Questions & Answers

What is the Administration's proposal for passenger rail and for rescuing Amtrak? 

The Administration believes we need a fundamental shift in our paradigm for providing passenger rail service.  For the past 30 years, we have provided a subsidy to a private company both to operate passenger trains and to plan our passenger rail network.  It's time to shift to the same system we have for every other mode of passenger transportation - a system of federal/state partnerships for building transportation infrastructure and a reliance on other parties to operate over it. 

Putting passenger rail on a solid foundation of planning and investment will give this important mode of transportation the support it needs to grow. 

What will happen to Amtrak under the Administration's proposal? 

The current Amtrak will be split into three different entities. 

One private company will provide maintenance and operations on the infrastructure of the Northeast Corridor (the stretch of track between Washington, D.C. and Boston, Massachusetts).  The infrastructure on the Corridor that is currently owned by Amtrak will be transferred to the federal government, which will lease it to a multi-state compact of the states on the Corridor.   

A second private company will provide train operations - just as Amtrak currently does for commuter rail lines and state-funded intercity passenger trains.   

A third company, a government corporation, will hold Amtrak's right of access to its current routes over the lines of the freight railroads and the Amtrak name and logo.  Both the right of access and the logo will be licensed to states and multi-state compacts that want to provide passenger rail service.  Those entities will present proposals to the Department of Transportation, specifying the service to be provided, the capital investment plan they have worked out, and the train operations provider they want to use.  DOT will review and approve the plans, grant the right of access and the ability to use the Amtrak name, and will match 50 percent of the capital investment in the service (tracks and other infrastructure, and the trains themselves).  

States are already strapped for cash.  How can you expect them to carry more of the load in passenger rail? 

States are already investing more than $345 million per year in intercity passenger rail service.  Roughly $140 million of that is capital investment, which would now be eligible for a federal match under the Administration's plan.   

The states where passenger rail is a priority are already investing.  We believe that states are the best judge of where that service is important, where people need it, want it, and will use it.  We think that, as in all modes of transportation, the federal government should let local priorities guide its investments. 

The British had severe problems when they split train operations from infrastructure, as the Administration proposes to do.  Why won't we have the same problems? 

Passenger train operations and infrastructure ownership are already split in the United States, and have been for decades.  Amtrak operates trains over more than 22,000 miles of track in the United States; it owns only 730 miles of track (mostly on the Northeast Corridor between Washington, D.C. and Boston, and in Michigan).  All other tracks are owned either by freight railroads or by the states.  

Also, the British rail deregulation model privatized both train operations and infrastructure.  The Administration's proposal would give states a substantial role in the planning of passenger rail service.  Infrastructure operations off the Northeast Corridor would remain with the freight railroads, while passenger rail train operations would be carried out under contract to state governments and multi-state compacts.  On the Northeast Corridor, both infrastructure operations and train operations would be carried out under contract with a multi-state compact. 

Every mode of transportation receives subsidies of some sort.  How can you expect passenger rail to be any different? 

We don't.  The Administration's plan would remove the burden of infrastructure investment from Amtrak and place it where it lies for every other mode of transportation - a state/federal partnership.  On the Northeast Corridor, that would mean a partnership between the federal government and a multi-state compact.  The same situation could exist outside the Northeast, say with a compact of states to implement the Midwest Regional Rail Initiative.  It could also mean funding a specific state's initiative, such as those in California, North Carolina and Washington.  

You say you're going to introduce competition into passenger rail.  How are you going to do that? 

In this case, the competition will come when train operators compete for contracts with states and multi-state compacts.  In many cases, we expect states to choose private companies to operate the trains, but public agencies (such as transit agencies) may also be chosen. 

Under the Administration's proposal, we do not dictate solutions to the states in advance.  Some states may choose private sector providers, some will choose public transit agencies to operate trains.  The federal investment will be limited to capital investment (track upgrades and maintenance and purchase of trains) - while states will cover any required subsidy of train operations.  Since the states would bear the burden of any operational subsidies, we believe the states should have the freedom to choose the best value among the available options among train operations providers. 

The freight railroads say there is no room for passenger trains on their tracks, which is borne out by Amtrak's current on-time performance.  How will your proposal address the existing capacity problems on the freight railroads? 

We recognize that capacity issues are a major potential limiter on the growth of passenger rail service.  Outside the Northeast Corridor, where tracks are almost entirely owned by freight railroads, states and multi-state compacts would have to negotiate with freight railroads for the addition of any new routes.  Under the Administration's proposal, states would be eligible for a 50 percent federal match to their passenger rail infrastructure capital investments.  In their negotiations with freight railroads, the states would come to the table with capital dollars for the expansion of existing capacity.   

What will be the impact on Amtrak's unionized work force be if this proposal is implemented?  

The impact is expected to be minimal.  The proposal preserves all existing collective bargaining rights and Railroad Retirement eligibility.   The two private companies to be spun off from the existing Amtrak, the passenger rail services company and the passenger rail infrastructure management company, would both be classified as railroads for benefits and labor protection purposes.  

In addition, the Administration believes that by placing passenger rail planning and investment on a solid foundation, this transportation sector will realize a new potential for growth. 

Why should states be asked to assume the responsibility for routes that provide for national mobility, e.g routes that connect the coasts or the Great Lakes to the Gulf of Mexico?  Shouldn't this be the responsibility of the federal government? 

In no other mode of passenger transportation does the federal government take on the entire responsibility for the system, and the wisdom of that approach has been proven time and again.  States and local governments are the best judges of where a particular transportation service is needed, and the best judges of where their people want to go. 

Much of the current Amtrak route structure was laid down in the 1960s. (Amtrak's routes are effectively the passenger routes run by the freight railroads before their passenger rail responsibilities were transferred to Amtrak.)  With the current structure, in some areas the government is subsidizing service that very few people use and, as a result, missing opportunities to support passenger rail service in areas where people need and want it today. 

The bill does not preclude a national system.  However, it embodies Secretary Mineta's principle that our passenger rail system must be based on sound economics.  A national system must be composed of routes that people actually want to travel in sufficient numbers to justify the expense. 

David Gunn, Amtrak's President, says the company needs $1.8 billion per year in federal funding.  The House Transportation and Infrastructure Committee and the  Senate Commerce Committee have voted to authorize $2 billion per year in Amtrak funding.  How much federal funding is contained in your proposal? 

The bill authorizes such sums as may be necessary to carry out the programs to be established.  The Administration's budget request for Amtrak for Fiscal Year 2004 is $930 million.  But no amount of money will ever solve Amtrak's problem without meaningful reform, and that's exactly what we propose. 

Where will these funds come from? 

The program described in the bill would be funded from General Fund revenues, just as the current Amtrak appropriation is.