What’s the Future of Amtrak?

Billy House

Things really broke down several weeks ago when Rep. John Larson, D-Conn., invited House Transportation and Infrastructure Committee Chairman Bill Shuster to his state to chat up federal investment in transit and other infrastructure needs.

That is, the Amtrak train they boarded in New Haven for a ride to Hartford stopped after it left the station, the lights went out, and, ultimately, it had to be towed back to New Haven. Larson, Shuster, and state Transportation Commissioner James Redeker had to finish the trip by car.

“More than ironic,” Larson recalled.

Lawmakers and transportation-policy experts say the upcoming months could be pivotal for America’s passenger-rail system.

With the five-year Passenger Rail Investment and Improvement Act expiring in September, lawmakers must address contentious issues to craft a reauthorization bill: How to deal with aging infrastructure in fiscally constrained times? How to address calls for the privatization of some routes and the rejiggering of state-federal cost-sharing relationships? What is the very future of some long-distance corridors?

Many lawmakers, including Democrats and some Northeastern Republicans, note that the nation’s intercity rail provider has set ridership records in nine of the past 10 years, including a record 31.2 million passengers in 2012, up from 21.7 million in 2002.

But Washington’s deficit hawks, some of whom have long targeted Amtrak, want to reduce or eliminate subsidies to passenger rail. Some also question the continuation of money-losing routes that help wipe out Amtrak’s profits from its busiest route, the Northeast Corridor between Boston and Washington.

Rep. John Mica, R-Fla., one of the most vocal Amtrak detractors, no longer holds the top seat on the Transportation Committee. Still, he has not relented in his push against the service; he calls for privatizing parts of Amtrak, including the Northeast Corridor. Mica continued his mantra at a hearing earlier this month, calling Amtrak a “costly monopoly” run with a “Soviet-style mentality.”

Shuster, who headed the Transportaion panel’s Railroads, Pipelines, and Hazardous Materials Subcommittee before taking over at the full committee (Rep. Jeff Denham, R‑Calif., now has that subcommittee’s top seat), has been a cosponsor with Mica on legislation to let private companies bid to operate rail service in the Northeast.

Yet Shuster also has sent out early signals he wants to proceed along a more moderate—or perhaps even bipartisan—track as chairman, and he has made it clear he’s committed to getting a rail reauthorization done this year. He has talked openly about building his relationship with ranking member Nick Rahall, D-W.Va., and has underscored his belief in the federal government’s role in transportation as important to the economy.

Of passenger rail, specifically, Shuster in March told a gathering of the American Association of State Highway and Transportation Officials, “I’ve watched, in the last 40 years, the debate in Congress. Republicans used to stand up and say, ‘Amtrak has failed; sell it off and do away with it all.’ I don’t agree with that. There is a need for passenger rail in this country.”

At the same time, Shuster also said, “I think it’s wrong that we can’t get Amtrak to a place where they’re not taking big subsidies from the federal government. They can get to a place where they may be able to get close to break-even.”

Shuster, a Pennsylvanian, has pointed to the Northeast Corridor as a place to focus on high-speed and other rail development. And in a speech to the Ripon Society this month, he said, “That corridor is going to continue expanding, so we need to make sure we have a passenger-rail system focusing on these corridors. There are places in this country that we have rail that maybe we shouldn’t have rail—at least not at this point. We need to focus the system so that it is going to organically grow, so that 20 or 30 years down the road we do have an actual system that’s maybe not profitable but can at least stand on its own two feet.”

How all of that might translate into the specifics of a less-divisive reauthorization bill remains to be seen.

Committee aides say talks are in the earliest stages. But now that Shuster has held several hearings, traveled around the country, and appeared on roundtables, they say he will soon start to work with Denham to identify the major issues and craft themes to address them.

Aides say Shuster’s approach will be to build on the reforms and successes of the 2008 authorization bill and to rethink those things that did not work. In terms of Amtrak specifically, one aide said, “I think our idea would be really to build on that, keep sort of forcing them to do a better job, be run more like a business, and be just sort of smarter in how they do things.”

Amtrak hasn’t given the committee a formal proposal for what it wants to see in a new authorization bill, but has emphasized its capital funding needs.

In fiscal 2013, Amtrak’s subsidies from the federal government will be about $1.348 billion. That includes $443 million in operating subsidies – down from $756 million in 2004. Amtrak President Joseph Boardman told lawmakers at a hearing in March that Amtrak now covers 88 percent of its operating costs with ticket sales and other revenues, reducing its federal operating subsidy to just 12 percent.

Amtrak also is to receive about $905 million this fiscal year in federal money for capital programs and debt service. But Boardman said that while the federal capital levels have sufficed, they “are not going to be adequate in the future ... we will need much higher levels of federal capital funding.”

Some outside experts, such as Robert Puentes, a senior fellow with the Brookings Institution’s Metropolitan Policy Program, say American passenger rail is in the midst of a “renaissance.” Partly that’s the result of the 2008 authorization bill, he says, which ordered the establishment of metrics and benchmarking to track Amtrak performance.

Puentes is a coauthor of a paper that argues for strengthening the U.S. commitment to passenger rail, but with a “new alignment” that would include expanded state roles, such as agreements to share in operating costs and responsibilities for corridors longer than 750 miles. The upcoming negotiations on a reauthorization bill provide an opportunity to have a real national “conversation” on the role of passenger rail in the United States, he contends.

As Boardman told lawmakers at a recent hearing, “Over the last decade, we’ve grown our ridership, cut our debt and reliance on federal operating support, and we’ve brought new service to states and regions that have fewer and fewer choices.”

“We’re doing the right thing, and I’m proud of the job we’ve done,” he said. “But it cannot go on indefinitely; we face very real capital challenges that will have to be addressed in the near future.”