- - Thursday, February 1, 2018

ANALYSIS/OPINION:

President Trump says that his highest legislative priority in 2018 is an infrastructure bill that includes private investments in “roads, rails and regulatory reform.” The best way to enlist the private sector in the passenger rail element of an infrastructure plan is to open the 15 national long-distance corridors and 27 state-supported routes to private competition with Amtrak.

Skeptics suspect that private operations won’t work any better than government-chartered Amtrak. But, for the first time since the bankruptcy of the Penn Central railroad in 1970, private passenger rail is becoming feasible. Investors, states and unions are stepping forward.

Some states help subsidize Amtrak service now. The Passenger Rail Investment and Improvement Act (PRIIA) of 2008 authorizes such states to open routes to private bids. Connecticut and Flordia are doing so. Following the recent deadly Amtrak derailment near Tacoma, the Cascades service funded by Washington and Oregon is a logical next prospect for inter-city competition.

Private commuter rail companies in a number of metropolitan areas already make successful private bids against Amtrak. Over 80 million riders daily use services provided by companies such as Herzog, First Transit, Keolis, TransDev and Bombardier. Some of these operators bring recent lessons gained from private service in Germany, Britain and Asia. In Florida, private companies have prevailed over Amtrak for public subsidized commuter routes in both greater Miami and Orlando.

In a promising added development, the All Aboard Florida company is preparing to offer inter-city Brightline train service along the 236-mile corridor between Miami and Orlando without public subsidy. The $3 billion project recently opened the initial route between Fort Lauderdale and West Palm Beach.

Most inter-city service is still likely to depend on state support to some degree. But efficiencies matter, regardless. Without Amtrak’s bureaucratic overhead and management style, private concerns almost always are able to beat Amtrak’s costs and make service improvements.

Another compelling reason to seek private competition is Amtrak’s safety record. After a deadly train accident in Pennsylvania in 2015, National Transportation Safety Board chairman Robert Sumwalt warned that “Amtrak safety culture is failing and is primed to fail again.” It did fail again in a train derailment in Washington State last July, and then it did so once more last December at Dupont, Wash.

The latest accident was the inaugural run of a state-funded, Amtrak-operated service from Seattle to Portland. The trip ended when the train ran through a 30-mile-an-hour curve at 78 mph, propelling a new locomotive and most of the cars off the tracks, over an embankment and onto Interstate 5 traffic. Three passengers were killed and 62 passengers and crew, plus eight occupants of highway vehicles, were injured.

Amtrak was criticized after the derailment for not deploying “Positive Train Control” (PTC) technology that would have slowed down the Cascades train at the curve and overridden human error. But media focus on PTC as a safety solution neglects the longer-range issue of Amtrak’s innovation-stifling monopoly. The Amtrak contract for the Cascades service should be canceled by the State of Washington and a new bid offered that invites private competitors.

Nationally, the heavily traveled Northeast Corridor (NEC) is a special case. Amtrak not only operates the service, but also owns the tracks and other infrastructure. Critics contend that Amtrak seems to make money on NEC operations only because it fails to account for infrastructure overhead costs.

Looking at the NEC realistically, a group of investors is backing a proposal called AIRNet-21 that would privatize the Northeast Corridor infrastructure and put operations out to competitive bid. Unlike other prospective changes in passenger rail, however, AIRNet-21 would require congressional action.

Congress and the administration should note that private sector interest is growing. For decades, it was assumed that corporations would not want to get into a business that was abandoned back in the days when auto and air travel first boomed. Technology is changing, however, as are increasing patterns of inter-city congestion. All Aboard Florida’s successful appeal to bond buyers is a positive precedent for other projects.

Even freight railroads that have avoided passenger service, such as BNSF and Union Pacific, might be attracted. In most of the country, passenger rail uses their tracks, and some mostly-freight railroads — in metro Chicago, for example — already run successful commuter systems. Freight railroad investment in passenger service almost surely would be advanced if an infrastructure bill included funds for smoother tracks, and, in certain places, undergrounding of utilities for safety, security and environmental purposes.

According to Ray B. Chambers of the Association of Independent Passenger Rail Operators, “If there are transparent and open bids for inter-city rail in the Northwest or anywhere, I think several private carriers would take part.”

At a recent Public Transportation Conference, Charles Hogue, Government Affairs Director of the Brotherhood of Maintenance of Way Employees/Teamsters, stated, “Competition between operators for intercity passenger routes, with traditional labor protections, is a good way to expand passenger service in America.” He added bluntly, “Aggressively launching competition for intercity passenger corridors is the only way we can create a high-performance network. Amtrak needs to learn to compete or get out of the way.”

Some federal as well as state government role in passenger rail is probably inevitable. Transportation systems are regulated. Government historically has had a capital role in commercial road and air systems, as well as rail. Yet for road freight haulers, and for bus and air carriers that use federally financed infrastructure, private competition predominates. People may be frustrated with airline companies, but, who supposes that flying would improve if there was only one, government-chartered airline?

If the administration truly wants its infrastructure program to include “private participation” and seeks projects that are “transformative,” it should include passenger rail transportation. Encouragement of private sector competition for inter-city passenger rail service is exactly what would prove “transformative.”

Bruce K. Chapman is chairman of the board of Discovery Institute. He was a member of the Amtrak Reform Council during the George W. Bush administration.

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