INTERNATIONAL RAILWAY JOURNAL, SEPTEMBER 2021 ISSUE: 50 years since Amtrak was founded, the United States’ federally owned passenger operator is arguably at the most exciting juncture in its history. William Flynn, Amtrak President and CEO, presented the company’s ambitious plans for growth and development to International Railway Journal Editor-in-Chief Kevin Smith.
It was perhaps fitting that United States President Joe Biden was front and center at the celebration held to mark the 50th anniversary of Amtrak at 30th Street Station in Philadelphia on April 30.
Biden has been a vocal supporter of the federally owned passenger operator for almost the entirety of its existence: from his days as a U.S senator when he would regularly ride the train from Wilmington, Del., to Washington D.C.; to his time as the U.S. Vice President, when he presented the Obama Administration’s plans for several short-lived high-speed passenger projects as part of a 2009 economic stimulus package. Now as the 46th President, Biden has made rebuilding and reviving the country’s infrastructure, including its passenger rail operator, the signature policy of his first term.
The American Jobs Plan was announced by Biden on March 31 and has since moved to Congress for debate and negotiation. The Administration hopes the legislation that emerges will satisfy Biden’s objectives so he can sign it into law this autumn.
Inevitably, given the variety of views on the scale and ambition of the proposal on both sides of the political spectrum, there have been several compromises. From a $2.3 trillion plan when Biden presented it, the Senate scaled it back to a $1 trillion initiative, including $550 billion of new spending. However, the legislation took a significant step forward on Aug.10 when 19 Republican senators joined with their 50 Democratic colleagues to pass a bi-partisan Infrastructure bill, a move praised by Biden.
As it stands, the bill includes $66 billion for intercity passenger rail, with $22 billion of this figure set to go directly to Amtrak. This includes $6 billion for the Northeast Corridor, and $16 billion for the national network, including state-supported services.
In addition, public transit will net a $39.2 billion investment windfall, and the Federal Railroad Administration (FRA) will receive $36 billion. This is divided into $24 billion for FRA grants for NEC modernisation and $12 billion in grants for new and expanded intercity rail, which could include high-speed. The remaining $8 billion will go toward freight and safety improvements, among them grade crossing eliminations.
The bill passed to the House of Representatives, which is expected to mark iy up for House/Senate reconciliation in September. However, while Democrats hold a majority in the House, the infrastructure bill is far from enactment. Progressive House Democrats are seeking to align their support for the Infrastructure Bill with the passage of $3.5 trillion federal budget plan, which includes an abundance of social programs, another priority for the Biden Administration. Naturally, this is proving more bothersome for Republicans. None joined the Democrats in a Senate vote to proceed with the package in the early hours of Aug. 11. With debates over the deal under way, political brinkmanship from both sides has continued, potentially placing the entire spending package in jeopardy.
Amtrak of course is all too familiar with the bear baiting that occurs on Capitol Hill. So often a political football, its leaders have regularly had to scrap with Congressional committees with varying degrees of sympathy to secure annual operating budgets over the years. Demands for capital dollars have been equally tempestuous. However, this time things feel a little different. With politicians from both sides determined to show their constituents that they can get things done in Washington, a significant infrastructure package—which has been promised for many decades—might yet get over the line.
Amtrak CEO Bill Flynn certainly hopes so. Indeed, Flynn, who was speaking to IRJ shortly before the bill was approved by the Senate, remains optimistic that the promised capital funding will find its way to the railway.
“It’s more money than has ever been directed Amtrak’s way in our 50-year history,” Flynn says. “We’re not celebrating yet; there’s a ways to go. But I think a month ago, we would have been more cautious.”
In practice, the $6 billion of funding for the NEC will provide the opportunity to deliver much-needed updates to rolling stock, rehabilitation, upgrades and expansion of maintenance facilities, and to bring stations into compliance with Americans with Disabilities Act (ADA) requirements.
It’s a similar story on the national network, where the $16 billion will support projects to acquire new rolling stock to replace aging equipment, update maintenance facilities and meet ADA requirements at stations. “This will eliminate a backlog of what I would say is deferred capital work on Amtrak assets outside of the NEC,” Flynn says. “It will also eliminate the backlog of assets in our system. That’s our reservation system, security, training and technology centers more broadly.”
The FRA grant funding will provide federal dollars to support major big-ticket infrastructure upgrades and state-of-good-repair projects.
For the NEC, this includes schemes identified by the Northeast Corridor Commission in its C35 plan announced in July, a 15-year outline for redeveloping the NEC, which before the pandemic was used by up to 2,200 trains per day. Among the priorities are the Gateway Project to deliver a long-awaited addition to the 111-year-old North River Tunnels in New York City (which will be refurbished), and a replacement for the Baltimore & Potomac Tunnels, which came into service in 1873. Upgrades to the East River Tunnels in New York are equally as pressing, as are replacements for several key bridges in New Jersey and Connecticut that are 110-120 years old.
However, with these projects priced at many billions of dollars—the complete Gateway program tops $30 billion—the $24 billion funding is unlikely to meet the entire need by itself.
For the national network, the guiding policy is the Amtrak Connects U.S. plan, which was released on March 31 to coincide with Biden’s infrastructure announcement. Amtrak describes Connects U.S. as a 15-year plan to connect up to 160 communities in 25 states by building new or improving existing rail corridors; 59 corridors are identified, and Amtrak plans to open new stations in more than half of U.S. states, increase rail service to 47 of the top 50 metropolitan areas, and create more than half a million new, well-paying jobs. The total net economic impact from operations is estimated to reach $8 billion per year by 2035 and generate $195 billion in additional economic activity. Amtrak will also benefit from $800 million in total annual revenue growth compared with 2019, attracting 20 million more passengers annually.
The plan itself calls for a $75 billion investment over 15 years, so the Infrastructure Bill will not meet all demands in one hit. Yet it will provide funding to get a significant number of priority projects up and running.
Connects U.S. identifies specific city pairs that could be well served by an enhanced intercity passenger rail service in America’s “megaregions,” networks of metropolitan areas covering distances of 400 to 450 miles connected by travel patterns, economic links, shared natural resources and social and historical commonalities. Among the existing corridors identified for improvement are Chicago-St. Louis; New York City-Albany and -Montreal; San Diego-Los Angeles-Santa Barbara-San Luis Obispo; and Chicago-Milwaukee and -Minneapolis, where improvement plans are already taking shape.
Flynn says the Chicago route is currently served by the daily Empire Builder, one of Amtrak’s traditional long-distance trains, which runs from Chicago all the way to Portland and Seattle on the West Coast, and the seven trips per day Chicago-Milwaukee Hiawatha. The corridor served 900,000 annual passengers pre-COVID, and plans are already taking shape for Amtrak in cooperation with the states of Illinois, Wisconsin and Minnesota to introduce two more round trips between Chicago and Minneapolis-St Paul in addition to the daily Empire Builder service. “The last piece of that was securing the necessary funding from Minnesota, which the governor signed up to just a few weeks ago,” Flynn says.
Others are new lines in areas of the country which have experienced rapid population growth in recent decades but where Amtrak connectivity has not kept up.
This includes the Front Range corridor, running north-south from Cheyenne, Wyo., to the cities of Fort Collins, Denver, Colorado Springs and Pueblo in Colorado. The area is home to around 5 million people, and Flynn says it is ripe for the introduction of a competitive passenger rail service due to regular congestion on the arterial Interstate 25. Amtrak plans to offer three daily round trips between Fort Collins and Pueblo, with one extending north to Cheyenne. The operator expects to attract 196,000 annual passengers by 2035, and Flynn says there is very strong support in the communities to build the corridor.
The “3C+D” corridor in Ohio is another priority. This would connect Cincinnati, Dayton, Columbus and Cleveland, four significant cities separated by just 260 miles but with no current passenger rail service. The plan is to offer three daily round trips with an initial trip time of 5 hours 30 minutes. There is also a plan to extend the existing Fort Worth-Oklahoma City Heartland Flyer north to Wichita and Newton, Kan., to connect with the Chicago-Los Angeles Southwest Chief as well as improve access to the Texas Triangle with new services linking Dallas, Houston, Austin and San Antonio, and the daily Chicago-San Antonio Texas Eagle.
Introducing a new service from Los Angeles and Riverside, Calif., to Phoenix and Tucson, Ariz., is another priority for Amtrak. Phoenix is the fifth largest U.S. city. And despite good light rail and other transit services, it is not currently served by intercity passenger rail. Flynn says there is a lot of excitement in the city to develop such a service, but crucial to the Arizona scheme and all the other possible projects identified in Connecting U.S. is for Amtrak to secure cooperation from the states. “It’s not Amtrak unilaterally saying, ‘let’s do this service;’ we have to have willing partners, and the willing partners are the states,” Flynn says.
He adds that this collaborative work involves identifying the core characteristics of what will make the corridors successful. Factors include access to high population centers, competitive transit times, and the fact there is little or no existing service. He says it is also important to consider how the service could combat challenges such as traffic congestion and contribute to climate change mitigation.
Another upcoming project that tackles these elements and is making headway is the plan to double-Amtrak’s operation in Virginia over the next 10 years to provide an hourly service. The $3.7 billion “Transforming Rail in Virginia” initiative aims to offer a new double-track railway from Washington D.C., to Ridgeway, N.C. that will be used by both Amtrak and Virginia Rail Express (VRE) trains.
Amtrak will invest $944 million in exchange for the introduction of six new daily round trips and exclusivity to provide intercity services for 30 years. VRE will also provide $200 million as the operator increases its service by 60% on the corridor. Crucially, the state has agreed to acquire 383 miles of right-of-way and 223 miles of existing track for $525 million from CSX, in rail corridors paralleling the I-95, I-64 and I-85 highways
The CSX infrastructure includes half of the rail corridor right-of-way on the 102-mile section from Washington D.C., to Petersburg, Va. that includes 39 miles of existing track; passenger train rights on the S-Line between Richmond and Petersburg; the entire abandoned 74-mile corridor from Petersburg to Ridgeway, N.C.; and the entire 172-mile of right-of-way and 185 miles of track west from Doswell north of Richmond to Clifton Forge, Va.
The initiative also includes the construction of a $1.9 billion dedicated double-track passenger railway bridge over the Potomac River that will be built adjacent to the CSX-owned Long Bridge, the only current railway bridge connecting Virginia and Washington D.C., along with a further $1 billion of infrastructure investment across the state to deliver the new corridor. This includes constructing 37 miles of new track that will be completed in stages up to 2030, and apart from in Ashland, Va., will offer a four-track railway with two dedicated tracks for passenger services.
Flynn says this infrastructure expansion effectively means that Amtrak could offer through services from the NEC into Virginia and North Carolina, potentially supplementing its Raleigh-Charlotte Piedmont service, which has experienced significant growth in recent years, as well as the long-distance Carolinian service from New York to Charlotte. He says this offers major opportunities for integrated ticketing and services that could potentially redefine the NEC. Preliminary plans to develop a Charlotte-Atlanta higher-speed line are also taking shape, with a preferred alignment for the line identified in July and the Georgia Department of Transportation (GDOT) and the Federal Railroad Administration (FRA) releasing a Tier 1 Environmental Impact Statement (EIS) and Record of Decision (ROD) for the as-yet-unfunded project.
“If you just step back and say, well, wait a minute, you know, the second largest financial center in the United States is Charlotte, after New York; the Research Triangle of Raleigh, Durham, and Cary, is kind of the East Coast high tech center; and then you come through to the capital, and then on through all the way to New York and Boston. I think it’s just a great example of what can be achieved,” he says.
Cooperation with CSX was critical to make this future expansion of service possible. A similar $257.2 million agreement was also reached by the state with Norfolk Southern earlier this year to expand Amtrak service to Roanoke, Va., in 2022 and NEC services to the state’s New River Valley from 2025. However, the two Class I’s have been less willing to cooperate with Amtrak on its plans to introduce a twice-daily Gulf Coast service between New Orleans and Mobile, Ala., in 2022.
NS and CSX argue that a study over the impact on freight operations posed by passenger trains has yet to be completed, and until it is, no Amtrak service can be introduced. Amtrak counters this by saying that the route has been studied on numerous occasions, but that the Class I’s keep moving the goal posts. Spokesman Marc Magliari said the study should have taken seven months to complete and that the parties had been in discussion about the proposal for five years. “We safely and successfully operate together elsewhere in the United States, with dependable freight service coexisting with reliable and relevant Amtrak service,” Magliari told IRJ sister publication Railway Age. “That’s what the Gulf Coast deserves, too.”
The two parties have since clashed in multiple filings with the Surface Transportation Board (STB), culminating in the STB throwing out efforts by the Class I’s to dismiss the case on Aug. 6 based on Amtrak’s application for an STB order requiring CSX and NS to allow Amtrak to operate the new service. The STB has set a Dec. 16 deadline for the railroads to provide proposals on a hearing format. However, Amtrak says the case could still end up in court, further delaying service introduction.
Thus, if increased capital funding becomes available for new passenger trains, the greatest challenge for Amtrak looks likely to be securing the track access it needs to offer a competitive and efficient service. Indeed, the Gulf Coast outcome could prove a litmus test for similar contests over the coming years.
President Biden’s executive order issued on July 9 to address competition in the U.S. economy seemingly ups the ante and adds weight to Amtrak’s cause. It specifically calls for the introduction of some open-access rail operations—such as reciprocal switching—a demand that was slammed by the Association of American Railroads (AAR) as “misguided.” AAR says this will result in interference with functioning freight markets and undermine the railroads’ ability to reliably serve customers.
When responding to a question about the possible impact of the executive order on Amtrak’s ability to secure the access it requires, Flynn refers to the creation of Amtrak in 1971. Specifically, he says the “essential bargain” made with the federal government by the rail freight industry, which for many companies at the time, particularly those in the Northeast, lacked sufficient funds to invest in even basic track maintenance. The freight railoads agreed to transfer their financially draining passenger operations to the government in exchange for allowing Amtrak to access track infrastructure under a pre-agreed avoidable cost formula, and for passenger trains to have priority over freight.
“That’s the law,” Flynn says. “The issue for us is that we have not enjoyed the benefit of that bargain on the national network.”
Flynn was quick to emphasise that Amtrak does and is prepared to pay “over and above” for a level of service above the baseline. And while he is encouraged by Biden’s executive order and the appointment of a fully staffed STB, which as part of their remit, oversees the bargain, he feels more is needed, particularly with the likelihood that the Gulf Coast application to the STB will be followed by other similar cases in the future. “Of course, we have the law, but we need some additional legislation that we believe needs to put more focus on enforcement of that law,” Flynn says.
He also points out that Amtrak is not likely to be alone in fighting for the law to be upheld. The states it is partnering with to grow service are also likely to support its cause to secure the necessary access, as emphasised by Virginia’s commitment to purchase the infrastructure outright from CSX.
The desire of Midwest states to enhance connections is mirrored by states in the South and the Southwest. This could potentially transform Amtrak’s offer and the landscape of U.S. rail operations in regions where freight is the only show in town. Creation of the Amtrak network in 1971 mirrored the distribution of the country’s population of 220 million at that time. 50 years later it is 330 million. And while the population of the Northeast and Midwest is roughly the same, the South, Southwest and West Coast have experienced an influx of 110 million new people. Flynn believes the time is right for the operator to catch up.
“Our service today looks very much like it did in 1971,” he says. “There’s a large under-served population, and that is really the underlying logic of Amtrak Connects U.S. That’s an exciting opportunity if we can get this level of funding to invest in infrastructure, rolling stock and stations, and service expansion.”
COVID Checks Amtrak’s Charge to Operating Profitability
Flynn took over as Amtrak CEO in April 2020 in the midst of arguably the biggest crisis to hit the United States since the Second World War.
As the first wave of the COVID-19 pandemic took hold, the passenger operator had already reduced its daily offer from around 330 trains to just 160-165 in mid-March 2020. Daily passenger numbers had plummeted to 53% of the usual 90,000, and again to 3.33% or 3,000 riders in the first week of April.
Flynn explains that Amtrak felt that it needed to continue to provide a certain level of service during the crisis. “We see ourselves as essential,” he says. “And my belief is that the 3,000 people that were riding with us in April needed to get somewhere, otherwise they would not have been on that train.”
With Amtrak continuing to operate, Flynn says the focus was on keeping passengers and its staff as safe as possible. The wearing of masks was mandated—a condition that remains in place today—and the railway’s efforts were bolstered through partnerships with academics at the Bloomberg School of Public Health from Johns Hopkins University, in Maryland, and the Milken School of Public Health at George Washington University.
Among the work was providing Amtrak with a better understanding of the airflow and filtration in its passenger coaches and the steps it could take to improve the safety of that environment. “It was really valuable,” Flynn says. “Because unlike the airline industry, where there’s a lot of information about airflow in a plane, there is less information about railcars.”
Amtrak also worked with foreign railways to learn how they were responding and to share information from the medical professionals it was working with.
By July 2020, ridership had recovered to 20-25,000 daily passengers, where it remained until April. As vaccines became more prevalent, this has since grown to around two-thirds of pre-pandemic ridership as Amtrak eased capacity limitations that were set at 50% during the height of the pandemic. In addition, almost all of the 28 state-supported services that Amtrak runs have been restored, with notable reintroductions of trains in New England to attract tourists in recent weeks.
Indeed, Flynn reports that with many offices remaining closed, Amtrak passengers tend to be leisure rather than business travelers. This is evident in the fact that the operator’s long-distance trains have virtually fully recovered. Flynn says the strength of these services is the sleepers and roomettes where passengers “can get on the train and close the door,” he says, adding that these passengers are also benefitting from the restoration of the train’s traditional dining service. “We’re essentially sold out on our sleepers and roomettes until October-November,” he says.
Amtrak has also noted a change in the age demographic of its passengers; the number of 55 and over riders has fallen while 18-34-year-olds have increased. “There is a whole new demographic segment of folks who hadn’t for whatever reason thought about riding the train,” Flynn says. “And they like it. That’s a growth opportunity. Our job now is to make lifelong riders from those customers and to really understand them.”
Inevitably the return of passengers will translate into improvements in Amtrak’s financial performance. The railway was the beneficiary of $1.7 billion of recovery funding from the $1.9 trillion American Rescue Plan, which was signed into law by president Biden on March 11, and enabled Amtrak to restore full service to its long-distance trains as well as call back furloughed employees. Amtrak had also benefitted from earlier pandemic bail out packages totalling $3 billion.
The pandemic had checked Amtrak’s pursuit of its first-ever operating profit, which Flynn says on Feb. 29, 2020, at the half way point of its financial year, the railway was on course to secure. Flynn’s predecessor, Richard Anderson, had made it his mission to improve Amtrak’s operational performance, often the ire of critical senators overseeing its budget each year.
The railway had made significant progress, reducing its operating loss to $29.8 million in its fiscal 2019 financial results, an improvement of 82.6% over the $170.6 million loss reported in 2018, and its best-ever operating result. Controversial cutbacks to loss-making long-distance services were carried out—including scaling back onboard catering, which has been heavily criticized. The restoration of some at-seating dining has been praised, but Flynn is keen to continue this trend toward profitability. When Amtrak might get close to this level of performance again is difficult to predict. The operator reported a $801.1 million deficit in its COVID-ravaged 2020 results. However, Flynn says the work undertaken in the past five years to improve operational performance and introduce “solid disciplines” meant it was in a much stronger position to respond when the pandemic hit.
Reflecting on where Amtrak might be by the end of the year, Flynn says that with ridership up in the high 70% range compared with pre- COVID levels, and with university students returning to campuses this autumn, he thinks traffic can stay in that range. However, with the delta variant taking hold and COVID cases surging in the United States, he is understandably cautious. “It’s hard to say what the effect of that is going to be,” Flynn says. “In some parts of the country, we have high vaccination rates generally in the population, and in other parts we don’t. If you asked me six weeks ago, I would have been a bit more enthusiastic about the ridership. But looking forward, I think we have to temper it a bit, because it’s a new level of uncertainty that unfortunately we have to deal with.”
New Trains Set to Revitalize Amtrak’s Offer
Amtrak in July selected Siemens Mobility to supply 73 multi-power push-pull trains for use on the NEC and on state-sponsored routes. The $3.4 billion contract includes options to build up to 140 single-deck trains and is potentially the railway’s single largest-ever fleet order.
The new trains will replace 37% of Amtrak’s fleet of aging Amfleet equipment used on the NEC as well as some state routes, predominately on the East Coast. Intriguingly, in addition to 50 electro-diesel and eight diesel locomotives, the order includes 15 battery-electric hybrids units. The first trains will be delivered in 2024, and the first hybrid battery sets in 2025. Flynn says he expects Amtrak to exercise the first option for another 10 trainsets in the next couple of years.
The push-pull trains will join new Alstom Avelia Liberty high-speed trainsets on the NEC, with Flynn confirming that the first of the Alstom trains will enter service toward the end of the first half of 2022. The fleet will increase the number of these types of trains in service from 20 to 28, and offer a near 40% increase in capacity per train.
Elsewhere, Amtrak this summer began to introduce 450 refurbished long-distance Superliner coaches dating from the 1980s and 1990s. The double-deck vehicles primarily serve Midwestern, Southern and Western routes, and will be steadily introduced during the next three years. The first updated Superliner sleeping cars, dining cars and Sightseer lounge cars will begin operating this autumn. Single-deck Viewliner sleeping cars operating to and from the East and Southeast will receive similar improvements, with new CAF-built equipment coming on line.
In addition, Amtrak is testing the first of its new ALC-42 diesel-electric locomotives. Built by Siemens Mobility and equipped with Caterpillar QSK95 prime-movers, delivery and introduction of the units will continue until 2024.