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Thread: Amtrak is going down one way or another

  1. #1
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    Default Amtrak is going down one way or another

    I coming back form work when I herd this on th radio. President Bush wants to Cut a good amount of lines, pretty much take away about half the traffic on the Northeast Corrider so there can be another company come and go against Amtrak. The lines that could be cut depend on how mny p[eople ride it and how much the states wanna keep them going. There was some other stuff he wanted to do but those are the ones I rememberd. Oh he will not finace Amtrak he half amount they want. Nor will he give that much to any railroad in the fuure. Of course a goood amount of the senators are shaking there head at this but guess who makes the veto? I will try to find more info. Amtrak also said if they don't get the money they need, Amtrak will be one by the end of the month.

  2. #2
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    Default Yes and no:

    Bush passenger rail plan unveiled to heavy criticism
    by Bill Stephens

    Transportation Secretary Norman Mineta today outlined a bare-bones Bush administration plan for passenger rail that would strip Amtrak of federal operating support, split it into separate operating and infrastructure companies and begin limited franchising of routes.

    If adopted, the plan would likely gut Amtrak’s long-distance network – and perhaps even other routes – unless states agreed to subsidize the trains. Meanwhile, Amtrak President and CEO David Gunn again warned that the railroad would have to shut down if it doesn’t secure an emergency loan in a matter of days.

    Mineta said the administration’s support for increasing Amtrak funding beyond $521 million next year – a figure that would merely allow the railroad to shut down after October 1 – would hinge on Congress backing the five principles of its plan to reform passenger rail.

    That could set up a battle with Amtrak supporters in Congress. The Bush plan largely mirrors recommendations made by the Amtrak Reform Council – recommendations that found little backing on Capitol Hill.

    And some members of Congress were critical of the plan and the lack of an administration solution to Amtrak’s short-term cash shortfall, which will shut the railroad down next month if it can’t obtain a $205 million loan to tide it over to the beginning of the fiscal year in October.

    Mineta said the administration was doing all it could to ensure that Amtrak trains continue to roll.

    Although Amtrak is highballing toward a shutdown next month, the Bush plan doesn’t address Amtrak’s immediate cash crunch. The plan does maintain, however, that Amtrak’s structure is flawed and must be completely overhauled.

    “The country can ill afford to throw billions of federal dollars at Amtrak and just hope its problems disappear,” Mineta said. “Thirty years’ experience should teach us that merely hoping for better performance is a doomed approach.”

    Thus the plan proposes five basic reform principles:

    • Create market-driven passenger rail service without federal operating subsidies. “Prices and passengers – not politics – should drive service,” Mineta said. “Amtrak’s current route network provides too many services with limited market appeal at high operating costs to the federal government. “

    • Amtrak should become an operating company. “We believe a gradual separation of train operations from infrastructure ownership would shed better light on the true economics of passenger rail and help the public sector make better educated decisions about the future of intercity passenger rail,” Mineta explained.

    • Introduce “carefully managed” competition. Amtrak should be forced to compete with private companies for the right to operate certain routes and should contract out for support services such as reservations system, food service and equipment maintenance. “We firmly believe that marketplace discipline could deliver higher quality service at competitive prices,” Mineta said.

    • Establish a long-term partnership between the states and the federal government to support passenger rail. “We believe that clear-eyed, comprehensive, financially responsible transportation planning, which is mandated for other surface transportation modes, is crucial to the future of new forms of passenger rail,” Mineta said.

    • Create a private-public partnership to own and manage the Northeast Corridor. Amtrak would continue to operate the corridor during a transition period, but states, governors, commuter railroads and local officials should play a role in how to manage the Boston-Washington corridor.

    The plan also calls for decision-makers to work separately on continuing intercity rail and developing high-speed corridors.

    Gunn told a Senate appropriations subcommittee this afternoon that Amtrak and the service it provides are “well worth saving,” despite the years of bad management decisions at the railroad.

    And he was critical of the Bush plan.

    “No amount of councils, commissions, study groups, panels, or symposiums will find a painless answer to what to do about Amtrak,” Gunn said. “Recent proposals to privatize or restructure are exercises in problem avoidance. The federal government must decide what role rail should play just as it does with highways and air, even waterways.”

    Gunn pledged to improve Amtrak’s cost-recovery and to let Congress know exactly what its financial needs are.

    “We will look at every route and service to improve efficiencies and cost recovery,” Gunn said. “Most of our trains lose money and they always will, but we can run them more efficiently. That is an achievable goal. Pursuing self-sufficiency was not.”

    Sen. Patty Murray, D-Wash., who chairs the transportation appropriations subcommittee, said the Bush administration wasn’t doing enough to see that Amtrak continues to operate through the summer – much less beyond.

    “If the Bush administration is not prepared to ask for sufficient funds to
    maintain the intercity passenger rail service that Secretary Mineta and [Deputy Secretary Michael] Jackson say is so indispensable, then the Bush administration needs to be prepared to explain to the American people why it will allow Amtrak to go bankrupt in the middle of the summer travel season.”

    But House Transportation Committee Chairman Don Young, R-Alaska, praised the Bush plan.

    “After years of virtually no direction from previous administrations on Amtrak and its continuing management and financial problems, I commend the Bush administration for putting forward its thoughts on Amtrak,” Young said. “The administration has wisely taken many of the recommendations from the Amtrak Reform Council, which carefully examined and exposed the rampant problems in Amtrak’s management and financial practices in America’s passenger rail system.

    Young said it was time to support an improvement of passenger rail, and touted his $59 billion RIDE-21 bill as the way to do it. The measure would shift most high-speed rail project funding to the states and bar Amtrak from receiving high-speed money.

    House railroad subcommittee chairman Rep. Jack Quinn, R-N.Y., said he understood the need to reform Amtrak, but was critical of the plan and the administration’s lack of a solution to keep Amtrak running.

    “I don’t think that privatization of Amtrak is the answer, nor is separating it from federal support the way to proceed,” Quinn said.

    “With Secretary Mineta’s announcement today, the only logical conclusion one can reach is to give Amtrak the $1.2 billion it needs to survive with some oversight reforms,” Quinn said. “ If we don’t, the administration’s ‘principles’ for Amtrak reform are pointless. There will be no passenger rail service around to fund. We need less talk and more action.”

    Sen. Tom Carper, D-Del., and a past member of Amtrak's Board of Directors, said he had grave concerns about the Bush plan to shift the cost of national service to already overburdened states.

    “The administration arrives late to the debate, unfortunately carrying the wrong prescription to cure Amtrak's ills,” Carper said. “I'm afraid that this plan could make things much worse, not better, for national passenger rail service.”

    Outside Congress, reaction to the plan was largely negative.

    The freight railroads were nervous about the prospect of having to deal with more than one passenger operator, which carries open access ramifications and questions about operator qualifications.

    “It’s the devil we know compared to the devil we don’t,” said one Class 1 executive who deals with passenger issues.

    “The Association of American Railroads is deeply concerned about the proposal to franchise Amtrak’s operating authority and how that could adversely affect the world's premier freight rail system,” said AAR President and CEO Edward R. Hamberger. “We look forward to working with the administration, Congress, and other interested stakeholders to develop sound freight and passenger rail policy.”

    The United Transportation Union, which represents 3000 of Amtrak’s 24,000 employees, expressed some optimism that a workable passenger rail solution can be reached.

    “As the Bush administration gives the matter additional thought and hears
    more extensively from stakeholders, we are confident that Transportation
    Secretary Mineta and President Bush will recognize that selling off portions
    of Amtrak and mimicking the failed British system are not how one saves a
    national intercity rail passenger system," UTU International President Byron A. Boyd Jr. said. He was encouraged by Federal Railroad Administrator Allan Rutter’s suggestion before the Senate today that a passenger rail summit be held, as Boyd had recommended this winter.

    The National Association of Railroad Passengers sharply criticized the plan, which is says pulls the rug out from under Amtrak.

    “Ending operating grants is tantamount to ending all service, because
    not even the Northeast Corridor breaks even when below-the-rail costs
    are considered,” said Ross Capon, NARP’s executive director. “It is absurd on its face to simultaneously talk of ‘eliminating federal operating grants’ and ‘putting Amtrak on a sound economic footing.’”

    NARP said Gunn – a proven turnaround manager – should be given time to carry out his mission to reform Amtrak.

    Passenger rail advocates also said the Bush administration was abdicating its federal responsibility by shifting funding responsibility to increasingly overburdened states.

    “The federal government is forgetting what its role is,” said Rick Harnish, executive director of the Midwest High Speed Rail Coalition. “Just about all of the routes that Amtrak operates cross state boundaries, so they are clearly interstate commerce. The federal government is supposed to support and enhance interstate commerce.”

    But Gil Carmichael, who chaired the Amtrak Reform Council, praised the administration plan, calling it a “bold step.”

    “I’m real excited,” Carmichael said. “This is going to give us a new national rail system. The old Amtrak is going out of business and the new Amtrak is about to start.”

    Separating operating and infrastructure is a necessary step to put Amtrak on a sound financial footing, Carmichael said.

    First, though, Amtrak will have to clear its more pressing need for cash if it hopes to avoid shutting down next month. That will be no easy task, Congress was told today.

    The Bush plan itself could make it more difficult for Amtrak to obtain a loan that would enable it to operate beyond July 1. Amtrak plans to use next year’s requested $1.2 billion appropriation as collateral for a loan that would bridge its cash shortfall.

    But commercial lenders need a sign that Congress and the White House will agree to meet Amtrak’s $1.2 billion request. Lenders also need auditors to certify that Amtrak is a going concern, something else that has not happened.

    “If the administration were unable, or unwilling, to give us a loan guarantee, then the only other options would be for Congress to direct the secretary of transportation to guarantee a loan or, as a last resort, to step in with short-term bridge funding for the balance of the fiscal year,” Gunn said. “The window for fixing this problem in this way is short. Unless we are able to secure access to these funds either through a loan guarantee or another form of funding, I will have no choice but to announce a shutdown of the entire system.”

    Amtrak officials met with Rutter this week to go over the loan request. “It’s a priority. There’s no doubt about it,” said FRA spokesman Rob Gould. “The question is can we do it?”

    The RRIF program is open to short lines and regionals as well as Class 1’s, but it has strict eligibility requirements and is geared toward capital improvements.

    Amtrak should not be eligible for a RRIF loan because it is facing an operating cash shortfall, Transportation Department Inspector General Kenneth Mead told the Senate appropriations panel this afternoon.

    Mead also said that it was unlikely that Amtrak could obtain a loan from commercial lenders. Among the few alternatives left to avert a shutdown, he said, were direct federal loans tailored to the Amtrak emergency or a special appropriation from Congress.

    “This is the second time in just over one year that Amtrak has asked Secretary Mineta and the Department of Transportation to save Amtrak from falling into a financial abyss,” Rutter told the Senate panel today, referring to last year’s mortgaging of Penn Station in New York. “However, expending significant effort by the Congress and the administration on an annual basis just in hope of assuring Amtrak's survival for another year is no way to run a railroad and reform is necessary.”

    Mead warned, as he has in past appearances before Congress, that lawmakers should not lose sight of the need for massive capital spending if a true national system is to be retained.

    “Amtrak’s current short-term funding crisis should not be allowed to obscure the equally critical and far more difficult issue of long-term capital funding,” Mead said. “The cost of short-term operating losses pales in comparison to the multi-billions of dollars in long-term capital investment that will be needed to sustain a national, intercity passenger rail system.


    Blake Harris
    Vice Dean, Limbaugh Institute for Advanced Conservative Studies

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  3. #3
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    Default RE: Yes and no:

    Well actully I do like some parts. Like letting comepators in is good. But some of this is just a damn shame.

  4. #4
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    Default RE: Yes and no:

    I forgot to mention, that article is from Trains.com

    Blake Harris
    Vice Dean, Limbaugh Institute for Advanced Conservative Studies

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  5. #5
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    Default RE: Amtrak is going down one way or another

    I plan to write to my representatives about this. I really think it's unfair to expect the railroads to be self-sufficient while Congress continues to throw money at the enviromentally destructive airline and auto industries. Why are the railroads being held to a different standard, and how exactly can the railroads be expected to compete when they are not even state-of-the-art? Even Amtrak's show piece, the NEC, would be considered an average medium speed line in most developed countries. We seriously need funding for many new 200 mph lines along major trunk routes currently serviced by airlines and autos. If the federal government were to pay to have these lines built, the operating revenues would be sufficient to cover operating costs. The situation could also be helped by prohibiting many short haul flights(i.e. Washington to NY to Boston) that would be better served by true high-speed lines. Were a state-of-the-art line to be built, Washington to Boston city center to city center could be done in less than 3 hours. Airlines currently take 1 hour or more flight time, plus at least 45 minutes at each end travel to the city center, and at least another hour for highly invasive but necessary security procedures. This is a total time of 3.5 hours. I have little doubt TGV-like services would take away all business on airline routes of 500 miles or less. Is it going to take a few more planes flying into buildings to get Congress to realize that planes are not the answer to our future transportation needs? And exactly how are people like myself who don't drive and refuse to take a plane supposed to get around? By bicycle?

  6. #6
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    Default RE: Amtrak is going down one way or another

    I work on the Subcommittee on Railroads and attended the Senate hearing. Bill Stephen’s article accurately highlights the gravity of Amtrak’s situation. The railroad will be informed by early next week, if it will receive the RIFF by the DOT. Gunn mentioned a possible shutdown of the entire system by the middle of next week. In addition to contacting your own representatives, I believe your letter should be directed to members from both parties on the full Transportation & Infrastructure, especially the Subcommittee On Railroads.

  7. #7
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    Default RE: Yes and no:

    [font size="1" color="#FF0000"]LAST EDITED ON Jun-21-02 AT 11:16AM (EDT)[/font][p]What were those immortal words of free market economics? "Level Playing Field". The US Government cannot simply expect Amtrak and its successors to create that level playing field, not without massive funding. Cutting back on short haul flights is one way to go, it will also free up airport space for long haul carriers, something which the big airlines like AA and United, and foreign airlines like BA will support. But what is needed is a change of perceptions, like re-introducing the old names on new higher speed services, such as the Empire State Express, the Zephyrs etc etc. Competition may be good for certain routes, but what is needed is demand, and demand will only be made by changing attitudes. Yes, the fast trains are needed, and I could make a list of suitable stock which could be bought 'off the shelf'. But new trains won't change attitudes.


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  8. #8
    LordTauk Guest

    Default RE: Amtrak is going down one way or another

    I got a question...

    Since the government let Conrail acquire back to private enterprises (CSX and NS), couldn't they do that sort of thing to Amtrak? I dont know how much that will help or who will run and maintain it?

  9. #9
    LordTauk Guest

    Default RE: Amtrak is going down one way or another

    Along with my post above, I just heard on the news just right now that they said Amtrak has only a few more days to run without "stoppage", and they are in a finacial crisis (not that none of us dont know), I dont think they got the real deal on Amtraks problem without doing proper investigation first. They kinda said it like the entire Amtrak system is shutting down tomorrow. Messed up.

    This is the same local news TV channel that mad a big deal about the recent Penn Station bump with a local MARC and an Amtrak. They also mad a real big deal about a CSX derailment in a tunnel in Baltimore a year or so ago, Im not sure if anyone remember but a few (2 I think) chemical cars derailed and leaked a little - can't remember what they were containing... not saying its not a big deal but aslong as you get the point that it isnt going to poison you if you are in the city I think it doesn't need to be on the news for 2 weeks straight...

  10. #10
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    Default RE: Amtrak is going down one way or another

    2 words srew Bush!
    why dont he listen to profesionals who know bout this kind of situation?


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