Monthly Archives

August 2005

Issues

RailPAC Endorses S. 1516

The Board of Directors of RailPAC, the Rail Passenger Association of California, enthusiastically endorses the bipartisan SB 1516. (Full text on Thomas at the Library of Congress)

  1. Its official title, beyond Senate Bill 1516, is the Passenger Rail Investment and Improvement Act of 2005. Some call it PRIIA 2005, and others are simply calling it the Amtrak reauthorization bill.RailPAC: This bill indicates that a national Amtrak system is here to stay, and must be made more robust and healthy. Corridors are OK, but Amtrak is a national passenger railroad, not a regional railroad serving only a handful of states.
  2. “Amtrak To Continue To Provide Non-High-Speed Services – Nothing in this Act is intended to preclude Amtrak from restoring, improving, or developing non-high-speed intercity passenger rail service.”RailPAC: That means that Maglev, Acela, and other proposals are not the sole hope nor future for Amtrak or passenger rail service in this country.
  3. The creation of a schedule of penalties by the Surface Transportation Board that will be assessed against the long distance train host freight railroads if the railroads fail to handle Amtrak trains by a minimum set of standards. The penalties will be designed to “fairly reflect the extent to which Amtrak suffers financial loss as a result of host rail carrier delays or failure to achieve minimum standards, and will adequately deter future actions which my reasonably be expected to be likely to result in delays to Amtrak.”RailPAC: While this means the host railroads will have to act responsibly, this also correctly puts a huge burden on Amtrak to maintain its locomotives and rolling stock in such a manner that breakdowns will not occur out on the railroad main lines, nor terminal delays will occur because a train has not been properly inspected for dispatching. This provision alone could do more to improve relations between Amtrak and its host railroads than almost any other concept.
  4. The bill encourages (but does not mandate) the Amtrak board of directors to develop an incentive pay program for Amtrak employees.RailPAC: This moves the company further away from acting like a government agency and more like a private business, and also would help attract a better class of employee.
  5. S. 1516 sets authorization for Amtrak capital and operating expenses and state capital grants, all separately. The amounts are specified for what goes where, and defines uses for the amounts of federal monies.RailPAC: This has a real chance of finally bringing some accountability of where and how federal monies will be spent, without the muddying of waters when Amtrak in the past has shifted designated monies around like pieces on a chess board.
  6. This bill allows current Amtrak President and CEO David Gunn, and his successors, to run a company that is not burdened with past debt mistakes that were the fault of his predecessors and the extremely poor stewardship of past Amtrak boards of directors.
  7. Excess Railroad Retirement payments are also addressed as separate federal monies.RailPAC: This needs to be a separate amount that does not have anything to do with the operating grant amount.
  8. S. 1516 calls for the establishment of an improved financial reporting system. The bill says the Amtrak board of directors “shall implement a modern financial accounting and reporting system that will produce accurate and timely financial information in sufficient detail – (A) to enable Amtrak to assign revenues and expenses appropriately to each of its lines of business activity, including train operations, equipment maintenance, ticketing, and reservations; (B) to aggregate expenses and revenues related to infrastructure and distinguish them from expenses and revenues related to rail operations; (C) to allow the analysis of ticketing and reservation information on a real-time basis; and (D) to provide Amtrak cost accounting data.”RailPAC: Greater transparency, consistency and honesty in Amtrak’s internal accounting procedures can only help the Amtrak Board make better informed investment decisions, including where to invest generous levels of federal capital support to achieve the highest possible returns on investment measured by transportation output and passenger ticket revenue, per dollar invested.
  9. The Amtrak Board of Directors is expanded to 9 qualified members, including the President of Amtrak and the Secretary of Transportation (or his staff member designee).RailPAC: This seems a political move, especially since there is a provision that no more than four members of the board may be members of the same political party. A provision is also noted to attempt to provide balanced representation of the major geographic regions of the country served by Amtrak. In other words, no more stacking the board with NEC representatives.
  10. A small provision calls for a $5,000,000 expenditure for grants to Amtrak and states participating in the Next Generation Corridor Train Equipment Pool Committee for the purpose of designing, developing specifications for, and initiating the procurement of an initial order of one or more types of standardized next-generation corridor train equipment and establishing a jointly-owned corporation to manage that equipment.RailPAC: We urge this provision not encourage designing new cars from the ground up, but to modify and modernize currently available off-the-shelf equipment.
  11. Relief for the states that have been paying Amtrak to operate state-supported trains is included in this bill. All state contracts will be created under similar criteria, and no state will pay more than another for basic train services, including food service cars.
  12. An independent auditor is directed to establish methodologies for Amtrak route and service planning decisions, including new routes, existing route expansions, and possible elimination of existing routes.RailPAC: Also addressed are concerns for performance, cost recovery, on-time performance and minutes of delay, ridership, onboard services, stations, facilities, equipment, connectivity with other routes, needs of communities for transportation, and the methodologies of other countries which have passenger rail service.
  13. Similar criteria are established for developing a separate annual performance improvement plan for the long distance system that includes a host of information, such as data on sleeping cars and diners.RailPAC: The end result of this, is that the FRA will hold Amtrak accountable for routes that are not improved internally by Amtrak, and may withhold federal monies designated for these routes. This will help the national system to stop being the stepchild of Amtrak, and force management to focus on the huge potential of the national system versus the constant and wrong focus on the corridors and the NEC.
  14. S. 1516 addresses how the NEC capital funds shall be spent in an orderly fashion, and also establishes a Northeast Corridor Infrastructure and Operations Advisory Commission plus a Safety and Security Committee.RailPAC: For the first time, there will be a seat at the table for everyone who is a stakeholder in the NEC.
  15. Money for state grants, at 80% federal funding, follows a long, but rational process. Just about every contingency is accounted for, and the availability of grants going back to projects in 2004 and 2005 is included, hoping to help states that started projects on their own initiative.RailPAC: California, and any other state that has invested its own funds, could be adversely affected because budget constraints have not allowed new capital spending in those two years. Therefore, we WITHHOLD full endorsement of this provision pending its resolution.

RailPAC urges its members to convey their support for SB 1516 to Senators Boxer and Feinstein, as well as their Congressional representatives.

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Commentary

Skepticism is the Mother of Security

By RailPAC President Noel T. Braymer — The July 7th bombings of London transit has set off a wave of panic, which is just what the bombers wanted. There are calls to spend massive amounts of money to increase security on all forms of public transportation, comparing the situation to security at the airports. Yet even the pundits admit that Israel, the most security conscience nation on earth hasn’t been able to stop bombings on their buses. These bombings are not random acts of thoughtless violence. British Prime Minister Tony Blair’s popularity even with his own Labour Party was hitting an all time low. He hoped to shore up his image by hosting the G-8 economic conference in Scotland. That way he could be seen with rock stars promoting help for impoverished African counties. Bombing London while this was going on was a way to rain on Mr. Blair’s parade. The train bombings in Madrid in March 2004 were timed just before the Spanish National elections. Their purpose was to weaken an already unpopular Prime Minister because of his support of American involvement in Iraq. It is unlikely that Al-Qaeda will be bombing Fresno anytime soon.

Security is very important for public transportation. It saves lives, for example on the train tracks. It saves money in reduced legal liability and vandalism. It encourages ridership, because safety is a major factor in how people decide to travel. But turning every train station and bus stop into mini-airport terminals will be massively expensive. It will turn people away from public transportation by slowing travel time, and will come from money needed to expand service. The main problem is such a knee-jerk reaction distracts us from the underlying cause of today’s terrorism: OIL!

The problem is our continuing dependence on oil, and the instability of the counties we depend to supply it. We now import 58% of our oil. Some 42% of our energy consumption comes from oil. The U.S. burns 45% of the world’s production of gasoline. We use 60% of our oil consumption for transportation. The United States has about 2% of the world’s total oil reserves. There has not been a major new oil discovery since 1962. Current oil reserves are expected to last about 60 years.

Oil prices are increasingly unstable. Saudi Arabia has admitted that it will have difficulty meeting current demand. There is increasing evidence that the most productive oil fields in Arabia are starting to dry up. Arabia should be a wealthy country. If you are a member of the Saudi royal family, you are wealthy indeed. However, Arabia has a population of 22 million with about 6 million foreign workers. Official unemployment is around 13%, but including women in the workforce, the unofficial unemployment rate is between 24 to 30%. There is a great deal of poverty and hostility in Arabia to the royal family. In turn the royal family is increasingly dependent on the United States to stay in power. This may explain why much of the leadership and money for Al-Qaeda comes from Arabia.

What’s the worse that could happen? Perhaps we could look at Iran. We depended on the Shah of Iran as our ally. He depended on us to stay in power. Officials in Washington were caught off guard when his regime was overthrown by revolution. Our relations with Iran are still far from normal. If we do nothing, or continue as we are, things could get very ugly.

What we could do – and should have done – is to raise taxes on gasoline and “gas guzzlers.” We should raise the minimum fuel efficiency of new cars, and rebuild and expand the national rail network for both expanded freight and passenger service. We could lower fares on buses and trains, which would be justified in saving fuel and dollars being sent overseas. There are many transit projects waiting for funding. Perhaps most importantly we should encourage construction of affordable housing that is well served by transit and commuter rail, and close to jobs and shopping served by transit and rail. If these things were easy, they would have been done long ago. But would you prefer an armed security officer on every bus with a bomb sniffing dog? That is assuming there is any fuel left for the bus.