Deep in the transportation bill that Congress passed last week is a seemingly small but possibly critical change in funding for Amtrak, the country’s national passenger rail service. Lawmakers want to separate the budget for routes along the popular Northeast Corridor from the rest of the network. Any operating profits that Amtrak makes on the Northeast route, which people actually use, would be reinvested there rather than going to prop up lines elsewhere – a long-overdue reform.
Rail is a must-have for the urban zone from Washington to Boston. Washington, Philadelphia and New York account for nearly a third of Amtrak’s passengers. The Northeast Corridor posts an operating profit of about $400 million.
Keeping the Northeast Corridor and the rest of the national network on the same account has forced popular routes to subsidize less popular ones. This partially explains the sorry state of even Amtrak’s most critical lines. A train derailed in Philadelphia in May because required safety upgrades had not been completed. A couple of months later, electrical problems in two aging tunnels under the Hudson River snarled train traffic. When Northeast Corridor train service shuts down, the country loses roughly $100 million a day in economic activity.
Segregating the Northeast Corridor’s budget from the rest of the system’s will not be a cure-all. For one thing, Amtrak retains some flexibility to transfer money between accounts, so there’s still an opportunity for Amtrak to force Northeastern rail passengers to subsidize others.
Moreover, rail travel is an expensive service, even where demand is high. The Northeast Corridor faces high costs, such as for those Hudson River tunnels, that federal and local governments will probably have to help pay.
But making the Northeast Corridor more independent and self-sustaining should focus improvements on where they are most needed and, in the long term, open the way for more public and private investment.
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