Could states ditch Amtrak for a private contractor?

[Mailliw]

Hypothetically could a state simply ditch Amtrak and contract out state supported routes to a private company? If I understand it right California is basiclly planning to do this and have DeutschBahn run its HSR instead of Amtrak.

 

[Thirdrail7]

Yes, states can ditch Amtrak and have in the past. They can also initiate their own service.

 

[rickycourtney]

The biggest hurdle for most states ditching Amtrak is that they don't own the equipment used on their services, they rent it from Amtrak. For those who own their equipment, they often contract with Amtrak-owned facilities for maintenance.

 

[Devil's Advocate]

For each state sponsored service there will be a contract which specifies the terms and timelines for renewing or replacing Amtrak staff, equipment, ticketing, interlining, etc. I believe such contracts are considered privileged and private for purposes of FOIA but some details are released as public meeting minutes and legal disputes. In a state like California you may be able to request a broad strokes high level outline from staff of an elected representative or an appropriate regulatory authority.

 

[Eric S]

Another huge hurdle is negotiating access to tracks. Freight railroads, which own most trackage, have not been too keen on working with non-Amtrak entities.

 

[MikefromCrete]

While states like California own their own equipment, the biggest problem is access to the Big 7 freight railroads. The freights like to work with one organization and may not want to work with an outfit like Keolis. A lot of commuter rail networks are run under contract by private operators like the MBTA and Keolis. So, it could happen, but it would be difficult.

 

[PVD]

I believe Keolis handles VRE as well.

 

[sttom]

It would be possible for a state to contract with another company, but it wouldn't be easy. The new contractor would have to deal with things like ticketing and reservations that a commuter operation generally doesn't have, it would have to deal with station services should there be any, and maintenance facilities. Ticketing and reservation systems are probably the easiest thing to solve, but the facilities are another. A state would likely have to put up the money to build a new maintenance facility which may be a hard sell. The stations are another wild card, if they are owned by the state in question or lower levels of government, they would be fine. But the biggest issue is dealing with track access. Amtrak has statutory rights to access that other operators or the state doesn't have. I can't remember which thread it was one, but the Norfolk Southern blatantly states to other would be operators that Amtrak's cost of accessing their tracks are not a metric to go by when planning a service due to the legal arrangement that Amtrak exists under. So for a state to switch operators it would need
1) Its own equipment.
2) Control over the stations.
3) Be willing to build its own maintenance facilities.
4) Probably pay more for track access.
5) Possibly lose some onboard services.

 

[Devil's Advocate]

Is there any evidence that Amtrak still enjoys the kind of mandatory access that leads to below-market trackage fees? To the best of my understanding whatever Amtrak pays today is negotiated on even terms. In theory if a freight railroad tried charging impossible prices it might create a regulatory enforcement problem, but to the best of my knowledge that threat has not been levied or acted upon in many years.

 

[rickycourtney]

I do think that the Northern California routes are in the best position to make the switch. The equipment is state-owned, the stations are generally owned by local governments, California owns (or at least co-owns) the Oakland maintenance facility, has experience negotiating with UP and BNSF, and is already discussing dropping some on-board services (new trainsets won't have cafe cars).

On top of that management of the San Joaquins JPA has a cozy relationship with Herzog Transit Services and a frosty relationship with Amtrak.

 

[sttom]

Is there any evidence that Amtrak still enjoys the kind of mandatory access that leads to below-market trackage fees? To the best of my understanding whatever Amtrak pays today is negotiated on even terms. In theory if a freight railroad tried charging impossible prices it might create a regulatory enforcement problem, but to the best of my knowledge that threat has not been levied or acted upon in many years.

According to the attached DoT slides from 2017 and an OIG Report from 2010, yes they do. Amtrak pays "incremental costs" instead of a "market rate" for access.

https://www.fhwa.dot.gov/Planning/f...ptember_2017/21/talkingfreight9_21_2017bl.pdf
https://www.oig.dot.gov/sites/default/files/AMTRAK Access Fees (Final redacted3).pdf

 

[Devil's Advocate]

According to the attached DoT slides from 2017 and an OIG Report from 2010, yes they do. Amtrak pays "incremental costs" instead of a "market rate" for access.

There seem to be some wiggle words of unknown significance mixed in with those statements. For me the realization that UP was able to levy a multi-hundred-million price tag for a one-time schedule change to the Sunset Limited put Amtrak's access in a completely different perspective. The usual response is that it wasn't a serious figure, but that's kind of the point, and the schedule never did change afterward.

 

[jis]

In my experience trackage access for LD trains is a different kettle of fish from trackage access for a regional system, For the latter usually the interested state has often got considerable leverage over the private line and can often strike a reasonably equitable deal, examples being Caltrans and UP, or VDOT and CSX. NCDOT had even more leverage with NS, while we have seen NYSDOT strike a good deal with CSX, and most surprisingly Florida DOT work with CSX. But as I said an LD train traveling through multiple states is a different kettle of fish, specially if all the states on the route do not want to gang up on the railroad.

 

[TheCrescent]

Didn't Indiana contract with Iowa Pacific for the Chicago-Indianapolis train, and didn't New York State contract with a freight RR for the Adirondack years ago?

 

[Trogdor]

Didn't Indiana contract with Iowa Pacific for the Chicago-Indianapolis train, and didn't New York State contract with a freight RR for the Adirondack years ago?

Kind of, and no (at least not that I’m aware of).

Indiana went with Iowa Pacific to provide equipment and on-board service for the Hoosier State. However, Amtrak was always the operator, with their engineers and conductors running the train.

The Adirondack has, as far as I can tell, always been operated by Amtrak, though equipment has varied over the years.

 

[keelhauled]

Iowa Pacific at one point owned a shortline that ran from Saratoga Springs to somewhere else, and tried to run a passenger train that connected with the Adirondack and/or Ethan Allen. It ended as you would expect an Ed Ellis venture to. It's possible TheCrescent was thinking of that.

 

[jiml]

I have a vague recollection of the Adirondack being operated by CP (D&H) for Amtrak for longer than some other routes, from its start in 1974. There was some issue that made this necessary, but once completely handed over it was the first train they ran into Canada without a crew change. Even the Montrealer had a crew change at the border, as of course did other Amtrak services (International, Maple Leaf) until the Cascades.

 

[jis]

Iowa Pacific at one point owned a shortline that ran from Saratoga Springs to somewhere else, and tried to run a passenger train that connected with the Adirondack and/or Ethan Allen. It ended as you would expect an Ed Ellis venture to. It's possible TheCrescent was thinking of that.

Saratoga to North Creek. I rode it during the brief period that it ran. It was OK. At least it had one of the ex-Santa Fe domes.

I have a vague recollection of the Adirondack being operated by CP (D&H) for Amtrak for longer than some other routes, from its start in 1974. There was some issue that made this necessary, but once completely handed over it was the first train they ran into Canada without a crew change. Even the Montrealer had a crew change at the border, as of course did other Amtrak services (International, Maple Leaf) until the Cascades.

The CP operation was discontinued on A Day. Actually there were two trains run by D&H/CP that were discontinued, a day train and a night train. The day train was the Laurentian.

Adirondack was introduced three years later as a 403b (NY State funded) Amtrak train which for a period ran as a section of the Empire State Express between New York (GCT) and Albany. In those early days many Amtrak trains operated with T&E crew provided by the host railroad and that most likely was the case with this train too. Back then it ran to Windsor Station, which does not exist anymore, having been replaced by Lucien L'Allier a couple of blocks west. Also, between 1974 and 1977 it used D&H equipment (mostly ex-Laurentian) due to Amtrak's equipment shortage. In 1977 it got a Turboliner set ending the use of D&H equipment.

 

[TheCrescent]

Yes, I was thinking of the Adirondack, with D&H equipment.

I would think that any state that wanted to start a new service could contract with anyone that the stated wanted to.

 

[jiml]

In 1977 it got a Turboliner set ending the use of D&H equipment.

Other than the occasional dome car, the best viewing windows ever offered on the route.

 

[neroden]

In my experience trackage access for LD trains is a different kettle of fish from trackage access for a regional system, For the latter usually the interested state has often got considerable leverage over the private line and can often strike a reasonably equitable deal, examples being Caltrans and UP, or VDOT and CSX. NCDOT had even more leverage with NS, while we have seen NYSDOT strike a good deal with CSX, and most surprisingly Florida DOT work with CSX. But as I said an LD train traveling through multiple states is a different kettle of fish, specially if all the states on the route do not want to gang up on the railroad.

Massachusetts had a rather large fight with CSX over buying all the tracks they use for MBTA service (and all the ones they wanted for future MBTA service); Massachusetts won. It's a template worth following.

In Michigan, NS actually wanted to sell, and pressured MIDOT to buy.

The problem for a route crossing multiple states is always the one state which won't play ball. I suppose we could transfer northwestern Indiana to Michigan or Illinois to avoid that problem on the routes I most care about -- the population of northwestern Indiana would probably like that since the state treats them very badly -- but it hasn't been suggested. ;-)

 

[Exvalley]

Another disadvantage is that, without an interline agreement, a passenger cannot book a through-ticket with Amtrak.

 

[Devil's Advocate]

So for a state to switch operators it would need
1) Its own equipment.
2) Control over the stations.
3) Be willing to build its own maintenance facilities.
4) Probably pay more for track access.
5) Possibly lose some onboard services.

Rolling stock and motive power can be leased, maintenance can be contracted, and onboard services are vanishing on Amtrak anyway. You'll need access and signage for each platform, but depending on the layout that could come from the rail access contract rather than the station owner.

I think the three biggest show stoppers are...

Track access rights (as you and others mentioned)
Reasonably priced insurance (haven't seen this yet)
Wording of the indemnity agreement (or this)

This is just my view as an outsider, and some states may have their own protections that can be leveraged as needed, but these are the issues that would concern me the most. The other items are also important but unlike these three those issues would likely have more than one solution.