PURPOSE:

The purpose of this staff report is to request City Council consideration for support of Assembly Joint Resolution (AJR) 18.  AJR 18 opposes the U.S. Department of Transportation�s �zero funding proposed budget� for Amtrak in Fiscal Year 2006.

BACKGROUND:

On April 13, 2005, the U.S. Department of Transportation introduced a reform proposal to Congress regarding the restructuring of Amtrak in order to improve their operations nation-wide.  The Passenger Rail Investment Reform Act introduces a zero funding proposed budget in fiscal year 2006 for Amtrak.  This bill cuts the $1.2 billion in federal funds for Amtrak and makes key reforms by: (1) transitioning Amtrak into a purely operating company; (2) creating a federal and state partnership to support passenger rail by offering 50-50 matching grants to states for development of infrastructure projects that improve passenger rail service; (3) introducing market-based competition to the system; and (4) setting up a service to maintain the Northeast Corridor (NEC) in New York which is the most heavily used.  The legislation authorizes targeted capital funding for projects needed to bring the NEC back into good condition.

Under the legislation, Amtrak will no longer be responsible for maintaining tracks, stations, and other infrastructure.  Amtrak will carry the role of an operating company, whose sole focus will be on running trains safely and on time.  Local, regional or state authorities will be given the responsibility of making decisions about service, transportation planning and local needs, and making certain that rail operators are providing reliable, efficient, and effective service to the public.  As well, the federal government and state or local governments will share the cost of rail improvements, station construction and other physical improvements.

ANALYSIS:

California Assembly Members David Jones and Tim Leslie; and Senators Christine Kehoe, Abel Maldonado, and Denise Ducheny have consequently introduced Assembly Joint Resolution (AJR) 18 which opposes the federal government�s proposal to eliminate funding for Amtrak.  The provisions in AJR 18 include: 1) advocating Congress to provide adequate operating and capital funding for Amtrak; 2) preserving and improving the four national network Amtrak trains currently serving California: the Coast Starlight (L.A. to Seattle), the Southwest Chief (L.A. to Chicago), the Sunset Limited (L.A. to Orlando) and the California Zephyr (Bay Area to Chicago); and 3) establishing a multi-year capital funding program to match state expenditures to initiate, improve, and/or expand passenger rail services. 

Assembly Joint Resolution 18 will allow Amtrak to sustain its role in providing passenger rail services across the nation.  Completely cutting federal funding of Amtrak would virtually shutdown all Amtrak operations, and would ultimately result in the company going into bankruptcy.  The growing concerns over congested freeways and streets, vehicular pollution, and airport congestion have led many State lawmakers to urge the Federal government to reconsider pursuing a funding cut that would impact so much of the population, not only in the State of California, but also across the nation.  California has the second largest population of Amtrak ridership in the nation, the Northeast Corridor being the first.  As many as 9.3 million passengers use the trains annually in California.  Amtrak operates an average of 70 intercity trains and more than 200 commuter trains per day throughout the state. Although the federal government may have a contingency plan to partially support the Northeast Corridor, the rest of Amtrak�s operations would close down.  This is an unacceptable solution to improving Amtrak�s operations.  Amtrak recognizes the issue and is taking steps to correct this issue themselves. 

Amtrak is required to submit a Strategic Plan to Congress annually and is prohibited from making program expenditures not included in the Plan without Congress� advance notice and approval.  Amtrak�s Strategic Plan for FY 2005-09 identifies approximately $8.5 billion in federal funding over the five years, averaging $1.7 billion per year.  This amount would allow Amtrak to operate their current network, begin to address its maintenance and capital improvement needs originally deferred due to lack in funds, and begin to cover its debts.  Amtrak currently operates about 44 routes over 22,000 miles of track, and runs a deficit of over a billion dollars each year.  This deficit can be attributed to three factors: operating loss; capital depreciation which comes from the costs associated with the natural wear and tear of equipment and infrastructure; and debt service.  Unlike the aviation and highway programs, Amtrak does not have trust funds that provide a steady source of financing for capital improvements.  Amtrak needs this federal funding in order to continue to pursue their capital improvements, and maintenance repairs, as well as sustain their current operating network and improve the services they provide to rail passengers.

Amtrak has made progress in reforming itself over the last few years by reducing its operating costs to help fund needed capital improvements. Over the last 30 months, Amtrak CEO and President David Gunn has cut operating costs, reduced the employee headcount from slightly less than 25,000 to just under 20,000 employees, has increased the number of trains it operates by 20%, and implemented internal reforms designed to control costs and improve efficiencies.  At the same time, Amtrak is achieving increases in ridership.  Amtrak is requesting $1.8 billion in federal funding for FY 2006, but is prepared to operate on a $1.2 billion plan which is the amount they have received for FY 2005. 

AMTRAK IN BURBANK:

The Amtrak station in Burbank is located near the Bob Hope Airport.  Airport travelers, workforce commuters, pedestrians, MTA transit bus riders, and passengers on other commuter trains such as the Metrolink are serviced by the Burbank Amtrak station.  Amtrak is a vital link for Burbank residents as well as the surrounding communities.  The elimination of Amtrak funding would negatively impact on Burbank.  Losing Amtrak services would result in a major increase in traffic as many of our Burbank workforce utilize this mode of transportation to commute from their homes into Burbank for work.  Burbank residents leaving the city to their work destinations will also experience hard ship with the loss of this station and its services.  It is important for staff to provide many modes of mass transit for Burbank residents; Amtrak�s services are a critical alternative to vehicular traffic and congestion in the city.

Since 1976, California has become one of several states to assist Amtrak in funding in order to have more than its four national network train system.  Through Caltrans, the State of California provides capital grants and support for station and track improvements such as train intersection signals, locomotives and cars, connecting Amtrak bus services, and operating assistance for the three Amtrak corridor routes in the state: Capital Route, San Joaquin Route, and Pacific Surfliner Route.  All three routes are among Amtrak�s five busiest in the nation.  The Pacific Surfliner from Paso Robles to San Diego ranks second; the Capital Corridor service from Sacramento to San Jose is third; and the San Joaquin route from Oakland to Sacramento to Bakersfield ranks fifth.

One of the most critical routes for Burbank residents is the Amtrak California Pacific Surfliner Route which lies along the Pacific Coast of California, connecting the cities of San Diego, Los Angeles, Oxnard, Santa Barbara, and San Luis Obispo.  The Pacific Surfliner operates seven days per week, at eleven frequencies per day.  Most of the service is between San Diego and Los Angeles; one round trip each day operates between San Luis Obispo and San Diego (including stops at Santa Barbara), while other round trips operate between Santa Barbara and San Diego. This route is used by workforce commuters, as well as people taking leisure trips along coastal portions of the state.  The Burbank Amtrak station is a stop on this route that both residents and surrounding communities can utilize for everyday uses as well as taking scenic trips along the coast to their vacation destinations.  A standstill in Amtrak�s service to Burbank will force people to consider alternative methods of transportation such as flying or driving.  This Amtrak train route is used by many families and individuals heading on vacation in the state as well as out of the state.  Having this option helps reduce highway traffic, as well as airport congestion.  Not having this option will force commuters and vacationers to drive or fly to their destinations. 

CONCLUSION:

The Federal government�s proposal to cut funding for Amtrak would result in a shift of responsibility for the national passenger rail service to states.  State�s accountability would include not only the role of transportation planning and decision-making, but also the role of cost sharing for rail improvements, station construction, and other physical improvements.  Assembly Joint Resolution 18 will provide $1.4 billion in FY 2006 funding for Amtrak to utilize in order to maintain operating and capital needs.  In addition, this funding will preserve and improve the four national network Amtrak trains that originate in California and stretch out across the nation; and will establish a multi-year capital funding program to match state expenditures to initiate, improve, and/or expand passenger rail services. 

Currently, AJR 18 has been referred to the State Committee on Transportation.  The Committee will consider this item at their May 2, 2005 hearing to decide whether to: 1) approve the resolution as it stands; 2) request amendments before approving the resolution; or 3) deny the resolution.  Pending Committee approval, AJR 18 will then go to the Governor for approval or denial.  The results of the Committee hearing will be decided following the submittal of this staff report.  During the May 10, 2005 presentation to Council, staff will provide an update on the results of the Committee hearing.  At that time, staff will request Council�s consideration for support of AJR 18 either at the Committee level or with a letter urging the Governor to sign the resolution.

RECOMMENDATION:

Pursuant to the results of the hearing with the Committee on Transportation, staff recommends Council approval to write a letter either at the Committee level or to the Governor of the State of California expressing support of Assembly Joint Resolution 18, which opposes the elimination of federal funding for Amtrak.

EXHIBTS:

Exhibit A          Assembly Joint Resolution 18

Exhibit B          Letter from California�s Intercity Rail Corridors

go to the top