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With a new administration in D.C., it's time to think outside of the box because passenger rail's survival just may depend on it

Tuesday, August 24, 2010

Intercity Rail Competition Part 1

When it proposed the Passenger Rail Investment and Improvement Act of 2008, Congress could have drafted the competition portion a bit better than it actually did. It seems that the process that Congress approved leaves it up to the states. I would have started the bidding process for all corridors next April and mandated that the states hand their HSR corridors over to their operator of choice by October 2013. This would also apply to Conventional routes that would be subject to speed upgrades. The move would make any transition from Amtrak to a new operator should a state or states decide to move in a different direction as smooth as possible.

As for long-distance routes, Amtrak would have been mandated to submit an evaluation of its top third, middle tier, and worst performing routes to Congress 18 months after the passage of PRIIA. Bidding for these routes would have taken place in October 2013 with the host railroads operating them a year later. Congress should give a subsidy and/or grant to the hosts running overnight routes in place of Amtrak. In return, the host would operate the route for five years. After the five-year period, the host railroad would have the option to either operate the route permanently if the entire route is on its rails or lease the route to another operator like Keolis for a decade. If the route is on multiple rails, then the Class Is would come together and select a new operator to run the entire route a part of a consortium.

Now, it seems that January's big winners scheduled to operate Emerging and Regional HSR as well as additional Conventional frequencies will select Amtrak as the operator. While, it seems to be a deterrent, other companies should follow SNCF's lead and begin developing their own alternatives--whether those include Express HSR, Regional HSR, or just a direct alternative to Amtrak that could possibly lead to an Express corridor.

I look at the Midwest, where the French rail operator has provided some interesting alternatives--all of them Express routes--since Amtrak will upgrade many of its existing Conventional lines to Regional status. First, a Chicago-Detroit route via Fort Wayne could compete with the Wolverine route. Second, its proposed Chicago-St. Louis route would be parallel to Amtrak's current Lincoln service. In the end, travelers between the two cities could end up choosing from three different rail companies since MWHSR has also proposed another Express route that would utilize Champaign and Decatur. The thing is that some companies could target specific travelers while others could cater to everyone.

Furthermore, there are openings in Wisconsin and Minnesota as there are some uncertainties over where the Madison-Twin Cities portion of MWHSR will stop. Hypothetically, a rival organization can fill in whatever gaps that aren't covered by either the U.S. or French carriers. Amtrak may be tapped to operate the Hiawatha extension in 2013, but there is an opening to provide a Madison-Chicago alternative by way of Rockford that companies like Deutsche Bahn, RENFE, Virgin Trains, and others could take advantage of. Also, one of these companies could negotiate with NEWRails to run trains between Milwaukee and Green Bay.

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