(By User:DanielHolth - Own work, CC BY 2.0, https://commons.wikimedia.org/w/index.php?curid=6835990)
Amtrak, this nation’s passenger rail system, has been operating since 1971, when it took over service from the freight railroads, who lost interest in operating a national passenger rail network after World War II in the face of increased competition from the new Interstate highways and the rapidly modernizing commercial aviation infrastructure. Amtrak has had its ups and downs over the course of the past few decades. Amtrak depends on federal funding to operate and survive, and in today’s polarized political climate, Amtrak seems to have fewer and fewer friends in Washington to defend and protect it. I’m of the opinion that Amtrak needs to be strengthened, not weakened.
Amtrak has been under a mandate to be completely and totally self-sufficient by means of revenue from passenger fares and other sources. While Amtrak certainly does earn a good deal of revenue from passenger fares, such a mandate is completely and totally unrealistic and unfair. When transportation systems, be they motor coach or commercial aviation, are left to fend for themselves to be profitable, the first thing that happens is that they shut down and cease operations if they are NOT profitable. If Southwest Airlines tries to increase service from Tucson, for example, and no one is flying on the planes, Southwest will and must cancel some of those departures in the name of profitability.
Amtrak, in my opinion, is too important to a balanced national transportation system to be left to the insecurity and uncertainty of the “free market.” Amtrak is too important to be canceled.
To quote someone who made a comment in an article on Amtrak in The Economist:
“To all of these people - both Amtrak supporters and haters - who think that somehow it could be profitable it it were privatized (or otherwise left to its own devices), why-the-hell do you think it was created in the first place ?!?!”
https://www.economist.com/node/21565047/comments
America needs a balanced national transportation system, consisting of our Interstate highways (and trucks, cars and motorcoaches such as Greyhound), aviation and the major airlines, our maritime and shipping system, and our railroads, including Amtrak. Not every cross-country traveler wants to fly. Not every cross-country traveler wants to drive. Passengers must be allowed to have a CHOICE in their mode of long-distance travel in this nation. Amtrak needs to remain active, viable and healthy as the pleasant and hassle-free alternative to commercial aviation and other forms of long-distance travel.
Here’s what I want:
1. Keep the long haul transcontinental routes going. When traveling longer than 100 miles, Amtrak is significantly more convenient, and a more pleasant traveling experience, than Greyhound or flying.
2. Improve the short haul routes. Privatization is not the answer. I learned about the fiasco that happened when the state of Indiana tried to outsource the on-board operations of its short-haul train, the “Hoosier State”, to private companies. It sort of worked for a while but Amtrak had to take the route back over. And this is because apparently there is a Federal mandate that states have to completely pay for any Amtrak routes under 150 miles. Ridiculous.
3. Feed into both with dedicated Thruway coaches.
Amtrak’s Thruway network, nationwide, needs to be structured the way it is in California, with dedicated Amtrak-branded motorcoaches using Amtrak-designated stations and stops.
4. Keep the passenger on-board experience awesome. On-board experience is something that should not be cut back on, or treated lightly.
Keep making the experience, even in basic coach, better than the airlines. Keep the seats wide, and the legroom generous. Provide complimentary snacks, juices and soft drinks even in standard coach. Give all coach passengers a basic amenity kit, with basic toiletries and hygiene items.
Improve and enhance amenities such as dining car service, always included in the cost of the ticket for sleeping car (basically first class) passengers - which is being threatened with outright elimination. On two routes, dining car service is apparently being eliminated altogether:
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Contemporary Dining for Capitol Limited and Lake Shore Limited Sleeping Car Passengers
Effective July 11, 2018
Amtrak will offer hot and cold contemporary, fresh dining choices for sleeping car customers, in place of traditional dining car service, onboard the Capitol Limited and Lake Shore Limited trains, starting July 11.
Meals will be ordered with the sleeping car attendants and delivered to sleeping car passengers through enhanced room service. Sleeping car customers will choose from a variety of quality, fresh and ready-to-serve meals. A Kosher meal will continue to be available with advanced notice.
Sleeping car passengers have the option to dine at available seating in the sleeping car lounge or can continue to be served in their bedrooms or roomettes. Meals will continue to be included in the sleeping car fare. The tables in both the sleeping car lounge and café/lounge cars will be on a first come basis for seating but there will be no at-table dining service.
Sleeping car passengers on all Amtrak trains are offered complimentary morning coffee, chilled water and juices, in-room meal service, turn-down service for their beds, private restrooms and shower facilities. Also provided are pre-boarding privileges and same-day access to lounges, such as Club Acela in the Northeast Corridor and the Metropolitan Lounge in Chicago.
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https://www.amtrak.com/alert/contemporary-dining-capitol-ltd-lake-shore-ltd.html
They go on to state that the existing a la carte cafe/lounge car menu will continue unchanged.
I am all for efficiency, but one of the traditional components of rail travel has always been the dining car. Eliminating this tradition for “enhanced room service” and “contemporary, fresh dining choices” (which smack of the crazy options which pass for in-flight meals on the major airlines) is, in my opinion, an ill-advised move, and will likely turn off some passengers.
Where I would welcome this new service: as a complimentary offering for passengers traveling in basic, standard coach service, to keep the costs of their meals down.
5. Invest in new rolling stock (passenger cars), and maintenance and upgrades of trackage and stations.
You may ask, “But Mike, just HOW can we still maintain Amtrak if it’s so important? What will it take?”
Simply put, it will take money, and more of it. And that money needs to be (mainly) public money with a bit of private money - from the very freight railroads that dropped passenger service like a sack of hot potatoes.
Hear me out for a moment:
Amtrak is not funded fairly, in the manner that the Interstate highway system, or America’s airports, or even the public bus, light rail and subway systems in our cities, are funded.
It makes no sense, ZERO sense, to me that commercial aviation gets millions and BILLIONS in a government-mandated trust fund that actually has a surplus, while Amtrak struggles to survive.
“Also targeted by the White House for cuts in 2019 are grants that go to Amtrak to support long-distance routes. The budget calls for a reduction of more than half for those grants, from the 2017 amount of $1.5 billion to $738 million in 2019…'Amtrak's long-distance routes suffer from poor on-time performance, account for only 4.7 million of Amtrak's nearly 32 million annual passengers, and incur annual operating losses of more than $500 million,' the administration said. The budget proposes that states contribute to the Amtrak grants on an equal basis with the federal government."
https://www.travelweekly.com/Travel-News/Government/Trump-proposes-higher-fees-air-travelers-less-money-Amtrak
https://www.taxpolicycenter.org/briefing-book/what-are-major-federal-excise-taxes-and-how-much-money-do-they-raise
I believe the long-haul transcontinental routes need to be seen as necessary loss leaders. They should absolutely be the flagship trains of Amtrak and provide the maximum amount of comfort and value to the passenger.
And while I like the fact that states are willing to pitch in and do their part to fund Amtrak service that benefits their states, Amtrak is a NATIONAL system and the primary source of funding sufficient for the entire system should be Federally-based.
One of my ideas: raise the federal motor fuel and aviation taxes by one penny each and create a dedicated national Amtrak Trust Fund, similar to the highway, mass transit and aviation trust funds. This would be a dedicated source of at least partial funding for the Amtrak national system, independent of the General Fund and independent of support from the various states. The Amtrak fund should earn a moderate interest on the funds on account. This Amtrak Trust Fund would primarily support day-to-day operation of all passenger service (including traditional dining car service, and reducing the burden on the states to provide funding for shorter routes), with a strong secondary focus on basic maintenance and upkeep of rolling stock, trackage owned directly by Amtrak and the station infrastructure. I would imagine that major improvement projects would still need to be funded on an individual basis through the appropriations process.
Apparently, I’m not alone in thinking this. In researching this article, I discovered (from Jeff Davis of the Eno Transportation Weekly) that Congress came close to establishing a trust fund for Amtrak back in 1997:
“Since the Budget Act of 1974, the only way to get contract authority (multi-year mandatory budget authority) from Congress is to have it drawn from an excise-tax-supported trust fund. The federal highway, mass transit formula, and airport aid programs all have access to contract authority and therefore have a kind of certainty to their funding levels in future years (at least until the multi-year reauthorization bill providing the contract authority expires). Multi-year certainty is a good thing where capital programs are concerned. Amtrak actually came close to trust fund access once – the Senate version of the 1997 tax reconciliation bill would have created an Intercity Passenger Rail Fund supported by a half-cent of the existing gasoline and diesel taxes. But the House killed that provision in conference, and Amtrak has never come close to trust fund access again.”
In 2014, the federal gas tax raised $35 billion. Dedicating just two percent of that to Amtrak would raise $700 million. In 2015, the federal aviation fuel tax raised about $14 billion. Dedicating just 1.5 percent of that to Amtrak would raise $210 million. That is a combined $910 million as a dedicated funding source for Amtrak, at least on a supplemental basis, irrespective of any other Federal grants or revenue from fares.
I wouldn’t even mind paying an extra $1 per ticket, as an Amtrak passenger, to help pitch into this Amtrak Trust Fund. Amtrak earned $3.2 billion in FY 2017 in passenger fare revenue (a record) on over 31 million passenger trips, so (assuming one passenger trip equals one ticket) naturally a $1 ticket surtax could bring in as much as $31 million.
(https://media.amtrak.com/2017/11/amtrak-sets-ridership-revenue-and-earnings-records/)
Also, I believe the big Class I freight railroads, and even the Class II railroads, should contribute more towards Amtrak. This idea, while I think it is perfectly fair, is sure to draw much weeping, wailing and gnashing of teeth. Yes, I know that Amtrak was created to take the burden of passenger service off of these carriers. What is clear: The freight railroads are quite profitable and as the “host railroads” to Amtrak are critical to Amtrak’s success. BNSF alone reported $21 billion in revenues in 2017. BNSF, which actually owns 35% of Amtrak’s preferred stock, should pay one percent of revenue into the Amtrak Trust Fund. One percent is not very much to ask, but it would provide an annual infusion of $210 million. Multiply this amount by four (to hypothetically account for contributions from Union Pacific, Kansas City Southern, CSX and Norfolk Southern) and let’s even subtract $300 million to account for lower operating revenues from KCS, CSX and NS and add $50 million as a combined contribution from ALL Class II railroads, about 15 or so (those Class II railroads operated through a governmental agency, such as the LIRR, which is basically part of the New York City transit system, would be exempt). We get $590 million.
The Aviation Trust Funds gets a portion of its revenue from a 6.25 percent surcharge on air cargo. I think a one percent Federally-mandated surcharge on all Class I and Class II freight cargo (payable directly and exclusively by the cargo shippers themselves) would be a fair way to supplement the Amtrak Trust Fund. In fiscal year 2016, the total revenue for BNSF, just from freight alone, was nearly $19 billion. One percent of that would make $190 million. Added to the $590 million number we arrive at $780 million. (Mind you, for this surcharge, I am not counting contributions from the other Class I and Class II railroads, just BNSF alone.)
https://www.bnsf.com/about-bnsf/financial-information/pdf/performance_update_4q_2017.pdf
Added to the $910 million this gives us a minimum of well over one and a half billion dollars ($1,610,000,000) in dedicated annual revenue (give or take about 5 percent or so each year) to keep Amtrak strong. Hell, I’d be happy with one billion. Amtrak has consistently received about $1 billion most years of its history in the form of appropriations from Congress (but in some years as low as $600 million). With a dedicated trust fund supplied through minor increases in the motor fuel and aviation fuel taxes and contributions from the freight railroads, including a surcharge on freight, Congress, and even some of the individual states, can actually get away with appropriating less money directly.
This is keeping in mind that according to the FAA, at the beginning of FY 2018, the Aviation Trust Fund had a cash balance of about $15 billion. The Highway Trust Fund had a cash balance of about $37 billion. I don’t think $1 to 1.5 billion in dedicated annual revenue is too much to ask, in light of that, to keep America’s passenger rail network strong.
I would even go further and propose that Congress simply move $5 billion from both the Aviation and Highway Trust Funds to provide initial seed funding for an Amtrak Trust Fund, and allow for the same formula I proposed above: modest contributions from the Aviation and Highway Trust Funds plus modest contributions from the Class I and Class II freight railroads.
One compromise I could accept: perhaps the freight railroads could provide fewer funds to the trust fund in exchange for taking their own initiative and making their own capital improvements to their own trackage and right-of-way, that would be beneficial to both Amtrak and the freight railroads; double-tracking or adding sidings to sections that are currently single-track, for example. This would help Amtrak immensely. There would be fewer delays, especially on the long-haul western routes. The freight railroads are supposed to prioritize Amtrak traffic, but in practice, this happens on a haphazard basis, to the annoyance of Amtrak, so much so that Amtrak wants the authority to file legal action against the freight railroads to force them to cooperate. My compromise would severely reduce the need for such legal action.
http://thehill.com/policy/transportation/269711-amtrak-requests-18b-for-2017-fiscal-year
https://www.enotrans.org/article/amtrak-submits-ambitious-11-billion-budget-request/
America needs a balanced transportation system, one in which the American long-distance passenger has a true choice in how he or she travels. Amtrak is a huge and important part of such a balanced system, and must be not only protected, but made as strong as possible. A dedicated revenue source via an Amtrak Trust Fund is a great starting point. Will our elected officials listen?
