By Kirsten Korosec
February 13, 2018

President Donald Trump’s spending plan released Monday proposes slashing the federal subsidy for Amtrak passenger rail service by nearly half.

The proposal for Amtrak funding would drop from $1.495 billion to $738 million in the fiscal year that begins Oct. 1. It’s just one tiny piece of Trump’s $4.4 trillion fiscal 2019 budget that would increase spending for border security and the military and cut federal programs like Medicare.

Trump’s 2019 fiscal year budget, entitled “Effective, Efficient, Accountable: An American Budget,” would widen the federal budget deficit to $984 billion in the next fiscal year. That’s nearly double what last year’s budget estimated for 2019, reported the Wall Street Journal.

Trump’s proposed cuts comes at an uncertain time for Amtrak, which has been involved in three fatal crashes since December. Republican lawmakers were on one chartered Amtrak train when it collided with a garbage truck and derailed, causing one fatality. The rail service is also grappling with aging infrastructure and a federal mandate that must be met by the end of this year.

Congress mandated in 2008 that passenger and freight railways reduce the risk of speeding by implementing a system called Positive Train Control, which automatically intervenes if trains travel too fast or at risk of collision. Amtrak has PTC installed on 69% of its track, despite the fact that the congressional mandate came with no special funding for the passenger rail service. The deadline is the end of 2018.

Amtrak relies on federal funds for system maintenance, to install the technology. The rail service has also struggled with aging infrastructure. In late December, Trump ditched an Obama-era proposal to have the federal government underwrite half the cost of a multi-billion Amtrak tunnel connecting New Jersey to Penn Station on a popular route.

Trump’s proposed budget acknowledges that Amtrak has improved ridership and revenue on the Northeast Corridor in cities such as Boston and Washington, as well as other state-supported routes. The Trump Administration’s main issue is with the long distance train routes, which it says has large operating losses of more than $500 million annually and serves a small number of passengers. Federal subsidies have propped up these money-losing routes, the budget document contends.

Amtrak serves 32 million passengers each year. Only 4.7 million take Amtrak’s long distance routes. Long distance routes, including the Southwest Chief, California Zephyr, and Empire Builder, required a subsidy of $118 to $149 per passenger, Trump’s proposed budget says.

The budget proposes cutting the subsidies by nearly half and shifting that financial burden of the operating subsidy for those long-distance routes onto states.

“This would make States more equal partners with the federal government, and would strengthen the responsiveness of Amtrak to the communities they serve,” Trump’s budget reads. “State contributions to long distance routes is only one tool in the menu of options for reform the Administration will be exploring to improve the current system and reduce Federal subsidies in the long distance network.”

The Trump Administration believes Amtrak should also eliminate redundant routes and change ticketing for long distance routes that operate over the Northeast Corridor. The budget plan also proposes Amtrak find a way to break even on its premium and first class services, and suggests contracting these out to private operators or eliminating them altogether.

SPONSORED FINANCIAL CONTENT

You May Like

EDIT POST