Hotline #845
January 17, 2014
By Sean Jeans-Gail
The U.S. Congress passed a compromise $1.1 trillion omnibus 2014 budget this week, with a continued tightening of the fiscal belt on discretionary spending. Amtrak’s funding numbers were a mixed bag, with increases to capital numbers paired with cuts to its operating budget. President Obama is expected to sign the bill into law.
Total Amtrak funding actually increased by 3.4%. Amtrak gets $1.39 billion, which is $46 million higher than the FY 2013 level. However, this increase is due to a $1.05 billion capital budget—including $199 million for debt service, $50 million for American With Disabilities Act spending, and $20 million for Northeast Corridor-specific programs. Amtrak’s operating budget actually was reduced by $102 million (although there is an option to flex $40 million in capital over to operating if needed). The bill also includes $10 million in Department of Homeland Security funds for Amtrak, and $23.5 million for the Amtrak Inspector General. Helpfully, the bill repeals restrictive language included in Hurricane Sandy relief act, which will let Amtrak access about $80 million in fiscal 2013 capital recovery funds.
High speed rail funding again was zeroed out, a particular disappointment for California, which later this year is to begin construction on the statewide system capable of reaching 220 mph. Public transit received $10.7 billion, a $100 million reduction from the 2013 level.
One bright spot was the intermodal, competitive-grant Transportation Investments Generating Economic Recovery (TIGER) program, which increased from $474 million to $600 million; railroads and rail transit have done well in previous rounds of TIGER funding.
California’s high speed rail project continued to be in the national spotlight with a January 15 Congressional hearing highlighting the challenges that lie between the project’s groundbreaking—scheduled for later this year—and its completion.
The House Transportation & Infrastructure Subcommittee on Railroads held the hearing. Dan Richard, chairman of the California High Speed Rail Authority, did an excellent job, injecting intelligence and facts into a debate that has become overly politicized. Subcommittee Chairman Jeff Denham (R-CA), a vocal skeptic on the project, praised Richard’s openness and responsiveness to the committee’s questions—both during the hearing, and in conversations with NARP leadership afterwards.
Richard did a superb job of explaining why the adverse court decision should not be a problem. The court said that California law (the bond act) “on its face, required the Authority to address funding for the entire Initial Operating Segment (IOS).” Richard noted that the term IOS does not appear in the law. The law refers to “usable segment.” Richard believes he can explain to the court that the Valley Segment, for which they do have funding, IS usable. It will be used initially by the Amtrak San Joaquins and ACE commuter train. Richard also noted that California’s Legislative Counsel says the Authority’s current plan is in compliance with the law.
Rail Advocates Rally in Support of Bullet Train
NARP issued a release the day before the California project hearing reaffirming our support of California High Speed Rail, endorsing the “blended” approach, which “involves beginning operations by sharing tracks with commuter trains San Francisco-San Jose and within the Los Angeles metro area.” NARP is confident that “the state will reap substantial benefits from the vastly improved trip times—compared with what is possible today—that the blended approach will provide.”
NARP was also one of many organizations that rallied public support for the project in Representative Denham’s Twitter Townhall. Using the hashtag #CAHSR, advocates dominated the online question and answer session, with roughly 90 percent of the questions expressing support for the high speed line. Trains Magazine has more(subscription required).
Projects Opponents Hold the Line
The outpouring of support did not stop Representative Denham from unveiling a bill yesterday to prevent additional federal funds being dispersed to the project until “sufficient” outside funding is identified. While the bill has several cosponsors from California’s Republican Congressional delegation, the bill is extremely unlikely to move in the Democrat-led Senate.
Denham also highlighted a clause that the Federal Railroad Administration included in its agreement with California that says future federal funding to California (potentially not just in transportation) may be withheld if the high speed rail project goes under—ostensibly to protect federal taxpayers. This revelation further raises the stakes for the project’s success.
The surface transportation reauthorization process kicked off January 14 with a hearing held by the full House Committee on Transportation & Infrastructure.
Although elected officials and public stakeholders are still weary from the last two year reauthorization, passed only one year ago, the Highway Trust Fund’s looming insolvency is driving the debate. The current Congress’ inability to consider raising taxes of any kind, however, raises serious questions about its ability to avert the bankruptcy, projected for fall 2014.
The last time the gas tax was raised was in 1993 (it’s not even pegged to inflation), and the Highway Trust Fund has been flirting with bankruptcy since 2008, requiring massive infusions of roughly $53 billion in general taxpayer revenue to keep it going. Now, political leaders are trying to identify a longer term solution. Speaking before the annual meeting of the Transportation Research Board on January 15, U.S. Transportation Secretary Anthony Foxx proposed stabilizing transportation funding through a comprehensive corporate tax overhaul.
“We need to be asking what we're going to be doing about [the Highway Trust Fund] in 2014 because starting in August, the fund could start bouncing checks,” Foxx said. “We know this is a tough mountain to climb, but it's the right mountain to climb because it's the one that will help us create jobs and set this country up for success over the long term,” he added later.
As part of an effort to raise public awareness about the impending bankruptcy, the U.S. DOT has introduced a Highway Trust Fund Ticker, providing regular updates on when the fund is projected to reach zero. The Highway Trust Fund is on track to run out sometime in mid-September, and the Mass Transit Account is causing worries among transit officials.
“At the time MAP-21 was enacted, the cash balance of the trust fund was thought to be sufficient to last us through the end of this fiscal year. As I sit here today, I can't be sure that this will be the case,” Federal Transit Administrator Peter Rogoff told Congress this week. “We have very similar worries for our colleagues at the Federal Highway Administration, whose trust fund account is also rapidly approaching insolvency.”
Transit Funding Questioned & Defended In Lively Exchange
While the kick-off was a mostly convivial affair, it briefly devolved into a battle over the role of transit and transportation subsidies when Representative Richard Hanna (R-NY) questioned why taxes on gas and diesel should go to public transit systems.
“People who use mass transit are not all poor. I’ve been in New York City, I’m a New Yorker, and there’s a lot of wealthy people that ride the transit,” said Representative Hanna. “It’s a great way to get around, and as you say, each year 35 million people load themselves. Why doesn’t that lead you to the conclusion that people who take mass transit should not pay something toward that?”
It’s dispiriting that the “roads pay for themselves” blunder should once again rear its head, as well as the notion that transit users are not already paying a significant part of service costs. In fact, the amount of money spent on roads between 1947 and 2005 exceeded the gas tax and other “user fees” by $600 billion (in 2005 dollars). Luckily, one of Hanna’s colleagues provided a compelling counterargument.
“I’ve been so intrigued by these conversations about transit riders subsidizing the transit for what we put into the gas tax for roads because I can think of a number of public goods that we get for having transit in place, not the least of which is taking so many people off the highways so that our trucks and commercial vehicles can travel more safely and more efficiently,” said Representative Donna Edwards (D-MD). “If we’re going to begin to quantify things, I hope we begin to quantify some of those things when it comes to asking whether transit is a net positive or a negative. Frankly sometimes people in my district and my state ask me why…we’re subsidizing roads out in the middle of nowhere, and I say ‘you know it’s because we’re Americans and we make an investment in a national system, and so the folks in the rural areas get their roads and in our metropolitan area, we get our transit.’”
The Texas Department of Transportation (TxDOT) has requested funding from the feds to extend a rail corridor development study south of San Antonio into Monterrey, Mexico.
TxDOT asked the U.S. Department of Transportation for an additional $400,000 to expand a study that is currently looking at connecting Austin, San Antonio, Dallas/Fort Worth, and Oklahoma City with fast, frequent, and reliable train service. Including the Monterrey segment could have a significant impact on the final route selection.
“What we have requested today from the secretary is to take this to the next level and include Monterrey,” said Texas Transportation Commissioner Jeff Austin. “That is important because once we get to route selection, we can attract private investment dollars, which is critical.”
Planners envision a two hour trip time between San Antonio and Monterrey, and Mexican officials believe the train could be up and running by 2018 at a cost of $1.5 billion. The plan is especially attractive because Mexican government officials, who are launching a big push to modernize the nation’s passenger rail network—have expressed strong political and fiscal support for the project. Mexico has already secured land for the rights of way on the segment within their territory.
“From the Mexican side, they are very interested,” U.S. Representative Henry Cuellar (D-TX) told the Texas Tribune. “From the Texas side, they are very interested.”
The plan involves a total of more than 100 miles of new rail line on both sides of the border, and a new, modern international crossing, which would also dramatically improve international freight rail.
Massachusetts Governor Deval Patrick proposed a package of $12 billion in transportation improvements on January 10, with strong investment levels included for rail and transit.
“We invest in our transportation infrastructure because roads, rail and bridges create a foundation that supports private sector investment and expanded opportunity for all our residents,” said Governor Patrick (D).
Rail and transit projects outlined in the Governor’s plan include:
$1.3 billion to complete the Green Line Extension, providing full service to Somerville and Medford by 2020.
$835 million to begin the $1.3 billion replacement program of 43-year old Red line vehicles and 31-year old Orange Line vehicles, as well as improvements to tracks, signals and systems.
-$254 million for South Coast Rail (Fall River and New Bedford via Stoughton), including early action improvements to rail ties, signal systems and bridges, as well as beginning preliminary engineering for the project.
-$252 million for implementation of diesel multiple unit service (DMU) on the Fairmount Line and expansion of the Silver Line to Chelsea.
-$34 million for the Housatonic Railroad, including the rehabilitation of tunnels, track and signals in advance of eventual rail line acquisition.
-$31 million to complete track and signal projects necessary to restore permanent, seasonal Cape Flyer passenger service to Cape Cod.
-$211 million for regional transit services, including $15 million for the purchase of senior citizen transportation vans for the local Councils on Aging
MassDOT will be holding a series of meetings of public outreach meetings January 29 to February 10. You can see the locations listed here.
Travelers Advisory
—Amtrak is offering passengers special winter deals to combat the post-holiday blues:
-Amtrak Guest Rewards members can brighten up their winter by riding and earning free travel on Acela Express, Northeast Regional, Hiawatha Service and Amtrak Cascades. More details at AmtrakGuestRewards.com.
-Now through January 27, Amtrak passengers can book a winter getaway for up to 20 percent off of one-way fares on every long-distance train route for travel between January 22 and April 16, 2014.
-Amtrak is offering passengers in the Midwest a 20 percent discount on several trains between now through March 31.
Additionally, Amtrak’s Winter/Spring 2014 Timetable is now available.