Amtrak budget request hits the Long Distance trains with a cost shift that doesn’t make sense

Report and Commentary by Russ Jackson and Andrew C. Selden, URPA

Amtrak published its budget request for the year beginning October, 2014, on March 18. To read the full document, go to this site: http://www.amtrak.com/ccurl/412/537/Amtrak-FY2015-Federal-Budget-Request-ATK-14-028,0.pdf In summary, here is what Amtrak has in store for the western Long Distance Business Line, which includes the Coast Starlight, California Zephyr, Empire Builder, Southwest Chief, and Sunset Limited that all serve the west coast.

In the words of Amtrak CEO Joe Boardman, “Amtrak’s fifteen long distance routes are the backbone of our system. Their principal mission is connectivity, and it is an increasingly important one to communities that have been losing their bus and air connections at a steady pace over the last decade. Our trains connect rural communities with major metropolitan areas, and afford our passengers a wide range of destinations – a service that has become increasingly important as air and bus options have contracted in many states. Since 1998, long distance ridership has grown by roughly 20%, without the introduction of any new services, frequencies, or equipment; FY 2013 ridership reached its highest point in twenty years.”

We certainly agree with that. Mr. Boardman recognizes, at least on paper, that the long distance trains are important. But then he goes on to totally change the picture for their future. “Long Distance service costs have been offset in recent years by revenues from our Northeast Corridor services, Amtrak is proposing in FY 2015 that the Federal Government provide for the totality of their operating need, $618 million, as part of our FY2015 operating need. Like the Northeast Corridor, these trains will require significant capital investment, with a total identified FY 2015 need of $295 million. Our Superliner cars, which are used in long distance service, are probably the hardest-run passenger equipment in North America, with the average car traveling an annual distance equal to seven trips around the world.”

Where are the proposals for growth of the Long Distance trains to help offset the “costs” he describes? All he wants is more Government money! And, he is not likely to get it from a frugal Congress. So, where are the growth plans for new cars for the western trains? All we have seen is the order for new low-level cars that will only be run on the eastern Long Distance trains. Where are the plans for increasing revenues by adding additional cars to already sold out trains? Where are the plans for protection of the Southwest Chief? All he does in this document is state that problem and welcome the states’ participation. What are the plans for making the Cardinal daily, and the Sunset Limited daily and extended back to Florida? This document, which will never be adopted by the Congress in its entirety, does propose some interesting ideas, but there is no doubt that adoption of those ideas will further put the Long Distance trains at risk by being beholden to the actions of future Congresses, while the NEC is not!

As for the Northeast Corridor (NEC), Mr. Boardman is wrong about his analysis. Here is what Andrew C. Selden says is the real picture: “Joe Boardman should star in The Music Man–he’s that good a “salesman.” Amtrak’s Northeast Corridor is its smallest, weakest and most heavily subsidized segment, according to Amtrak’s own numbers, when ranked by transportation output rather than mere transaction volume; and if one adds all of the NEC’s costs not just its direct, variable, costs, the NEC has no “profits”–it is a net consumer of federal subsidy totalling more than $600 million a year. The long distance trains are Amtrak’s largest, strongest and least-subsidized division, by the same yardsticks. The long distance group produced 1.55 times the output of the entire NEC in FY’13, and any two of the western long distance routes outperformed the entire Acela operation. Mr. Boardman apparently doesn’t want anyone to know that. The NEC doesn’t even have much social value, either, as it suffers a 52% load factor, and a market share for intercity transport of less than 2%. The long distance trains run statistically nearly sold out, and in many cases have market shares (in their respective travelsheds) of as much as 5%.”

For further analysis of these factors, see Mr. Selden’s complete analysis of the 2013 year at Amtrak on: http://www.unitedrail.org/2014/02/04/amtrak2013results/

Unfortunately, many rail advocacy groups and particularly the Congress are too lazy to want to look beyond what Amtrak tells them and will instead concentrate on mundane things like the Food & Beverage service “losses,” or having pets on board the trains. The high revenue-generating western Long Distance trains are therefore doomed to mediocracy while the NEC will flourish and whatever Amtrak says is their “profit” will go back to the NEC. If the western Long Distance and the Short Distance state-supported trains are isolated financially and dependent upon the yearly largess of the Congress they might as well be sold off so Mr. Boardman won’t have to worry about them anymore. You think he might have thought of that?

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