilt in kind for about 1/3 of the new cost, so you'd need more than small advance in the state of the art to justify new.

And that's just the difference to purchase the equipment. A little later maybe I'll take a look at what it costs to keep it running...

-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/

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Posted by oltmannd on Wednesday, February 17, 2010 11:31 AM
HarveyK400

oltmannd

...Suppose you place a value on "carbon reduction" and decide to pay the operator some money for each passenger mile operated. Sounds simple but what if the mere presence of the service induced the trip? There is no "carbon reduction" in fact, but a "carbon expenditure".

I think the best time to make these judgments is during planning.  Pick the projects and plans that provides the most benefits for the buck that have a shot at turning an operating "profit". It's easy to understand and most politically palatable, I think.

 

Society benefits and costs should not be just a well-intended planning decisions; but should be a part of well-considered, understood, and more stable public policy enacted by elected officials and referendum.

The case of induced travel and carbon expenditures needs to be weighed against the value of increased economic benefit through personal spending for other purposes.

Which makes is an even more incomprehensible and confusing game to play. I don't think a single mile of interstate highway went through that kind of scrutiny when it was built. It was, "Here's the map. Here's the fuel tax to pay for it."

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Posted by HarveyK400 on Wednesday, February 17, 2010 1:19 PM

Responses to some of your questions:

Paul Milenkovic

blue streak 1

Do not want to get into the operating subsidity debate but:

Below rail and above rail costs are not entirely separated.

1. Who owns the station? - Few stations are owned by Amtrak in the Midwest.  Most are built, owned, and maintained by the community.  Some of the smallest stops, such as Plano, IL and Princeton, IL are simply shelters.  In the first case, the small shelter was built by the Burlington and is still in use while the brick station was leased or sold.  A bus-type shelter was erected at the latter, perhaps by the City, on railroad property and on a remnant of the railroad platform.  Amtrak may have bought the fences and hand-operated mobility device lifts.

2. Does AMTRAK have to pay any operating costs of the station? If so is the station energy efficient? - Certainly for Chicago Union Station, Glenview, IL, and Springfield, IL; but there is no operating or energy cost for Plano or Princeton.

3. Is station layout such that quick loading and unloading possible? Many larger stations are not! - A more pertinent question may be whether only attended doors and traps are used, especially now with train-side ticket and ID checking.  Low level platforms and passengers segregated in certain cars by destination or origin further slow alighting and boarding. 

Most Midwestern and Chicago suburban stations do not have controlled access.  On the other hand, Chicago and Milwaukee funnel all passengers (at least for the tracks dedicated to Amtrak) along the platform to or from the head house.  From Amtrak's perspective, this is not a problem.  It is a problem in that CUS is considered to be inadequate for anticipated future demand precisely because of inefficient utilization and lack of adequate capacity to move passengers on and off the platforms and the width of the platforms themselves.  Utilization of the run-through track was dismissed simply because it was used to store the Empire Builder.

4. reference to #3 is station well lit and laid out for quick passenger ingress and egress?

5. Are intermediate service stations (water, catering, fueling,maintenance, etc) laid out so as to be able to service quickly? Almost forgot termination stations.

6. Are the approach tracks to the station difficult with long restricted speed approaches, puzzle switches, curves, etc; or are the statoin tracks laid out for quick deceleration and acceleration? - I have not seen anything in the US that approaches the speeds in and out of even the older stations of Europe.

7. Is the station track layout such as to allow quick turns, addition, or deletion of some cars? - Metra can turn a push-pull in less than ten minutes.  I think Amtrak's foremost problem is low on-time reliability with occassional delays measured in hours.

8. Are the main line tracks smooth, with gentle curves to reduce cant deficiency, etc to the reduce rough track wear on the rolling stock? Would also apply to station tracks. - Host railroads have much better mainline track now.  Amtrak trains such as the Builder and Southwest take rougher secondary lines for a part of their respective routes in order to reach certain cities. 

As for gentle curves, nothing in the US to this day was built for anything faster than 100 mph.  The long tangents found in the Tidewater, Midwest, West, and Central Valley resulted in not having to go around some geological feature between points A and B.

9. Is the track speed consistent or are a lot of permanent slow orders in place?  - Yard Limits and municipal restrictions are other hindrances for passenger services.  These all can be part of a discussion about grade separation or railroad relocation for more than just HSR.

10. Is track capacity such that there are not slow downs due to conflicting traffic? - Interesting insofar as host railroads don't like putting long freights through the diverging leg of a turnout, yet a second or third main track is not justifiable for a limited passenger service.  What can be worse is that limited passenger use of a siding may not keep the rust off the rails and not shunt grade crossing or ABS circuits, problems on the CHI-STL line hat I hope has been resolved.

11. Is the track a hogback or essentially a gradual grade?  - While hogbacks or hill-and-dale profiles might affect fuel consumption, it hardly affects schedules for short passenger trains that have reserve power for maintaining a cruising speed.  The reserve comes from a need for more power for quick acceleration.

 All these items and many more will have the effect to increase or decrease crew duty time and fuel/electric consumption, maintenance, turn times, which are certainly a measure of operating costs. I feel that many stations have one or more of the above noted deficiencys. Certainly many route tracks do. 

The cumulative affect of these factors may make a some difference - like having a more convenient, marketable departure or arrival time.  It also may make a difference in turning a round trip without another set of equipment.  To paraphrase Sen Dirksen, "A dollar here, a dollar there, can add up to serious money." 

All of those cited reasons are why it is "hard" (i.e. expensive) to run a train.  It is also "hard" (also expensive) to operate steam locomotives in mainline passenger service, and we aren't doing that anymore either.

What if a rubber-tire mode (motorcoach bus) is much "easier" (the Babler Family with those shiny blue-and-white motorcoaches they park in the cow barn).  The Bablers have loan payments on the "rolling stock", wages, insurance, fuel, maintenance, administration, etc.  And yes they are subsidized in the sense that the "tracks" are "for free."  Apart from the tolls going into Illinois.  And the tax on their diesel fuel.  And they have to fight Chicago traffic.

But somehow our neighbors the Bablers are able to eke out some slim profit as owner-operators of a small bus fleet, but small rail operations need subsidy.  And yes, there are trackage payments, but for the Hiawatha train, these payments are a small slice of the budget.

How about this thought experiment.  Contract with the Babler Family to run some kind of connecting bus service between Sturgeon Bay and Chicago Union Station.  Make some arrangement for trackage rights and pay that out of another budget.  How much would it cost to contract with somebody to run a train with the same number of seats?  Which costs more and why?

 
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Posted by blue streak 1 on Wednesday, February 17, 2010 1:20 PM

Thoughts: A bus has the same wheel loadings as a truck ie 4000#+ per tire vs less than 800# for any car buit today. RWM tells us the road wear is to the 4th power of the weight so buses are being subsidized by automobiles now. (trucks also) . A bus is not paying its allocated share of road maintenance.

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Posted by HarveyK400 on Wednesday, February 17, 2010 1:38 PM

oltmannd
Which makes is an even more incomprehensible and confusing game to play. I don't think a single mile of interstate highway went through that kind of scrutiny when it was built. It was, "Here's the map. Here's the fuel tax to pay for it."

 

To a degree, a map was developed initially for an Interstate System; but some quantification may have been done there too to justify the program.  Certainly, driving costs, emissions, and environmental assessments were part of the process that followed for road and transit improvements.  I only had some peripheral involvement in that process.

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Posted by Anonymous on Wednesday, February 17, 2010 5:12 PM

blue streak 1

Thoughts: A bus has the same wheel loadings as a truck ie 4000#+ per tire vs less than 800# for any car buit today. RWM tells us the road wear is to the 4th power of the weight so buses are being subsidized by automobiles now. (trucks also) . A bus is not paying its allocated share of road maintenance. 

Whether buses are subsidized by automobile drivers is debated vigorously by the American Bus Association.  There is some support for their position in studies done by the Texas Transportation Institution.  In any case, bus operators are motorists.  And motorists as a group receive a very small federal subsidy compared to the subsidy received by passenger rail.

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Posted by Anonymous on Wednesday, February 17, 2010 5:28 PM

henry6

One of the slight of hands here is how the cost is determined. 

The cost accounting rules are defined by the American Institute of Certified Public Accountants and are used by the external auditors in their annual audits of Amtrak financial statements.  Allocations, estimates, etc. require judgment, but the wiggle boundaries are fairly strict.  If Amtrak's management fails to follow generally accepted accounting principles, they are likely to find themselves facing a qualified or adverse opinion.  Clearly, they don't want this in the post Enron and Sarbanes-Oxley period. 

My read of Amtrak's financial reports tells me that they follow generally accepted accounting principles, as opposed to generally accepted governmental accounting principles, and they appear to do a pretty good job of it.

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Posted by Anonymous on Wednesday, February 17, 2010 5:41 PM

henry6

This is a note I put on another adjacent thread but has pertinence to this conversation...

TRAINS' Newswire 2/16 story on Lynchburg train making a profit is quite intrestng on several notes. First that it is making a profit in its second month negating the need for a state subsidy.  Second that because of this train seats have opened up on the Crescent which has gone to the Crescent's bottom line making it's economics more favorable.  I think it underscores the fact that if you think of running passenger trains as a service rather than merely running trains, it will work.  The train makes one round trip a day but it is in addition to other trains on the route.  Maine's Downeaster service and California's San Diego service, among others, have proven this point in the past,  It is just not a point that gets through the crania of politicos!

According to Amtrak's December Operating Report, which is the latest report posted on-line, the Washington to Lynchburg train turned 13.1 cents of operating profit per passenger mile for the first three months of FY10.  Whether that will hold for the whole year remains to be seen.

The Cresent is not doing so well.  It lost 30.9 cents per passenger mile before interest and depreciation.  That's an increase of 3.1 cents per passenger mile over FY09 results through the first quarter.    

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Posted by schlimm on Wednesday, February 17, 2010 5:48 PM
I finally found some Amtrak numbers, though not the ones sam1 refers to. Interesting, nevertheless.

In FY 2009 Total revenues were $2.35 bil., of that only $1.95 bil. was from passenger and commuter operations.

                 Salaries and benefits were $1.7 bil.

                 Net depreciation was $562 mil.

                 Track usage to host RR's was $115 mil.

So it appears that wages and benefits (90% union) eat up almost all the ticket revenues.

C&NW, CA&E, MILW, CGW and IC fan

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Posted by Anonymous on Wednesday, February 17, 2010 5:59 PM

Amtrak owns approximately 46 of the 525 stations that it serves.  Pennsylvania Station, New York; Chicago Union Station; and 30th Street Station, Philadelphia, are structured as Amtrak subsidiaries.  They charge Amtrak, as well as the other users, rent, which is the major source of revenue.  Of course they pay all the costs.  Anyone who has been to Penn Station knows that it has heaps of vendors who probably pay a pretty penny for the space that they occupy.   

Amtrak maintains another 181 stations, in addition to the 46 stations it owns, as well as 411 platforms throughout the country.  It generates revenue from these maintenance contracts.

In many cities, i.e. Dallas, Fort Worth, etc., the station is owned by the city.  They don't pay taxes on these facilities.  In Dallas, as well as Fort Worth, Amtrak rents a very small portion of the facility.  Whether it pays a market rate for the space is unknown.  I doubt it. In any case, city ownership is in effect a subsidy for Amtrak.  This arrangement is a common pattern throughout the country.  

Unfortunately, I have not been able to get hold of any of the financial statements for the stations owned by Amtrak to see if they earn a profit for the parent.  

Dallas Union Station is not energy efficient.  It is a cavernous building that was opened in 1913 or 14.  It was designed to serve thousands of passengers every day.  Under current conditions, it serves less than 100 passengers on a typical day.  But the whole building must be cooled and heated.  And cooling it during July and August in Texas is an expensive proposition.

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Posted by Anonymous on Wednesday, February 17, 2010 6:29 PM

schlimm
I finally found some Amtrak numbers, though not the ones sam1 refers to. Interesting, nevertheless.

In FY 2009 Total revenues were $2.35 bil., of that only $1.95 bil. was from passenger and commuter operations.

                 Salaries and benefits were $1.7 bil.

                 Net depreciation was $562 mil.

                 Track usage to host RR's was $115 mil.

So it appears that wages and benefits (90% union) eat up almost all the ticket revenues.

I used the same financial statements.  However, I showed the differences between FY08 and FY09, whereas you are showing just a couple of numbers from the financial statements. 

The financial statements contained in the Monthly Operating Report have not been audited.  If prior practices hold forth, some of the results shown in the audited annual report will be different from the numbers shown here. 

Salaries, wages, and benefits account for approximately 48 per cent of total expenses.  They represent 72.2 per cent of revenues.  They account for 93.6 per cent of passenger related revenues.  However, the flaw in this thinking is that all the salary, wage, and benefit expense is attributable to passenger revenues.  This is probably not true.

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