Sunlighting Amtrak’s PRIIA—Which Should Be Sunsetted

Written by M. E. Singer
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Louis D. Brandeis

When it comes to the news of Jan. 16, 2020 of Amtrak approaching the State of Tennessee to gin-up interest in its latest pitch for the highly questionable PRIIA legislation, it is best to remember what long-ago Supreme Court Associate Justice Louis D. Brandeis once said: “Sunlight is the best disinfectant.” As this action looks like a maneuver to manipulate Congress to allow Amtrak to disassemble long-distance trains and reallocate their equipment, I intend to ensure sufficient sunlight is evident here when Amtrak touts its newly discovered Nashville-Atlanta route.

Benchmark

If CSX, the owner of the ex-Louisville & Nashville (L&N) line between Nashville and Atlanta has not even been approached by Amtrak with preliminary details of any proposal, that is a non-starter for any thought of moving forward. CSX has been a deterrence over the years with Louisiana, Mississippi and Alabama to jump start a Gulf Coast train. Operationally, as the line between New Orleans and Mobile is single track with bi-directional signaling, the unresolved problem is that since CSX has implemented Precision Scheduled Railroading (PSR), it is running fewer but elongated freights that cannot fit into current sidings. As these PSR freights are now scheduled, CSX views any passenger service as a threat of interference to the integrity of its operation.

Historical Reflection

L&N Georgian

Few remember today how adept the L&N was in operating consolidated passenger trains between the Midwest-New Orleans and Atlanta. Actually, up until the late 1960s, these trains, centered around the Humming Bird (Cincinnati-New Orleans) and the Georgian (Chicago-Atlanta) running together between Chicago and Nashville, with sections from St. Louis (Evansville), Cincinnati/Louisville and Memphis all converging upon Nashville very late at night, where southbound and northbound trains were taken apart by switch engines moving the Pullmans, coaches, diners, lounges, baggage and RPO/REA/package cars onto the various dedicated tracks for almost simultaneous departures south to Atlanta and New Orleans, and north to Chicago/St. Louis and Cincinnati/Louisville/Memphis. Few railroads performed such a massive post-war switching operation on a daily basis. And yes, the L&N diners were rightfully famous for serving the best grits in railroading.

For a few years after Amtrak was birthed by the federal government, there was avid talk of scheduling the poorly performing Chicago-Florida train through Nashville/Atlanta. However, such discussion dissipated as Amtrak grew familiar with the infrastructure problems and concomitant costs created by the topography of this route. Before Amtrak started in 1971, the L&N operated a first-class passenger train over this intended route between Atlanta-Chicago, the previously mentioned Georgian. Due to the curving, mountainous route, particularly between Chattanooga and Atlanta, this train was limited to 40 mph and required six-plus hours to traverse the 285 miles between Nashville and Atlanta—when the line was double-tracked.

Associated Press photo

This route is now single-tracked with bi-directional signaling. Importantly, it is the principal Chicago/Midwest-Southeast freight corridor for CSX running its timed intermodal and PSR freights. Beyond the relatively slow speed imposed by topography, how would even the proposed two daily passenger trains traveling at a faster velocity than freight fit onto this restrictive “corridor,” without benefit of adding a second main track, at a cost of approximately $2 million per mile, plus costs for signaling, etc.? How will such costs be rationalized if at best two daily trains operate in each direction?

The common denominator defining a passenger rail corridor is a minimum of three trains per day in each direction. Given the lack of connecting trains at both end points in Atlanta and Nashville, how will the metrics be explicitly validated to support this service well beyond any suppositions created by Amtrak and its Northeastern-centric marketing department, when non-stop flights require but 70 minutes?

PRIIA: An ATM for the Northeast Corridor?

Despite freight railroads currently lacking capacity for Amtrak to create any new state routes, there is a reason for Amtrak to approach Southeastern areas previously devoid of passenger trains. Such state-supported trains operating under 750 miles, whether in one state or multiple regions, fall under PRIIA (Passenger Rail Investment & Infrastructure Act of 2008), which has created a mother-lode of wealth for Amtrak, valued last year at over $250 Million. PRIIA was maneuvered by Amtrak through Congress to facilitate Amtrak allocating more costs to state-supported corridors. In essence, PRIIA was designed to become a piggybank for Amtrak. To what extent are Tennessee and Georgia aware of the excessively high costs in store for them?

As the obscure accounting methodology Amtrak relies upon has rarely been reviewed “in the sunlight” by an external forensic audit to validate its assumptions, Amtrak has not practiced Generally Acceptable Accounting Principles (GAAP) by shifting costs exclusive to its Northeast Corridor to state-supported trains. Accordingly, Amtrak overcharges these states in order to subsidize its deficit-ridden Northeast Corridor. Also, Amtrak does not even charge, per PRIIA, the states along the 457-mile Northeast Corridor for its twice-hourly, bi-directional intercity trains serving Washington D.C., New York City and Boston. Rather than operating as a business and acknowledging common concepts of business, Amtrak refuses to recognize just the incremental costs involved to increase frequencies on the same route for state-supported trains.

Amtrak incorrectly interprets PRIIA to the detriment of states seeking to have competitive bids for operations, maintenance and repair; leasing of motive power and equipment; train and engine crews; and cafe, attendant, product selection, product costs, wastage and financial losses. Amtrak continues to handicap states seeking to provide rail service to fulfill growing demands for increased mobility.

Indeed, there are three Joint Powers Authorities in California successfully managing and marketing the operation of regional passenger services. If they were not beholden to Amtrak’s federal insurance program and its track access rights, LOSSAN (San Luis Obispo-Los Angeles-San Diego) would be profitable; the Capitol and San Joaquin corridors would be close to it by now. Indeed, Stacey Mortensen, Executive Director, San Joaquin Joint Powers Authority, stated in November 2019 before Congress how Amtrak charges three times as much as a private firm, Herzog, to operate trains.

Now, Metrolink decided to sever its contractual relationship with Amtrak, one of four contractors for the 538-mile, six-county regional/commuter rail system. Since 2010, Amtrak has provided train and engine crews, and according to an internal Amtrak memo to employees, Metrolink “has chosen not to accept Amtrak’s bid to continue to provide services.” Amtrak submitted a joint bid with Fluor Corp. in response to a summer 2019 RFP.

Metrolink’s decision, I believe, is not due to any problems attributed to the T&E crews and other services provided by Amtrak, nor the competencies of Fluor and its consultants. Instead, I believe it is predicated upon a build-up of ill will created by Amtrak’s application of PRIIA. To what extent has this been experienced by California’s three JPAs attempting to competently run their state corridors, in spite of Amtrak’s attitude re: PRIIA?

Despite Amtrak’s complaints and legal challenges over treatment by the Class I’s, when you see how poorly Amtrak is treating publicly operated commuter rail lines for depots it owns and controls (Washington Union Station, Chicago Union Station and perhaps dozens of other similar properties around the U.S.), if given a choice, why would any knowledgeable public commuter rail operation contract with Amtrak?

Importantly, as states realize how paralyzing Amtrak’s embrace of PRIIA has been toward any increase in frequencies or consideration of new routes, the marketplace should be focused upon encouraging further development of skills by competitively priced, alternative private firms (i.e. Herzog, Keolis). Ideally, states should push back against PRIIA and move toward the concept recently presented to the Commonwealth of Pennsylvania: operation of the Philadelphia-Harrisburg corridor service by SEPTA. (USDOT owns the right-of-way; Norfolk Southern and Amtrak have freight and passenger rail operating rights, respectively.)

Growing Challenges to Amtrak’s Reliance Upon PRIIA

There is a growing resistance within some states against Amtrak’s “take it or leave it” attitude. Indeed, the Commonwealth of Pennsylvania is looking at taking back the Philadelphia-Harrisburg right-of-way and having SEPTA operate the trains and acquire its own equipment. This would be extended west of Harrisburg to Pittsburgh for the NS-owned former Pennsylvania Railroad/Penn Central/Conrail main line, with SEPTA negotiating its own financial deal with NS for track access and dispatching. Currently, the only passenger train on that route is Amtrak’s daily New York-Pittsburgh Pennsylvanian.

Bennett Levin

For the Commonwealth of Pennsylvania, it is indeed relevant and timely to embrace Bennett Levin’s evidentiary research and testimony before the Pennsylvania House of Representatives Transportation Committee to bring Western Pennsylvania into the 21st century to control costs, enhance product value, create supportive marketing and establish Class I relationships. There is no reason why the Commonwealth cannot lease its own motive power and equipment (as is done in North Carolina), hire T&E crews from Norfolk Southern or operationally and financially from a vetted private firm (as is done in Connecticut), and lease the café to sell its own products and provide staff for food service (as is done in Maine).

Amtrak Hiawatha at Milwaukee Intermodal Station. Photo courtesy WisDOT.

The Chicago-Milwaukee Hiawatha service could vastly improve by eliminating the middle man, Amtrak. As the Chicago-Milwaukee corridor has evolved into an economic and heavily populated megalopolis, the increased demand for more frequent and faster passenger trains has not—and will not—be met by Amtrak, due to PRIIA creating the artificial constraints of equipment availability and financial/operating costs. 

Some states are taking the path of going their own way with the federal wallet, which could help negate Amtrak’s National Network of inter-regional passenger trains. That’s fine, but such states should do it with their own funds.

Before the Commonwealth of Virginia gets to benefit at no cost from Amtrak’s extension of the Northeast Corridor to Richmond, while only paying the marginal difference for service extension to Norfolk, Newport News, Lynchburg and Roanoke, the FRA/USDOT should rule that any federal relief for state rail operations/equipment should be directed as a priority to the states that currently fully pay per PRIIA for their state-supported passenger trains—such states as California, Pennsylvania, Illinois, Michigan, Wisconsin, Oregon, Washington, etc.

M. E. Singer is an observer and commentator on the passenger rail industry, identifying shortfalls and growth opportunities. He is currently Principal at Marketing Rail Ltd. in Chicago, a consultancy to achieve passenger rail customer experience and product branding. Singer has prior corporate experience in turnaround operations management, marketing, and mergers and acquisitions in the health care field.

Categories: Class I, Commuter/Regional, Freight, High Performance, Intercity, Passenger, Short Lines & Regionals Tags: , ,