[WASHINGTON, D.C.] – As the aviation industry announces their intention to cut 30,000 jobs in the wake of rapidly rising jet fuel prices, U.S. Senator Dick Durbin (D-IL) today introduced legislation that would create jobs and help Amtrak meet the increasing demand for an efficient, cost-effective and reliable alternative mode of travel.  Durbin’s bill aims to promote the replacement and rehabilitation of Amtrak’s aging fleet of passenger cars and to revive the train car industry in the United States.

The Train CARS Act envisions a Twenty-First Century Rail system that makes flying short distances a thing of the past with a high-speed rail system rooted in major metropolitan areas like Chicago. The most immediate obstacle in the way of making this vision a reality is the lack of passenger rail train cars and equipment. 

“Driven by the rising price of oil, we are witnessing a fundamental transformation of our economy and our national transportation system,” said Durbin.  “Aviation downsizing and the high cost of driving have led to a dramatic increase in Amtrak ridership – up 11% from last year.  But without more resources, Amtrak will not be able to keep pace with new ridership.  My bill proposes a package of financing options to bring our existing train cars into a state of good repair and lay the groundwork for the next generation of trains built in America.”

The United States has seen a surge in ridership on Amtrak routes and Illinois is no exception.  Ridership on all Illinois state-subsidized routes added an additional 181,000 passengers during the first two-thirds of the current fiscal year, bringing the state’s ridership to 670,000 for the year.  Specifically, ridership on the Illinois Zephyr and Carl Sandburg routes jumped 41.4 percent in 2007 compared to the previous fiscal year.

American railcar giants like the Pullman and Budd Companies provided a strong domestic manufacturing base for over a century, providing rail cars that are still on the tracks today.  But those companies have long since closed their doors and left the business of making passenger rail cars, due in part, to years of underinvestment in the U.S. and increased investment by European countries.

The Train CARS Act provides funding to encourage manufacturers currently supplying passenger rail cars overseas to bring their modern design and manufacturing expertise to the U.S. and open manufacturing facilities here to meet growing demand. The bill also provides a tax incentive for private, domestic businesses to re-enter the passenger rail equipment business and rebuild facilities and train cars here in the U.S.

Durbin’s legislation would take the following steps to address the most immediate obstacle to expanding Amtrak service – the lack of passenger rail train cars and equipment:

• Grants and Tax-Credit Bonds for Domestically-Manufactured Train Cars: Creates a new matching grant program at the Department of Transportation for Amtrak and states to rehabilitate existing equipment and purchase new, American-made equipment.  Also authorizes Amtrak to issue up to $2.8 billion in qualified bonds over four years to finance train car projects. To encourage bond purchases, owners would receive a credit against current year taxes.

• Buy American Requirements and Labor Protections: Ensure that any funding or tax credits provided in the bill are used for domestically produced train cars and that workers in the manufacturing and rehabilitation of train cars are paid a prevailing wage and protected under federal railroad labor laws. 

• Capacity Improvement Charge Matching Program: Allow states to receive a dollar for dollar match on any equipment fee they impose for the purchase of new domestically produced train cars. 

• Next Generation Equipment Pool: Mandate that Amtrak establishes a committee, along with Federal Railroad Administration and interested states, to design and develop specifications for a procurement standard for the next generation of passenger rail equipment.  The Committee is instructed to examine the benefits of having a public or private corporation separate from Amtrak purchase new equipment and lease that equipment to the states and Amtrak for service. 

• Intercity Passenger Rail Rolling Stock Trust Fund: Create a new trust fund to give Amtrak and the states a secure and reliable source of capital funding to replace the nation's train cars.  The legislation would transfer one-quarter cent of the per-gallon motor fuels tax into the new Rolling Stock Trust Fund for three years generating approximately $400 million/year.  

Durbin’s legislation would take the following steps to bring the passenger rail system – an industry that could once again offer high-paying jobs to thousands of workers and serve as the backbone of a national transportation system – into the 21st Century:

• National Passenger Rail Electrification System Study: Directs the GAO to conduct a study of the costs, benefits and economic impacts of providing intercity passenger rail along a national electrification system.  Electrifying the passenger rail system would provide a non-oil transportation alternative that could transport passengers along high-speed corridors without ever using a drop of oil. 

• Job Transition Services for Workers: Requires the Department of Labor to identify existing programs and recommend changes to help transition workers leaving the aviation and automobile industries transition into rail care manufacturing, rehabilitation and maintenance.  

Senator Tom Carper (D-DE) is an original cosponsor of today’s legislation which is also supported by the following national organizations:  the National Association of Railroad Passengers, the Environmental Law and Policy Center, the AFL-CIO Industrial Union Council and the United Transportation Union.