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[RailHaRRy]

From the DOT web site:

Monday, July 28, 2003
Contact: Leonardo Alcivar
Tel: 202-366-4570
DOT 63-03

Secretary Mineta Sends Passenger Rail Reform Bill to Congress

U.S. Transportation Secretary Norman Y. Mineta today submitted to the Congress the Bush Administration's proposal for fundamental reform of the nation's intercity passenger rail system, the first comprehensive proposal in thirty years. The Passenger Rail Investment Reform Act of 2003 builds on the successful service models used in several areas around the country to provide states and localities greater flexibility to plan and invest in rail service operations to create a truly national system.

"Our nation's current system of intercity passenger rail has failed to deliver on its promise for American travelers," said Secretary Mineta. "Business as usual is a recipe for failure. The Bush Administration is proposing a measured, steady, but certain course to lasting reform. Our proposed legislation will yield a more financially stable and effective network of intercity passenger rail - one that the country can confidently rely on."

He added, "I believe that our states and localities, in partnership with the federal government, are best suited to decide how and when to operate passenger rail service. As with highways, transit and aviation, local and regional priorities should govern rail transportation planning and investment."

The Administration's proposal would bring investment in intercity passenger rail in line with all other transportation modes by creating a system in which states and local communities, using capital investments supported by federal funds, operate rail service in their areas. Funding for the President's proposal will be subject to the appropriations process.

The proposal builds on proven models of success in attracting riders and providing quality service for travelers, such as the Cascades service between Portland, Oregon and Seattle, Washington, and other state-funded trains in California and Illinois.

The Administration's proposal replaces subsidy payments to the National Railroad Passenger Corporation (Amtrak) after a transition period, with direct federal matches for capital investment to be paid directly to the states. States and multi-state compacts would submit proposals for passenger rail capital investment and train operations to the U.S. Department of Transportation. Ultimately, states would be free to choose the train operations provider of their choice - whether a private company or a public transit agency.

Under the Administration's plan, Amtrak would transition over time into three entities:

* A private passenger rail company that would operate trains under contract to states and multi-state compacts - just as the current Amtrak operates trains under contract to commuter rail agencies;

* A private rail infrastructure company that would maintain and operate the infrastructure on the Northeast Corridor under contract to a multi-state Northeast Corridor Compact. Title to Amtrak's current tracks, stations and other infrastructure on the Northeast Corridor will be held by the federal government and leased to the Northeast Corridor Compact; and

* The National Passenger Rail Corporation, which would continue as a government corporation that would retain Amtrak's current right to use the tracks of the freight railroads, and the Amtrak corporate name. Both the track-access rights and the Amtrak brand would be provided under contract to states and multi-state compacts for qualifying passenger rail service they sponsor.

Secretary Mineta cited the Cascades rail service, developed by the states of Washington and Oregon, as a model for the support and innovative planning that results when communities and states take the lead in addressing their needs for passenger rail service. The two states have invested some $170 million in developing high-quality passenger rail service from Portland to Seattle. State funds have been used to improve track, purchase new trains and upgrade stations. The states have provided operational subsidies to support the service and have hired Amtrak to run it. Other states are exploring the potential of such multi-state coalitions for the planning of intercity passenger rail service and eventually high-speed rail service.

Under the Administration's proposal, the transition plan for the Northeast Corridor between Washington, D.C. and Boston, Massachusetts - by far Amtrak's busiest route -would relieve the private passenger rail operations company of the need to fund capital investment to maintain the Northeast Corridor. The bill proposes to transfer Amtrak's current property on the corridor to the federal government, which would fund its significant capital backlog over a period of several years, leasing the corridor to a Northeast Corridor Compact composed of the corridor states.

During a multi-year transition, Amtrak, followed by the newly created passenger rail service provider company, would hold the contract for train operations on the corridor. The passenger rail infrastructure company would hold the contract for corridor maintenance and upgrades, signaling and switching during this transition. At the end of the transition, the Northeast Corridor Compact would take bids from private sector companies and public sector transit agencies for both contracts, introducing competition and bringing Northeast Corridor passenger rail financing and investment in line with the new passenger rail model proposed by the bill.

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Passenger Rail Investment Reform Act of 2003

My comment: A prescription for the death of intercity passenger rail.