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July 2021
By Julie Sneider, Senior Associate Editor
On May 1, 1971, the first Amtrak train rolled out of New York City on its way to Philadelphia, less than a year after President Richard Nixon signed the Rail Passenger Service Act of 1970 to establish the start of the National Passenger Rail Corp.
The creation of a national passenger railroad stemmed from a desire of the nation’s railroads — many of which were in or nearing bankruptcy — to unload unprofitable passenger service and focus only on hauling freight. To preserve intercity passenger-rail service, the Rail Passenger Service Act consolidated 20 passenger railroads into what would become known as Amtrak.
But for many years after its founding, some members of Congress and other political leaders continued to debate whether a national passenger railroad would — or should — survive: Would Amtrak be able to operate a safe, well-run and well-equipped service for passengers? Should taxpayer dollars be used to support a national rail service in the United States?
Consequently, such questions meant Amtrak and its supporters spent a lot of energy making the case for the railroad’s ongoing existence and federal funding. Even as Congress continued pouring federal funding into the nation’s highways and airports (such as $46 billion for highways in 2019), many on Capitol Hill stuck to the belief that tax money shouldn’t be spent on a national passenger-rail system.
Times have changed, however. As Amtrak marks the 50-year milestone, it does so with support on both sides of the political aisle and from a president known as “Amtrak Joe” for his longtime backing of the railroad. Now the railroad has an “all-time level of common support” in Congress, says Amtrak President Stephen Gardner.
“What is remarkable today is how little the conversation is over whether Amtrak or passenger rail should exist in the United States. We’re now into conversations about how we should build the service, where we should have the service and what type of service it should be,” he says.
While political support for Amtrak has grown more bipartisan over time, the public’s support has been there all along, Gardner says, adding that whenever he travels and people find out where he works, they tell him “we want more trains” or “we love Amtrak.”
Chief Executive Officer Bill Flynn, Gardner and other Amtrak leaders are betting that public popularity will flourish in the coming years, since studies show younger generations — particularly the millennials and Gen Z — indicate a preference for riding trains and accessing public transit systems over driving vehicles. Taking advantage of that timing, Amtrak execs have been spending this anniversary year by touting an agenda that lays the groundwork for future growth.
A key part of it is Amtrak Connects US, a 15-year “corridor vision” plan that aims to foster service growth across the United States. To be implemented in collaboration with states, local communities, President Biden’s administration and other stakeholders, the plan builds on the railroad’s national network, integrating new and improved corridors to expand the existing system, Amtrak execs say.
Currently, Amtrak — along with its 17 state partners — serves 46 states. The proposed expansion calls for improving 25 existing routes, adding 39 new routes and bringing service to over 160 new communities. That’s on top of the 525 communities the railroad now serves.
“The nation has grown by 120 million people since 1971 — places like the South and West have more than doubled in population — and Amtrak’s network has not caught up,” Gardner explains.
The plan also calls for improved service in major cities that currently are underserved by rail — such as Houston, Atlanta and Cincinnati — as well as new service to cities that include Las Vegas, Nashville, Columbus, Phoenix and Wichita, with increased access for many towns in between.
Specifically, the proposed Connects US new or expanded routes include:
Gardner, Flynn and other Amtrak officials say Connects US gets to the heart of why Congress created Amtrak, which was to connect America by rail on behalf of the federal government. Amtrak is in a position to carry out the plan because it has the national capabilities and expertise in place now to do it; is the only entity that offers a comprehensive national network; and has access to all existing rail infrastructure needed for passenger-rail growth.
Just how much of Amtrak’s growth plan is doable will depend in part on how much funding it can wring out of Congress. Amtrak estimates it will cost $75 billion over the 15 years to implement the plan.
In a May 26 letter to lawmakers, Flynn asked for legislation that helps the railroad achieve its goals, including a new rail corridor-development program aimed at developing new corridors and improving existing ones through Amtrak’s National Network grant. Amtrak would use the money to cover the initial costs of getting corridor routes up and running before asking states to support them. Additionally, Flynn asked for “dedicated, predictable and sufficient funding” — a perpetual request from Amtrak to Congress — through mechanisms such as an intercity passenger-rail trust fund.
On the surface, Amtrak’s request comes at an opportune time. Not only is Amtrak Joe in the White House, but the current Congress is poised to consider a massive infrastructure plan. Typically, Amtrak receives about $2 billion a year in federal dollars toward operations, which Biden has described as a “bargain” for the nation’s pocketbook and environment.
“I’ve been riding Amtrak for almost as long as there’s been an Amtrak,” Biden said April 30 in Philadelphia at an event marking the 50th anniversary. “And I’ve come to see that Amtrak doesn’t just carry us from one place to another; it opens up enormous possibilities. And especially now, it makes it possible to build an economy of the future and one that we need.”
As president, Biden has said investing in Amtrak — and rail in general — is an important part of renewing the nation’s infrastructure, recovering from the COVID-19 recession and confronting the global climate crisis. His $2 trillion “American Jobs Plan” infrastructure proposal called for $80 billion specifically for rail, with much of it targeted at Amtrak.
As of press time, Biden and lawmakers were negotiating a compromise infrastructure package. How well Amtrak will make out financially — if or when a bill passes — remains to be seen. Implementing the railroad’s vision for the future “really does depend on Congress” enacting funding and legislation to create a long-term, stable and focused program for rail expansion and improvement, Gardner says.
If the recent past is any indication, Amtrak should benefit even if Congress approves only a “traditional” infrastructure package that funds transportation, roads and bridges. Over the past year, the federal government has included Amtrak in two major bills aimed at the nation’s recovery from the pandemic: the $2.2 trillion Coronavirus Aid, Relief and Economic Security (CARES) Act signed by President Trump in March 2020; and the $1.9 trillion American Rescue Plan (ARP) signed by Biden in March of this year. Amtrak received about $1 billion under the CARES Act and another $1.69 billion under the ARP to help recover from COVID’s impact on business operations, workforce and state funding partners.
The pandemic struck less than a year after Amtrak delivered what its executives described as its “best operating performance,” logging 32 million passenger trips and $3.3 billion in total operating revenue in FY2019. And with strong ridership and revenue levels in first-quarter 2020, the railroad was on track to achieve another high-performing year.
Then, the pandemic hit and business plunged, as cities and states declared stay-at-home restrictions. Amtrak’s ridership plummeted.
“We lost 97 percent of our business in March [2020] — we went from 90,000 riders a day down to 3,500,” says Gardner.
To address crushing revenue losses, the railroad furloughed 1,200 employees and slashed service levels. Once the rescue act passed, Amtrak began recalling those workers and restoring long-distance service. Now thanks to the “hard work” of Amtrak employees and with the support of Congress, the railroad has stabilized, Gardner added.
“We’re adding back service and have been seeing continuous ridership and revenue increases, particularly since February,” he says.
As of mid-May, ridership returned to about 30% of pre-COVID levels. As vaccination rates continue to climb and the summer travel season plays out, Amtrak execs are hopeful that ridership will steadily increase. At a media event held at Chicago Union Station last month, Amtrak vice presidents noted that summertime leisure trips were booking up fast. (In FY2019, the National Network of 15 routes registered 4.5 million passengers.)
The federal support that Amtrak received during the pandemic is a sign that the railroad has turned a corner in terms of bipartisan support, Gardner believes. If Congress passes an infrastructure plan that includes funding for its proposed expansion, Amtrak will start working out the details with states, local communities along the corridors, the U.S. Department of Transportation and freight railroads whose track would host the passenger trains.
Where Amtrak would launch new routes first would depend on corridors where existing partnerships are in place or where planning for new service is underway. Examples of those situations include additional service in the Midwest and Virginia, and the proposed new Front Range service.
“In every corridor, there are near- and long-term opportunities,” says Gardner.
One location where Amtrak, federal and some state and local leaders are anxious to get trains running is along the Gulf Coast, which lost Amtrak service in 2005 after Hurricane Katrina destroyed the region’s rail infrastructure. This past February, Amtrak announced it had notified Norfolk Southern Railway and CSX of its intention to begin service between Mobile, Alabama, and New Orleans starting in 2022.
But the Gulf Coast situation highlights another challenge: Whether Amtrak service returns to the Gulf Coast — or to other new corridors, towns and cities for that matter — depends on the host railroads. While Amtrak points out that those railroads are required by federal law to provide Amtrak trains priority on shared track, the two Class Is involved in the Gulf Coast proposal haven’t been in a hurry to accommodate passenger trains in the region.
Amtrak contends it has a legal right to access Gulf Coast track, and has asked the Surface Transportation Board (STB) to force CSX and NS to allow passenger service to be restored. The board hadn’t issued a ruling as of press time.
The Gulf Coast situation underscores Amtrak’s at-times strained relationship with freight railroads. For more than a decade, the two sides battled in court over Amtrak’s on-time performance (OTP), with the passenger railroad blaming the freight railroads for late-arriving trains on some of its routes. That case made it all the way to the U.S. Supreme Court, and late last year the FRA issued a rule laying out OTP metrics for Amtrak trains.
Gardner acknowledges that Amtrak has a “varied” relationship with its hosts.
“Some are very collaborative and anxious to work with us to look at opportunities to expand service; others, less so,” he says. “We hope the situation we’ve had in the Gulf Coast won’t be the standard in our plan to expand. Our hope is that the Gulf Coast [issue] can be resolved quickly through the STB, and that that resolution will indicate the benefit of working together to consider the question of how to advance passenger-rail service.”
Happy riders buy more tickets
Jim Mathews, president and CEO of the Rail Passengers Association, believes the freight railroads would prefer to renegotiate “the grand bargain” that Congress established when it took passenger train service off their hands 50 years ago.
“I get that [the host railroads] have a business to run, but they should recognize they continue to derive benefits from Amtrak’s existence,” he says. “But for the sake of the country and its economy — as well as in recognition of the law as it is on the books today — everyone should come to these conversations [about Amtrak service] with an open mind and a good faith attitude toward arriving at a decent solution.”
Mathews, whose organization was instrumental in convincing many lawmakers to back Amtrak’s creation, believes Amtrak can’t take for granted its public and political support, especially as its leadership appeals to Congress for more money. In recent years, Mathews has been critical of Amtrak attempts to cut costs by trimming certain long-distance routes, slashing food and beverage service or eliminating train station agents and police officers. Such cost-cutting measures haven’t gone over well with certain members of Congress, says Mathews, adding that Amtrak leaders testifying on Capitol Hill have been grilled by Republicans and Democrats for considering policy changes that impact passengers without first seeking public input.
“I think addressing the customer service piece — which is in Amtrak’s control — is something that would go a long way and take the [political] heat off of issues that Amtrak can’t entirely control, like on-time performance,” he says.
Amtrak officials say they’re trying to do just that. For example, the railroad is investing $2.45 billion to modernize Northeast Corridor service, which will feature 28 next-generation high-speed Acela trainsets now being built at an Alstom plant in New York. Amtrak’s most environmentally sustainable trains to date, the new Acela fleet is designed to reach speeds up to 160 mph — 10 mph faster than existing Acela trains. The first new trainsets are expected to enter service in 2022.
In another effort to modernize, Amtrak has ordered a fleet of new ALC-42 Siemens Charger diesel-electric locomotives for the National Network, including all long-distance and many state-sponsored routes. Amtrak announced an initial order of 75 new locomotives in December 2018, with deliveries expected through 2024.
One of the Charger locomotives was on display June 15 at Chicago Union Station, when Amtrak officials rolled out a three-year, $28 million program aimed at enhancing the rider experience. The program includes a refresh of 450 rail cars on long-distance trains serving overnight routes.
Keeping passengers happy can only help Amtrak as it seeks more federal and state support, Mathews believes. The public is ready for it, he adds.
“Our association has always had faith that the American people wanted to take trains where airlines wouldn’t serve. Amtrak has borne that out. This was a spit-and-baling-wire service when it started, and still it took off,” he says. “Over the past 10 years, even with its shortcomings, Amtrak has continued to set ridership records. It just shows you that the demand for it is there.”
Email comments or questions to julie.sneider@tradepress.com.
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