The U.S. public transportation, rail transit, intercity passenger rail and freight rail systems are integral and vital components of the nation’s intermodal transportation network. Each mode plays an important role in improving economic growth, quality of life, national security and the environment. These systems must be expanded to meet public demand, and continue to be integrated into the overall surface transportation planning process. Fully developing and utilizing these systems should continue to be a shared responsibility of federal, state and local governments and the private sector.
Public transportation capital investment is an effective means of adding capacity and mobility options to the overall surface transportation system, thereby reducing traffic congestion and improving the transport of interstate commerce, and overall regional quality of life and productivity. It also encourages mobility and freedom, and provides links to economic and social opportunities.
To achieve these objectives, public transportation systems should not be treated as independent entities serving the demand for travel. These systems should be conceived and coordinated as part of an integrated transportation network where each mode will perform the role that is most appropriate.
According to the American Public Transportation Association (APTA), nearly 10.8 billion passengers took trips using some form of public transportation in 2014. APTA also estimates that 7.8 million people commute to work on transit daily, a 25 percent increase since 2005. Moreover, the U.S. Department of Transportation (U.S. DOT) estimates that more than 25 million passengers use public transportation on a regular basis.
Investments in public transportation capital projects create job opportunities and stimulate private development. The public transportation industry provides direct employment to almost 403,000 employees.
Public Transportation System
The nation’s public transportation systems are owned and operated by state and local governments or governmental agencies, in partnership with the federal government. Currently, there are almost 6,800 transit providers operating in the U.S.
The private sector also plays an important role in this system, designing and constructing capital facilities, furnishing rolling stock and equipment, as well as managing and operating services for governmental partners. This federal partnership with state and local governments, transit agencies and private firms is vital to the continued growth and improvement of the public transportation network.
The U.S. public transportation system consists of multiple-occupancy vehicle services operating on local and regional routes, including: private and public buses, fixed guideway systems, bus rapid transit systems, commuter rail and streetcar operations using both public and private operators, ferryboats, and para-transit, taxi or van pool services contracted by public transportation agencies with private transportation operators.
The public transportation network currently includes:
- 7,795 route-miles of commuter rail––serving 1,245 rail stations;
- 1,622 route-miles of heavy rail––serving 1,130 stations;
- 1,877 route-miles of light rail––serving 969 stations;
- 166,767 route-miles of traditional bus service and 424 route-miles of trolley bus service.
Public Transportation Financing
In 2012, all levels of government spent $58 billion to provide public transportation and maintain transit infrastructure. Of this total, $16.8 billion was spent on capital improvements, both to replace worn-out facilities and rolling stock as well to expand transit systems and services. Data in the U.S. Department of Transportation’s 2015 report to the Congress “Status of the Nation’s Highways, Bridges and Transit: Conditions & Performance” suggests an annual investment of $17 billion (in 2012 dollars) in public transportation facilities for the next 20 years is necessary just to maintain the overall system’s current physical conditions and eliminate the current $89.8 billion system preservation backlog. It would take an annual capital investment of $22.8 billion in 2012 dollars to maintain physical conditions and accommodate a projected ridership growth of 1.4 percent per year. To provide maximum benefits to the overall surface transportation system, federal public transportation investments should be increased to meet the systems needs as quantified by the U.S.DOT.
ARTBA supports the utilization of a number of financing sources and mechanisms to generate the revenues necessary to achieve these needs based investment levels, including:
Support for Continuation of the Highway Trust Fund Mass Transit Account
ARTBA supports continuation of the Highway Trust Fund’s Mass Transit Account to help finance federal investments in public transportation. The association also believes that the current allocation of federal highway user fee revenues between the trust fund’s Highway and Mass Transit accounts sets a fair modal balance which should be maintained.
Appropriate Sources of Federal Investments in Public Transportation
Currently, federal funding for state and local public transportation program is provided through federal Highway Trust Fund Mass Transit Account (HTF-MA) revenues, federal General Fund revenues, and state transportation department “flexing” of their federal highway funding, which is supported by the federal Highway Trust Fund’s Highway Account (HTF-HA.)
Given the magnitude of unmet highway capital needs in every state, ARTBA believes federal investments in public transportation should only be derived from the HTF-MA and the General Fund. The association urges the Congress to increase the revenue stream from both of these sources to provide the level of investment necessary to meet the needs identified by the U.S.DOT.
Budgetary Treatment of Mass Transit Account Authorizations
ARTBA urges that the budgetary firewalls and funding guarantee mechanism contained in current law be retained and strengthened to ensure maximize federal investments in transit. These guarantees allow transit systems to leverage federal investments, lower project costs and develop public-private partnerships. Congress has supplemented existing trust fund user fee revenue with a series of general fund transfers since 2008. If and when the integrity of the Highway Trust Fund is restored by returning to an exclusive user fee revenue stream to support surface transportation investments, those budgetary protections should be reinstated to assure all trust fund user fee revenue is invested expeditiously to support surface transportation improvements and avoid accumulation of a trust balance in excess of the amount needed to meet cash flow requirements.
State and Local Support for Public Transportation Investments
Furthermore, ARTBA believes it is appropriate—and necessary—for state and local governments to increase public investments in transit service and programs. Such state and local investments could be derived from multiple funding state and local sources––including application of appropriate dedicated sales, income, payroll or property taxes; dedicated benefit district revenues; other general revenue; fare receipts; and local bond issuances.
Appropriate Use of Federal Investments in Public Transportation
ARTBA supports the use of federal revenues for long-term capital costs, including: right-of-way acquisition, design, construction, project management and oversight of state and local fixed guideway systems, bus facilities and other transit stations and facilities; rehabilitation and reconstruction of existing fixed guideway systems; purchase of rolling stock and major rehabilitation activities that significantly extend the operational life of rolling stock; and the National Transit Cooperative Research Program.
ARTBA also believes that the federal role in funding public transportation should be maintained as a “needs–based system,” providing investment in transit facilities, equipment and service where justified.
ARTBA opposes the use of federal funding to finance general operating costs of transit systems in urbanized areas over 200,000. These costs are best funded and administered at the state and local level, without federal subsidies.
Flexibility in the Use of Federal Highway Trust Fund Revenue
ARTBA urges the elimination of the current flexibility in use of federal funds between highway and mass transit programs. This practice limits the effectiveness of scarce federal capital resources
Opposition to “Capitalization” of Maintenance Costs
ARTBA urges the elimination of the eligibility for transit agencies in areas with populations above 200,000 to treat maintenance costs as capital expenditures. This practice of “capitalizing” maintenance costs dilutes the financial resources available for capital improvements that add transit capacity or extend service coverage, and encourages deferral of system replacement and development activities.
Appropriate Use of Innovative Financing Mechanisms
ARTBA supports the continued use federal innovative financing programs––such as Transportation Infrastructure Finance and Innovation Act (TIFIA) and Railroad Rehabilitation and Improvement Financing (RRIF) loans, State Infrastructure Bank (SIB) assistance, and tax exempt bonds––to provide financing and credit assistance that leverage public and private resources for public transportation capital investments.
Funding Security Improvements
ARTBA believes that any federal investments made to assure security on the nation’s public transportation systems should be financed exclusively through the General Fund of the U.S. Treasury. Investments in transportation security are critical to the functionality and performance of the nation’s public transportation infrastructure network, and are an important aspect of ensuring the safety and security of the American people—particularly in a time of crisis. Transportation agencies should be given a strong role in determining how best to improve the security of public transportation systems.
Public Transportation Programmatic Policy Recommendations
Fixed Guideway Systems
Fixed guideway systems represent an effective component of urban transportation networks by serving major travel corridors in large metropolitan areas. They also serve as circulation/distribution systems in major activity centers such as central business districts. Fixed guideway systems can also be an effective component of a comprehensive strategy for urban revitalization.
ARTBA supports the development of these systems where projects can be economically justified by a comprehensive transportation, economic and social analysis.
General Fund appropriations for the Federal Transit Administration Capital Investment Grants should grow to meet the growing demand reflected in the pipeline of projects while also fulfilling the obligations to projects that have Full Funding Grant Agreements.
To maintain a balanced regional transportation system and rational transportation planning and decision-making process, the current federal match share requirements of 80 percent federal and 20 percent state and local for fixed guideway capital investments should maintained.
Bus Rapid Transit
If communities choose to utilize Fixed Guideway Capital Investment funds for the development of Bus Rapid Transit (BRT) facilities, ARTBA urges that a majority of a BRT projects funds be allocated for the development of a separate right-of-way (ROW) for the exclusive use of public transportation vehicles. This ensures that public transportation capital investment funds are focused on capital intensive activities, and differentiates these facilities from traditional bus service.
A BRT facility will often operate in the same corridor as a roadway. ARTBA supports the standardization of procurement and contracting regulations throughout the entire transportation corridor to eliminate duplicative or inefficient requirements on project partners.
Bus, Streetcar and Related Facilities
ARTBA supports the use of federal funds for bus and streetcar capital projects. The route flexibility inherent in bus transportation combined with the ability of the buses to share roadways with other highway motor vehicles provides significant potential benefits for investment in buses and bus facilities.
To fully realize the benefits of federal investments in bus and bus facilities, highway-related improvements such as preferential lanes, traffic signalization and bus turnoffs must be made. Many streets––particularly in residential areas––must be upgraded to accommodate the weight of buses. These highway-related improvements should be financed with Highway Trust Fund–Highway Account (HTF-HA) funds.
Research and Development
The National Transit Cooperative Research Program should be continued and expanded. The FAST Act allowed for the program to be funded through the Mass Transit Account, which will ensure stable and certain funding for the program going forward. Research should concentrate on improving the convenience, security, safety and comfort of public transportation, in addition to increasing the financial viability of public transportation services. Research efforts should also consider management and marketing techniques, innovative improvements to existing systems and methods of reducing operating costs. Continuation of the university transportation centers program is supported.
Freight and intercity passenger rail systems are key components of the nation’s integrated transportation system. The 140,000-mile national rail network provides energy-efficient, cost-effective transportation, and is essential to the nation’s economy and national security. To ensure the full utilization of this network, a substantial amount of new public and private resources must be invested in freight and passenger rail infrastructure improvements.
Policy Position Regarding the Creation of a National Rail Policy
To ensure maximum efficiency of the nation’s freight and intercity passenger rail networks, ARTBA calls for the creation of a national policy to focus and direct rail infrastructure investment.
The increased importance of freight movement requires that the development and expansion of the freight rail system be coordinated, and the condition, performance and investment needs of individual corridors be identified. Similarly, to fully realize the public benefits of intercity passenger rail, a comprehensive strategy must be in place to ensure necessary intercity service is provided, and funded commensurate with documented needs.
U.S. DOT released a progress report on the status of the congressionally-mandated Nation Rail Plan (NRP) in 2012. However, no further update or progress has been made on the implementation of the NRP. DOT should update the NRP and, in particular, be required to provide regular assessments of the freight and intercity passenger rail infrastructure investment needs, and serve as the lead agency for all federal involvement in rail infrastructure development.
A comprehensive national rail policy must also:
- Protect and Acquire Rail Right–of–Way (ROW)––The abandonment of rail lines and the utilization of the unused ROW for non-rail purposes is an impediment to the development of the nation’s rail network. ARTBA encourages the adoption of policies to protect or recapture rail ROW. Such policies would ensure necessary rail lines and connections can be developed to improve the operations of the freight rail system, and provide ROW for the development of high speed rail corridors––as well as fixed guideway transit in metropolitan areas. ARTBA supports legislation that specifically allows public agencies to restore future rail service whenever they choose.
- Provide Increased Funding for Security and National Defense Improvements––ARTBA believes that substantial increases in federal investments are required to assure the safety and security of the nation’s freight and intercity passenger rail networks. The rail system also plays a critical role in national defense, providing important links and logistical support for military facilities. A national rail policy must analyze the national defense and security investment needs of these systems and provide the resources to finance these enhancements.
- Federal rail security investment should not dilute rail infrastructure funding, which also provides substantial security benefits. As such, the General Fund of the U.S. Treasury should be the source of freight and passenger rail security and/or national defense enhancements.
- Role of Private Sector in Development of Freight and Passenger Rail Systems–Private sector firms should be utilized to design, build, reconstruct and maintain freight and passenger rail infrastructure. Further states and public authorities should encourage a greater role for private operators.
ARTBA supports the development of a transportation system that allows more efficient handling of commercial, industrial, agricultural, energy and defense shipments. In the development of this system, ARTBA advocates a transportation policy that enables all modes to make the most of their inherent advantages and compete on equitable regulatory and promotional terms, sharing the transportation market on the basis of customer preference, service and relative economic costs. Freight railroads are a vital component of this system.
The U.S. DOT’s 2002 “Commodity Flow Survey” found that the nation’s freight rail system carries 16 percent of the nation’s freight by tonnage and dollar volume, and 40 percent of all freight ton-mileage. The U.S. DOT forecasts freight tonnage in the U.S. to increase 77 percent from 2006 to 2035, and rail freight tonnage to increase 73 percent over this period.
Freight Rail System
The Surface Transportation Board defines Class–I railroads as having annual operating revenues in excess of $453 million as of 2015. There are currently seven shareholder-owned Class-I railroads operating in the U.S. These railroads operate approximately 94,000-mile rail network and employ over 149,000 workers. Class–I railroads accounted for 88 percent of the nation’s rail traffic and 94 percent of the total rail revenue in 2006.
Short-line and Regional Railroads
Regional (or Class II) railroads operate line-haul of at least 350 miles and/or have operating revenues between $40 million and $453 million in 2013. Short–line (or Class III) railroads are defined as having revenues below $40 million. Altogether, the 546 short–line and 21 regional railroads operate and maintain 45,000 miles of track—approximately 32 percent of the nation’s rail route miles.
Class II and III railroads represent a growing segment of the industry, providing service to local jurisdictions and critical intermodal links to the freight transportation system. Twelve percent of all rail traffic originates with short–line or regional rail systems. These carriers provide employment for approximately 19,000 16,600 workers. Approximately 95 percent of these railroads are privately owned.
Strategic Rail Corridor Network (STRACNET)
Thirty-eight thousand miles of the U.S. rail network comprise the U.S. Department of Defense’s (DOD) STRACNET, handling movement of DOD shipments throughout the nation.
Capital Investment Needs of the Freight Rail System
The railroad industry is extremely capital intensive. The Association of American Railroads estimates that Class-I railroads have invested approximately 16 percent of their operating revenues in capital investments since the beginning of the decade. This compares to an investment level of approximately four percent for the U.S. manufacturing sector.
The American Association of State Highway and Transportation Officials’ (AASHTO) 2002 “Freight Bottom Line Report” estimates that between $175 billion and $195 billion is needed between 2000 and 2020 just to maintain the nation’s current freight rail infrastructure and to maintain freight rail’s share of future freight capacity forecasts.
- $13.8 billion for safety improvements (additional warning systems, grade separations, grade-crossing elimination and track relocations);
- $11.8 billion for short-line railroad capital improvements. (There is currently a $9.5 billion shortfall in this investment area.);
- $80-$100 billion in Class-I infrastructure repair and maintenance; and
- $70 billion in Class-I infrastructure improvements, beyond repair and maintenance investment needs, equivalent to $3 1/2 billion per year over 20 years. Class-I railroads are currently investing $2 billion annually for these improvements, approximately $1.5 billion per year below identified needs.
Increasing freight rail infrastructure investment to these needs-based levels is essential to U.S. economic health, national security, and quality of life.
Freight Rail Financing Policy Recommendations
As the nation’s freight rail industry is privately owned, private sources of financing bear the primary responsibility for financing its infrastructure. According the Federal Railroad Administration, since the enactment of the Staggers Rail Act––which partially deregulated the rail industry––the rail industry has invested more than $593 billion in capital improvements and maintenance of their track and equipment.
Despite this substantial investment, many segments of the rail network are reaching maximum capacity, threatening the efficiency of rail operations. The anticipated increase in freight volumes make it imperative to generate additional revenue to provide the capital upgrades necessary to meet the future demands on the system.
ARTBA Supports Expansion of Tools to Generate Additional Private Financing, such as:
- Use of Targeted Federal Tax Incentives––ARTBA supports the enactment of targeted federal tax incentives to encourage and attract additional private investments in rail infrastructure improvements. The rehabilitation tax credit adopted by Congress in 2004 provides a tool to help non-Class-I railroads to improve their rail infrastructure. This program should be continued and enhanced. ARTBA supports a similar mechanism to help Class-I and indeed all railroads expand rail capacity to meet both freight and passenger capital needs that provide public benefits.
- Innovative Financing–– ARTBA believes federal innovative financing and credit assistance programs––such as the Transportation Infrastructure Finance and Innovation Act (TIFIA) and the Railroad Rehabilitation and Improvement Financing Program (RRIF)––should be continued and expanded. These programs are designed to attract substantial non-federal investments to improving the nation’s intermodal surface transportation system.
- Public–Private Partnerships (PPPs)–– ARTBA supports the creation of PPPs, and believes the resources each party contributes should be commensurate with the projected benefits each would derive from the project and that a mechanism or calculator for measuring public and private benefits should be adopted.
To facilitate and generate rail infrastructure improvements, public authorities and the private rail industry have entered into a number of innovative PPPs. These agreements allow railroads to work with communities where rail traffic and capacity constraints have impacted the efficiency of the railroads and have negatively impacted communities.
ARTBA further believes that the U.S. DOT––working with state and local governments and the railroads––should identify regions and rail corridors in need of capital upgrades and improvements to address safety, capacity or system connectivity concerns. The USDOT should also play a leading role in the development of PPPs where it has identified necessary projects that provide public benefits and address public needs.
Policies Regarding Public Financing of Freight Rail Infrastructure
ARTBA supports public resources being made available to rail infrastructure improvement projects providing public benefits in order to supplement private investments in rail capital improvements.
- Dedicated Funding Mechanism–– ARTBA believes it is appropriate—and necessary—for the federal, state and local governments to levy user fees on rail use to finance public investments in rail infrastructure. ARTBA also supports the creation of a national goods movement program that is funded by dedicated user fees to ensure a necessary level of capital development of the freight rail system.
- Federal Tax-Exempt or Tax-Credit Bonds––ARTBA supports the use of federal tax incentives, including tax-exempt and/or tax-credit bonds, to provide a public sector contribution by subsidizing the cost of financing freight infrastructure improvement projects.
- Such public financing assistance should assist in leveraging additional private resources to meet the capacity and performance needs of the system through a number of potential funding sources.
- Only Appropriate Use of Federal Highway Trust Fund Revenue–– The appropriate use of federal highway user fee revenues is to improve the operation of the federal surface transportation program. These revenues should only be used for the highway/railway grade crossing program––including grade separation––and highway connections to major intermodal freight rail terminals and connectors to major freight rail and port facilities.
Freight Rail Policy Issues
Development of Strategic Corridor Network
ARTBA urges the creation of a strategic rail corridor system. While ARTBA supports the concept of STRACNET; this system must be updated to address the growing defense and security challenges facing the freight rail network. Such a system must address not only national defense needs, but also the security threats to the network, particularly the shipment of hazardous material.
Federal Capital Development for Shortline Railroads
ARTBA support the use of federal General Funds and/or bond financing for the infrastructure investments needs of shortline railroads. Many of these networks are not equipped to handle the 286-ton rail cars, which have become the industry standard. Failure to improve the infrastructure on these rail lines will undermine the operation and efficiency of the entire freight rail and intermodal transportation system.
Rail Relocation Program
ARTBA supports the creation of a new program funded from the federal General Fund to provide state and local governments with assistance for the relocation of freight rail lines. Such a program would facilitate safety, quality of life and economic development initiatives in communities with numerous railway/highway grade crossings.
Education and Research
ARTBA encourages and supports additional federal involvement and funding of education and research programs to improve railroad technology and safety, including enhancing public awareness and understanding of railroad operations and safety matters and continuation of National Operation Lifesaver Program.
Railway/Highway Grade Crossings
ARTBA believes the development and expansion of safe and efficient freight and passenger rail networks are dependent on improving highway-railway grade crossings. As of October 2015, there were a total of 211,631 grade crossings. Inefficiency at these crossings––particularly along high density freight rail corridors––has a severe impact on safety, traffic congestion, and the movement of goods.
Since the Railway/Highway Crossing Program was signed into law in 1973, the Federal Railroad Administration reports the number of rail/highway incidents at public crossings has been reduced by nearly 80 percent. Despite this improvement, rail/highway safety incidents result in almost 300 deaths annually.
- Rail/Highway Crossing Program––ARTBA supports the continuation and expansion of the Railway/Highway Crossing Program as a means to improve the overall safety and efficiency of the nation’s intermodal transportation system, and to improve the quality of life along rail corridors.
To ensure that funding provided under this program is directed to the highest priority crossings, ARTBA supports policies providing state highway agencies the authority to determine grade crossing priorities. ARTBA supports open competitive bidding for federally funded grade crossing installation and renewal projects to the extent feasible.
ARTBA also supports expanding eligibility under this program to include certain “private grade crossings” that are now fully accessible and used by the general public.
- Appropriate Use of Federal Funds––Federal funds should be used for construction and/or reconstruction of grade separation, or the installation of warning devises and equipment. Funding made available under this program should not be used for the operation or maintenance of grade crossing safety equipment.
- Type of Crossing Improvement––The location and type of crossing improvement should be determined by engineering studies that develop the most efficient and cost-effective improvements possible, considering warning signals and devices, gates or positive protections devices, road closures, grade separations, track consolidations and relocations, and a variety of other alternative improvements.
- Use of Technology and Innovative Approaches at Crossings––ARTBA supports the development and utilization of new technology for highway-railway crossing warning systems, hazard elimination and construction techniques. Innovative methods to further improve safety at highway-railway grade crossings, such as cost-efficient active warning systems for lower volume grade crossings, positive protection devices, and photo enforcement at grade crossings should be explored.
- Crossings on the National Highway System––There are over 4,500 at-grade crossings on the National Highway System (NHS). ARTBA recommends the establishment of a long-term priority for the Railway-Highway Crossing Program of improving safety at grade crossings on the NHS.
When a highway-railway grade crossing is present at the site of a capital improvement project on the NHS, the project should, if feasible, also eliminate the at-grade crossing.
- Grade Crossings on High Speed Rail Corridors––In developing high-speed ground transportation systems, safety and security should continue to be a paramount consideration. Consequently, no high-speed system should operate over lines with highway-rail grade crossings.
Intercity Passenger Rail
Passenger rail will play an increasingly critical role in the nation’s multimodal transportation network, providing increased capacity and redundancy in transportation alternatives along congested intercity corridors, as well as providing an important intermodal transportation link in many communities across the country.
U.S. Passenger Rail System
Conventional railroad passenger service (under 150 mph) in America is largely operated by government-sponsored National Passenger Rail Corporation (Amtrak). Some states and commuter agencies contract with Amtrak to provide rail service. In addition, many states pay Amtrak a subsidy to keep Amtrak service operating on corridor routes between city pairs.
The intercity passenger rail system consists of 21,300 miles of routes. Amtrak owns and operates 622 miles of track, all in the northeast, the rest is owned by freight railroads. The system serves 500 communities in 46 states. According to Amtrak, 81 percent of the intercity passenger trips are less than 500 miles.
In addition to conventional rail service, 36 states are currently involved in efforts to develop high speed rail service along high density corridors. To date, the federal government has provided minimal assistance to develop next generation high speed rail technology and plan corridors. ARTBA supports capital grants to states from outside the Highway Trust Fund to develop traditional corridors and to initiate a new program for high speed rail corridors with a process that encourages rail corridor development through public private partnerships.
Capital Investment Needs of the Intercity Passenger Rail Network
Insufficient capital investment in passenger rail infrastructure has resulted in increasing deferred maintenance costs across the system, and has contributed to the ongoing inefficiencies in the passenger rail network.
In 2010, Amtrak issued a master plan for the Northeast Corridor calling for $52 billion in investments needed to cover system repairs and upgrades and some capacity enhancements to help handle the projected 60% increase in ridership by 2030. It also released a vision for high-speed rail in the northeast corridor to accommodate train speeds of up to 220 miles per hour. The cost of this high speed rail vision was estimated at $117 billion, with the New York-Washington segment completed by 2030 and to Boston by 2040. Amtrak is also progressing on a $14 billion Gateway Program to upgrade train service from New Jersey to New York City.
These findings make clear that developing a cost-effective, fully functional intercity passenger rail network in the U.S. will require substantial rail infrastructure investments.
Intercity Passenger Rail Infrastructure Financing Policy Positions:
ARTBA supports the development and expansion of high speed intercity passenger rail service where justified by marketing forecasts, economic feasibility or social requirements, with a goal of 125MPH or higher. Where justified by travel demand and cost effectiveness, a goal of over 150 MPH could be appropriate.
ARTBA believes that, where appropriate, the federal government should provide the funding necessary to meet the capital investment needs of the intercity passenger rail network. ARTBA also supports efforts by states to expand intercity service. To increase the efficiency and trip time competitiveness of the intercity passenger rail system, ARTBA supports the development of high speed rail corridors.
States or multi-state authorities should be responsible for planning, design, construction and operation of new inter-city passenger rail systems – contracting for these functions as appropriate with private contractors.
ARTBA believes that states and public authorities should be encouraged to initiate competitions between qualified private operators, with approval of track owners, to provide intercity passenger service. This is a common practice in Europe and Asia that has proven highly successful. For example, in the United States, with a population of 320 million, the heavily government subsidized entity Amtrak provides approximately 31 million passenger trips annually with its aging fleet of equipment. By contrast, in Great Britain with a population of 61 million, private contract operators carry 1.2 billion rail passengers a year. Several countries have had success with private operation of passenger service and the U.S. should explore opportunities in this area.
To generate the additional investments required to maintain, improve, and expand the intercity passenger rail network and to develop high speed rail corridors, ARTBA supports the utilization of a number of financing mechanisms, including:
- Dedicated Funding Mechanism––ARTBA supports creation of a long-term, dedicated funding mechanism to finance capital investments in intercity passenger rail infrastructure. These capital improvements should be financed by levying appropriate user fees, in addition to fair box charges, such as a rail passenger facility charge and/or the use of tax advantaged bonding. Operational activities are appropriately financed from the Federal General Fund.
- Federal/State Matching Grant Fund Program––ARTBA supports the creation of a federal/state matching fund program to provide investments in intercity high speed rail corridor development.
- Tax-based incentives–– ARTBA supports the enactment of federal tax incentives––such as tax credits for owners of rail infrastructure who invest private resources in upgrading the rail network where passenger rail service utilizes privately-owned freight rail track.
- Innovative Financing––ARTBA supports the continuation and expansion of federal innovative financing and credit assistance programs––such as Transportation Infrastructure Finance and Innovation Act (TIFIA) and the Railroad Rehabilitation and Improvement Financing Program (RRIF). Intercity passenger rail capital improvement projects are eligible for these programs, which are designed to attract substantial non-federal investments to improving the nation’s intermodal surface transportation system.
- Appropriate Use of Federal Rail Funding––ARTBA supports the use of federal revenues for long-term capital costs, including: right-of-way acquisition, design, construction, project management and oversight of high speed or high-density rail corridors; and the purchase of rolling stock and major infrastructure rehabilitation activities.
ARTBA opposes the use of federal funds to finance the general operating costs of high speed and other intercity passenger rail systems. These costs are best funded through operating revenues or by state and local authorities as in the commuter model. When initiating high speed rail or other corridor service through states or other public authorities, Amtrak and private operators should be encouraged to compete for selection as service operator on a completely level playing field. One possibility, common in Europe, would be to establish a system where qualified operators (including Amtrak), would bid on routes with the subsidy being one element of the bid package. Over time, all federal operating subsidies should be eliminated and ultimately become the responsibility of the states or public authorities as in the US commuter model with the federal government maintaining capital responsibility as in the aviation and highway models.
- Appropriate Use of Federal Highway Trust Fund Revenue––Federal highway user fee revenues should not be utilized to provide investments under this program, except for the highway-railway crossing hazard elimination in high speed rail corridor program.
- Funding High-Speed Rail Studies––ARTBA endorses the consideration, study and analysis by the federal government, individual states, a federation of states, or private organizations of the construction of high-speed passenger train systems. The Federal Railroad Administration should also be provided sufficient annual funding––from the federal General Fund––to assist states to conduct needed studies of the development of high-speed rail corridors and technology development.
- Next Generation High Speed Rail Technology Research and Deployment––The federal government should continue to provide support for the development and testing of next generation high-speed rail technology for service in excess of 150 miles-per-hour, including magnetic levitation transportation technology. ARTBA urges the federal government to move toward implementing this technology in an effort to demonstrate its effectiveness as a key component of the transportation network.
(Revised September 2017)