Developing State-Amtrak Agreements

1. Developing State-Amtrak Agreements Stephen Gardner Vice President, Policy and Development March 8, 2010

2. PRIIA/ARRA: The blueprint • PRIIA (October 2008) • Reauthorized Amtrak ($2 billion annually) • Federal matching grant program for intercity/HSR capital investments • FRA, states and Amtrak work in partnership to establish new/improved passenger services • Amtrak operates national network; partners with states to design and operate services and improve NEC • States plan rail service role and provide operating/capital funding • FRA provides capital funding and integrates state planning into a national system • Collaboration among states, US DOT, Amtrak, transit agencies, host railroads, suppliers, and others key to success • ARRA (February 2009) • $8 billion for intercity/HSR capital grants to states • No state match required

3. Existing Amtrak-State Collaboration • State-supported corridor services: Partnerships with 15 states • NEC Master Plan process underway since 2006 • 9 commuter services on Amtrak infrastructure • Numerous Shared capital investments (examples) • Infrastructure (Keystone Corridor) • Maintenance Facilities (Seattle) • NEC Joint Benefit Agreements • Stations (Wilmington) • Equipment (Pacific Surfliner)

4. PRIIA/ARRA: Amtrak’s role to-date • Amtrak partnered with more than 25 states to support over 100 projects and corridor applications in the first round of grant requests • Stakeholder agreements • Service development plans • Ridership/revenue estimates • Project scope • Planning assistance • Application assistance

5. First Round Grant Announcements • Announced projects will benefit at least 13 existing Amtrak routes • Higher speeds/reduced trip times • Increased frequencies • Improved stations • Increased reliability • Funds new/extended services • Downeaster extension (Portland – Brunswick, ME) • Ohio “3C” Corridor (Cleveland – Columbus – Cincinnati) • Hiawatha extension (Milwaukee – Madison, WI) • $3.5 billion for “Greenfield” HSR projects in California & Florida • Planning grants, funded with 2009 appropriations, to help develop future applications • Additionally, several “TIGER” grants will benefit Amtrak stations and services

6. Amtrak Network and ARRA HSIPR Awards

7. Amtrak’s role for grant implementation • To complete grant agreements and fully fund projects, FRA will likely want • Concrete funding/spend plans • Fully developed of budgets/scope/schedules • Refined operating/investment plans and costs • Compliance with state and Federal requirements/laws • Completed agreements and contract negotiations • Many different types of activities may require Amtrak-State collaboration and agreements • Investments on Amtrak-owned/operated infrastructure • Investments on host railroad infrastructure • New/extended services • Additional services on existing routes • Station investments • Schedule changes • Facilities improvements • Fleet acquisition/assignment/utilization • Identifying Amtrak manpower and resource requirements

8. Amtrak Agreement Considerations • Maintenance responsibility for equipment-related grants • In general, existing agreements should satisfy Amtrak’s commitment to operate service until improvements are completed • Use existing agreements when possible and use as model for new agreements • Flow-downs • Operating support • Look for opportunities where other federal funds can supplement FRA grants

9. Amtrak/State/Host Collaboration for New and Expanded Routes • For service-related grants, state, Amtrak and host railroad should agree up-front on service outcomes, in particular • Amtrak train trips per day • Amtrak train trip time • Maximum delay minutes per Amtrak train trip • Amtrak, state, and host then design an infrastructure to support these agreed-upon outcomes • Avoid unreasonably impairing freight operations • Practical improvements, not “gold plated” • Public sector provides funding to “build it right” and host railroads make enforceable commitment to “run it right” • Hosts commit to provide service, not just build infrastructure • Grant-funded projects need to be coordinated with existing/on-going Amtrak and Host services, projects, initiatives, and priorities (e.g., Amtrak’s station ADA plan) and recognize regional impacts of simultaneous projects

10. Preparing for Future Funding Rounds • States and Amtrak should again work together to identify/advance projects fundable under $2.5 billion FY2010 appropriation and in future funding rounds • Early Amtrak/state engagement • Clear identification of goals/needs • Service planning (Sec. 207), preliminary ridership/rev #’s • Amtrak participation in state discussions with host railroads • Environmental guidance • Equipment needs • Application development and review • Joint applications? • Recognition of Amtrak resource needs • Adapt organizational structures/processes to new environment • Amtrak • FRA • State DOTs

11. Amtrak-State Agreements: Equipment • Whatever happens, we all need fleet! • Average passenger car 24 years old, older than ever • Comprehensive fleet plan for all Amtrak business lines • Total fleet procurement over a 30-year period will include 2,500 cars and 700 locomotives = 100 cars annually • Total anticipated cost (2009 dollars) • $11 billion through 2023, $23 billion through 2040 • Not including needs for projected state-supported corridor frequency increases and new services • Designed for baseline 2% ridership growth on existing services • Procurement model scalable for higher growth (options and retirement rate) • Fleet design to be coordinated with Sec. 305 process/specs as much as possible to create common designs/subsystems/parts/processes across entire system • Creates sustainable domestic manufacturing capacity

12. Looking ahead: state activities • Participation in PRIIA-initiated processes • PRIIA 209 (state corridor pricing) – joint responsibility • PRIIA 210 (long-distance trains) – work with Amtrak on opportunities to better integrate LD routes and corridor services • PRIIA 212 (NEC Infrastructure & Operations Advisory Committee) – joint undertaking among DOT, NEC states, and Amtrak • PRIIA 305 (equipment pool) - joint undertaking among DOT, NEC states, and Amtrak • Future grant rounds will require • State capital match (at least 20%) beginning in FY10 • Operating funds • Completion of state rail plans • Section 207 compliance • Working together to meet standards and raise train performance • Building support to sustain and grow HSIPR program and Amtrak

13. Looking ahead: Amtrak’s objectives • Support the expansion, improvement and establishment of intercity and high-speed passenger rail service • Rebuild planning and development capacity after years of neglect and turmoil • Develop new business processes, resources and policies to support growth • Improve service delivery • Become a better, more nimble partner for state customers (customer surveys and interviews) • Integrate new and improved services into a seamless national network with enhanced intermodal connectivity • Provide leadership role in equipment acquisition/planning • Facilitate partnerships among states, host/commuter railroads and Amtrak All this requires people and $$

14. Policy considerations: implementation & next round • Long-term dedicated funding for HSIPR and Amtrak • Defining relationships • State-Amtrak, State-DOT, Amtrak-DOT • PTC – costs and grant eligibility • Pricing/cost allocation policies • State corridor service costs (PRIIA 209) • NEC shared infrastructure/services (PRIIA 212) • Commuter/host railroad benefits vs. contributions • Equipment - roles and responsibilities for funding/financing, acquisition, ownership • Standards • Application evaluations • Ridership, cost, benefit, projections • Sec. 207 Metrics and Standards • Environmental process and requirements (Categorical Exclusion, etc) • Flow-downs and tax implications – dealing with the hosts

15. Amtrak-State Agreements: National rail plan issues • What will the National Plan mean for future grant projects? • Should projects have to be in the plan? Will there be a map? • When should compliance with state rail plan requirement return for grants? • Sec. 207 Metrics and Standards and National Plan integration? • Should differences among state perspectives/levels of commitment affect National Plan? • How does the Amtrak system fit into the National Plan? • What funds the National Plan?