The National Corridors Initiative, Inc.
Destination:Freedom

A Weekly North American Transportation Update

For transportation advocates and professionals, journalists,
and elected or appointed officials at all levels of government

Publisher: James P. RePass      E-Zine Editor: Molly McKay
Foreign Editor: David Beale      Webmaster: Dennis Kirkpatrick
 

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August 8, 2011
Vol. 12 No. 31

Copyright © 2011
NCI Inc., All Rights Reserved
Our 12th Newsletter Year

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IN THIS EDITION...   In This Edition...

  News Items…
US DOT Awards $782 Million For Made-In-USA Passenger
   Rail Equipment
Board Picks Michael Melaniphy As APTA’s Next President
  Political Lines…
Massachusetts MBTA General Manager Appointed MassDOT
   Secretary/CEO
  Business Lines…
French Transit Operator RATP Buys Manchester, England
   Tram System
FTA Names Metro Transit-St. Louis COO Friem
   ‘Manager Of The Year’
 
  Selected Rail Stocks…
  Freight Lines…
Short Line Railroads Innovating To Boost Economic
   Development
  Commentary…
Ignoring Infrastructure Is Playing With Fire:
   A Guest Post
The Deal: Avoid Default But Cut Spending Drastically;
   Amtrak, Transit Riders are Big Losers
  Editorial…
Congratulations, Tea Party
  Publication Notes …


NEWS OF THE WEEK... News Items...

US DOT Awards $782 Million For
Made-In-USA Passenger Rail Equipment

From Internet Sources

WASHINGTON – U.S. Transportation Secretary Ray LaHood announced this past week that California, Illinois, Iowa, Michigan and Missouri will receive $336.2 million to purchase next-generation, American-made trains that will run on rail corridors in those states. Previously awarded rail dollars bring the amount received by these five states and Washington State to $782 million for the purchase of 33 quick-acceleration locomotives and 120 bi-level passenger cars.

“Today’s announcement is all about jobs. Thanks to the leadership of the Obama Administration, these orders will pump more than three quarters of a billion dollars into the domestic manufacturing industry,” said Secretary LaHood. “And, our Buy America standard will put people to work all over the county.”

California and Illinois reached cooperative agreements with the Federal Railroad Administration to begin a multi-state procurement of equipment for passenger rail corridors in California, Illinois, Indiana, Iowa, Michigan, Missouri, Oregon and Washington State. Through a joint procurement process states will leverage these federal investments, along with state matching dollars, ensuring that taxpayers receive the best possible deal while creating the necessary momentum to encourage manufacturers to build equipment in U.S. plants with American workers and suppliers.

“Building a nationwide rail network is critical to America’s long-term economic success. More people are choosing to take the train and this year Amtrak is projected to set an all-time record by topping 30 million annual riders,” said Federal Railroad Administrator Joseph C. Szabo.

Trains will be designed to travel more than 110 mph along intercity passenger corridors, and meet standards developed by the state-led, Next Generation Equipment Committee. This will provide manufacturers with consistent specifications for all passenger trains in the United States, reducing costs for manufacturers and customers, while providing a boost to the railcar manufacturing industry. The state partners will now begin a joint procurement process, first issuing a request for information (RFI) and then a request for proposal (RFP) to allow for an open and competitive process. The RFI is expected to be issued in late summer 2011.

A strict “Buy America” requirement ensures that U.S. manufacturers and workers receive the maximum economic benefits from this federal investment. In 2009, Secretary LaHood secured a commitment from 30 foreign and domestic rail manufacturers to employ American workers and locate or expand their base of operations in the U.S. if they are selected for high-speed-rail contracts. In addition, in June, DOT announced a $562.9 million loan to Amtrak through FRA’s Railroad Rehabilitation and Improvement Financing (RRIF) program to finance the purchase of 70 high-performance, electric locomotives from Siemens Industry USA, creating 250 new manufacturing jobs in California, Ohio and Georgia.

The Obama Administration has invested $10.1 billion to lay the groundwork for a high-speed and intercity passenger rail network in the United States, providing rail access to new communities and improving the reliability, speed and frequency of existing lines. Of that, more than $6 billion has been obligated, with corridor projects under way in New England, Illinois, Washington State and North Carolina and stations under construction in California and North Carolina.


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To Succeed Bill Millar

 

Board Picks Michael Melaniphy
As APTA’s Next President

From The American Public Transportation Association

WASHINGTON, DC---In a unanimous vote July 26, the APTA Board of Directors named Michael P. Melaniphy to serve as the association’s next President and Chief Executive Officer. A well-known leader in the industry, Melaniphy has spent his entire career in public transportation, with 23 years of experience in both the public and private sectors.

The selection is the culmination of an extensive process that sought input from all segments of APTA. Melaniphy was the unanimous recommendation of the Presidential Selection Task Force, which conducted a wide-ranging search for the best candidate to replace William Millar, who is retiring Oct. 31 after 15 years as APTA President.

Melaniphy is currently Vice President Public Sector for Motor Coach Industries. Prior to that, he worked at First Group and its predecessor companies, serving as general manager for public transit systems in Charlotte, NC; Wichita, KS; and Hamilton, OH; and as assistant general manager in Laredo, TX. Melaniphy started his public transit career in college as a bus driver for the campus system at Indiana University, where he studied under the legendary transportation Professor George Smerk.

Melaniphy, who serves on the APTA Board of Directors, has long been active in APTA. He is first vice chair of the Business Member Board of Governors and chairs the APTA International EXPO Committee and the Awards Committee. He has served as a member of the APTA Nominating Committee as well as on critical APTA task forces including the Framework for the Future Task Force, Governance Task Force, and Reauthorization Task Force. He is a Leadership APTA graduate.

“Michael Melaniphy is an outstanding choice to lead our association forward in this critical time,” said APTA Chair Michael J. Scanlon. “He is eminently qualified and brings broad-based experience in both the public and private sectors. I am very pleased that we have found in Michael a leader who not only loves our industry and has dedicated his career to improving it, but also has the vision and leadership skills to move our industry forward.”

“The Presidential Selection Task Force unanimously recommended Michael Melaniphy to become APTA’s next president because we believe he is uniquely qualified to take our association to the next level,” said APTA Vice Chair Gary Thomas, who serves as task force chair. “Michael’s extensive experience, his advocacy skills, strong management and business skills, and his dedication to and passion for public transportation are a perfect match for the attributes the APTA Board of Directors determined necessary for APTA’s next president.”

APTA President Millar added, “I have known and worked with Michael for many years and he is a superb choice to lead APTA. Also, I am delighted to have a Leadership APTA graduate succeed me. Michael will be an inspiring leader for our association and the excellent APTA staff.”

In accepting the presidency, Melaniphy said, “I am thrilled to be selected as APTA’s next president. I pledge to do my absolute best to serve all our members and ensure that our association is laser-focused on strengthening and improving public transportation. I am honored to be named Bill Millar’s successor. His leadership has brought our industry unprecedented success and I will build on his legacy to take our association to the next level of accomplishment and influence.”

The selection process began with APTA Chair Scanlon’s appointment of Thomas and 11 other APTA members at a meeting of the Board of Directors on Jan. 7, 2011. The task force worked on a schedule and process designed and vetted by the APTA Board of Directors.

Once appointed, the task force competitively selected APTA member Krauthamer & Associates to serve as its executive search firm. It also began to define the qualities most important in the next APTA president by reaching out to transit CEOs, transit board members, business members and APTA committees, and finalizing that list after obtaining guidance from the APTA Board of Directors in March. The task force then crafted a job description grounded in those qualities and began the recruitment process.

Melaniphy was selected from among a large, diverse candidate pool that included 180 candidates. The task force narrowed the field over the course of a three-round review process that included several hours of interviews, review of written submissions, and vigorous background investigations for the finalists.

Thomas summed up the work of the task force: “There were several extremely well qualified candidates and the final decision was a difficult one. It was very gratifying to have so many qualified candidates with such dedication and passion for our industry and association. As a task force, we are confident that we have selected the very best candidate to lead our association.”

“I want to thank the task force members for their hard work and dedication and congratulate them on their outstanding choice,” said APTA Chair Scanlon.

In addition to Thomas, members of the task force are: David Armijo, principal, Armijo & Associates, Tampa, FL; Mattie P. Carter, commissioner, Memphis Area Transit Authority, TN; Flora Castillo, board member, New Jersey Transit, Newark, NJ; Greg Evans, vice president, Lane Transit District Board of Directors, Eugene, OR; Sharon Greene, principal, Sharon Greene & Associates, Laguna Beach, CA; Angela Iannuzziello, vice president, GENIVAR, Toronto, ON; Arthur Leahy, chief executive officer, Los Angeles County Metropolitan Transportation Authority, CA; Jerome Premo, global transit director/executive vice president, AECOM, Los Angeles¸ CA; Diana Jones Ritter, managing director, Metropolitan Transportation Authority, NY; Peter Varga, chief executive officer, Interurban Transit Partnership, Grand Rapids, MI; and Phillip Washington, general manager, Regional Transportation District, Denver, CO.

Melaniphy will officially assume the post on Nov. 1, and will join APTA prior to that date to work with Millar until his Oct. 31 retirement to ensure a smooth transition.


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POLITICAL LINES... Political Lines...  

Massachusetts MBTA General Manager
Appointed MassDOT Secretary / CEO

By DF Staff And MBTA Press Release

BOSTON – Governor Deval Patrick announced last week that he will appoint the current general manager of the Massachusetts Bay Transportation Authority (MBTA) Richard A. Davey as Secretary and CEO of the Massachusetts Department of Transportation, MassDOT, effective September 1st. Davey will replace outgoing MassDOT Secretary and CEO Jeffrey Mullan, who last month announced his decision to resign in order to return to the private sector.

The Mass DOT, whose major responsibilities include the MBTA --- one of the nation’s largest mass transit systems --- and the Central Artery Tunnel (“The Big Dig”), is deeply troubled. The MBTA has had decades of under-investment, coupled with a generous retirement system that is under-funded, and the Big Dig has had several very public systems failures since it opened, many times over budget, a decade ago.

Mullan was seen as a central figure in the work-in-progress turn-around of Mass DOT and its key project areas, and his loss is expected to be deeply felt. Davey is well-liked and has been one of the most accessible MBTA general managers in many years, but faces the same Herculean task that Mullan faced, starting September 1.

Out-going Secretary Mullan was known to be seeking a pay raise --- as Secretary, he earned only $150,000 a year --- and was also targeted by media critics because of problems with Big Dig light fixtures that were installed only a decade ago, but are crusting out already due to salt water incursion (leaks) in the tunnels. The handling of the issue was played out in the press as a management failure, because the Governor was not informed of the problem as soon as some thought was prudent; Governor Deval Patrick is hyper-sensitive about Big Dig safety issues because of past problems, including a 2006 ceiling collapse that killed a woman driving through the tunnel.

In making the announcement, Gov. Patrick said, “Rich has a proven record of commitment to safety and customer service, along with an energetic leadership style that will allow him to hit the ground running in continuing to implement transportation reform at MassDOT. I look forward to working with Rich, and want to express my deep appreciation for Jeff Mullan’s passion and outstanding service to the citizens of the Commonwealth.”

“Rich Davey has worked in close partnership with Secretary Mullan to help transform our transportation services to a system focused on putting the customer first,” said Lieutenant Governor Timothy Murray. “Jeff has laid a very strong foundation for MassDOT, and I commend him for his great work and leadership. I am confident Rich Davey’s dedication will build on our administration’s accomplishments as we continue to strategically invest in improving transportation in communities across the state.

Richard Davey, Gov. Deval Patrick, Jeffrey Mullan

Photo: MBTA

Left to Right - Incoming MassDOT Secretary Richard A. Davey, Governor Deval Patrick, and outgoing Secretary of Transportation Jeffrey Mullan. The change will take effect September 1, 2011

Since March 2010, Davey has served as MassDOT’s Rail and Transit Administrator and as General Manager (GM) of the MBTA. As GM, Davey has overseen an increase in MBTA ridership that hit a record 379 million unlinked passenger trips in the year ending June 30. He has made safety for customers and employees his highest priority, starting an MBTA Safety Hotline to encourage employee reporting of safety concerns. Davey spearheaded innovative customer service programs including the award-winning “Where’s the Bus, Subway, and Commuter Rail” Open Data Initiative to encourage development of smart phone applications at minimal cost to the MBTA. The Open Data Initiative alone has led to the creation of more than two dozen apps for smart phones and other hand-held devices, giving thousands of commuters real-time information on transit services. Davey also convened regular “Join the GM” customer outreach visits to MBTA stations and other facilities across the state in an effort to bring transparency and openness to the "T."

Prior to his involvement with the MBTA Davey was an officer of the Massachusetts Bay Commuter Railroad (MBCR) a consortium of partners formed to operate the MBTA commuter rail lines under contract to the MBTA.

“I am honored by Governor Patrick’s appointment and promise to build on the demonstrated commitment of the Governor and Lieutenant Governor to create a unified transportation enterprise that puts safety first, serves the customer, and makes the most efficient use of our resources,” said Davey. “I am fortunate to follow Jeff Mullan and benefit from his mentorship in taking on this responsibility. As the first Secretary of MassDOT, Jeff has brought a depth of knowledge and boundless energy to the task, and I join the Governor and Lieutenant Governor in wishing him well.”

Davey is a resident of Boston and regularly rides the T to work. He earned a Bachelor of Arts degree from the College of the Holy Cross and a Juris Doctorate summa cum laude from Gonzaga University School of Law.

In his role as Secretary and CEO of MassDOT, Davey will be responsible for day-to-day management of the transportation organization created by the Transportation Reform legislation signed by Governor Patrick in June 2009. MassDOT began operation on November 1, 2009, governed by a five-person Board of Directors appointed by the Governor and including four divisions – Highway, Rail & Transit, Aeronautics, and the Registry of Motor Vehicles.

“Richard Davey is a skilled administrator and a qualified manager, who has shown an ability to take on a tough job and make difficult decisions,” said House Speaker Robert A. DeLeo. “I’ve been fortunate to work with Richard on a number of issues in his current position and look forward to working with him in his new role.”

“I have worked closely with Jeff Mullan during his tenure as Transportation Secretary. He was instrumental in making transportation reform work for the Commonwealth and has been a strong leader during some difficult times. I look forward to working with Rich Davey to address the many transportation challenges that Massachusetts faces,” said Senator Thomas McGee, Senate Chair of the Joint Committee on Transportation.

“Jeff Mullan has worked very hard to implement transportation reform as requested by the Legislature and I will miss him. I look forward to working with Rich Davey and continued efforts to improve transportation in Massachusetts,” said Representative William Straus, House Chair of the Joint Committee on Transportation.

“During my MBTA review I met hundreds of transportation experts and senior managers. Rich Davey distinguished himself as able to deal with the complex issues, vast management challenges and myriad of relationships. He will make progress and support the Governor in transforming transportation into a more powerful statewide economic engine,” said David D’Alessandro.

Before taking the helm as MassDOT’s first ever Secretary and CEO, Jeff Mullan previously served as Undersecretary and General Counsel of the Executive Office of Transportation and the final Executive Director of the Mass Turnpike Authority. As MassDOT Secretary and CEO, Mullan was responsible for the implementation of the Administration’s landmark transportation reform law, including overseeing the consolidation of seven state agencies and the merging of multiple departments and cultures. In under two years, Mullan has successfully focused MassDOT on four goals: saving money, improving customer service, rebuilding the workforce and investing in infrastructure projects across the entirety of the Commonwealth.

Under Mullan’s leadership, MassDOT reforms have saved the state more than $125 million in 2010, and the agency has led an investment of nearly $1 billion this year to rebuild the Commonwealth’s roads and bridges - nearly twice the investment of 2007. Mullan has brought a sense of creativity to MassDOT, finding innovative ways to navigate difficult issues. He restored RMV service to residents in Greenfield by merging the branch location with an existing visitors center and took on the Fast14 Bridge Project in Medford, which will replace 14 structurally deficient bridges in just one summer. Mullan has placed customer service at the forefront of the agency throughout his tenure, with the second phase of the “youMove Massachusetts” statewide civic engagement effort beginning this fall. His employee morale and workforce development initiatives included creation of the Transportation Round Table, a monthly opportunity for any employee to directly address their concerns and ideas with MassDOT senior leadership.

Throughout his years of service, Jeff has led the way in making Massachusetts a national leader in transportation and has demonstrated an unwavering commitment to building a stronger Commonwealth for future generations.


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BUSINESSLINES... Business Lines...  

Across The Pond...

French Transit Operator RATP Buys
Manchester, England Tram System

From The Financial Times

Editor’s Note - Acronyms In This Article:

RATP -  Régie Autonome des Transports Parisiens (English: Autonomous Operator of Parisian Transports)

SMLStagecoach Metrolink Limited (“SML”), the local name Stagecoach gave its Manchester subsidiary]

 

MANCHESTER---RATP, the French transit operator that runs the Paris transit system, has purchased the Manchester, England tram operations of The Stagecoach Group, the Financial Times is reporting.

Stagecoach is a major operator of bus, transit, and rail systems in England, Canada, and the United States.

FT reporters Andrew Bounds and Gill Plimmer wrote:

“Stagecoach Group has sold its subsidiary running Manchester’s trams to RATP, the state-owned operator of Paris’s public transport network. The bus and rail operator sold SML, which has a 10-year contract to run Metrolink until July 2017 and assets of £16.2m, to RATP Dev UK, a wholly owned subsidiary of RATP.”

“The deal allows Stagecoach to focus on its core business of running bus and rail contracts ahead of a raft of franchises coming up for auction next year, including West Coast Railways, which it runs with Virgin Rail.

Stagecoach said it was a ‘good deal’ for shareholders that did not signify any wider shift of strategy for the group. It said it was not engaged in any discussions regarding a sale of its tram operations in Sheffield and that it retained a bus company in Manchester.

“RATP, one of the biggest transport companies globally, is the latest foreign operator to show interest in running British transport operations. The European transport market is in the process of being liberalized, forcing the continent’s state-owned companies to look further afield to gain market share,” reported FT.

“RATP Group operates trams and light railways in cities including Paris, Mumbai and Florence, and carries 12m passengers daily. Transport for Greater Manchester, the council body that owns the system, said passengers would benefit from RATP’s expertise, particularly in smart ticketing,” wrote FT.

The complete FT article can be found at: http://www.ft.com/cms/s/0/dc4797b2-bd06-11e0-bdb1-00144feabdc0.html#ixzz1U6WgDOuG


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FTA Names Metro Transit-St. Louis
COO Friem ‘Manager Of The Year’

From Progressive Railroading (www.progressiverailroading.com)

ST. LOUIS — The Federal Transit Administration presented Metro Transit-St. Louis Chief Operating Officer Ray Friem with the Region VII Transportation Manager of the Year award.

Friem was honored for “displaying leadership while providing transportation service that is integral to the community, and for creating a vision for the system that has support both within and outside Metro,” Metro Transit officials said in a prepared statement.

Friem assumed responsibility for transit operations in 2003. He oversees the operations and maintenance divisions of MetroLink light-rail, MetroBus and paratransit van services. He also heads the planning and system development department, Americans with Disabilities Act services, and Metro Transit security and fare collection functions.


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STOCKS...  Selected Rail Stocks...

Source: MarketWatch.com

   This
Week
Previous
Week
Canadian National (CNI)70.5874.86
Canadian Pacific (CP) 59.4163.86
CSX (CSX)21.9724.57
Genessee & Wyoming (GWR)51.6955.04
Kansas City Southern (KSU)52.1359.35
Norfolk Southern (NSC)69.1975.70
Providence & Worcester(PWX)14.0013.88
Union Pacific (UNP)92.47102.48


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FREIGHT LINES... Freight Lines...  

Marketing Award Competitors

 

Short Line Railroads Innovating
To Boost Economic Development

From The American Short Line Railroad Association (www.aslrra.org)

This is the fourth in a series describing in detail the short line and regional railroad marketing initiatives that competed for the 2011 ASLRRA Marketing Awards. “Perhaps your railroad has similar market opportunities that may be sought and realized, as these railroads did!,” noted the ASLRRA, in a memo to its member railroads.

New England Central Railroad: The NECR, in partnership with Canadian National (CN) and Maple Leaf Distribution Services, successfully implemented a backhaul initiative involving inbound CN-marked boxcars of paper products originating on CN in Canada. Maple Leaf, located in Barretts (Palmer), MA, receives the inbound loads at their facility and generates outbound loads of old newsprint that move to Canadian customers on CN. The key factor driving the success of this program has been rapid turn times. Cars are made empty and reloaded on the same day, usually at the same rail door. The NECR expects to handle 500 cars of old newsprint in 2011.

Newburgh & South Shore Railroad: The NSR, historically a steel switching road, has diversified its commodity base. Key to this diversification has been the development of limestone trains inbound to Cleveland from Ohio quarries on other railroads. National Lime & Stone is the shipper and receiver. In Cleveland, NSR either transloads the limestone for movement in trucks to various construction and paving projects in and around the Cleveland area or stores it for future distribution. The NSR handles 200 cars per month.

Port Terminal Railroad Association: PTRA, which serves the Houston Ship Channel industries, stays ahead of the competition through continuous improvement in technology, human capital, and infrastructure. Its Railcar Management Inc. technology program supports PTRA’s railcar and core business management, while their in-house database facilitates human capital enhancement and management. In addition to the capacity created by technological enhancements, PTRA has invested over $17 million during the last five years to further enhance capacity, business efficiencies, and customer service.

Providence & Worcester Railroad: Working with Motiva Enterprises LLC, the PW developed a rail-served ethanol terminal in Providence, RI. The facility can handle 100-car trains of fuel grade ethanol. Although PW also handles unit trains of ethanol in conjunction with the Eastern Class I’s, it has partnered with Canadian Pacific to reach into the corn-based ethanol production area west of Chicago. More than 5,000 railcars were delivered to Motiva in 2010.

[Thanks to Charles Hunter of New England Central Railroad in forwarding this news item to Destination:Freedom]


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COMMENTARY... Commentary...  

Ignoring Infrastructure Is Playing
With Fire: A Guest Post

From The Infrastructurist:
http://www.infrastructurist.com/2011/08/02/ignoring-infrastructure-is-playing-with-fire-a-guest-post

 

(This Is A Guest Post By Richard “Rich” Cooper, Vice President Of Research & Emerging Issues
For The National Chamber Foundation (NCF), The U.S. Chamber Of Commerce’s Nonprofit Think Tank.)

Last Friday, the Federal Aviation Administration’s (FAA) budget ran out. The House of Representatives was supposed to pass new funding to satisfy ongoing essential FAA projects – like improved radar for managing Louisiana-Texas airspace or installing approach path indicator lights. Because of the ongoing Congressional battles on the debt ceiling and other matters, it failed to pass new funding and the FAA went into partial shutdown. Last Saturday, 4,000 FAA employees were laid off, and construction projects to modernize numerous airports all came to a halt.

While the partial shutdown of the FAA shows the ramifications from a Washington standoff, it also speaks to the wider issue of how we think about infrastructure in this country. Airways, roads, bridges, rails and utilities are a part of America’s vast and impressive infrastructure, what has long been the gold standard for a developed, prosperous nation. Like all things, however, infrastructure requires updating and improvements, and for decades, leaders in the government (as well as the private sector) have been remiss in ignoring our national infrastructure needs.

That was the theme of a recent program hosted by the National Chamber Foundation, “Infrastructure: What We Want; What We Need.” The keynote speaker was retired Commandant of the U.S. Coast Guard Adm. Thad Allen, who talked about the importance of building resilience into our communities and infrastructure – lessons he learned firsthand while leading the response to Hurricanes Katrina and Rita, as well as the BP oil spill. Also on the program was a group of panelists from the public and private sectors who raised points on American competitiveness and the need for public-private partnerships.

One key recommendation revealed by the panel is for state and local governments to work with the private sector to address infrastructure needs; this because additional funding isn’t going to come from Washington. Take President Barack Obama’s Monday night address to the country about the ongoing debt crisis. He warned that unless we address our growing national debt, America “won’t have enough money to make job-creating investments in things like…infrastructure.”

Too true. Yet, it’s not simply that we don’t have enough to pay for updating our critical infrastructure – it’s that, proportionally, we don’t dedicate enough funds to keeping our infrastructure up to date in the first place. The (unspoken) sentiment among the public and private sector experts at the event was that we are encountering an absence of leadership on this issue. There is a fundamental problem with the way our leaders view infrastructure – it is not as high a priority as it needs to be.

Further, there are not enough voices in the public and private sector making clear infrastructure’s central role in rebuilding America. Certainly there are a lot of loud voices inside the Washington Beltway, but are they clamoring for their party or their country’s needs?

Without a strong and up-to-date infrastructure, our economy will be hard-pressed to recover from the 2009 recession, compete with China, India and other countries, and build the kind of resilience into our infrastructure that will allow us to bounce back from disaster, whether natural or manmade. Absent that, we will see not just the partial shutdown of a federal agency but severe, long-term consequences for the entire country.


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The Deal: Avoid Default But Cut Spending Drastically;
Amtrak, Transit Riders are Big Losers

By David Peter Alan

There is no use repeating old news. By now, everybody knows that the nation has avoided whatever consequences might have resulted from refusing to raise the nation’s borrowing authority to exceed its obligations. Whatever those consequences might have been, we do not know.

We do know that the wealthiest Americans and the large corporations will not be required to pay more taxes to support the government. That means that the tax system will become more regressive, at least indirectly. We also know that there will be no extension of unemployment insurance, so the number of Americans who lost their jobs long enough ago that they are truly poor, will increase. Social security, Medicaid and some aspects of Medicare will be spared, but that means the pot of money for all other non-military spending will shrink dramatically during the next several years.

While the pundits talk in grand terms, they say nothing about mobility. People with automobiles, including those pundits, will still be able to use them whenever and wherever they can use them today. People without automobiles, or who choose to --- or must --- ride transit, will take a huge hit. To this writer, it is unclear how well the transit industry will be able to survive the dauntingly challenging times ahead.

Transit in general has been facing exceptionally hard times lately, as has been reported in this column and elsewhere. Some medium-to-large transit systems, and many smaller ones, have raised fares and cut service drastically. There have been reports of transit systems disappearing completely. Except in a few major cities, most transit riders have little money and work at low-wage jobs. As the economic downturn becomes worse and government is prevented from spending the money needed to increase public sector hiring, the situation will worsen for many current transit riders. If they lose the bus route that they use to get to work, they will be out of luck, whether or not they currently have a job. If they have no reason to ride, they will also not contribute any badly-needed revenue to the transit provider.

State, county and municipal governments are strapped for cash all over the country, and have been cutting transit budgets almost everywhere. That essentially always means cuts in service. There is still some Federal assistance available, primarily for capital projects. Other help comes from other Federal programs. They include JARC (Job Access and Reverse Commute), CMAQ (Congestion Mitigation and Air Quality), Section 5311 (funding for small transit systems in rural areas) and others. With the new requirements for extreme cost-cutting in Washington, it is highly likely that many transit systems will lose much or all of the aid they now get from Congress. Any replacement for current TEA-LU legislation must take the cost-cutting mandate into consideration and reduce available funding accordingly.

Funding bills always originate in the House of Representatives, and John Mica, current Chair of the House Transportation and Infrastructure (T&I) Committee has proposed cuts in capital funding. If highway funding is cut, it is certain that transit funding will take at least as large a hit. Some cities, like New York, Chicago and San Francisco, depend on transit for their economic vitality. Transit riders in those and a few other cities represent a broad spectrum of society, not only its least affluent members. Transit will survive in those cities, albeit with higher fares and less service.

The survival of transit as it now exists in many other places is questionable. Transit is part of the “discretionary” spending that must be reduced. So are many other programs that benefit Americans who belong to the middle class or below. Evening and Sunday service will probably be among the first casualties in many places, and some could lose Saturday service, too. Rail transit will probably survive more consistently than buses, but some of the new, small commuter operations will be in trouble.

For example, New Mexico nearly killed week-end service on the Rail Runner line. It survives, at least for now. Any cuts in any places that have been considered and postponed can always be revisited when times become bad enough.

As for Amtrak, it is difficult to imagine Amtrak surviving intact over the next few years. Amtrak spending is totally discretionary, and is not even protected by the presence of highway funding in a transportation re-authorization, as some transit funding is. The nation’s passenger railroad seems to be a favorite target of many Republicans, especially TEA-Party followers. In the past, essentially all Democrats supported continuation of the basic Amtrak network, without expansion. A number of Republicans always joined them.

The Bush Administration attempted to eliminate Amtrak’s budget in 2002. Amtrak resisted at that time, most notably through the efforts of President David Gunn and Board Chair John Robert Smith. Those efforts saved the trains at the time, although a few long-distance runs have been discontinued since then. The next crisis should be even more difficult for Amtrak, and it is unclear whether or not the railroad can successfully fight against the budget-cutting mania in Washington. Major corridors, like the Northeast Corridor and the corridors in California, will survive, but it is unclear how many long distance trains will still be running when the dust clears.

One thing we know for sure, and that is that major cuts are coming from Washington and, consequentially, at the local level as well. We will probably not know exactly what will be cut next year until the “Super Congress” of twelve (equally divided between House and Senate, and between Democrats and Republicans) mandates the cuts; a list that cannot be amended. So much for democracy.

In any event, the people who will decide what we must live without have automobiles to get them to their prestigious offices. Transit and trains are only two of the items that other people need, but the budget-cutters do not. To this writer, the situation appears exceedingly grim. The transit scene has weathered many storms, but those were merely showers by comparison, and a hurricane is coming. The same holds true for Amtrak.

Is the message of this column pessimistic? Absolutely. Is the message of this column realistic? This writer fears and believes so. In conclusion, here is a piece of advice for anyone who has wanted to ride any particular Amtrak train or transit line, but has not gotten around to it: RIDE IT WHILE YOU KNOW YOU STILL CAN! You may not have much time.

(David Peter Alan reports regularly on the state of transit in America. He has ridden every Amtrak route and most rail transit in the nation. The opinions expressed are his own, and do not necessarily reflect those of NCI, or any other individual or organization.)


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EDITORIAL... Editorial...  

Congratulations, Tea Party

If Wisdom is recognizing your mistakes as you are repeating them, then those in Congress who noted that the last time we voted to cut government spending while still in an economic slump was 1937, are wise men indeed. Too bad they didn’t have the votes to overcome the Tea Party bully boys (and girls), who have without a doubt, --- and as we have warned before --- sent America into a double-dip Great Recession.

If you don’t think so, watch the stock market. The Smart Money --- that would be the folks who ginned up the housing bubble and then got bailed out when it burst --- is leaving town by the bucketful. America is not alone in triggering a worldwide decline – Greece, now Italy, and perhaps Spain started the ball rolling --- but we have given it massive momentum, first by flirting with default, and then by avoiding default in a way that will without question take whatever steam there was out of the “recovery.”

The last time we had a double-dip recession was the Great Depression. It ended not because of government policy --- in 1937 the GOP Congress forced Roosevelt to reverse his pro-infrastructure, pro-growth policies, sending unemployment soaring almost at once --- but because of the onset of the Second World War. While America did not officially enter the war until the attack of December 7, 1941, it was by 1940 massively supplying the British, who, after the surrender of France June 22, 1940, stood alone against Hitler.

American factories suddenly needed workers, and, lo and behold, the Depression ended, literally with a bang.

We do not hope for war as a way out of this Great Recession. That is too high a price to pay. But unless we reverse the policies of the last few months, and re-commit this country to a future that includes all Americans, not just the rich, we are in for a long, slow, and dangerous decline. Congratulations, Tea Party. You won.


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