Amtrak The Coast Starlight exits a tunnel and passes through a canyon in Southern California on its way to Los Angeles over former Southern Pacific track. Some western lines have made record gains. The story is below.

 

Crisis, hope, and myths

BALTIMORE – America’s inter-city passenger trains are in “a state of crisis,” but encouraging things are happening, and Amtrak now enjoys leadership with record-breaking credibility among policy-making officials.

That combination of crisis and optimism were the main ingredients in a July 3 address by Gilbert Mallery, Amtrak’s Vice-President for Planning and Business Development. Questions also have been raised anew about the relationship between Amtrak and the freight railroads.

Speaking to a joint convention of the National Railway Historical Society and the Railway and Locomotive Historical Society, Mallery pointed to the $2 billion per year multi-year authorizations reported in House and Senate committees.

As noted by this correspondent, who emceed the banquet amid the six-day convention, a show of confidence in Amtrak on this scale, never before seen in the 32 years of the passenger rail corporation’s history, could be attributed to David Gunn’s high credibility among lawmakers – even including some Amtrak critics – and the teamwork on the part of Mallery and others working with Gunn on the goal of bringing America a first-class passenger railroad by getting it back to a state of good repair.

The Amtrak V.P. said Gunn is a straight-shooter – “blunt almost to a fault” – who has dispensed with the “happy talk” of previous Amtrak management that glossed over perennial problems, resulting in “bad information on Capitol Hill.”

Moreover, people out there are riding the rails again. Amtrak’s ridership is the highest in its history, up 2 percent since last May. Lest that seem paltry, the fact is that travel, in general, is down 20 percent, mainly because of a slow economy and security concerns.

Long distance trains’ ridership is way up – 17 percent for May.

Amtrak revenues are down 9 percent, but not to worry. Expenses are down by $110 million.

So where is the “crisis?”

When you go to Washington Union Station, and look out at the system from the platforms of the stub-end tracks, you see an infrastructure that is little changed from 1930 or in some cases, since 1910.

“Financial stability” is what is needed. A so-called “high-speed” Northeast Corridor, where trains are often slowed down to 50 mph, does not bode well for the future unless something is done.

Mallery outlined some “myths” that have been repeated over and over again so persistently over the years that in some quarters they have come to be accepted as gospel.

Myth No. 1: Amtrak is a source of funding for the states. Not so, as could be ratified by simple math.

Myth No. 2: Amtrak can be profitable. That does not pass the laugh test.

Myth No. 3 (related to No.2): The private sector is just dying to take over Amtrak, and the freight railroads are “anxious to get back in the passenger business so they can start losing money again.”

Earlier in the day of Mallery’s speech, the joint NRHS-R&LHS convention featured a seminar on the heroic efforts of the B&O (or B&O/C&0, as it was known in later years) to save passenger trains in the private sector.

Paul Reistrup, David Watts, and William Howes, Jr. documented in personal recollections and slide presentations how the Baltimore & Ohio (unlike some of its competitors) did not try to drive passengers away. There was a determination that though the B&O was not the richest of the Class I carriers, it would be the best.

“We went out with our heads held high and we kept our integrity intact,” Reistrup told the gathering.

Howes, who at the banquet that night would introduce Mallery, was asked during the morning seminar Q&A session about relations between Amtrak and the freight railroads whose property hosts Amtrak almost everywhere in the country outside the Northeast Corridor. He replied that there is a feeling among the Class Is that their dealings with Amtrak do not constitute a business relationship.

“It may be that a true business relationship between Amtrak and the freight railroads never will happen or, in fact, never can happen,” Howes said, but it is reality nevertheless.

Howes, by the way, cannot in any way be accused of harboring an anti-passenger bias. His love of passenger trains is reflected by the fact that he was president and 20-year board member in the 1970s and 1980s of the Chesapeake Division of the Railroad Enthusiasts, Inc., now the Chesapeake Railway Assn.

For his trouble in trying to save B&O passenger trains as they were bleeding millions of dollars, an irate woman whose favorite train had been eliminated stormed into Howes’s office and took a swing at him. (He ducked in time.)

Of course, his comment about Amtrak and freight railroads referred to a longstanding complaint by the Class Is that the payments they receive from Amtrak are not in harmony with market value, and in many cases fall short of what it costs them to host the passenger trains.

A bulletin released this past week by the National Association of Railroad Passengers (NARP) recalls that the freight railroads “urged the federal government to create Amtrak and agreed to provide access to their tracks at an incremental cost basis in 1971.”

Moreover, NARP says a case can be made for the opposite view – “that Amtrak subsidizes the freight railroads.” In support of that, the passenger train advocacy group cites the Amtrak payments into the railroad retirement fund at about $150 million toward the retirement of workers that Amtrak never employed. The Railroad Retirement Board, a federal agency, oversees the funds.

It is not D:F’s purpose to wade into this accounting debate one way or the other. Howes’s comment that “a true business arrangement” may never be attained reflects a dilemma among those who support Amtrak and also credit the freight railroads for their vital role in U.S. commerce and their status as the only major private sector transportation mode in the world that funds both operations and infrastructure. This dispute may be a problem with no solution, and no “good guys” or “bad guys.”

Amtrak President David Gunn has compared Amtrak to “the canary in the mineshaft,” a forerunner of problems possibly coming down the pike for freight railroads.

In his talk, Mallery referred to a “lack of [adequate] capacity,” and capital needs that he said the freight carriers have.

As D:F has reported, there has been a debate within the boardrooms of the Class Is as to what extent government subsidies should be accepted, if at all. In announcing a Chicago plan to avoid congestion among the 500 freight trains and the more than 700 passenger trains entering and leaving the city every day (See D:F June 30), AAR President Ed Hamberger stressed that government dollars would cover the cost of public benefits in the project, while private corporate funding would cover the cost of benefits that accrue to the railroads. In such partnerships, the proudly independent freight railroads are careful to maintain a wall of separation on public and private money and who benefits from what.

Myth No. 4: If you just get rid of the long distance trains, Amtrak’s money troubles will go away.

The long-distance trains account for only $300 million out of a proposed $1.8 billion dollar budget. Moreover, getting rid of them would incur high labor protection costs.

Furthermore, states outside the urban corridors in the Northeast, Midwest, and West Coast would balk at paying for what would amount to urban corridor operations which do not serve the folks in small towns and more rural states.

Mallery approvingly quotes conservative columnist George Will who has written that Amtrak’s long distance trains are a “cost of democracy,” and are “here to stay, like true love – only more so.”

Myth No. 5: “Quick reform” will solve Amtrak’s problems.

“Before reform can take place, “Mallery said, “the system needs to be repaired. The cheaper reform is stability.” In fact, the Government Accounting Office (GAO) has found that the cost of liquidating Amtrak would be $44 billion.

Myth No. 6: Amtrak is victimized by “high labor costs.”

Not so, Mallery told the Baltimore convention. Amtrak workers earn 90 percent of the pay enjoyed by workers in comparable jobs with the freight railroads, and 60-70 percent of the pay of those employed in transit agencies. However, Gunn has said “productivity” improvements can be made, and he will deal with them in negotiations with rail labor.

Myth No. 7 (and this is covered not only in Mallery‘s remarks, but in a bulletin published by NARP): Amtrak is unique in operating in the red at taxpayers’ expense.

Amtrak supporters are frustrated that this particular myth has gained currency, in large part, due to a pervasive ignorance on the part of the media. One 19-year-old woman this writer met at a Washington gathering said she would not ride Amtrak “because it’s government-subsidized.”

NARP says if that is a problem, then one should stay off the highways and airplanes as well, as they are subsidized by taxpayers at handsome rates.

A Brookings Institution study shows that in 2001, 41 percent of funding for highways came from payments not occasioned by highway use (i.e., property taxes, bonds, general funds, other taxes and fees).

“While most of this is at the state and local levels,” says NARP, “federal policy encourages this by offering states generous funding matches for highway investments, but no match for intercity rail investments.”

Moreover, Mallery notes that the feds provide highway matching funds on an 80/20 basis, 50/50 for transit, but (again) no match at all for intercity rail.

Amtrak is trying to help states plan corridors that are ripe for development, bearing in mind that Amtrak’s priority right now is to see that the current service Gunn inherited is fixed. A given state’s governor “needs to be out there as an advocate.”

Amtrak would shut down and essential air service subsidies would be cut to 50 small airports while increasing highway funding if a House Appropriations subcommittee bill for the Fiscal Year 2004 budget becomes law.

The Transportation, Treasury and Independent Agencies Subcommittee of nine Republicans and five Democrats recorded its vote on Friday. The action sets up a battle in the full Appropriations Committee and possibly the House floor, according to a Washington Post report.

The bill reflected the priorities of the subcommittee chairman, Rep. Ernest J. Istook (R-Okla.), a longtime Amtrak foe, but it goes against the sentiment of the full House where a majority of members signed a letter asking Istook to grant Amtrak the full $1.8 billion requested by Amtrak President David Gunn.

Istook’s bill would grant $580 million to Amtrak, which is $320 billion below President Bush’s request. It would require that $300 million be spent on the Northeast Corridor between Washington and Boston, far less than is required to keep that line running. It also requires USDOT to ensure sufficient funds for commuter operations now run by Amtrak.

The amount, if eventually approved, would immediately shut down all long-distance and regional passenger rail systems outside the Northeast, says Amtrak, and it is unclear how long the Northeast Corridor could operate before a shutdown.

In addition, both the Senate Commerce, Science and Transportation Committee and the House Transportation and Infrastructure Committee earlier voted to authorize $2 billion a year for Amtrak for at least three years.

Amtrak President and CEO David Gunn said the subcommittee’s bill is so unrealistic that it would lead to the immediate shutdown of all Amtrak operations, including the Northeast Corridor, in addition to all commuter service that operates over Amtrak lines and all state-supported regional service, including the extensive California rail system.

“You would crash,” he said. “You would shut down. It would be a chaotic shutdown.”

Rep. David Obey (D-Wis.), ranking minority member of the full Appropriations Committee, promised “an arduous committee markup of the bill.”

Istook said his priority is highways, which would receive $34.1 billion, $4.8 billion more than the president requested and $2.5 billion more than the current fiscal year. He said that Amtrak “has not gotten sufficiently serious about restructuring.”

Rep. John Olver of Massachusetts, the top Democrat on the subcommittee, argued that there’s no major intercity rail system in the world that operates profitably without government support and that the subcommittee-backed budget, part of a $90 billion Transportation and Treasury spending package, “would strangle our national passenger rail system,” The AP reported.

Rep. John Mica, R-Fla., a senior member of the House Transportation Committee that sets infrastructure policy, welcomed the low-end budget figure, saying he was campaigning “to get them the minimal amount of money until we get some commitment for reform.” The subcommittee action was “going to precipitate a serious look at reform,” he predicted.

Mica is drawing up legislation that he said would return Amtrak to its core mission - long-distance service. He would turn over commuter services in the Northeast Corridor, Amtrak’s biggest source of revenue, to a compact of Northeastern states.

“The Northeast Corridor, if properly managed, not only has the potential for making money but could also dramatically change the travel patterns” in the region, he said.

Transportation Department Inspector General Kenneth Mead, in testimony to the House Budget Committee earlier this week, said that even a budget of $1 billion a year wouldn’t “solve the fundamental problem: the current Amtrak model is broken.”

“The status quo pleases no one,” Mead said. “It will require significant increases in funding just to maintain it, and it will not meet the mobility needs of this country in the years ahead.”

The Congress created Amtrak in 1971, and services 500 communities in 46 states on 22,000 miles of track.

Amtrak California lines June ridership and ticket revenues showed an improvement over the preceding year. The Pacific Surfliner recorded 188,120 passengers, up 29.9 percent over Fiscal Year 2002, and a record for the month. Ticket sales totaled $2,870,836 ticket, up 15.4 percent above fiscal 2002.

The San Joaquins also showed gains. 71,210 passengers was a 2.3 percent gain over one year earlier, and also a record for the month. The carrier produced $1,740,857 in ticket revenues, up 6.4 percent.

The Capitol Corridors carried 94,702 passengers, which was up 6.1 percent over last year, and yet another record for the month. Revenue produce through ticket sales totaled $1,034,163, a gain of 7 percent over the same period one year earlier.

Union Pacific and CSX will be doing some heavy trackwork that will delay several Amtrak trains.

UP will be working on its Colorado right-of-way between Grand Junction and Denver from July 16-19, July 22-26, July 29-August 2, August 5-9, and August 12-14.

Amtrak reports its No. 6, the eastward California Zephyr, will hold to depart Grand Junction at 12:55p.m., about two hours late, and also be delayed operating through the work area. No. 5 will pass through the area before work begins, if it is on time. The delays will not appear in the railroad’s “Arrow” computerized ticketing system.

Other trackwork will affect the Sunset Limited and Silver Service trains.

CSX will go to work on its Sanford subdivision iron, so train Nos. 1 and 2, the Sunset will be disrupted between Jacksonville and Sanford, Fla.

For No. 1, its origination dates of July 24, 27, 29, August 5, 7, 10, 12, 14, it will originate in New Orleans following day, instead of Sanford.

Amtrak reports buses will operate between Orlando and New Orleans in both directions.

No. 2 origination dates of July 20, 23, 25 and August 1, 3, 6, 8, 10, 13 will see the train terminate in New Orleans two days later.

No. 92, the northward Silver Star, will also encounter delays in the Sanford Subdivision. Between July 22-29 and August 5-14 the daily train will depart Miami 59 minutes earlier at 9:36 a.m. and operate earlier through arrival at Jacksonville. It will depart Jacksonville on time at 7:45 a.m.

The train will operate on its normal schedule July 30 through August 4, and on resume its normal schedule on August 15.

USDOT Spokesman Lenny Alcivar told D:F on Friday “No replacement has been named” to replace Deputy Secretary Michael Jackson.

Jackson stunned railroad watchers last week when he said he would be leaving as of August 1. He said the demands of his high-pressure job had taken too much time from his wife and 8-year-old daughter. Jackson left Lockheed Martin in a vice-president role to take the federal post on May 3, 2001. He also said the transportation post was becoming a financial burden for his family.

Alcivar added that USDOT Secretary Norman Mineta wouldn’t be leaving any time soon.

“Secretary Mineta is committed to serving at the department indefinitely,” he declared.

Mineta was hospitalized in Washington following a back injury last year, but has been back on the job for several months.

STB to conduct two hearings, meeting

The Surface transportation Board is going to hold two hearings in July – one in New York City on the 24^{th –} and another in Washington on the 31^st. A meeting, intended for counselors involved in official STB proceedings, will be in D.C. on July 29.

Chairman Roger Nober said a public hearing will begin at 2:00 p.m. in New York’s Federal Conference Center in the Jacob Javits Federal Building.

The topic will be a case titled, Chelsea Property Owners – Abandonment – Portion of the Consolidated Rail Corp. West 30^th Street Secondary Track in New York (Docket No. AB-167 (Sub-No. 1094)A.)

Nober said anyone who wants to speak at the hearing should state so in writing by July 15.

The topic is involves what to do with an elevated steel and concrete railroad viaduct, named the “Highline,” built in Lower Manhattan in 1930 and owned by Conrail.

In 1992, the board’s predecessor Interstate Commerce Commission approved the abandonment of the Highline so that it would not be available for use in rail service, despite opposition by Conrail.

The community is seeking the property to turn it into a park.

In August 1992, the Chelsea Property Owners (CPO), a party seeking the viaduct’s condemnation and demolition, asked the board to find that a draft settlement agreement meets a previously imposed requirement that Conrail be reimbursed for all demolition costs in excess of $7 million.

In addition, another party, Friends of the High Line, Inc., has asked the board to reopen the 1992 proceeding on historical and environmental grounds.

The City of New York has asked the Board to issue a certificate of interim trail use (CITU) under Section 1247(d) of Title 16, USC [16 U.S.C. 1247(d)] to allow the city to negotiate an agreement with Conrail to “rail bank” (to preserve until a time when rail use might be restored) the Highline and allow it to be used for the time being as a trail.

Meanwhile, Conrail has asked the federal board to determine whether the agency has the authority to issue a trail certificate for the property.

The other hearing, to be heard in the STB’s Washington hearing room at 10:00 a.m., is intended to provide “a forum for interested persons to express their views on the matters at issue in the case entitled Kansas City Southern – Control – The Kansas City Southern Ry. Co., Gateway Eastern Ry. Co., and The Texas Mexican Ry. Co. (STB Finance Docket No. 34342 [”KCS-Tex-Mex”]).

Anyone who wants to speak at the hearing should file a written notice with the board by July 23.

Kansas City Southern is a non-railroad holding company controlling two U.S. railroads, the Kansas City Southern and the Gateway Eastern.

On May 14, KCS filed an application with the STB seeking approval for KCS’s control of a third U.S. railroad, Tex-Mex, as reported in D:F in recent weeks.

In its Decision No. 2 on June 9, the board accepted the KCS-Tex-Mex merger application and set a procedural schedule for its consideration.

The board wants to hear from the public as well as lawyers.

It stated that although an oral argument session is a formal way for lawyers representing involved parties to express “legal” views regarding disputed matters, a public hearing is less formal and the views expressed therein generally are not expected to be “legal” arguments.

In the forthcoming meeting for “practitioners,” Nober said the STB will hold an informal informational session for them – counselors involved in official STB proceedings – and other agency stakeholders beginning at 10:00 a.m. in the board’s hearing room.

The information session will include informal presentations by the board’s office supervisors and the opportunity for those interested in the board’s work to meet and converse with agency staff members and each other.

The public, industry, and media should call Vernon A. Williams, Esq. at (202) 565-1718 by July 26.

Sound Transit This rendering is somewhat conceptual in nature, “as we have not yet contracted with a light rail vehicle provider. The exact appearance will depend on which manufacturer is chosen,” says Sound Transit spokesman Geoff Patrick.

Sound Transit Board Chairman Ron Sims reported on July 7 the transit agency a clean bill of health for Link light rail in a report from the U.S. DOT’s Inspector General. The report, which follows two years of intense scrutiny, confirms that Sound Transit has met requirements for receiving federal funds to build light rail in the Puget Sound region.

In the report, the Inspector General confirmed that Sound Transit had successfully demonstrated that the initial segment of Link light rail is on track in all of the major areas addressed, including the project’s costs, schedule, safety and viability as a stand-alone transit project.

“This is a moment of affirmation for Sound Transit,” said Sims, who is also King County Executive.

Sound Transit spokesman Geoff Patrick told D:F, “Our Central Link light rail project is a new line. Subject to federal funding, we're gearing up to give the Seattle area its first taste of light rail.”

Patrick noted, “To avoid confusion, Sound Transit is opening a 1.6-mile streetcar line in Tacoma this summer and also doing Sounder commuter rail. We began Seattle-Tacoma service in 2000 and are planning to begin Seattle-Everett service by the end of the year over existing freight tracks.”

Sims noted, “The Inspector General’s findings validate both the ‘highly recommended’ rating we received from the Federal Transit Administration (FTA) and the inclusion by President Bush of $75 million for this project in his Fiscal Year 2004 proposed budget.”

“Everyone from Boeing to business to President Bush agrees that Link light rail is essential for the Puget Sound, and today the Inspector General has added his seal of approval,” said Sen. Patty Murray (D-Wash).

The funding now undergoes the final review by the FTA and Congress.

The report culminates a process that began in April 2001, when the Inspector General recommended that a $500 million full funding grant agreement for the light rail project be put on hold until Sound Transit could prove that it had resolved issues of serious concern.

“The Bush Administration takes its responsibility to safeguard the public’s funds very seriously and looked at Sound Transit under a microscope,” said Edmonds City Council President and Sound Transit Vice-Chair Dave Earling.

“The intensity of the Inspector General’s review confirms that Sound Transit has its house in order,” he added.

 “Anyone who has any question about whether light rail is back on track should read this report,” said Pierce County Executive and Sound Transit Vice Chair John Ladenburg.

He said, “We have truly turned a corner. This validation of the changes we’ve made to the project and the way Sound Transit operates confirms that the problems of the past are behind us.”

Over the course of the two-year audit, the I.G. stationed staff at Sound Transit’s headquarters for nearly a year. The office’s report concludes Sound Transit has resolved all of the identified issues, including the cost to complete the Link initial segment, now thoroughly evaluated and found reasonable.

Also, the proposed schedule for building the project is viable, and the risks are identified, and operating buses and trains jointly in a downtown tunnel safely is feasible.

The 14-mile initial segment is a stand-alone system, and any future extensions would be evaluated in their own right if Sound Transit seeks federal funds for them.

“This report recognizes the effectiveness of the changes Sound Transit has made,” said Snohomish County Executive and Sound Transit Board Member Bob Drewel.

Drewel said, “It affirms what we know very well from our hard work: that the Central Link initial segment is a critical project that Sound Transit is ready to start building.”

Seattle Mayor Greg Nickels, a Sound Transit Board member, noted, “Piece by piece, the path is clearing for a program that will put thousands of people to work and will build a new transit alternative for Seattle commuters.”

The report found that one remaining area of concern facing the light rail project is the outcome of pending litigation on the constitutionality of Initiative 776.

“We accept and respect the Inspector General’s job of studying every conceivable scenario,” said Sims, who also declared, “The Sound Transit Board will formally provide assurance that the agency can weather even the worst and most unlikely I-776 scenario within our existing local revenue sources and without compromising our commitment to sub-area equity.”

“It’s important to keep in mind that the state Attorney General has allowed Sound Transit to continue receiving its voter-approved motor vehicle excise tax, irrespective of whether I-776 is held constitutional,” Sims said.

The worst-case scenario identified in the report assumes Sound Transit would not be permitted to collect its full 0.3 percent motor vehicle excise tax, but instead would only be allowed to collect the amount necessary to make annual payments to repay previously issued bonds. However, to make such a ruling, the Supreme Court would have to reverse clear and long-settled earlier court rulings.

In Municipality of Metropolitan Seattle v. O’ Brien, the Court held that a state law cannot limit a transit agency’s ability to collect a tax that has been pledged for repayment of bonds. The Court held that the tax must be collected in full even if it the full amount was not necessary to make the bond payments. The Court issued a similar ruling in Tyrpak v. Daniels, where it held that tax collections could not be reduced even if the agency has sufficient funds to make the bond payments from other taxes.

Federal funding for Link will undergo a 60-day Congressional review period after the Federal Transit Administration transmits the grant to Congress.

In 1996, voters approved funding for Sound Transit to provide a regional system of transit improvements, including Sounder commuter rail, ST Express regional bus service, numerous capital improvements (including park-and-ride lots, transit centers and direct access ramps) and Link light rail.

Jacksonville-based CSX recommended last week a $20 million to $30 million project to add yard tracks which could enable the Massachusetts Bay Transportation Authority to add two more midday trains to the westernmost stops on the Boston-Worcester line.

At State House hearings in Boston on July 7 and 8, CSX, which owns the tracks between Framingham and Worcester, presented representatives of the Central Massachusetts Caucus and the MBTA with a capacity study that called for construction of 6.5 miles of new track.

22 track miles are involved between the two cities, from CP 21 where CP Yard, North Yard, and Nevens Yard are located (Nevens is at milepost 21.7), and CP 43, marking Worcester Yard.

According to the CSX “Worcester Service Expansion Study,” the tracks between Worcester and Boston are now at full capacity for both passenger and freight trains, Metro West Daily News reported on July 10.

It is 24 miles from South Station to CP 21. CSX property begins at CP 3.

To maintain the existing quality of service without causing more delays, CSX recommended the MBTA construct the new yard tracks in both Framingham and Worcester.

“This would allow us to move trains around without putting them on the main track,” said MBTA spokesperson Joe Pesaturo.

It also would allow the MBTA to increase the number of roundtrip weekday trains from 10 to 12 at the five stops farthest west – Ashland, Southborough, Westborough, Grafton and Worcester. In contrast, the MBTA operates 20 roundtrip trains between Boston and Framingham each weekday.

“The capacity study provides sobering information, but the reality is that the rail infrastructure is outdated and does not meet existing passenger and freight demands,” said state Rep. Karyn Polito (R), who is House co-chairman of the Central Massachusetts Caucus.

“It is imperative that all local, state and federal officials work collaboratively... with the MBTA and CSX to make improvements to the rail a priority.”

If the MBTA decides to expand, funding will be required to initiate engineering and environmental feasibility studies, Polito said.

CSX recommended the MBTA further investigate the possibility of expanded service by conducting a preliminary engineering study to better estimate the costs of the project, which could be up to $30 million, said CSX spokesman Brian Sullivan.

“It’s not a number that has a science behind it that says we’ve done detailed engineering,” Sullivan said.

High costs are expected because the construction areas may pose challenging obstacles, including environmental issues and land acquisition.

The possibility of wetlands in Framingham and excavation of ledge areas in Worcester also could add to the project’s cost, Polito said.

The MBTA hopes to hire an engineering firm in three to six months, Pesaturo said.

Business leaders in the region support increased rail service from Worcester to Boston.

“There’s people that need to go in at different times, and if there’s not enough trains available, it’s not going to be of much use to them,” said Barbara Clifford, executive director of the Corridor Nine Chamber of Commerce, which includes Westborough, Southborough, Northborough and Shrewsbury.

“From trying to ease the congestion on the roads and serve people that may have a reverse commute, there’s so many reasons that it would make good sense to be able to have more (trains),” Clifford said.

The Massachusetts Sierra Club is planning to launch a three-month ad campaign this week calling for construction of a one-mile train tunnel connecting North and South stations.

The North-South Connector would make traveling more convenient and reduce the number of cars on the road by 55,000 daily, according to organization spokesman Jeremy Marin. Posters bearing the headline “Why Doesn’t This Train Go to South Station?” started appearing last Monday on North Shore commuter rail trains, according to The Boston Herald of July 8.

When the Massachusetts Bay Commuter Railroad took over Massachusetts Bay Transportation Authority commuter rail operations on July 1, thing apparently went well as Amtrak rolled away from the tasks.

An Amtrak conductor based in Boston told D:F, “In all honesty, the only thing that seems to have changed, besides the name of the operator, are the name tags and hat badges. Other than that, you never would have known there was a change.”

He added, “Even the employees said they didn’t notice a thing, other than a few new faces moping around.”

Amtrak employee passes are no good on MBCR trains. Amtrak employees – whether they are on their way to work or not – must buy a ticket like everyone else.

Another Amtrak employee, at Southampton Street Yard, said the “Locals no longer stop at the ‘Top of the Hill’ to pick up or let off employees.”

The Readville Shuttle commuter trains used to stop just west of South Bay Tower – literally at the top of a hill on the Dorchester line near Columbia Road – to pick up and drop off Amtrak and MBTA employees. It was a flag stop. An employee bus now runs hourly from the yard to South Station.

He also noted, “Amtrak no longer washes commuter trains at our car wash,” located on a nearby loop track.

Another railroader observed, “It sounds like MCBR wants labor to be more efficient.”

All the former Amtrak employees working in Boston MBTA Commuter Service who became MBCR employees on July 1 received an immediate 5 percent raise and a $1,000 signing bonus.

Starting June 29, the Washington Metropolitan Area Transit Authority (WMATA) began operating more weekend trains. The Metrorail system now opens at 7:00 a.m. on Saturdays and Sundays and close at 3:00 a.m. Friday and Saturday nights. WMATA estimates 10,000 daily new riders will use Metrorail between 7:00 and 8:00 a.m. on weekends, and 3,000 more riders between 2:00 and 3:00 a.m. on Friday and Saturday nights. The 3:00 a.m. late-night service is an 18-month demonstration program funded by the District of Columbia.

– APTA

Light rail service on the Los Angeles County Metropolitan Transportation Authority’s Los Angeles to Pasadena Metro Gold Line begins July 26, pending final approval from the California Public Utilities Commission.

The new 13.7-mile light rail line, with 13 stations, will connect Union Station in downtown Los Angeles to Pasadena. The opening of the Gold Line will extend Metro Rail in Los Angeles to 73.1 miles. The Metro Gold Line joins two existing light rail lines, the Metro Blue and Green Lines, and the Metro Red Line subway. In its first year of operation, the new line is expected to carry an average of between 26,000 and 32,000 weekday boarding passengers.

– APTA

A gang that used night-vision binoculars and other modern technology to steal goods from freight trains in Jersey City, N.J. has been broken up after a decade of thievery.

The “Conrail Boyz” stole millions of dollars of cargo, mostly consumer goods such as designer clothes. One 2001 robbery netted more than 17,000 Sony PlayStation units worth $5 million, The AP reported last week.

In most of the robberies, “train jumpers” would board a slow-moving train to search for valuable lading, said Steven Hanes, director of Norfolk Southern’s police force. Other gang members would pose as rail workers to find out where the train was stopping.

The goods would be unloaded, then peddled on the street or in shops.

Some gang members were arrested repeatedly over the years, but they avoided long jail terms because they did not carry weapons.

The Conrail Boyz were the “largest single gang ever to attack North American railroads,” Hanes said, citing the size of their membership, their longevity and the value of the stolen merchandise.

Authorities had arrested 13 people as of Thursday and were searching for 11 others described as gang members. They said they are still pursuing leads to determine if a railroad employee tipped off the gang to lucrative loads.

The indictments issued July 8 stated Edward Mongon led the gang, 28, of Union City, N.J. who used relatives to launder the proceeds. He was charged with 17 counts, including racketeering and money laundering, which carry up to 20 years in prison each. Police are searching for him. His parents, Martin and Ersilia Mongon of Hoboken, were arrested in Pennsylvania. They face a money laundering charge.

Burlington Northern & Santa Fe completed building a 7.85-mile rail line in Calhoun County, Texas on July 9 and the first shipment of products from the Union Carbide Corp. Seadrift facility.

The new line connects Dow’s industrial complex at Seadrift with BNSF’s rail network near Kamey. Construction began in February 2002 and was completed approximately 15 months later in May 2003.

“This new rail line is a good example of providing competitive commercial solutions to the marketplace,” said BNSF’s Dave Garin, group vice-president for industrial products. He said, “The construction was completed on-time with no workplace injuries.”

Dow’s Seadrift Operations moves approximately 60 percent of its materials by rail. The majority of its rail shipments are outbound plastic pellets frequently used to manufacture wire and cable products, food and beverage containers, synthetic fabrics and automotive parts. Other rail shipments include outbound industrial chemicals used in making health and personal care products, paints, home cleaning agents and automotive fluids.

Some 1,500 West Virginians filed claims against CSX in late June charging they had been injured by asbestos, but the freight railroad argues most of those claims were from people weren’t even in the state.

CSX stated from its corporate headquarters in Jacksonville, Fla. On June 26 about $17 million was set aside to account for the newly filed claims. A press release stated, “This reporting is consistent with previous experience in similar claims, however, the legitimacy of each claim must still be thoroughly reviewed and litigated.”

The railroad stated, “Just days before a new venue law took effect in West Virginia, approximately 1,500 cases were filed against CSX Transportation (CSXT), CSX Corporation’s rail operating unit. The vast majority of the claims involve people who never lived or worked in West Virginia and could have been dismissed and required to have been heard in states that have some relationship to the claim, if they had been filed after June 4, the effective date of the new law.”

CSX Senior Vice-President of Law and General Counsel, Ellen Fitzsimmons, said, “The rush to beat the effective date shows why the leaders of West Virginia made such a responsible decision earlier this year to reform the state’s venue statute. With these latest filings, hundreds of cases have entered West Virginia’s resource-constrained court system that have no connection with the state. Responsible citizens and the shareholders and employees of CSX want us to fight for judicial fairness and against every illegitimate claim, and we will,” said.

A Mexican federal court in Mexico City has given Transportacion Ferroviaria Mexicana (TFM) protection from a financial court.

Grupo TMM and Kansas City Southern, TFM owners with controlling interest, reported the decision on Friday. The firm stated that TFM was formally notified by a three-judge panel on July 9.

The Court of the First Circuit made its judgment on June 11, which granted TFM constitutional protection (Amparo) against the ruling of the Mexican Federal Tribunal of Fiscal and Administrative Justice, Mexico’s fiscal court.

That ruling was issued on December 6, 2002. It had denied TFM the right to receive a value-added tax (VAT) refund. TFM initiated its claim for the refund in 1997.

The Circuit Court's judgment ordered the Fiscal Court to vacate its December 6, 2002, resolution, and to issue a new resolution following the guidelines of the Circuit Court's judgment.

The Circuit Court found that the value-added tax refund certificate had not been delivered to TFM, and confirmed the Fiscal Court's determination that TFM has the right to receive the refund certificate.

The Circuit Court's ruling states that the Treasury's decision denying delivery of the refund certificate to TFM violated the law, and it instructs that the reimbursement certificate be issued to TFM on the terms established by Mexico’s Article 22 of the Federal Fiscal Code in effect at that time.

“As a result of this ruling,” KCS stated in a press release, “the case has been remanded to the Fiscal Court, and TFM believes that the guidelines contained in the Circuit Court's decision are clear.”

The railroad added, “However, TFM cannot be certain of the final terms of the new resolution to be issued by the Fiscal Court. In addition, a third party claim or legal action could be brought against TFM as a consequence of the new ruling to be issued by the Fiscal Court in compliance with the judgment of the Circuit Court. Should such an action or claim be brought against TFM, TFM believes it would have sufficient legal defenses. As of today, it is not possible to determine when the Fiscal Court will issue its new ruling, nor when TFM is likely to receive the value-added tax refund.”

TFM has also recorded a higher traffic total for the week ended July 5. Details are in the following story, below. Meanwhile, KCS is headed to a U.S. Surface Transportation Board hearing this month, as reported elsewhere in this issue of D:F.

Canadian National Ry. reported on Friday it has reached a tentative labor agreement with the United Transportation Union on the company's former Duluth, Winnipeg & Pacific Ry. in Northern Minnesota.

The carrier stated terms of the three-year agreement, which would take effect on September 1, “are being withheld pending ratification.” The UTU represents 80 locomotive engineers, conductors and brakemen on the former DW&P.

Freight traffic on the nation’s railroads was up during the week ended July 5 in comparison with the corresponding week last year, the Association of American Railroads (AAR) reported on Thursday.

Intermodal volume totaled 164,003 trailers or containers, up 11.2 percent from the comparable week last year. Carload freight, which does not include the intermodal data, rose 1.2 percent to 280,127 cars. Carload volume was up 4.3 percent in the East but down 0.6 percent in the West. Total volume was estimated at 24.5 billion ton-miles, up 3.8 percent from last year. Both this year’s week and the comparison week from last year included the Independence Day holiday.

Fourteen out of nineteen commodities were up from the comparable week last year, with coke up 46.3 percent; crushed stone, gravel and sand rising 17.9 percent and nonmetallic minerals gaining 13.6 percent. Loadings of metallic ores dropped 28.2 percent from last year while shipments of metals and products declined by 10.1 percent.

The AAR also reported the following cumulative totals for U.S. railroads during the first 27 weeks of 2003: 8,661,201 carloads, up 0.2 percent from last year; intermodal volume of 4,993,900 trailers or containers, up 6.5 percent; and total volume of an estimated 764.2 billion ton-miles, up 0.9 percent from last year’s first 27 weeks.

Railroads reporting to AAR account for 90 percent of U.S. carload freight and 96 percent of rail intermodal volume. When the U.S. operations of Canadian railroads are included, the figures increase to 96 percent and 100 percent. Railroads provide more than 40 percent of the nation’s intercity freight transportation, more than any other mode, and rail traffic figures are regarded as an important economic indicator.

Both intermodal and carload freight were up on Canadian railroads during the week ended July 5.Intermodal traffic totaled 38,209 trailers and containers, up 11.2 percent from last year. Carload volume was 52,090 cars, up 4.9 percent from the comparable week last year. Both this year’s week and the comparison week from last year included the Canada Day holiday.

Cumulative originations for the first 27 weeks of 2003 on the Canadian railroads totaled 1,660,423 carloads, down 1.5 percent from last year, and 1,105,910 trailers and containers, up 9.6 percent from last year.

Combined cumulative volume for the first 27 weeks of 2003 on 15 reporting U.S. and Canadian railroads totaled 10,321,624 carloads, down 0.1 percent from last year and 6,099,810 trailers and containers, up 7.1 percent from last year.

The AAR also reported that originated carload freight on the Mexican railroad Transportacion Ferroviaria Mexicana (TFM) during the week ended July 5 totaled 8,821 cars, up 5.5 percent from last year. TFM reported intermodal volume of 2,942 originated trailers or containers, down 0.3 percent from the 27^th week of 2002. For the first 27 weeks of 2003, TFM reported cumulative originated volume of 233,488 cars, up 2.3 percent from last year, and 96,222 trailers or containers, up 32.2 percent.

CSX

CSX’s directors approved regular quarterly dividends on the company's common stock on July 9. The 10 cents per share dividend is payable September 15 to shareholders of record on August 25

Six British railmen to face charges

Three senior managers from Network Rail – the company that runs Britain's rail network – and two from a key maintenance firm, were charged on July 9 with manslaughter in connection with the fatal 2000 train crash at Hatfield, near London.

Network Rail, successor to Railtrack, which maintained the rail infrastructure in 2000, and Balfour Beatty Infrastructure Services, also have been charged with gross negligence, manslaughter and failing to comply with Britain's Health and Safety at Work Act, police said.

Six other people, including former Railtrack boss Gerald Corbett, have been charged with failing to protect the safety of rail users.

Four people died in the October 17, 2000, crash when a Great North Eastern Ry. express derailed half a mile south of Hatfield station in Hertfordshire, 18 miles north of London.

The people charged were Charles Pollard, director of the London North East Zone of Railtrack; Alistair Cook, infrastructure contracts manager of the London North East Zone of Railtrack; Sean Fugill, area asset manager of the London North East Zone (South) of Railtrack; Anthony Walker, regional director until August 11, 2000, of Balfour Beatty; and Nicholas Jeffries, civil engineer for Balfour Beatty.

Those were their titles at the time of the wreck.

A sixth person facing manslaughter charges has not yet been named.

Indexing the federal gas tax

The following is the text of a letter from Free Congress Research and Education Foundation national chairman Paul M. Weyrich to House Transportation Committee Chairman Don Young (R-Alaska) regarding indexing the federal gas tax for finance highway and transit projects in the TEA 21 reauthorization. Weyrich has served as FCR’s national chairman since 1977. – Ed.

July 7 – The question of how to fund improvements in our surface transportation infrastructure is the key element in the re-authorization of TEA-21. It is my belief that support for an increase or an indexing of the federal motor fuels excise tax is consistent with, and, even supportive of, conservative views on taxation and the role of the federal government.

The Founding Fathers expressly provided in the Constitution the federal pre-emption of regulation of interstate commerce. The Congress then provided federal support for the building of canals, maintenance of ports, and the building of railroads as essential to trade and commerce, both foreign and domestic. There is an apocryphal tale that George Washington was an investor in the Virginia company which proposed to build a canal on the south side of the Potomac River, and for which the Congress appropriated some funds.

More recently, the federal support of Highways and Transit has evolved from the National Defense Highway System in 1957 through ISTEA in 1991 to TEA-21 in 1998. TEA-21 is the first time ever collection and distribution of user fees guaranteed for use only in building a national and integrated transportation system (Highways and Transit).

Not all taxes are created equal. The federal motor fuels excise tax under examination is unique. The tax revenue cannot be used for any purpose except that for which it is collected. There is no diversion, no hoarding to reduce deficits, no substitution of other programs. Under TEA-21, it must be used for the purpose for which it is collected.

This tax also passes with ease another test of principle – it does not fund the growth of government. Rather, it promotes the growth of the economy through private sector jobs in engineering, construction and manufacturing.

This first, direct wave of economic development, partially funded by the user fee collected at the federal level, provides the basis for all the following waves of private economic development and jobs built on the transportation system which maintains and enhances our ability to compete in the global market, to provide private sector jobs, and in a very real sense, to limit the intrusion of government in the economy and in our lives.

Independent economic analyses of the proposal of Chairman Don Young indicate that it would add $290 billion to the nation’s nominal gross domestic product (GDP) over the next six years when compared to the level of GDP generated by the baseline program, and $73 billion to real potential GDP.

These permanent enhancements of the economy add to the standard of living of future generations.

Moreover, the studies have shown that the proposal adds far more to household disposable income than the annual $45 cost of the proposed increase in the federal motor fuels tax. Billions in equipment investment improving productivity and U.S. competitiveness, and billions in consumer spending, would also add to state and local tax receipts, generating matching funds required under the highway and public transportation programs, and helping to reduce state and local budget deficits. These are believed to be conservative estimates, and if they are true, they indicate a tremendous positive impact on the nation’s economy. Furthermore, in addition to the obvious direct construction and manufacturing job creation, it is clear that the enhancements to GDP, investment, productivity, and consumer spending will lead to even greater job creation.

In addition, it is useful to note that the user fee collected at the federal level accounts for only 21 percent of all the money spent on transportation construction, maintenance and capital equipment in any given year. The rest is provided by the states, local government, private investment, public authorities and other user fees.

In 1998, a Republican Congress voted overwhelmingly to ensure that the collected user fees would actually be spent on our national transportation system.

Two things have taken place since then. Firstly, inflation has eroded the past value of the user fee for present day investment. Secondly, the absolute need for transportation investment to support economic growth and quality of life throughout the United States has grown exponentially.

At the very least, shouldn’t a Republican Congress in 2003 adjust the level of investment for inflation and maintain it going forward?

In summary, a committed conservative can support an increase in the transportation user fee which is collected at the federal level because such would meet the tests to be applied to all taxes: necessary federal function; efficient and effective collection and disbursement for the purpose of the federal function; no growth in government; state and local level of effort; and contribution to supply side economy.

Perhaps a careful reader of this letter will ask, “How can he describe the gas tax in the first paragraph as “...the federal motor fuels excise tax...” and in the last as “...the transportation user fee collected at the federal level...”?

Because the former is its technical description and the latter is what it actually is in practice and usage.