Amtrak and Freight – Now What?

At the end of April, The U.S. Court of Appeals for the D.C. Circuit struck down parts of the 2008 Passenger Rail Investment and Improvement Act, ruling that the act gives Amtrak too much authority to direct and punish freight railroads where they compete for track time and access. The court deemed Amtrak in “competition” with the freight railroads because they “compete” for track time.

On the surface, this appears reasonable. Amtrak is a quasi-governmental agency that is theoretically in business to make a profit providing passenger services. If it were strictly a private enterprise, legislation that allowed it to dictate when and where it could use the tracks belonging to another private enterprise would never be allowed to stand, absent a contractual agreement between the two parties wherein consideration was given for agreed-upon services. The relationship between Amtrak and the freight railroads is substantially different from this. Except for the instances where Amtrak has carried express trailers, rail-to-highway convertible vehicles, Amtrak and the freight railroads simply do not compete for the same business.

In fact, the freight railroads would not be freight-only railroads were it not for The National Railroad Passenger Corporation, dba Amtrak. Let me clarify a bit. With a few notable exceptions that deserve mention in a separate blog, most railroads, in the 1960s found themselves operating passenger trains that they just simply did not want to run. The Interstate Commerce Commission and many individual state railroad commissions still viewed passenger service as something of a public obligation to be met by railroads in return for the charters they were granted decades, sometimes tens of decades, before. The “train off” process was long and complicated, and many times the government powers simply would not release the railroads from this obligation. In some cases, there is anecdotal evidence that the railroads simply made it so miserable to ride the trains that passengers would, they hoped, support the train offs.

To the freight railroads, Amtrak became a deal with the devil. Payment was not made in souls, though many would argue that some of the beloved passenger trains were, in fact, the railroads’ souls. The payment was made in equipment or the obligation of maintaining said equipment, passenger servicing infrastructure, personnel to run the Amtrak trains, and the final deal the railroads didn’t really want to make. The final deal was the railroads giving Amtrak track access and scheduling priority. Were the railroads super profitable back then, they probably would have fought harder to avoid the last part. But they were not. They were still hamstrung by the heavy hand of regulation. Conrail became, in 1976, the second child of this heavy hand, Amtrak being the first, as the eastern railroads still struggled to make a buck. But the die was cast and the deal was made.

Ten years after Amtrak started, Congress decided it had regulated long enough. Railroad deregulation in the form of the Staggers Act left the freight railroads in a much better position to control their economic destiny, and they set about doing so to the point where, today, railroad stocks are just as attractive to investors as are any other transportation issues. But there was still that pesky agreement to let Amtrak use the track time to run its federally-mandated passenger network.

The railroads have approached this problem on three fronts, none of which indicate they want to honor the spirit of the original agreement. First, they simply ignore the Amtrak schedules when it suits them. The relatively minor financial penalties don’t bother them now, and they are good at making it look like they are trying to comply. The latter is made more credible to the casual observer and railroad shippers when it is noted that they are unable or unwilling, despite massive investments in track and signal expansions, to meet on-time performance goals with their own trains, let alone Amtrak.

In the second place, they throw up obstacles to starting new Amtrak routes on their tracks. Excuse? The freight railroads are always behind the eight ball and up to their ears in freight even when there is a traffic downturn, and even when Amtrak, the states, or advocacy groups come up with logical and viable plans to schedule the new routes.

Thirdly, they fight scheduled passenger trains in the courts. The subject ruling is the consequence of Amtrak finally getting Congress to recognize that the railroads are not listening to Amtrak when it comes to on-time performance problems. It is the railroads fighting back in court. It is a hissy fit.

What next? Amtrak can try to take it higher, but that will take time. Congress can rewrite the law, but as written the FRA or STB can still regulate cooperation and penalties into the rules if either chooses to do so. Amtrak’s board can get off its duff and hire a competent CEO to replace Joe Boardman, one with operating experience and a no-nonsense approach to the railroads. With Boardman retiring this year, that may happen.

Will on-time performance get worse? As an answer, some may ask if it can get any worse. I think that, for the foreseeable future, if you ride Amtrak and want to get where you’re going on time, you should carry a rabbit’s foot, a four-leaf clover, and a few other good-luck charms. And pray continually.

© 2016 – C. A. Turek – mistertrains@gmail.com

(Charles A. Turek is a writer and novelist based in Albuquerque, NM. After four decades working in areas of the insurance industry related to transportation, he now writes on all aspects of American railroading. Charles is a political conservative but believes in public funding of passenger rail as a part of the federal government’s constitutionally conservative obligation to provide for defense and public infrastructure so that private enterprise may flourish.)