Amtrak Matching Funds for Rebuild of S.W. Chief Route Coming With Terms and Conditions

Amtrak has agreed to contribute matching funds toward the project to upgrade the route of the Southwest Chief, but at a price it has never demanded before.

The passenger carrier will only agree to help fund the track rebuilding if the states promoting the project as well as BNSF submit a comprehensive plan for the remainder of the infrastructure investments and associated costs to rebuild the route in New Mexico.

Amtrak has also demanded that “prior to the obligation of grant funds for this project, the County of Colfax, N.M., BNSF, and Amtrak will enter into appropriate agreements setting forth our roles and responsibilities with respect to the project, with terms acceptable to Amtrak.”

Colfax County is the lead government entity that is seeking a federal TIGER grant to help fund rebuilding of the route of the Chicago-Los Angeles Southwest Chief.

More than two years ago BNSF said it would no longer maintain the route of the Chief in portions of Kansas, Colorado and New Mexico to 79 mph speeds because freight traffic on the route is light.

Former Amtrak President Joe Boardman said in an interview with Trains magazine that Amtrak’s current approach to matching the funds being put up by government entities to rebuild the route of the Southwest Chief differs from the company’s behavior when he was its head.

Amtrak’s demands for terms that it alone must approve was submitted with the Colfax County TIGER grant application.

Amtrak Executive Vice President and Chief Financial Officer William N. Feidt said the passenger carrier “strongly supports” the application as a continuation of improvements and that Amtrak will offer $3 million if the grant application is successful.

Two government entities have been awarded TIGER grants in recent years to pay to upgrade the route of the Chief in Kansas and Colorado.

Those grants to the city of Garden City, Kansas, and La Junta, Colorado, were matched by funds from BNSF, the states involved, Amtrak and other cities with an interest in seeing the Southwest Chief remain on its current route.

Amtrak is the primary user of the route between Hutchinson, Kansas, and a junction west of Lamy, New Mexico.

In his interview with Trains, Boardman said he and former BNSF Chairman Matt Rose agreed that completion of the track work would not hinge on knowing where all the money would eventually come from.

“It was logical that we would do this in pieces,” Boardman said. “Yes, we couldn’t complete everything with the piece of money [from the first grant], but we couldn’t spend that money on construction right away anyway. We had strong commitments from all of the cities along the way. For me, that was enough to just keep going [with subsequent grants] and now the communities have an expectation that the project will continue.”

Colfax County is seeking more than $17.5 million for the track work. Entities other than the federal government are projected to contribute $9.19 million toward the project, including $3 million from BNSF and $1 million apiece from the states of Kansas, Colorado and New Mexico as well as pledges from 17 communities in the three states

The American Association of Private Railcar Owners has pledged $10,000 while the Colorado Rail Passengers Association has agreed to contribute $1,000.

The most recent TIGER grant awarded to the project was $16 million, but that and other pledges funds leaves the $26.7 million project more than $1.5 million short.

It has not been determined if, as a result, officials will curtail the scope of the track rebuilding or seek larger matching contributions.

BNSF has reportedly “asked for a final Federal Railway Administration-approved budget in order to determine how much scope we need to reduce.”

The work to be done includes tie and rail replacement, rebuilding the roadbed at the Devils Throne fill area west of Lamy, and signal system improvements in New Mexico.

“One of the things I learned working on these kinds of things, is that if you fail to move when you have an opportunity to move, you’re probably going to fail to get this done,” Boardman told Trains.

Amtrak Names Locomotive after ex-Head Boardman

Amtrak has named P42DC No. 42 after its former president, Joseph Boardman.

Painted in a livery honoring the nation’s veterans, No. 42 will carrying an inscription below its cab reading: “Amtrak Honors: Joseph H. Boardman, President and CEO 2008-2016, US Air Force Vietnam Veteran.”

The locomotive was officially named for Boardman earlier this week during a ceremony held at Washington Union Station that was attended by more than 100 invited guests, including Union Pacific CEO Lance Fritz; BNSF Railway Executive Chairman Matt Rose; Federal Railroad Administration Administrator Sarah Feinberg; former FRA boss Joe Szabo; union officials; and dozens of Amtrak employees and managers.

Also attending and speaking were U.S. Transportation Secretary Anthony Foxx, Amtrak Board of Directors Chairman Tony Coscia and board member Tom Carper, U.S. Rep. Jeff Denham, and Association of American Railroads President and CEO Ed Hamberger.

Current Amtrak President and CEO Wick Moorman was absent because he was on a previously-planned family vacation.

Moorman to be Next Amtrak President

Former Norfolk Southern head Charles W. “Wick” Moorman has agreed to become president of Amtrak effective Sept. 1.

Moorman, who retired as president and CEO of NS in 2015, will replace Joseph Boardman.

In announcing Moorman’s appointment, Amtrak said he had agreed to take a $1 yearly salary but will be eligible for a $500,000 annual bonus if meets specified performance goals.

Moorman would be the third Amtrak head to take over after serving as president of a Class I railroad.

Graham Claytor Jr. served as Amtrak president from 1982 to 1993 having previously been president of the Southern Railway.

Alan Boyd was president of Amtrak between 1978 and 1982 had been president of the Illinois Central Railroad.

“I view this as public service,” Moorman told Railway Age Editor-in-Chief William C. Vantuono. “Amtrak is important to the freight rail carriers, and to the country. This is something I really want to do, and I believe I can contribute to making Amtrak a better railroad. I’m sure the work will be interesting, and I hope it will be fun as well.”

Moorman said he did not take the job for the money or because he had been unhappy in retirement.

In a news release, Moorman said he agreed to take the position because, “it is an honor and privilege to take on the role of CEO at Amtrak, and I look forward to working with its dedicated employees to find ways to provide even better service to our passengers and the nation. At Norfolk Southern, our team fostered change by placing a solid emphasis on performance across all aspects of our business, which helped develop a stronger safety and service culture throughout the company. I look forward to advancing those same goals at Amtrak and helping to build a plan for future growth.”

Moorman has more than 40 years in the railroad industry with NS and the Southern.

He began his railroad career working on a track gang during college and because a management trainee after graduation.

Moorman is a graduate of Georgia Tech University and the Harvard Business School.

He served on the boards of Duke Energy Corporation, Chevron Corporation, the Virginia chapter of the Nature Conservancy, and the Georgia Tech Foundation.

He had held the post of NS executive chairman until late 2015.

“Wick Moorman is a proven railroader whose track record of success demonstrates his commitment and adherence to rail safety, efficiency and service to customers,” said Association of American Railroads President and CEO Ed Hamberger in a statement. “His contributions and leadership in the freight rail industry, I believe, will advance the working partnership the freight railroads have with Amtrak. The AAR and its freight rail members recognize the importance of Amtrak as a reliable U.S. passenger rail service and look forward to working with Wick in his new capacity.”

Amtrak Board Chairman Anthony Coscia said in a statement, “We are very pleased that someone with Wick’s experience and vision will lead Amtrak during this critical period as the company charts a course for future growth and improvement.”

Coscia expressed optimism that Moorman would improve Amtrak’s relationship with its host freight railroads.

“He clearly understands both worlds, and he’s going to be in a position to try to get us all to a much better place,” Coscia said.

Boardman Tours Rebuilt S.W. Chief Route

As part of what has been billed as a farewell excursion, Amtrak President Joe Boardman recently toured the route of the Southwest Chief and recognized local officials for landing federal money that was used to rebuild the tracks used by the train in Kansas, Colorado and New Mexico.

BNSF owns the former Santa Fe tracks used by the Chicago-Los Angeles train but has little freight traffic on it.

Back in 2012, BNSF said that it would no longer maintain the route to support passenger train speeds, which raised questions about the future of the Southwest Chief.

The cities of Garden City, Kansas, and La Junta, Colorado, in response sought and won federal TIGER grant funding totaling $27.6 million that was used to begin a track rehabilitation project.

“Since my service as Amtrak CEO began in 2008, Amtrak and BNSF have worked together to match federal grants with investments from both of our railroads, states and towns,” Boardman said.

The first of those grants was $12.4 million awarded to Garden City. It was combined with $9.3 million of private, local and state funding to renovate nearly 47 of the 158 miles of bolted rail sections between Pierceville, Kansas, and Las Animas, Colorado, to Federal Railroad Administration Class 4 condition.

That work enabled Amtrak Nos. 3 and 4 to operate at up to 79 mph. The project involved installing continuous welded rail and creating new grade crossings and turnouts.

A year later La Junta received a grant of $15.2 million that was used to rebuild the track on the La Junta Subdivision in Colorado and on 20 miles of the Albuquerque Subdivision. That project involved 39 miles of new continuously welded rail and ballast.

BNSF Executive Chairman Matt Rose, Interim Kansas Transportation Secretary Richard Carlson and mayors and state transportation officials rode with Boardman over portions of the route of the Southwest Chief.

The project also received $8 million from Amtrak and $4 million from BNSF.

Boardman also lauded the leadership and problem-solving strategies used to save the Southwest Chief.

Officials said more grant funding will be needed for future track rehabilitation on Raton Pass on other sections of track near Lamy, New Mexico.

Boardman Says S.W. Chief to Stay

Amtrak President Joseph Boardman said this week that the Chicago-Los Angeles Southwest Chief will continue to operate on its present route for the foreseeable future.

Boardman, who will step down as Amtrak president in late September, traveled the route of the Chief this week.

He noted that the train had been saved with the help of public funding, including $27.6 million in federal TIGER grant funding after BNSF threatened to lower the speed limit on the route as it downgraded its maintenance program due to low freight traffic.

Until a track rebuilding project began, the condition of the route had been deteriorating.

Some funding was provided by Amtrak ($8 million) and BNSF ($4 million). The funding paid for new rail and ties.

Boardman: We Need New Diesels

Amtrak needs new diesel locomotives, but its president, Joseph Boardman, said the carrier doesn’t have the money to pay for them.

 “Yes, we need new diesels. We need to do something different,” Boardman said.

Boardman rejected paying for new locomotive with loans financed with “profits” from the Northeast Corridor as the ACS-64 electric locomotives were, but fully paid for as state procurement contracts for diesel locomotives are being financed.

The Amtrak head said Congress won’t appropriate the money to buy the locomotives “until the public understands that this nation’s infrastructure needs to be rebuilt.”

Boardman Outlines Headwinds Amtrak Facing

Amtrak President and CEO Joseph Boardman told a Senate Committee on Tuesday that low gas prices and a strong dollar are negatively affecting Amtrak ridership this year.

Boardman told the U.S. Senate Committee on Commerce, Science and Transportation that other headwinds that Amtrak is facing include a pending Surface Transportation Board on-time performance rule-making proceeding and a strong U.S. dollar that has reduced international ticket sales.

Lower oil prices have sent many would-be Amtrak passengers to their automobiles to travel.

“This will be a challenging fiscal year for us and the rail industry,” Boardman said. “I think these challenges will continue in the years to come, and it’s going to be important that all of us who believe in intercity passenger rail work together to support its development.”

During his testimony, Boardman said the STB rule making proceeding pertaining to on-time performance is needed to prod the freight railroads into working harder to keep Amtrak trains on schedule.

If on-time standard are not approved by the STB, Boardman said, it could negatively affect long-distance and state supported trains and result in higher costs for taxpayers.

Boardman said Amtrak’s long-distance trains are particularly important to smaller communities, not just major metropolitan areas.

“We don’t just leap from city to city — we connect smaller towns and communities with one another, and with the nation’s major urban center,” Boardman said. “These communities pay taxes, too, and we provide them a service they use and depend on. I think the excitement you saw last week is dramatic evidence of just how much we can bring to those towns — and how deeply they appreciate it.”

He was referring to an inspection trip that ran over the former route of the Sunset Limited between Jacksonville, Florida, and New Orleans.

The line has been without Amtrak service since Hurricane Katrina damaged the tracks and Amtrak stations along the route.

“We must be careful not to lose the economies of scale of a unified operation,” Boardman said. “One of the things I have learned in my eight years of service is that a unified system brings not just economies of scale, but a greater understanding of the value that Amtrak delivers for the nation.”

Knox W. Ross, the mayor of Pelahatchie, Mississippi, and secretary-treasurer of the Southern Rail Commission, made a plea in support of long-distance trains.

The commission has been working to restore the Sunset Limited east of New Orleans.

Ross said a strong national network is important for everyone, even communities such as his, which is located 20 miles from the Sunset Limited route.

“The success of our town is directly tied to the prosperity of the region,” Ross said. “For my region to prosper, we must have a transportation system that provides options for residents to connect to opportunity in our region and beyond.”

Ross called supporting Amtrak was a “bi-partisan issue that we can all agree on.”

Timothy Hoeffner, chair of the Midwest Interstate Passenger Rail Commission and Director of the Office of Rail for the Michigan Department of Transportation, also touted the benefits of long-distance trains even though Michigan does not lie on any long-distance routes.

Hoeffner spoke of the importance of a unified national network and called for better synergies between the long-distance and state-supported routes as well as the critical Northeast Corridor. He said a direct link from Michigan to the NEC would be beneficial to Michiganders by avoiding a “detour” through Chicago.

Amtrak Seeks $1.8B in FY 2017

In a five year improvement plan, Amtrak is seeking $1.8 billion from Congress for fiscal year 2017.

The request includes $920 million for capital expenditures, $650 million for operating expenses and $263.7 million in federal discretionary grant programs authorized under the new surface transportation bill that Congress approved last year.

The budget request would cover continued efforts to improve service and safety, funding for implementation of positive train control, an expansion of Wi-Fi service throughout Amtrak’s network, and costs related to the Hudson River tunnel project.

“Amtrak’s capital needs are pressing. Outdated and inadequate infrastructure and equipment must be replaced to sustain and grow both the Amtrak system and the economy it supports,” Amtrak CEO Joseph Boardman wrote in a letter to accompany the budget request.

Boardman said Amtrak’s ridership last year exceeded 30 million for the fifth consecutive year, with ridership records set on the Northeast Corridor and two other services.

At $2.185 billion, ticket revenue was slightly less than the previous year.

Noting that Amtrak’s cost recovery was about 90 percent for the second consecutive year, Boardman said ticket revenue was “enough, when combined with our efforts to control costs, to sustain our financial performance.”

Amtrak Revenue Falling Short; Boardman Orders Department Heads to Reduce Spending by 3.8%

Amtrak President Joseph Boardman has directed department heads at the passenger railroad to cut their spending by 3.8 percent and warned that further budget cuts lie ahead.

In a letter sent within the company, Boardman blamed bad weather and low gasoline prices, which have resulted in less-than-budgeted revenue.

Amtrak ended Fiscal Year 2015 on Oct. 1 with a $305 million operating loss, which was $70 million worse than planned. The FY 2016 budget expects an operating loss of $245 million.

“We are going to need to take more aggressive actions to reduce our costs, some of which may be painful to take,” Boardman wrote.

Boardman said that low gasoline prices mean that some who would take the train are now driving short distances or flying long distances.

In particular, Boardman said, Amtrak had a “disappointing” Thanksgiving travel period. The letter also said a massive East Coast snowstorm in January disrupted service.

“Our company needs cash to pay our daily expenses, and our cash position is becoming a concern,” Boardman wrote.

An Amtrak spokeswoman said it would be premature to conclude that Amtrak will impose layoffs.

Boardman’s letter said Amtrak will make “all necessary investments” for employee and customer safety.

Among the cost-cutting mandates that Boardman cited are eliminating nonessential business travel and asking employees to conduct business by phone or video conference.

He also recommended delaying new costly projects and making new hires.

Carper Expresses Interest in Heading Amtrak

Speculation as to who will replace Amtrak President Joseph Boardman has begun with some industry analysts seeing the passenger railroad reaching out to the business world for a new chief.

Another possibility might be former Amtrak board member Tom Carper, who is now a U.S. senator from Delaware.

“I would like to be president of Amtrak,” he said. “I’ve wanted to have that job ever since I stepped down as governor in 1999. I was on the Amtrak board. I love trains. I have all my life. So I’m announcing my candidacy, not for president or vice president, not for anything else. I’m announcing my candidacy for Amtrak.”

The desire to see someone from the business sector appears to be rooted in a desire by some in Congress to see more competition to Amtrak from private companies.

A clause of the recently passed federal transportation bill would allow competition on certain long-distance routes.