Amtrak Gulf Coast Service: Analyzing the Blame Game

Written by David Peter Alan, Contributing Editor

Amtrak is attempting to start service between Mobile and New Orleans, along the Mississippi Gulf Coast. CSX and Norfolk Southern (NS) oppose Amtrak’s plan, and the issue is now before the Surface Transportation Board (STB). The issues are purportedly operational, having to do with rail capacity at the Port of Mobile, although there are also procedural issues to the controversy. There is a political dimension, too, with essentially the entire political establishment in Mississippi supporting Amtrak’s position and all of Alabama’s opposing it.

This report is an analysis of the STB filings, Docket No. FD-36496. The materials are voluminous, amounting to 62 filings comprising 1,326 pages as of June 1, 2021. We will touch on highlights of the key documents, where both sides present their legal arguments.

The issue before the Board concerns an application by Amtrak to permit operation of two daily round trips between New Orleans and Mobile, on a schedule that would allow those trains to begin running at the start of 2022. While the case itself concerns a narrow procedural issue, essentially a scheduling order, not only are the chief elected officials in Mississippi and Alabama choosing sides, but so are cities and towns in Mississippi and non-governmental organizations in both states. As of this writing, 19 parties submitted comments opposing the Amtrak request, or at least calling for a more-detailed study that would delay the start of Amtrak’s proposed Gulf Coast service. Every comment from Alabama opposes Amtrak’s request. So do three from Louisiana: from Port NOLA (the port authority in New Orleans), the Louisiana Railroads Association and Sen. John N. Kennedy (R-La.). The Mississippi Railroads Association also opposes the Amtrak proposal.

The situation in Mississippi is the reverse. All other comments from that state support the Amtrak plan. So does the Rail Passengers’ Association (RPA, also known as the National Association of Railroad Passengers, NARP), a national organization that advocates for an expanded Amtrak network. In all, there were 26 comments filed from Mississippi, including from the mayors of the towns along the route, who support the plan. The Southern Rail Commission, which contains representatives from all three states, requested that the procedures required to get the new trains going be expedited. 

Amtrak began by filing a 10-page Petition on March 16. It was filed pursuant to 49 U.S.C. §24308(e), which says in pertinent part (paragraph 1): “When a rail carrier does not agree to provide, or allow Amtrak to provide, for the operation of additional trains over a rail line of the carrier, Amtrak may apply to the Board for an order requiring the carrier to provide or allow for the operation of the requested trains. After a hearing on the record, the Board may order the carrier, within 60 days, to provide or allow for the operation of the requested trains on a schedule based on legally permissible operating times. However, if the Board decides not to hold a hearing, the Board, not later than 30 days after receiving the application, shall publish in the Federal Register the reasons for the decision not to hold the hearing.” 

Subsequent paragraphs place the burden on the freight carrier to demonstrate that such an order would unreasonably impair freight service, reiterate that the statutory goal is to implement schedules that would attain a system-wide average speed of at least 60 mph, and give the Board the authority to determine the amount of compensation the carriers would receive, unless the parties agree on an amount. While §24308(c) states a general preference for Amtrak trains over freight operations while giving freight carriers an opportunity to request relief, the provision at issue here is procedural.

Amtrak’s supporting exhibits filed with the Petition totaled another 816 pages:

Amtrak requested that STB “institute a proceeding and establish a procedural schedule for a hearing on the record followed by entry of an order requiring CSX Transportation, Inc. (‘CSX’) and Norfolk Southern Corporation (‘NS’) to allow Amtrak to provide for the operation of additional intercity passenger trains over the rail lines of CSX and NS between New Orleans, Louisiana, and Mobile, Alabama” on schedules submitted with the Petition. Amtrak also requested access to infrastructure owned by CSX and NS to prepare for service that Amtrak wants to start on or about Jan. 1, 2022.

Amtrak’s proposed schedules, submitted as Exhibit A, called for westbound trains to leave Mobile at 6:30 a.m. (Train 23) and 4:30 pm (Train 25), arriving in New Orleans at 9:53 a.m. and 7:53 pm, respectively. Eastbound trains would leave New Orleans at 7:35 a.m. (Train 24) and 5:31 pm (Train 26), arriving in Mobile at 10:58 a.m. and 8:54 pm. There would be four intermediate stops in Mississippi: Bay St. Louis, Gulfport, Biloxi and Pascagoula. Only the endpoints are located outside Mississippi.

Amtrak began by arguing: “For the past five years, Amtrak has been attempting to secure access to the host railroads’ rail lines for the purpose of restoring efficient and effective intercity passenger rail service to the people of the Gulf Coast, who lost such service following Hurricane Katrina. Bringing intercity passenger service back to the Gulf Coast is an integral part of an overall plan to make intercity passenger rail service a more vital part of the nation’s transportation system … Unfortunately, CSX and NS have failed to agree to allow Amtrak to provide for the operation of the requested Gulf Coast Service, which is a twice-daily round-trip service between New Orleans and Mobile set to begin on or about Jan. 1, 2022.” 

Amtrak stated its own good faith and then said, “But despite this time and effort, the parties remain very far apart in their positions on what is required to begin operating the Gulf Coast Service. With no agreement in sight and no guaranteed end to negotiations forthcoming, Amtrak is now seeking relief from the Board under Section 24308(e).”

Amtrak submitted the 2017 report of the Gulf Coast Working Group (GCWG), a body authorized by Congress in the Fixing America’s Surface Transportation (FAST) Act, noted that the report called for two daily round trips between New Orleans and Mobile, and listed the parties to the GCWG, which included Amtrak, CSX, NS and a number of state and local transportation officials in the region.

Amtrak presented some cost figures that would place the project on the inexpensive side, for a new start: “The report found that the Gulf Coast Service could commence with about $5.4 million in capital investments for station-related improvements, along with an additional approximately $95 million in capital improvements after the Gulf Coast Service began operations.” Amtrak characterized the responses from CSX and NS this way: “CSX and NS ultimately did not support the working group’s recommendations or its assessment of what was required to restore service. Rather than participate in the feasibility study that led to the report’s recommendations, CSX performed its own study and then demanded that the “necessary improvements for any Gulf Coast passenger restoration” would cost “at a minimum, $2 billion,” including a second main track, new sidings, siding extensions, and yard bypasses, modernization of drawbridges, as well as projects to improve speeds, including implementation of signaling systems and main track increases.” Amtrak said that the parties had a year-long agreement for a modeling study, but it was never completed.

Amtrak argued that Section 24308(e) says that the Board could order the CSX and NS to allow the operation and then hold a hearing, with authority to again order within 60 days that the operation be allowed. The carriers would then bear the burden of demonstrating that allowing the requested trains “would unreasonably impair freight transportation of the rail carrier.” Amtrak also cited legislative history from the 1980 amendments to the Rail Passenger Service Act that originally established Amtrak 50 years ago allowing an expedited procedure for Amtrak to start new services, given the historic lack of cooperation from potential host railroads. Amtrak also requested a scheduling order that would permit service to begin 180 days after “Decision Date Opening Proceedings” by expediting them.

The Board would need to approve Amtrak’s request for a scheduling order no later than early July, if the trains are to start rolling by New Years’ Day. At this juncture, such a quick result seems impossible. CSX and NS are opposing Amtrak’s request vigorously, which will delay the start of service. 

The opposition from Alabama politicians started almost immediately. Sen. Richard Shelby, Gov. Kay Ivey and Mobile City Council member Joel Daves, all Republicans, filed letters opposing Amtrak’s request. Although many of the opposing comments from Alabama were filed early in the proceedings (CSX and NS quoted them in opposing Amtrak’s application), the supporting comments from Mississippi came later. 

On April 2, CSX and NS filed a motion for a protective order that would designate any discovery material in the proceeding as CONFIDENTIAL or HIGHLY CONFIDENTIAL (emphasis in original). CSX and NS invoked the specter of “serious competitive injury” but did not otherwise justify the blanket request that all materials obtained during the discovery process be kept confidential.

CSX and NS filed a Motion to Dismiss Amtrak’s Petition without prejudice on April 5:

In short, they wanted the proceedings delayed, which would also delay the start of service. The carriers stated and briefed their opposition in a 284-page filing. They summarized their arguments by saying: “Amtrak’s Application should be dismissed for three reasons. First, Amtrak asks the Board to rule on a dispute that is not ripe, because (1) CSX Transportation, Inc. and Norfolk Southern Railway Company  have not refused to accommodate Amtrak’s proposed service—they have simply asked Amtrak to live up to the commitments it made to complete a joint Rail Traffic Controller (RTC) modeling study to determine the infrastructure that will be required to support such service and (2) Amtrak lacks important state support to ensure success. Second, Amtrak asks that the Board take major federal actions with significant environmental consequences, but it fails to submit an Environmental and Historic Report as required by 49 C.F.R. Part 1105. Third, Congress did not give Amtrak any cause of action that could support its extraordinary demand for an ‘interim order’ allowing Amtrak to enter other railroads’ lines to perform ‘preparations’ for new service before the Board issues any decision on whether the new service will be allowed.”

They went on to cite the statute and then claim that CSX and NS had not “refused” to cooperate and, therefore, had not triggered the statutory STB remedy. “CSXT and NS have not said no to Amtrak’s request” (at 2, underlined in original for emphasis), claimed diligence and accused Amtrak of bad faith in not completing the study that Amtrak blamed CSX and NS for not completing,” they said. In essence, the railroads distinguished between outright refusal and the five-year delay about which Amtrak complained. So, in effect, both sides are blaming each other over the study that was not completed.

The carriers also raised the lack of funding from the State of Alabama for the proposed service, and the threat of interference with freight operations there. Mobile is not far from the Mississippi state line, so it appears reasonable to expect that the Board will consider how much the lack of funding from Alabama would impede service primarily intended for Mississippi and New Orleans, as well as the actual amount of interference with freight operations that two daily passenger round-trips could cause.

CSX and NS argued that Amtrak had not complied with environmental study requirements under the National Environmental Policy Act (NEPA), or with historic-study requirements under the Historic Preservation Act. It would be up to the Board to decide what, if anything, Amtrak would be required to do. In the meantime, CSX and NS argued that Amtrak’s request for an order allowing preparation work for the new service to be dismissed with prejudice, a result that would further delay the start of service.

Amtrak submitted an 80-page response to the motion by CSX and NS, including exhibits, on April 26:

Amtrak argued that the statutory requirement of “refusal” has already been triggered because CSX and NS have not allowed the project to move forward, that the additional studies demanded by the carriers are not required, and that it is not necessary to garner unanimous political support to start the service, noting that Mobile supports the proposed service, even though Alabama generally does not. 

Amtrak summed up its arguments this way: “CSX and NS improperly attempt to shift the burden that Section 24308(e) places squarely on them by insisting that Amtrak cannot even file an application with the Board until Amtrak jumps through various hoops of CSX’s and NS’s own invention that the statute nowhere requires. Congress was so ‘concerned about the lack of cooperation private freight railroads have demonstrated toward Amtrak,’ and believed it was so ‘important that Amtrak have available to it an expedited procedure for making necessary modifications or additions to its operations,’ that it enacted Section 24308(e) for Amtrak to “secure expeditious relief from such intransigence.” 

Amtrak argued that the case was ripe for STB review because efforts to restore service on the line had been ongoing for years with no progress, and the studies cited by CSX and NS were not required because Amtrak was not requesting new infrastructure; saying: “Indeed, Amtrak’s position is the opposite—that service can be restored without the extensive infrastructure projects that CSX and NS have insisted must be completed before even a single train can run” (Id. at 3). Amtrak detailed prior efforts to get the service going, along with specific provisions of the Passenger Rail Investment and Improvement Act of 2008 (PRIIA) and the FAST Act, which governs transportation generally. Many of Amtrak’s arguments were procedural in nature, but Amtrak’s arguments state that CSX and NS have failed to cooperate with Amtrak’s efforts to restore the service to Mobile. 

There was later correspondence from the parties that raised issues concerning data that would be obtained through an RTC modeling study and the assertion by the freight carriers of the confidential nature of such information. While these are not the sort of arguments that end up setting precedent, they demonstrate the lengths to which Amtrak, CSX and NS are willing to go to defend their positions to an administrative agency usually concerned with more mundane issues such as freight rates and abandonment of lightly used freight lines—with the exception of the current CN-Kansas City Southern-Canadian Pacific merger battle. 

The tie-breaker in this contest may be the U.S. Department of Transportation. John E. Putnam, Acting General Counsel for US DOT, filed a letter on May 10 supporting moving the project forward. We reported that development on May 11. Putnam began by saying he was writing on behalf of DOT and the FRA “to express our interests in this proceeding and to highlight the importance of the passenger rail service at issue here … FRA has worked closely with Amtrak, CSX, Norfolk Southern and other stakeholders for several years to make the restoration of Gulf Coast service a reality. Unfortunately, despite an extended period of examination and the investment of significant funds, Amtrak has been unable to obtain the agreement of the host freight railroads, and there is no clear or imminent path to the restoration of this service, absent the Board’s intercession. We therefore urge the Board to act expeditiously on Amtrak’s application in the above-referenced proceeding, relating to the restoration of passenger rail service between New Orleans, Louisiana and Mobile, Alabama.” 

Putnam followed with a litany of efforts that the FRA has made since 2015 to resolve the impasse between Amtrak and CSX and NS, including listing a number of grants that the agency gave in furtherance of that goal. Then he concluded: “The Department stands ready to work with Amtrak, CSX, Norfolk Southern and other stakeholders to perform the work necessary to restore Gulf Coast service, which is long overdue. We ask the Board to give careful and prompt consideration to Amtrak’s petition, and we will be glad to provide any additional information or resources that would aid in the Board’s decision-making process. FRA looks forward to the opportunity to participate in any proceeding that the Board initiates, to ensure that passenger rail service may expand consistent with the law, while robust freight rail service, essential to the Nation’s economy, is preserved.”

How successful the FRA will now be in helping get the trains running to Mobile remains to be seen.  

However diligent Amtrak’s own efforts have been over the years, the last time a scheduled passenger train ran east of New Orleans was in 2005, to Florida on a tri-weekly schedule. The proposed service is different: two daily trains, and only as far as Mobile. There was a similar train once-daily for 253 days in 1984 and the beginning of 1985, in connection with the Louisiana World Exposition. There was another that ran for 278 days in 1996 and 1997. They were popular, but they ran only briefly. A lack of funding from the states was blamed for their elimination after less than a year of operation.

The dispute in the present case seems to be coming down to a contest between Amtrak and Mississippi wanting to get the trains rolling, against CSX, NS and Alabama, who are playing for time and hoping to delay the new start. The potential support for the service from USDOT, including the FRA, may make the difference, but it is too soon to tell. There are other issues that may have wider implications as Amtrak seeks to expand its network and advocates push for even greater expansion. 

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