House Subcommittee Advances Transportation Budget

House Advances Transportation Budget

Rail Sees Increase, But Questions Loom for Amtrak Operations

The House Appropriations Committee released the draft fiscal year 2023 Transportation, and Housing and Urban Development (T-HUD) funding bill, clearing the bill through the transportation subcommittee yesterday via voice vote. As usual, the lion’s share of the funding went to highways, but the committee did provide a 23 increase to discretionary investments in transit and passenger and freight rail.

The Federal State Partnership for Intercity Passenger Rail program saw a significant increase, from $100 million in FY22 to $550 million in this draft bill. This program is designed to fund capital projects that reduce the state of good repair backlog, improve performance, and expand or establish new intercity passenger rail services.

Additionally, there was a slight increase to the Consolidated Rail Infrastructure and Safety Improvements (CRISI) program, which funds projects that improve the safety, efficiency, and reliability of intercity passenger and freight rail. Promisingly, the bill includes a $150 million set-aside within CRISI to “support the development of new intercity passenger rail service routes including alignments for existing routes.”

However, this picture is complicated by the fact that these funding levels, while an increase over FY22 funding levels, are well below the amounts authorized by this same Congress just last November by a broad, bipartisan consensus (see ‘Table 1’).

Bill Shorts Amtrak Operations

Further muddying the picture for rail: the House T-HUD bill proposed $2.3 billion for Amtrak in FY23, well below the amount proposed by the White House ($3 billion) and the railroad itself ($3.3 billion).

Amtrak has warned that because “the lingering effects of the COVID-19 pandemic continue to affect revenue and ridership, robust FY 2023 grant funding is needed to enable Amtrak to continue operating our Long-Distance trains.”

Of course, some of Amtrak’s revenue problems are self-inflicted: the decision to furlough workers and incentivize early retirements left the railroad scrambling to find qualified workers to run the trains when labor and travel markets bounced back in the wake of the pandemic—something Rail Passengers warned about in advance of these decisions being implemented by Amtrak management. But however we got here, it is undeniable that ridership is still recovering, leaving a gap in Amtrak revenue.

The State-supported and long-distance routes (LDR) are of special concern. The 28 State-supported routes carry almost half of Amtrak passengers in a normal year, and are funded via agreements between Amtrak and 20 state partners. Any drop in ridership and ticket revenue creates varying levels of funding difficulties across all these routes and individual agreements. Amtrak was banking on increased federal funding to help close the revenue gap until passengers return. In the absence of federal funding, it may take an act by the state legislature to provide the stopgap funding needed to keep a service running.

The LDRs, meanwhile, have proved incredibly resilient compared to Amtrak’s other business lines. While the absolute number of riders isn’t as large, LDR trains have already reached 70% of their pre-pandemic ridership—even in the face of the reduced capacity and connections resulting from service reductions. However, because the track access fees that LDR trains pay to the freight railroads are included as an operational cost, these services are very dependent on annual federal appropriations. Furthermore, the billions of dollars in guaranteed Amtrak grants that are part of the Bipartisan Infrastructure Law (BIL) are restricted to capital projects. That means that while the National Network (NN) will receive $3.2 billion in dedicated capital funds through the BIL—above and beyond the numbers proposed in the FY23 T-HUD budget—none of that can go to fund the actual running of the trains.

The House T-HUD bill did include language designed to prevent Amtrak from reducing or eliminating NN service. The draft legislation states that none of the funds made available in the FY23 budget may be used by Amtrak to “discontinue, reduce the frequency of, suspend, or substantially alter the route of rail service on any portion of such route,” except in an emergency or during maintenance or construction outages. These provisions did not prevent service reductions during the pandemic, but it remains to be seen what Congress will accept as “an emergency” now that the pandemic has receded.

Next Steps

The full Appropriations Committee will take up the T-HUD bill next week, looking to close out all eleven spending bills before the July 4th recess. From there, the Senate will need to take up the spending bills before the end of the fiscal year on September 30th.

That means it’s not too late to make your voice heard! Join Rail Passengers in asking your members of Congress to support passenger rail service for ALL Americans!

Act Now!

Amtrak does have allies in the Senate who support the railroad’s $3.3 billion ask, led by Senator Chris Coon (D-DE). The Department of Transportation has also weighed in, with Transportation Secretary Pete Buttigieg warning in April that inadequate FY23 funding would set back “the reliability, the dependability, the frequency, and ultimately the speed of travel along these Amtrak routes.”

Rail Passengers staff will continue to work with members of the House, the Senate, and the USDOT to ensure that America’s train passengers have a voice in this process.

Funding

(Table 1)

(Millions)
BIL - Authorized Rail Funds	FY21 Enacted	FY22 Enacted	FY23 BIL Authorized	FY23 House THUD
Amtrak - NEC	$700	$875	$1,100	$882
Amtrak - Nat'l Network	$1,300	$1,457	$2,200	$1,463
FRA	$234	$241	$254	$250
Fed-State Partnership for IPR	$200	$100	$1,500	$555
CRISI Grants	$375	$625	$1,000	$630
RR Crossing Elimination Grants	N/A	$0	$500	$0
Restoration & Enhancement Grants	$5	$0	$50	$0
BIL - Guaranteed Funds	FY21	FY22	FY23
CRISI Grants	N/A	$1,000	$1,000
Amtrak - NEC	N/A	$1,200	$1,200
Amtrak - Nat'l Network	N/A	$3,200	$3,200
RR Crossing Elimination Grants	N/A	$600	$600
Fed-State Partnership for SOGR	N/A	$7,200	$7,200

Other Policy Provisions

--Restoration and Enhancement Grants: this program, which provides operating assistance grants for initiating, restoring, or enhancing intercity passenger rail transportation, was zeroed out in the House’s FY23 T-HUD bill. However, the bill does stipulate that Amtrak may use up to 10% of its $1.46 billion NN grant for the activities outlined in the program. While this will empower Amtrak to launch new services, it would be more meaningful if the Committee had funded Amtrak’s NN account at the levels authorized by this Congress just a few months ago.

--Local Matches: the bill allows Amtrak to use funds from both the NEC and NN grants as the non-federal match in grant applications, empowering Amtrak to partner with states looking to tap into the billions in new passenger rail grant funding guaranteed by the BIL.

--Increase Amtrak Discretion in BIL Spend Plans: Amtrak successfully convinced the Committee that it deserved an official seat at the table in drafting the detailed spending plan for the direct Amtrak grants provided by the BIL. Amtrak argued in its FY23 Legislative Grant request that since it “is an independent government-owned corporation governed by a presidentially-appointed and Senate-confirmed Board of Directors, which is responsible for making investment and capital allocation decisions for the company, the development of these plans is properly a dual responsibility of Amtrak and the Secretary, reflecting their joint role in programming and overseeing Amtrak expenditures.” The Committee agreed, inserting language that requires the USDOT to consult with Amtrak in drafting the annual capital expenditure plan for direct BIL grants to Amtrak, due each year as part of the annual Presidential budget request.