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As Amtrak ridership increases, so do calls to cut federal rail subsidies

This article first appeared in the St. Louis Beacon, Sept. 11, 2012 - WASHINGTON – Even though Amtrak’s ridership has reached record levels – including a nearly 11 percent increase on the St. Louis to Chicago route – the massive federal subsidies to the rail system are stoking renewed debate.

On Monday -- in advance of what was billed as a hostile U.S. House hearing -- Amtrak announced that its nationwide ridership had increased by 3.4 percent over the first 11 months of the fiscal year, with the year's total expected to exceed the rail system’s previous annual record of 30.2 million passengers.

Calling that rise “great news,” U.S. Sen. Dick Durbin, D-Ill., said ridership on the St. Louis-Chicago route – even though many passengers had to be bussed over parts of the route this year as tracks were upgraded to accommodate higher-speed rail – had shot up by 10.9 percent (more than 60,000 riders), totaling about 519,000 passengers over the fiscal year’s first 11 months.

“Amtrak continues to be a popular choice for families and business travelers in Illinois,” said Durbin, who has supported the development of the high-speed corridor connecting St. Louis and Chicago.

But the size of the federal government’s Amtrak subsidies – nearly $1.5 billion in this fiscal year, when both operating subsidies and capital costs are included – has led many Republicans, including presidential nominee Mitt Romney and the chairman of the House transportation committee, to call for ending or greatly reducing Amtrak’s federal support.

In an interview last month, Romney told Fortune magazine [http://finance.fortune.cnn.com/2012/08/15/mitt-romney-interview/ ] that, if elected, he hoped to help reduce the federal deficit by eliminating “various subsidy programs -- the Amtrak subsidy, the PBS subsidy, the subsidy for the National Endowment for the Arts, the National Endowment for the Humanities.”

And the GOP platform, approved last month by delegates at the Republican National Convention in Tampa, called for complete privatization of Amtrak. “It is long past time for the federal government to get out of the way and allow private ventures to provide passenger service,” the platform stated.

While Amtrak subsidies have been controversial for decades, the issue might come to a head in the next few months because Congress aims to make severe cuts in many federal programs over the next year to help reduce projected deficits.

Last year, Amtrak – which says its ticket prices and fees cover about 85 percent of its operating costs – had a net loss of more than $450 million. The federal government provided about $562 million in operating subsidies, as well as another $650 million in capital costs such as track improvements.

Durbin, for one, has defended Amtrak, and has worked to maintain federal support for improving the tracks on what is planned to become a high-speech rail line connecting St. Louis and Chicago, via Joliet, Pontiac and Springfield, Ill. He argues that rail transport is safer, greener and more efficient than auto traffic through the state.

“Over the last 11 months, riders took over 100,000 more trips on Illinois-supported Amtrak routes than they did during the same period last fiscal year – that’s a 5.6% increase,” Durbin said in a statement Monday. 

On top of the rise in St. Louis-Chicago ridership, he also cited increases this fiscal year in the Chicago to Carbondale (up 4.6 percent) and the Chicago to Quincy routes (up 4 percent). “This is great news for the residents and businesses along these routes that benefit from the increased economic activity that Amtrak service brings to their communities,” he said. 

But some leading GOP lawmakers make the case that Amtrak should be privatized to allow its management to shut down unprofitable routes and concentrate on corridors – such as the eastern seaboard corridor between Boston and Washington, D.C. – that can be self-sustaining.

U.S. Rep. John Mica, R-Fla., who chairs the House transportation committee, told reporters he is “going to go after Amtrak” – holding a hearing every month this fall on topics related to the rail system. On Tuesday, the panel’s hearing will focus on “the high cost of Amtrak’s monopoly mentality.”

Staffers said the hearing, and a GOP report, would probe Amtrak’s efforts to suppress competition from the private sector. The report, they said, would highlight “the significant cost savings realized by commuter rail agencies through competitive contracting for operations, and Amtrak’s ineffectiveness when competing with the private sector on these contracts.”

Mica, whose handling of the surface transportation legislation this spring irritated many House Democrats – including U.S. Reps. Russ Carnahan, D-St. Louis and Jerry Costello, D-Belleville -- wants to cut the federal government's support for Amtrak’s day-to-day operations.

While Mica conceded that some passenger routes would not survive without subsidies, he told the Associated Press: "I'm for the privatization, and if we can end them, we can."

The first witnesses at Mica’s hearing Tuesday is scheduled to be Amtrak’s president and chief executive, Joe Boardman. His office released a statement Monday saying that Amtrak ridership “is surging this year with 11 consecutive monthly ridership records. In each month of the current fiscal year, Amtrak has posted the highest ridership total ever for that particular month.” July was the single best ridership month in Amtrak history.

“All across America the demand to travel by Amtrak is strong, growing and undeniable,” said Boardman, in a statement. “Amtrak continues to deliver on its mission to fulfill a vital national transportation need and does so with improved management and financial health.”

From fiscal years 2002 to 2011, Amtrak ridership increased 44 percent and set new annual records in 8 of those 9 years, Boardman said. A record 30.2 million passengers traveled on Amtrak in FY 2011 on more than 300 daily trains – at speeds up to 150 mph (241 kph) – that connect 46 states, the District of Columbia and three Canadian Provinces.

One of the biggest complaints about Amtrak service in the Midwest has been late trains. On Monday, Durbin said he planned to “continue working with Amtrak, the Surface Transportation Board and freight railroads to further improve on-time-performance which will make train travel an even more attractive mode of transportation in Illinois.”