Amtrak

In an article for today’s Boston Globe, Derrick Jackson writes that “train travel is finally becoming a third rail of politics,” and “the first one to fry over it might be John McCain.”

For years, McCain, in the comfort of cheap gasoline for autos and airplanes, made Amtrak a personal whipping boy. Despite the fact that governments in Western Europe and Asia zoomed far ahead of the United States by supporting high-speed trains to relieve congestion, promote tourism and now as we are coming to know, save the planet, McCain has spent considerable capital in denying the passenger rail system the capital to modernize.

At this point, the current Amtrak passenger boom and capacity crunch has been well documented by the national media. Obama is a supporter of high-speed rail, which would include the proposed DC/NY system and, possibly, a funding boost for Moynihan Station.

The House and Senate have passed bills calling for new investments in passenger rail, creating the same federal incentives for states to invest in rail service, offering 80 cents for every 20 cents spent by the states. Barack Obama is a cosponsor of the Senate bill. Noting on his website that he is committed to the development of high speed rail, Obama said, "In many parts of the country, Amtrak is the only form of reliable transportation."

In the section of McCain's website called "reforming our transportation sector," there is no mention of rail. There is only his clean-car challenge to automakers, his $300 million prize to design battery cars, and enforcing only existing gas mileage standards. When The Washington Post reported on how President Bush's fiscal 2006 budget did not include a subsidy for Amtrak, would kill both $20 million for the next generation of high-speed rail, and $250 million for railroad rehabilitation, it quoted McCain as saying on television, "I'm glad the president is coming over with a very austere budget."

The luster of austerity is gone. Public transportation is becoming a real issue for the campaign trail. If so, McCain has all but handed Obama a golden spike to beat him over the head with.

Also, New York City Council Member Daniel Garodnick penned an editorial for today’s New York Sun calling for more federal support for the repair and expansion of the infrastructure system.

It is safe to say that the federal government has an interest in New York City remaining a global center of commerce, one with a mass transit system that can support a growing population, and a healthy infrastructure that does not endanger residents or discourage business, unlike the case of last summer's eruption of an 84-year-old steam pipe in Midtown Manhattan.

The extension of the no. 7 subway line to the Hudson Yards area is underway and when it's complete, its $2 billion price tag will have been paid entirely by the city of New York. Same goes for the $6 billion cost of building a third water tunnel that will serve New York City. Indeed, state and local governments foot most of the bill when it comes to infrastructure investment.

Add Moynihan Station to the list!

Read “McCain’s Agenda on Amtrak,” by Derrick Jackson for The Boston Globe

Read “Rebuilding New York,” by Daniel Garodnick for The New York Sun

Also, the National Association of Railroad Passengers has an excellent explanation of why the “mandate for profitability” is unfounded.

The steady drumbeat of news on the recent growth in passenger rail travel continued on Saturday when the New York Times reported that Amtrak is “bumping up against its own capacity constraints” as intercity trains are already sold out for some days this summer. However, “despite its popularity with passengers, the biggest determinant of the railroad’s health is still the federal government, and in Washington, views diverge sharply,” according to the article. The future of Amtrak “hinges on who wins the White House; Senator John McCain of Arizona, the presumptive Republican nominee, was a staunch opponent of subsidies to Amtrak when he was chairman of the Senate Commerce Committee. Barack Obama, the probable Democratic nominee, was a co-sponsor of the Senate version of the bill to provide an 80/20 financing match.”

Amtrak is an alternative to airlines along the Boston-New York-Washington corridor, and on some routes out of Chicago and a few in California. But most of its other routes are so slow that people take those trains because they have no alternative to reach places like Burlington, N.C., or Burlington, Iowa. Or they go for the train ride itself.

The railroad carried about 25 million passengers last year and may hit 27 million this year. (That is all intercity traffic; commuter rail, connecting suburbs and cities, is also growing, but that is not Amtrak’s market.) By contrast, the airlines carry about 680 million domestic passengers a year. If Amtrak were an airline, in terms of passenger boardings it would rank approximately eighth, behind Continental and US Airways and ahead of AirTran and JetBlue.

H. Glenn Scammel, a former head of staff of the rail subcommittee of the House Transportation and Infrastructure Committee, said the railroad should give up on some of its cross-country trains and redeploy the equipment on relatively short intercity trips, where it could provide enough frequency to attract new business. (Providing one train a day in each direction will not draw many new business travelers.)

But the railroad’s labor contracts provide stiff penalties for dropping routes, and dropping states from its itinerary would hurt its political support, especially in the Senate, where thinly populated states are overrepresented relative to their population.

Scarcity is not all bad for the railroad, though. It has raised ticket prices, so that it recorded ticket revenues of $153.4 million in May, up 15.6 percent from $132.7 million in May 2006. That jump is higher than the ridership increase of 12.3 percent, to 2.58 million, from 2.30 million.

Read “Travelers Shift to Rail as Cost of Fuel Rises,” by Matthew Wald for The New York Times

Last Thursday, Mayor Bloomberg testified before the Senate Banking Committee about the state of the nation’s infrastructure. “We are facing an infrastructure crisis in this country that threatens our status as an economic superpower - and threatens the health and safety of the people we serve,” he said. Bloomberg testified in favor of the creation of a National Infrastructure Bank that would issue up to $60 billion in tax credit bonds for infrastructure projects throughout the country. Earlier this year Bloomberg founded the Building America’s Future coalition with Governor Schwarzenegger of California and Governor Rendell of Pennsylvania.

Last week’s passage of the Amtrak reauthorization bill holds some promise for more federal funding for Moynihan Station, but the fact remains that state and local governments are responsible for three out of every four dollars spent on public infrastructure. New York City alone “needs $29.5 billion just in the next five years to continue to bring our mass transit system up to a state of good repair and to expand capacity to meet expected demand,” according to Bloomberg.

Here are some excerpts from his testimony:

To remain the world's economic superpower, we must build the infrastructure to support strong and sustained growth. And that means, very simply, things have got to start changing in Washington.

I hope 2009 will be a watershed year. The expiration of the current transportation bill will allow for a new debate on our infrastructure needs. I would hope and expect that it will focus on two issues: first, what should be the role of the federal government in our transportation system; and second, how we are going to pay for everything we know we need. And there are a few principles that I believe should guide the discussion:

First, we need to set clear goals - both for the short-term and long-term - and clear metrics for measuring success. Right now, we have no coherent national transportation policy. It's just a grab bag of programs with no goals that correspond to national priorities, such as reducing our dependence on oil and cutting our greenhouse gas emissions. We also lack performance standards to ensure we can meet our goals, which is just basic accountability. And we lack incentives that encourage cities and states to be more efficient, which is a basic idea of market economics. These practices are straight from Management 101, and we need to put them to work when it comes to transportation.

Second, we need to dramatically increase funding to help achieve our goals. Infrastructure costs money. But polls show that people are willing to pay for it - if they know they will benefit from it. Voters are smarter than politicians give them credit for being. They know there's no free lunch. But if they're paying for sirloin, they don't want to get served a bunch of baloney. To create the new funding we need, all options should be on the table, including general revenue, user fees, gas taxes, and public-private partnerships.

Third, we need to fund projects based on merit, not politics. One of the most promising concepts is the one introduced by Senators Dodd and Hagel: a national infrastructure bank. The bank would create an independent and nonpartisan entity that would fund the most vital needs - not the most parochial pork-barrel projects.

The bank's nonpartisan structure would also help us achieve the first principle I mentioned: instilling clear performance standards and accountability measures into projects.

These three principles are not Democratic or Republican. They are simply basic ideas that anyone serious about addressing our national infrastructure crisis should be able to support.

Yesterday, we posted on the passage of the Amtrak reauthorization bill, which includes a plan to solicit private proposals for a high speed train between DC and NY. Today, Eliot Brown of the New York Observer cites a source in Representative Jerry Nadler’s office and reports that part of the $2.5 billion grant program could provide a boost to Moynihan Station.

But the bill faces a major hurdle. On Monday the Bush Administration vowed to veto the bill because it "authorizes an unprecedented level of funding but does not include basic measures to hold Amtrak accountable to taxpayers for its spending decisions.”

The Amtrak bill that would solicit private sector proposals to build a high speed rail link between DC and NY passed the House on Tuesday. Gannett News reports that the 227-187 margin fell short of the majority required to override a Bush veto.

In addition to providing Amtrak operating subsidies over five years, the measure seeks to boost investment in high-speed rail.

It also calls for opening up the Washington-to-Boston route and 10 others across the country to private competitors — something Democrats such as Sen. Frank Lautenberg of New Jersey strongly oppose.

Though President Bush likes the bill’s privatization proposal, he rejects boosting funding for passenger rail if Amtrak isn’t held more accountable and doesn’t change the way it does business, the White House said in a statement explaining the veto threat.

Lautenberg, meanwhile, co-wrote an $11.4 billion Amtrak bill that passed the Senate 70-22 in October.

House and Senate negotiators have to come up with a compromise bill, which would then have to pass Congress and win Bush's signature to become law.

In other news, Governor Paterson announced his appointments to a commission on MTA financing. Richard Ravitch, former head of the MTA, will chair the commission. Appointees include MTA CEO Lee Sander, developer Douglas Durst, Con Ed chair Kevin Burke, and former Port Authority director Peter Goldmark. Excerpts from a press statement:

Governor David A. Paterson today appointed 12 members to the Commission on Metropolitan Transportation Authority (MTA) Financing, to be chaired by former MTA Chairman Richard Ravitch. The Commission is charged with recommending strategies to fund MTA capital projects and operating needs over the next ten years, a period when the Authority will be under unprecedented financial pressure as it expands its system and rebuilds its core infrastructure to provide the additional capacity needed to allow the region to grow. Governor Paterson announced in April that Richard Ravitch would head the Commission in wake of the failure of the congestion pricing proposal, which would have provided an additional revenue stream to the MTA….More here.

On Monday, a major story for NBC Nightly News reported that mass transit ridership has reached a 50 year high but it “may not be ready for all the Americans leaving their cars behind and hopping on for the ride.”

On Sunday, James Howard Kunstler called for fixing and expanding the rail system in an editorial for the Washington Post:

Fixing the U.S. passenger railroad system is probably the one project we could undertake right away that would have the greatest impact on the country's oil consumption. The fact that we're not talking about it -- especially in the presidential campaign -- shows how confused we are. The airline industry is disintegrating under the enormous pressure of fuel costs. Airlines cannot fire any more employees and have already offloaded their pension obligations and outsourced their repairs. At least five small airlines have filed for bankruptcy protection in the past two months. If we don't get the passenger trains running again, Americans will be going nowhere five years from now.

We don't have time to be crybabies about this. The talk on the presidential campaign trail about "hope" has its purpose. We cannot afford to remain befuddled and demoralized. But we must understand that hope is not something applied externally. Real hope resides within us. We generate it -- by proving that we are competent, earnest individuals who can discern between wishing and doing, who don't figure on getting something for nothing and who can be honest about the way the universe really works.

Read "Federal Government Remains Hostile to Rail Boom"

As we reported last week, Mayor Bloomberg met with Rep. Mica regarding a bill that would solicit private proposals for high-speed rail service between DC and NY. Afterwards, he released the following statement:

"I met today with Congressman John Mica of Florida, the Ranking Republican on the House Committee on Transportation and Infrastructure, who briefed me on his plan to encourage proposals to bring high-speed rail service to New York. Congressman Mica's plan makes a great deal of sense and I strongly support it. High speed rail service could cut the travel time between New York and Washington to only two hours. This would encourage more people to take the train, which simultaneously would relieve congestion at New York City airports and reduce our greenhouse gas emissions.

"Congressman Mica's plan, which is included in the House Amtrak reauthorization bill, would solicit proposals - including proposals from the private sector - to build the high speed rail service. Those proposals would be evaluated and presented to Congress for further action. Soliciting and considering proposals is an important and necessary first step toward determining the feasibility of this initiative.

"Congressman Mica's plan demonstrates the kind of ambitious, pragmatic thinking about our future that guided PlaNYC and that Building America's Future - my coalition with Governors Rendell and Schwarzenegger - is asking Congress to provide. Investing in modern mass transportation is critical to New York's future, and all options should be on the table. No idea should be ignored or dismissed simply because it is ambitious. That is not how America's greatest infrastructure marvels - from the Brooklyn Bridge to the Grand Coulee Dam - got built."

Yesterday, the New York Sun reported that Mayor Bloomberg will be meeting with Rep. John Mica on Friday to discuss his proposal for a high speed rail link – or “rocket train” – between DC and NY, a bill we detailed last week (see ”New DC/NY High Speed Rail Link?” and “DC/NY High Speed Rail Legislation Advances in House.”) It's no surprise that Senator Moynihan was an early proponent of the idea.

"It's a little late in the game, but we need it," the chairman of the political science department at Touro College, David Luchins, a longtime adviser to Senator Moynihan, said yesterday in an interview. "It's important because of the cost of oil, its important because of the environment, and it would be great for the economy — I see no downside. It is the most economically sound way to move people from New York to Washington."

Mr. Luchins also said that the job of generating political support could be eased by the disgruntlement of lawmakers who must deal with the rigors of shuttling between New York and Washington.

"The senator used to say you get one less day in purgatory for every day you have to spend on the shuttle," Mr. Luchins said.

As for the role of Amtrak:

A spokesman for Mr. Mica, Justin Harclerode, said Amtrak could participate but that the congressman envisions creating high-speed service that would be independent of existing commuter and freight lines, which would likely require new tunnels and ridding existing tracks of curves to facilitate speed.

On Tuesday, Bruce Reed, the president of the Democratic Leadership Council, and Paul Weinstein, chief operating officer of the Progressive Policy Institute, presented high-speed rail as the solution for air congestion in an editorial for Newsday.

That's why the next president and the new Congress should commit to building five new high-speed rail corridors in the next 10 years. The corridors would be selected based on three key criteria: geography (the flatter the terrain, the faster the train); a high probability of use (densely populated corridors with significant levels of highway and airborne traffic); and a commitment by the private sector, states and localities to share in the cost of construction. Wherever possible, the high-speed rail corridors should connect to major air hubs.

Roads and airports have direct sources of financing - namely, taxes on gasoline and ticket purchases. If high-speed rail is going to become a reality, it will need a similarly robust stream of income. That's why policymakers should establish a trust fund that would finance construction and maintenance. We could pay for this investment in a number of ways: carbon-offset purchases; a 4.3-cent diesel gas tax on the railroad industry that would raise about $200 million a year; ticket surcharges; and/or matching contributions from states served by the new rail lines.

How this would impact Moynihan Station remains unclear.

Read “High-Speed Rail Solution for Chronic Sky Troubles,” by Bruce Reid and Paul Weinstein Jr. for Newsday

Read “Congress Eyes a Rocket Train to Washington,” by Peter Kiefer for The New York Sun

Atlantic Yards Report has a thorough recap of Assemblyman Richard Brodsky’s hearing on West Side development held last Friday. Brodsky, who chairs the Assembly Corporations, Authorities and Commissions Committee, used the opportunity to question Deputy Mayor for Economic Development Robert Lieber, ESDC’s acting president Avi Schick, MTA Chair Lee Sander and others about the public investment and current status of Hudson Yards, the 7 line extension, and, of course, Moynihan Station.

We’ve excerpted some Moynihan-related items below, but the entire recap is worth reading - especially an exchange about using eminent domain for MSG. The Observer has a brief article on Sander’s comments about bringing light rail to the West Side and WNYC focused on comments about expanding Amtrak service at Penn Station to obtain further federal funding for the Moynihan project (see our related posts on a federal proposal for NY/DC high speed rail).

Looking at Moynihan

When it came to the Moynihan Station project, which could involve a new rail station in the Farley Post Office, the relocation of Madison Square Garden, and new office towers and retail over the current Penn Station/MSG site, Brodsky had the same basic questions. “How do I know how the public investment should be made versus private--what’s the rule?” he asked.

You make what’s “necessary to maintain the infrastructure, to maintain the stature of the city” replied Avi Schick, acting president of the ESDC. “This is not a subsidy for economic development. It is maintaining and enhancing transportation.”

Brodsky asked the “value of 5.4 million in FAR.” (He was referring to Floor Area Ratio but meant, simply, development rights.)

It’s not a simple answer, Schick said, saying that the working number is $125/square foot--the figure Levin later disputed.

Brodsky again asked about the appropriate relationship between public and private investment.

“We take into account the nature of the project,” Schick replied gnomically.

Brodsky acknowledged he was facing a formidable rhetorical foe. “I’m going to get you, Mr. Schick, but it’s going to take a bit longer,” he said playfully.

(At the close of the hearing, he offered public thanks to Schick for service to the state, suggesting that this might have been Schick’s last public hearing. Schick is leaving in September, so that suggests that, at the least, Brodsky’s not planning to hold an Atlantic Yards hearing by September.)

Who’s paying?

Brodsky brought up the apparent effort by Madison Square Garden to get government to advance the cost of building an arena.

“To my understanding, it’s not for the Garden, it’s for the [Moynihan Station] project,” Schick said.

Has the Garden asked for such support, Brodsky asked.

No, replied Schick.

Brodsky amended his question: Has the joint venture--involving Related Companies and Vornado Realty Trust--asked for such funding.

Yes, replied Schick.

Lieber added the entire financing plan was under discussion.

Summing up

In closing the hearing, Brodsky said the general question of whether we’re subsidizing projects at an appropriate level still remains. Still, he said he appreciated the government officials’ willingness to answer questions at a public forum, calling it an important part of the governmental process.

“I hope we can move forward on these [West Side] projects,” he said. “I fear we’re in more trouble than we’re letting on.” (He noted that it was news to him that the hearing brought out the city’s commitment to spend up to $3.5 billion on the #7 line, given that he'd previously criticized the city for committing to only $2.1 billion.) He said he was recessing rather than closing the hearing, given that he hoped Port Authority representatives would testify as well.

Does the legislature have any power, he was asked after the hearing. While it may not have direct oversight of such project, he said, in the long run the legislature has the power to pass laws restricting certain actions.

Again he criticized governance mechanisms to manage projects that bypass democracy. "What we've structured is a set of governance mechanisms that eliminate democratic institutions," he said. "And the net result is that anonymous people.... this is a set of Soviet-style bureaucracies that are acting without any public accountability, even when they’re right. They would much rather discuss whether they're right or wrong.... The reason we're in this problem with these projects is that the governance is secretive and out of touch, and we don't have enough money."

Doesn't Brodsky favor a new authority, however, to oversee the Hudson Yards project?

"A foolish consistency is the hobgoblin of little minds," riposted Brodsky, never at a loss for words. "The answer is, right now, I'm wrestling with a series of emergencies and the fact of the matter is that the Hudson Yards deal does not represent a thought-out economic development strategy or priority for what the city and the region need. In defense of that, we're scrambling for ways of gaining some control. It's not necessarily intellectually consistent."

"Having said that," he continued, "what today's hearing was about was bringing out into public view the realities of decisions, like on Moynihan, like, for example, the Garden is now seeking public monies." (He said he'd seen documents that have not been made public.)

"The Dolans have every right to seek public support," he said. "The public ought to deal with it intelligently. That's what this is about. This is about returning these things to the control of public agencies."

Agencies, perhaps, but not--as per his comments--public authorities.

Read “At West Side Hearing, Brodsky Questions Subsidies, Muses About Eminent Domain for MSG,” from Atlantic Yards Report.

According to the Wall Street Journal, the bill that would have the U.S. Department of Transportation solicit proposals for a high speed rail service between NY and D.C. was approved on Thursday by the House Transportation and Infrastructure Committee. Chris Conkey reports that “the bill's prospects appear to be strong since it enjoys the support of the committee's Democratic and Republican leaders.” (For more info on the bill read yesterday’s post: ”New DC/NY High Speed Rail Link?” and this reader’s comment). From the Journal:

"One way to address road and air congestion is by expanding our passenger rail system," said Rep. Bill Shuster, (R., Pa.), the ranking Republican on the House railroads subcommittee. Rep. James Oberstar (D., Minn.), chairman of the transportation committee, called the vote a historic milestone. "We ought to at least do in America what has been done in France to promote passenger rail service," he said.

The slow-moving U.S. rail network pales in comparison to the popular high-speed routes in Europe and East Asia. But hints of change are emerging. California is poised to vote on a ballot measure this fall that would steer over $9 billion toward the development of a high-speed route stretching from Sacramento to San Diego. Several Midwestern states have teamed up in the Midwest Regional Rail Initiative, which aims to speed up service times between Chicago and cities such as Detroit, Cincinnati and St. Louis.

The federal bill that advanced in the House Thursday would provide nearly $1.8 billion in grants to develop rail corridors between cities where trains can travel up to 110 miles per hour.

Another provision of the bill, championed by Rep. John Mica (R., Fla.), would have the Transportation Department solicit proposals for high-speed service along the heavily traveled and densely populated New York to Washington, D.C., route.

Mr. Mica's goal is to offer consumers a rail option that would connect the cities in two hours. It takes 2 hours and 45 minutes for Amtrak's fastest train, the Acela Express, to cover that distance.

Read “Railway Legislation Advances in House,” by Christopher Conkey for The Wall Street Journal