Fred Frailey Column: November TRAINS

[GBNorman]

Thank you, Fred Frailey, for your November TRAINS column.

Within the column, Mr. Frailey lets his readers know just how much the impact of two Amtrak trains ("One a day") can have on a given segment of track on which, say, forty eight other trains will operate over a single track road.

TRAINS subscribers,read the column to find out how the Amtrak trains can command far more than the 2/50'ths (4%) of the track's cost to operate than the "incremental" reportedly (it's a bilateral contract so no disclosure under FOIA) Amtrak pays the roads to handle their trains.

If such be the case, then it drives home the point that the roads made a "Faustian pact with the Devil", and that Amtrak "gets what they pay for.

The roads (believe me; I was there in the employ of a weak Class I) were desperate for relief - and further, the "strongs" who could have survived without signing up and, under RPSA70 (the Amtrak enabling legislation) would have been required to operate their trains for the following five years, privately agreed to sign up with their weaker "brothers", must have realized they signed, but wondered why - especially after Staggers when traffic picked up.

 

[jis]

And all this to excuse basic poor capacity planning by the Class Is by their cheering section. Oh well...

 

[GBNorman]

Planning, jis (hnu)?

Is it reasonable to expect investor owned Class I's (disclaimer: author is Long UNP) to expend funds simply to handle Amtrak trains more efficiently?

Amtrak gets what they pay for: movement over the road.

 

[Charles785]

Can someone provide a link to the Trains magazine commentary (not hidden behind a paywall) mentioned above?

 

[MikefromCrete]

If BNSF is having capacity problems, then it should double track the northern trans con just like it double tracked the southern trans con. I've never bought the argument that having a couple of passenger trains can screw up an entire railroad. Maybe the big execs shouldn't have cut everything to the bone in order to get big bonuses and making the big stockholders happy. Looks like Hunter Harrison's philosophy is spreading over the entire industry and will be the freight railroads' ultimate downfall. You can't keep screwing your customers and expect to survive.

I usually find Frailey to be an interesting columnist, but he apparently spent too much time while working at Fortune magazine hobnobbing with rail executives.

 

[west point]

The traffic forecast for 2050 are scary. Freight RRs will implode even without passenger trains ?

 

[MikeM]

My disagreement with Mr. Fraley's article is this. There are routes (like the eastern "suspended" part of the sunset limited) where Amtrak paid for improvements such as sidings, switch machines, signals, etc, to support their trains. In other cases, the rail line had plenty of capacity in the past where Amtrak ran, but due to consolidation of lines, that capacity has evaporated. My personal opinion is that when Amtrak service is at the same frequency as it has always been, growth in other segments requires the railroad to cough up the capital for expansion. Now if Amtrak suddenly decided to run three "Empire Builders" at different times on the northern transcon, that's new Amtrak service, and Amtrak owes the cost to purchase the capacity. But not for legacy trains - Amtrak can and should contribute to specific improvements but the railroads have to join in.

The alternative, which is how I read Fred's column, is that everytime a rail line becomes overloaded, be it due to freight volumes, reductions in crews, changes in train lengths, etc, Amtrak would be expected to pay to fix the capacity constraint first so that their trains can maintain schedules. And if volumes increase again, here we go again with a fresh load of capacity improvements paid for by Amtrak. End result, at some point all passenger trains fall off the map.

I do believe Amtrak has an obligation to invest in motive power, rolling stock, and stations to ensure that their trains run efficiently and to schedule. And when frequencies increase, there needs to be some cooperative framework as has been set between Amtrak California and the railroads. Which, admittedly, totally includes well justified capital investment into track and infrastructure to support faster and more frequent trains.

Railroads occupy a special place as a public utility, they're granted rights and privileges which many other types of businesses do not have. Had Amtrak not been brought into play, the contemporary railroad industry would look much different than it does now. We could have lost northeastern railroads due to bankruptcies and insolvency, and train off petitions could have gone on much longer than they did as citizens without other options fought to maintain their passenger service. Yes, Amtrak is an annoyance to operating personnel, and it does tie up railroad resources. Then again, the current regulatory culture towards railroads is extremely positive. I believe passenger service is about the only forward facing aspect of contemporary railroading that civilians see.

 

[Brian_tampa]

I agree with what Fred wrote along with Mr. Norman here. Amtrak (a government entity) is indeed confiscating the capacity (or property) of private businesses (the railroads) without fair compensation. This raises constitutional issues that will eventually be litigated. You can blame poor capacity planning, but at the end of the day, Amtrak is causing real costs to the railroads that are not recovered. I am surprised that jis does not see the valid comparison between what Brightline has negotiated with FECR versus the unfair agreement that was entered between Amtrak and the railroads so long ago. True, there was no gun pointed at anyone during the negotiations, but the fact remains that operating Amtrak trains does cause harm to the owners of the track those trains run on. Until Amtrak pays a premium price for premium service, they will get what they pay for and should not expect anymore.

 

[Ryan]

As you said, nobody put a gun to the head of the freight railroads when Amtrak was formed.

The government isn’t confiscating anything, and the suggestion that they are is profoundly divorced from reality.

 

[Brian_tampa]

If the suggestion that Fred makes in his story (about confiscating property without fair compensation) is profoundly divorced from reality, then why has Amtrak never been able to successfully force the railroads to install infrastructure (at their own expense) in order to maintain Amtrak schedule performance? Perhaps it is because Amtrak knows that if it attempted to make the railroads spend hundreds of millions of dollars on each route that Amtrak runs one train over each way per day, Amtrak would eventually be placed into the position of litigating 4th amendment issues with the railroads. As alluded to earlier, back in the early 1970s, railroads most likely presumed that freight traffic levels would not rise in the future to what we see today.

A larger point to be made is that Amtrak is a tenant. And as a tenant, it's power to influence the owner is limited and what matters more is the relationship between both. If it is adversarial, it benefits neither party.

 

[Ryan]

Or because an unfettered requirement to add infrastructure wasn't a part of the original agreement.

 

[Brian_tampa]

Or because an unfettered requirement to add infrastructure wasn't a part of the original agreement.

But how does that work with other parts of the law (which are probably open to interpretation) saying that the railroads must give Amtrak trains priority, etc... In the recent past Amtrak tried to force the railroads to adhere to a favorable OTP percentage rate. That was ultimateoy decided in the railroad's favor by the courts. All I am saying is that if Amtrak wants preferential treatment, they will need to pay alot more than they are now. In my opinion, Brightline's agreements with FECR show the way forward for modern passenger rail service over the other railroads.

 

[west point]

The freight RRs are being forced to meet the almighty god of the operating ratio. The fit will hit the shan when in 20 years the Freights cannot even meet freight traffic demands much less passenger rail on their tracks. Tracks near here are forecast to need all 2 main tracks but it will never happen !

 

[cpotisch]

If the suggestion that Fred makes in his story (about confiscating property without fair compensation) is profoundly divorced from reality, then why has Amtrak never been able to successfully force the railroads to install infrastructure (at their own expense) in order to maintain Amtrak schedule performance? Perhaps it is because Amtrak knows that if it attempted to make the railroads spend hundreds of millions of dollars on each route that Amtrak runs one train over each way per day, Amtrak would eventually be placed into the position of litigating 4th amendment issues with the railroads.

Because there's no law or rule that says the freights have to spend a crapload of money on infrastructure for Amtrak's benefit. All they have to do is let Amtrak use the tracks for that 4% fee.

 

[chrsjrcj]

Maybe the Feds or states should look at acquiring the infrastructure where congestion is a problem.

 

[John Bobinyec]

Maybe the Feds or states should look at acquiring the infrastructure where congestion is a problem.

That is exactly the situation here in NC. The state of NC owns (has always owned) the track that the Piedmonts and Carolinians run on from Charlotte to Selma (but only one of the tracks between Cary and Raleigh). NS leases and dispatches this track. (CSX dispatches between Fetner - Cary, and Boylan - Raleigh).

In recent years, the NCDOT rail division wanted to add more Piedmont trains. NS balked because there were several long sections of single track between Greensboro and Charlotte. So the rail division got plans together to double track those sections. Fortunately, when the Obama era stimulus packages came along, the rail division was ready. So after the track work was done, the two new trains (77 and 78) started in June, 2018.

But then things went downhill. NS closed its yard in Chattanooga. The work was moved to other places. Congestion ensued in areas seemingly far from Chattanooga. This has been most noted in the performance of the Crescent. But the Piedmonts also suffered near Linwood yard (north of Salisbury) and Pomona yard (near Greensboro), because of NS freight traffic

What to do? The rail division had a meeting with Amtrak and NS and got results. Things are better now. Why? Because NC owns the track.

jb

 

[west point]

Here is a real puzzle. Fred says it costs about $3M per mile to build track. Of course that does not include bridges or tunnels. Now if 10 miles of second main track can save the equivalent of 10 locos due to delays on single track why wouldn't a RR add fixed track instead of paying for locos and the ongoing crew and fuel expenses for delays ?

another puzzle . Several years ago either the STB or FRA published a long report specifying expected traffic on each line segment of every RR for the year 2040. Some one needs to find the report. Essentially the report AFAIR designated the northern transcon with enough traffic to require 2 main tracks. But that is not the only route so needing additional tracks. It is all over the USA with some locations probably needing 3 or more main tracks. BNSF is putting in a 3rd main track at a location on the southern transcon..

But the freight RRs with very few exceptions have made no effort to add track capacity probably due to the almighty operating ratios. Now they are taking delays on many routes and the ones with Amtrak trains provide a convenient scapegoat for not increasing capacity that they should have been doing all along. Remember when Amtrak was on those routes at different years there were no delays.

Another delay factor is the extra long freights that are becoming the norm. The RRs not extending all sidings to handle not one but 2 of these monsters is causing significant delays. Granted in mountain territory a second main track will be difficult but it can be done.

Maybe a expansion should be considered a FRA track exempt from taxes and should be subject to rapid approval by all agencys ?

Summary. The RRs signed the contracts when Amtrak could run on time. Now they want to eject Amtrak because they did not keep up adding the capacity needed to maintain the same OTP ! !

 

[Philly Amtrak Fan]

Seems like most of Amtrak expansion like the example John mentioned in North Carolina (Roanoke is another) has been at the state level. There's very few LD multiple frequency/day service outside the NEC and state supported service. All I can think of are the Atlantic Coast service and the CL/LSL overlap between CHI and CLE and does that really count since the two trains come within a few hours of each other? So essentially the states are willing to fund multiple frequency rail service and Amtrak is … on the NEC where Amtrak owns the rails. But what about other LD expansion? Are the Class I's asking too much or is Amtrak too cheap?

 

[railiner]

Maybe the Feds or states should look at acquiring the infrastructure where congestion is a problem.

And I still believe that instead, the private railroad's should retain their property, but the government should no longer tax it. (They would only tax their sales or income). However, the railroads in return would be required to use all of those tax saving's into maintaining, or improving their infrastructure.

Only where heavy passenger volumes exist would it make sense for the building of a separate passenger railroad, with no freight interference.

 

[Karl1459]

Here is a real puzzle. Fred says it costs about $3M per mile to build track. Of course that does not include bridges or tunnels. Now if 10 miles of second main track can save the equivalent of 10 locos due to delays on single track why wouldn't a RR add fixed track instead of paying for locos and the ongoing crew and fuel expenses for delays ?

another puzzle . Several years ago either the STB or FRA published a long report specifying expected traffic on each line segment of every RR for the year 2040. Some one needs to find the report. Essentially the report AFAIR designated the northern transcon with enough traffic to require 2 main tracks. But that is not the only route so needing additional tracks. It is all over the USA with some locations probably needing 3 or more main tracks. BNSF is putting in a 3rd main track at a location on the southern transcon..

But the freight RRs with very few exceptions have made no effort to add track capacity probably due to the almighty operating ratios. Now they are taking delays on many routes and the ones with Amtrak trains provide a convenient scapegoat for not increasing capacity that they should have been doing all along. Remember when Amtrak was on those routes at different years there were no delays.

Another delay factor is the extra long freights that are becoming the norm. The RRs not extending all sidings to handle not one but 2 of these monsters is causing significant delays. Granted in mountain territory a second main track will be difficult but it can be done.

Maybe a expansion should be considered a FRA track exempt from taxes and should be subject to rapid approval by all agencys ?

Summary. The RRs signed the contracts when Amtrak could run on time. Now they want to eject Amtrak because they did not keep up adding the capacity needed to maintain the same OTP ! !

Part of the issue is the cyclic pattern of the economy and freight traffic. While a second main, or even a third, may be crucial during a peak month in a boom year that track may well be underutilized for normal traffic demand. And then when, not if, the economy tanks the fixed needs of maintenance are still there and can wreck havoc with profit/loss. There is no easy answer here.

 

[Pere Flyer]

Maybe the Feds or states should look at acquiring the infrastructure where congestion is a problem.

And I still believe that instead, the private railroad's should retain their property, but the government should no longer tax it. (They would only tax their sales or income). However, the railroads in return would be required to use all of those tax saving's into maintaining, or improving their infrastructure.
Only where heavy passenger volumes exist would it make sense for the building of a separate passenger railroad, with no freight interference.

The tax savings would need to be quantified for that to work, otherwise it could be another case of Reaganomics where upper management simply pockets the savings.I’m no accountant, economist, or regulator, but I think it would be easier on the railroads’ accountants and the FRA regulators to preserve the property/land taxes and disburse the specific funds to railroads for construction.

 

[railiner]

Maybe the Feds or states should look at acquiring the infrastructure where congestion is a problem.

And I still believe that instead, the private railroad's should retain their property, but the government should no longer tax it. (They would only tax their sales or income). However, the railroads in return would be required to use all of those tax saving's into maintaining, or improving their infrastructure.
Only where heavy passenger volumes exist would it make sense for the building of a separate passenger railroad, with no freight interference.

The tax savings would need to be quantified for that to work, otherwise it could be another case of Reaganomics where upper management simply pockets the savings.I’m no accountant, economist, or regulator, but I think it would be easier on the railroads’ accountants and the FRA regulators to preserve the property/land taxes and disburse the specific funds to railroads for construction.

Okay, another way of looking at it, but the same idea...whatever they pay in real estate taxes would go back to pay for infrastructure maintenance and improvements. And...not diverted by the government agencies into anything else...

 

[Pere Flyer]

Maybe the Feds or states should look at acquiring the infrastructure where congestion is a problem.

And I still believe that instead, the private railroad's should retain their property, but the government should no longer tax it. (They would only tax their sales or income). However, the railroads in return would be required to use all of those tax saving's into maintaining, or improving their infrastructure.
Only where heavy passenger volumes exist would it make sense for the building of a separate passenger railroad, with no freight interference.

The tax savings would need to be quantified for that to work, otherwise it could be another case of Reaganomics where upper management simply pockets the savings.I’m no accountant, economist, or regulator, but I think it would be easier on the railroads’ accountants and the FRA regulators to preserve the property/land taxes and disburse the specific funds to railroads for construction.

Okay, another way of looking at it, but the same idea...whatever they pay in real estate taxes would go back to pay for infrastructure maintenance and improvements. And...not diverted by the government agencies into anything else... [emoji57]

Like I said, I’m not familiar with regulatory mechanisms, so I don’t know what additional framework would be necessary to mitigate the corruption that you’re hinting at. I just think it would be more likely that the money would go to infra from a stipulation-bound, gov’t held fund than from the pockets of the freights.

 

[me_little_me]

My disagreement with Mr. Fraley's article is this. There are routes (like the eastern "suspended" part of the sunset limited) where Amtrak paid for improvements such as sidings, switch machines, signals, etc, to support their trains. In other cases, the rail line had plenty of capacity in the past where Amtrak ran, but due to consolidation of lines, that capacity has evaporated. My personal opinion is that when Amtrak service is at the same frequency as it has always been, growth in other segments requires the railroad to cough up the capital for expansion. Now if Amtrak suddenly decided to run three "Empire Builders" at different times on the northern transcon, that's new Amtrak service, and Amtrak owes the cost to purchase the capacity. But not for legacy trains - Amtrak can and should contribute to specific improvements but the railroads have to join in.

The alternative, which is how I read Fred's column, is that everytime a rail line becomes overloaded, be it due to freight volumes, reductions in crews, changes in train lengths, etc, Amtrak would be expected to pay to fix the capacity constraint first so that their trains can maintain schedules. And if volumes increase again, here we go again with a fresh load of capacity improvements paid for by Amtrak. End result, at some point all passenger trains fall off the map.

I do believe Amtrak has an obligation to invest in motive power, rolling stock, and stations to ensure that their trains run efficiently and to schedule. And when frequencies increase, there needs to be some cooperative framework as has been set between Amtrak California and the railroads. Which, admittedly, totally includes well justified capital investment into track and infrastructure to support faster and more frequent trains.

Railroads occupy a special place as a public utility, they're granted rights and privileges which many other types of businesses do not have. Had Amtrak not been brought into play, the contemporary railroad industry would look much different than it does now. We could have lost northeastern railroads due to bankruptcies and insolvency, and train off petitions could have gone on much longer than they did as citizens without other options fought to maintain their passenger service. Yes, Amtrak is an annoyance to operating personnel, and it does tie up railroad resources. Then again, the current regulatory culture towards railroads is extremely positive. I believe passenger service is about the only forward facing aspect of contemporary railroading that civilians see.

Another complaint I have about Fred's article is his contention that the priority issue came later and was not part of the original agreement and that's what makes it improper. However, implied in an agreement to eliminate passenger service and allow Amtrak to use it's track is to not change that agreement by deciding to run trains so big that Amtrak gets the siding in any conflict. To do so makes it be an attempt to get rid of Amtrak by making passenger service so inconvenient, that Amtrak fails and thus is violation of that agreement IMHO. Amtrak wouldn't be screaming (well, whimpering) PRIORITY if the railroads played fair.

 

[railiner]

Maybe the Feds or states should look at acquiring the infrastructure where congestion is a problem.

And I still believe that instead, the private railroad's should retain their property, but the government should no longer tax it. (They would only tax their sales or income). However, the railroads in return would be required to use all of those tax saving's into maintaining, or improving their infrastructure.
Only where heavy passenger volumes exist would it make sense for the building of a separate passenger railroad, with no freight interference.

The tax savings would need to be quantified for that to work, otherwise it could be another case of Reaganomics where upper management simply pockets the savings.I’m no accountant, economist, or regulator, but I think it would be easier on the railroads’ accountants and the FRA regulators to preserve the property/land taxes and disburse the specific funds to railroads for construction.

Okay, another way of looking at it, but the same idea...whatever they pay in real estate taxes would go back to pay for infrastructure maintenance and improvements. And...not diverted by the government agencies into anything else... [emoji57]

Like I said, I’m not familiar with regulatory mechanisms, so I don’t know what additional framework would be necessary to mitigate the corruption that you’re hinting at. I just think it would be more likely that the money would go to infra from a stipulation-bound, gov’t held fund than from the pockets of the freights.

What I was "hinting at", was not so much government corruption, but rather, using those tax revenues for the general fund, and consequently not back into the rails....

It should not be very hard for the government agency in charge, to require detailed invoices or whatever means is determined, to show that the railroads are putting the tax savings back into the rail's, as required....