Amtrak Ready to Make Big Bet On Long-Distance

by Jim Mathews / President & CEO

Amtrak CEO Stephen Gardner told Congress this week he wants to make a New York Central-sized bet on the railroad’s long-distance network, setting in motion the biggest long-distance rolling stock buy in 75 years thanks to the Bipartisan Infrastructure Law’s historic capital funding.

Meanwhile, during the same hearing, anti-Amtrak members of Congress said they want to find ways to put some of that money from the new law – also known as the Investment in Infrastructure and Jobs Act, or IIJA – off-limits.

Answering a question posed by Rep. Mark Desaulnier, the Republican-turned-Democrat who represents San Francisco’s East Bay area, Gardner offered hints about the scope of the massive and long-overdue order for new long-distance equipment made possible thanks to the capital funding in the IIJA.

“We're about to go into the market again – and it will be the first time we're purchasing since the IIJA has been enacted – for our big fleet of long-distance equipment,” Gardner told Desaulnier. “This is going to be the largest order of passenger equipment since the 1940s acquisition by the New York Central. So, it's a huge opportunity.”

That order, placed in 1948, was for 721 railcars and it was spread out across three suppliers: the Budd Company, Pullman-Standard, and ACF. Back then, the price tag was $56 million. In today’s dollars, $56 million would be $706 million, but Amtrak has said previously that it would probably take considerably more. In fact, the unfunded fleet plan for rolling stock of all types is tagged at about $2 billion.

Money for new cars has to come either from regular appropriations or from the IIJA’s newly topped-up capital funds. Amtrak is earmarked $22 billion in the IIJA/Bipartisan Infrastructure Law for new investments, so conceivably that’s where the money could come from. Beyond that, however, the CRISI program (that stands for Consolidated Rail Infrastructure and Safety Improvement) seems the obvious source. The Federal Railroad Administration’s notice of funding opportunity for the latest round of CRISI grants has language that could make it eligible, and Amtrak has successfully applied for CRISI funding in the past.

Enter the new Chair of House Transportation and Infrastructure Committee’s rail subcommittee, Rep. Troy Nehls (R-Texas).

“Amtrak should not be allowed any more CRISI grant funding over the next five years while you are receiving tens of billions of dollars over the next five years,” Nehls said in his very first round of questioning during this week’s hearing.

The subcommittee Chair told Gardner “CRISI grant funding, in my humble opinion, should be set aside for the Class IIs and the Class IIIs” – a reference to smaller railroads, or those with less than $490 million in annual revenues – “so I am just letting you know that it would be my intent, while you are receiving billions and billions of taxpayers’ dollars over the next five years, that Amtrak should not be allowed to participate in the CRISI grant program.”

Of course, we believe that neither Amtrak nor any other large entity should be allowed to soak up all the available grant funding this historic Bipartisan Infrastructure Law provides. But at the same time, we have to recognize that there will be large projects taking up significant shares of funding which are nonetheless best for advancing the state of passenger rail in the U.S.

There’s some indication that congressional Republicans are already of the mind that since they can’t touch Amtrak’s new capital funds from the IIJA/Bipartisan Infrastructure Law, they’ll just let Amtrak starve on the operating funds side of the ledger. Nibbling away at the capital funding would be even worse.

The current arrangement of pieces on the political chess board makes the CRISI restriction a somewhat unlikely threat; the Federal Railroad Administration distributes the guaranteed funds from IIJA and will adhere to the CRISI requirements enacted by Congress, which explicitly include eligibility for passenger rail projects. However, there is an additional $1 billion in authorized CRISI funds that could come out of the annual transportation budgeting process; this must-pass legislation could be a vehicle for restricting eligibility to short-line railroads, so it is not an entirely empty threat. We’ll have to watch this one closely to be sure that we head off any unnecessary restrictions on Amtrak’s ability to invest in better equipment for the trains you and I pay to ride.

(P.S. – I also know full well what happened to the NY Central. Let’s hope that’s not an omen for what happens to Amtrak as it finally makes the investments we need in long-distance trains. If I see comments about the NY Central folding, I’ll know you didn’t read the entire column!)