House Hearing, 110TH Congress - Departments of Transportation, and Housing and Urban Development, and Related Agencies Appropriations For 2009

DEPARTMENTS OF TRANSPORTATION, AND
HOUSING AND URBAN DEVELOPMENT, AND

RELATED AGENCIES APPROPRIATIONS FOR 2009
HEARINGS
BEFORE A
SUBCOMMITTEE OF THE
COMMITTEE ON APPROPRIATIONS
HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
SECOND SESSION
SUBCOMMITTEE ON THE DEPARTMENTS OF TRANSPORTATION, AND
RELATED AGENCIES APPROPRIATIONS
JOHN W. OLVER, Massachusetts, Chairman
ED PASTOR, Arizona
CIRO RODRIGUEZ, Texas
MARCY KAPTUR, Ohio
DAVID E. PRICE, North Carolina
ROBERT E. BUD CRAMER, JR., Alabama
LUCILLE ROYBAL-ALLARD, California
MARION BERRY, Arkansas
JOE KNOLLENBERG, Michigan

FRANK R. WOLF, Virginia
ROBERT B. ADERHOLT, Alabama
JAMES T. WALSH, New York
VIRGIL H. GOODE, JR., Virginia
NOTE: Under Committee Rules, Mr. Obey, as Chairman of the Full Committee, and Mr. Lewis, as Ranking
Minority Member of the Full Committee, are authorized to sit as Members of all Subcommittees.
KATE HALLAHAN, DAVID NAPOLIELLO,

LAURA HOGSHEAD, LISA PEN A, and ALEXANDER GILLEN,
Subcommittee Staff
PART 5
Page
Federal Railroad Administration and National

Railroad Passenger Corporation [AMTRAK] ................
Saint Lawrence Seaway Development Corporation .......
Research and Innovative Technology Administration ..
Federal Maritime Commission .............................................
National Transportation Safety Board ..............................
Outside Witnesses ....................................................................
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PART 5TRANSPORTATION, AND HOUSING AND URBAN DEVELOPMENT, AND RELATED AGENCIES FOR 2009
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RELATED AGENCIES APPROPRIATIONS FOR 2009
HEARINGS
BEFORE A
SUBCOMMITTEE OF THE
HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
SECOND SESSION
SUBCOMMITTEE ON THE DEPARTMENTS OF TRANSPORTATION, AND

RELATED AGENCIES APPROPRIATIONS
JOHN W. OLVER, Massachusetts, Chairman
ED PASTOR, Arizona
MARCY KAPTUR, Ohio

NOTE: Under Committee Rules, Mr. Obey, as Chairman of the Full Committee, and Mr. Lewis, as Ranking
Minority Member of the Full Committee, are authorized to sit as Members of all Subcommittees.
KATE HALLAHAN, DAVID NAPOLIELLO,

LAURA HOGSHEAD, LISA PEN A, and ALEXANDER GILLEN,
Subcommittee Staff
PART 5
Page
Federal Railroad Administration and National

Railroad Passenger Corporation [AMTRAK] ................
Saint Lawrence Seaway Development Corporation .......
Research and Innovative Technology Administration ..
Federal Maritime Commission .............................................
National Transportation Safety Board ..............................
Outside Witnesses ....................................................................
U.S. GOVERNMENT PRINTING OFFICE
43800
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DAVID R. OBEY, Wisconsin, Chairman
JOHN P. MURTHA, Pennsylvania
NORMAN D. DICKS, Washington
ALAN B. MOLLOHAN, West Virginia
MARCY KAPTUR, Ohio
PETER J. VISCLOSKY, Indiana
NITA M. LOWEY, New York
E. SERRANO, New York
JOSE
ROSA L. DELAURO, Connecticut
JAMES P. MORAN, Virginia
JOHN W. OLVER, Massachusetts
ED PASTOR, Arizona
CHET EDWARDS, Texas
PATRICK J. KENNEDY, Rhode Island
MAURICE D. HINCHEY, New York
SAM FARR, California
JESSE L. JACKSON, JR., Illinois
CAROLYN C. KILPATRICK, Michigan
ALLEN BOYD, Florida
CHAKA FATTAH, Pennsylvania
STEVEN R. ROTHMAN, New Jersey
SANFORD D. BISHOP, JR., Georgia
BARBARA LEE, California
TOM UDALL, New Mexico
ADAM SCHIFF, California
MICHAEL HONDA, California
BETTY MCCOLLUM, Minnesota
STEVE ISRAEL, New York
TIM RYAN, Ohio
C.A. DUTCH RUPPERSBERGER, Maryland
BEN CHANDLER, Kentucky
DEBBIE WASSERMAN SCHULTZ, Florida
JERRY LEWIS, California

C. W. BILL YOUNG, Florida
RALPH REGULA, Ohio
HAROLD ROGERS, Kentucky
DAVID L. HOBSON, Ohio
JACK KINGSTON, Georgia
RODNEY P. FRELINGHUYSEN, New Jersey
TODD TIAHRT, Kansas
ZACH WAMP, Tennessee
TOM LATHAM, Iowa
JO ANN EMERSON, Missouri
KAY GRANGER, Texas
JOHN E. PETERSON, Pennsylvania
RAY LAHOOD, Illinois
DAVE WELDON, Florida
MICHAEL K. SIMPSON, Idaho
JOHN ABNEY CULBERSON, Texas
MARK STEVEN KIRK, Illinois
ANDER CRENSHAW, Florida
DENNIS R. REHBERG, Montana
JOHN R. CARTER, Texas
RODNEY ALEXANDER, Louisiana
KEN CALVERT, California
JO BONNER, Alabama
ROB NABORS, Clerk and Staff Director
(II)
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RELATED AGENCIES APPROPRIATIONS FOR
2009
TUESDAY, FEBRUARY 26, 2008.
FEDERAL RAILROAD ADMINISTRATION AND NATIONAL
RAILROAD PASSENGER CORPORATION [AMTRAK]
WITNESSES
HON. JOSEPH BOARDMAN, FRA ADMINISTRATOR
ALEXANDER KUMMANT, PRESIDENT AND CEO OF AMTRAK
Mr. OLVER. The committee will come to order. Let me make a

quick comment. There are a lot of other hearings going on. There
are duplicate hearings, three and four of them going on at the
same time and quite often there are members, who are involved
with those. And so, I do not think that the number of people here
represents any disinterest, but only a question of where responsibilities lie. So, anyway, with that said, let me welcome Administrator Joe Boardman and President and CEO of Amtrak, Alexander
Kummant, to todays hearing on the intercity passenger rail and
the FRAs fiscal year 2009 budget request.
A number of things have occurred since the last time you have
both appeared before the subcommittee. Amtraks ridership has
reached almost 26 million passengers. I think I should say 25.8, in
order to be one more significant figure of accuracy here, in fiscal
year 2007, up nearly 10 percent from 2006. It represents the fifth
straight year that Amtrak has set record after record of ridership.
At the same time, Amtrak continues to make progress in reducing capital backlog. The needs of the intercity passenger rail system remain great. Last year in testimony before the Senate, the
Appropriations Committee, the Inspector General pegged Amtraks
capital backlog at about $5 billion dollars. Second, the Presidential
Emergency Board, which was solely appointed by President Bush,
made a series of recommendations, in an effort to resolve an eightyear long negotiation impasse between Amtrak management and
its labor workforce. I am pleased that an agreement was signed between the two parties nearly a month ago and I am hopeful that
the agreement sees final ratification in weeks ahead.
Finally, the passenger rail working group, a subset of the National Surface Transportation and Revenue Study Commission,
issued a report recently that showed over seven billion dollars
would be needed each year between 2007 and 2015well, 2007 has
now passed, so let us just say from 2008 to 2015, which would be
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eight years, would come to $56 billion, if my grade school math is

still correct, to maintain the existing Amtrak system, number one,
to continue the development of planned new corridors, two, and to
create new routes to link major urban areas.
These three events, record ridership, a large capital backlog, the
PEB labor settlement recommendations, and the work of the passenger rail working group should have had some influence on the
Presidents fiscal year 2009 budget for Amtrak. Instead, we received what is virtually a carbon copy of the budget for intercity
rail that was submitted last year. Once again, the Presidents
budget request fails to address short- and long-term capital and operating needs of the system and also does not appear to acknowledge any recommendations of the Presidents own Emergency
Board. The Presidents budget request would provide a total $800
million for Amtrak, which consists of $275 million for operating
and $525 million for capital, plus an additional $100 million for an
intercity passenger rail grant program. Even with the operational
savings that Amtrak has achieved recently, over $60 million in
2006 and another $53 million in 2007, the $275 million requested
in the Presidents budget for operating will force Amtrak to severely curtail service or shutdown, in my view. The Presidents capital budget request of $525 million is also inadequate and will do
little to bring the system into a state of good repair.
In contrast, Amtraks budget request ofof $1.785 billion is more
than double the request of the President and $460 million more
than what the Congress provided in fiscal year 2008. While I am
confident the Presidents request is wholly inadequate to maintain
a national intercity passenger rail system, I must also point out,
it will be extremely difficult to come up with all of the resources
that Amtrak believes it will require from the federal government.
Unfortunately, the President left us a number of holes to fill, not
only in passenger rail, but also with regard to funding for our airports, highway infrastructure, transit systems, and for a significant
number of housing programs that serve our nations most vulnerable populations.
I look forward to your testimony and our discussion this morning
and I am hopeful that the funding priorities of the next administration will allow intercity passenger rail to be a viable part of a balanced transportation system. At this time, I would like to recognize
my ranking member, Mr. Knollenberg, for any comments that he
would like to make.
Mr. KNOLLENBERG. Thank you, Mr. Chairman. Which of these is
better focused, this one or that one? You cannot tell.
I am going to welcome certainly to both of you, Administrator
Boardman and Mr. Kummant, who is the president of Amtrak. I
have, for a number of years now, had the opportunity to review and
help sort through all of the conflicting evidence about intercity rail
transportation and, as yet, have not seen a clear pathway forward.
In many ways, it just seems as if the Department of Transportation
and Amtrak exist in two different worlds. I will explain a little
later. And we, in Congress, complicate this issue with an ongoing,
overreaching, overarching philosophical debate about the need for
a highly subsidized national rail system, as if that alone would be
justification enough for the taxpayer to provide whatever increases
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are over what cannot be supported by revenue. And I often wondered if these different views of the world will ever find a common
answer.
For example, for 2009, the FRA is requesting $900 million for the
National Railroad Passenger Corporation, including no funds for
operating expenses. Here is FRAs expectation and I think it sums
up their view of the world very well, and I am quoting from the
budget justification. This amount would enable Amtraks new
management team to keep the trains running and act on its mandate to reshape the company.
Now, when you look at Amtraks own proposal, which includes
$525 million of operating expenses and a total of over $1.7 billion
for 2009, it does not appear that the new management team has
yet heard or read about this mandate to reshape the company or
at least if it has, it does not consider $900 million from the Federal
Government as a likely outcome for 2009 or any other year. In fact,
I quote again from Amtraks request, Finally, and perhaps most
importantly, we will have to begin the process of procuring a modern fleet, one that would allow us to support the full range of current operational needs and the needs of the year 2020.
I hope the witnesses today can show that I am wrong, but I do
not get a sense that we have thesethat these views are consistent. Rather, it seems that we are falling into a rut, by which
I mean the DOT may now be using the mandate for change simply
as a way of meeting its overall budget target and Amtrak is not
taking seriously the need to change its corporate structure, target
its product, streamline its workforce, and compete successfully in
a rapidly changing transportation environment, as any corporation
with a product to sell should, in my opinion. When either side
takes the charge seriously, the result is that the Subcommittee is
stuck with a large funding gap to fill every year and with dwindling resources available to fill it. In the end, we are forced to short
or reduce many other worthy programs that are in great need to
keep the status quo for Amtrak. I find this to be discouraging and
unfortunate.
Mr. Chairman, I will have some questions for the two witnesses
about the specifics of their requests and the pathway forward, but
appreciate the opportunity to highlight what I think is becoming a
serious budget issue for the Committee, as a difference between the
two approaches to funding Amtrak grow greater and greater. And
with that, I will suspend my comments and I yield back the balance of time. I look forward to your testimony. Thank you.
Mr. OLVER. I think in very similar ways, I and my ranking member are looking at the same problem. In any case, now the Subcommittee will hear from the panelists. Mr. Boardman, let us begin
with you, and then we will move on to Mr. Kummant. Your complete witness statements will be included in the record. And you do
not have to be constrained to five minutes. We have a little time
here, but if you stay somewhere within roughly what each of us
have bothered to say to you, please. Go ahead, Mr. Boardman.
Thank you.
Mr. BOARDMAN. Thank you, Mr. Chairman, Ranking Member
Knollenberg. My prepared comments today are not going to be responsive to some of the issues that you have raised and I will go
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to those during the questions and answers, if you give me that liberty.
I appreciate the opportunity to appear before you today on behalf
of Secretary of Transportation, Mary Peters, and the Bush Administration, to discuss the Presidents budget proposal for fiscal year
2009, as it relates to the Federal Railroad Administration and Amtrak. This budget request continues to support the Administrations
commitment to ensuring that the Nations rail transportation system is safe, secure, and efficient. The requested $1.1 billion will
sustain and advance FRAs mission to improve railroad safety,
while providing valuable resources to ensure continuation of intercity passenger rail operations.
As you are aware, safety remains FRAs single most mission essential activity and strategic performance objective. The 2009 request includes $185 million in funds to directly support the agencys core safety assurance oversight and enforcement activities, to
achieve our goals of preventing and reducing railroad accidents and
incidents and contributing to the avoidance of serious hazardous
material incidents in rail transportation.
Included within FRAs safety budget is $1.2 million to expand the
implementation of the Close Call Confidential Reporting Pilot, also
known as the C3RP program. This initiative allows FRA to more
effectively leverage its resources by expanding its partnership with
industry to promote risk-reduction programs on the Nations railroads.
With regards to FRAs rail research and development activities,
the 2009 request includes $34 million to support our railroad safety
efforts. Of note are new initiatives that fund research in the area
of level boarding to support further access and compliance with the
Americans With Disabilities Act, the development of a new joint
bar inspection technology, and procurement of a high-speed ultrasonic rail flaw detection system. By far, the largest portion of
FRAs 2009 budget request provides $900 million in financial assistance for intercity passenger rail services, as you both already
noted. This includes $800 million in direct subsidies to Amtrak and
$100 million to expand the current $30 million Intercity Passenger
Rail Grant Program that was appropriated for the first time last
year.
In total, this funding level will support continued intercity passenger rail service, while Amtraks management team continues to
make progress in reshaping the company. This funding level encourages Amtrak to continue to undertake meaningful reforms and
control spending.
The Administration remains steadfast in its desire to improve
the manner by which intercity passenger rail services are provided.
This necessity also includes improvements on how Amtrak provides
such services and laying the groundwork for states to have a
stronger role in determining the important characteristics or services that they support financially and for the participation of other
entities in provision of intercity passenger rail service under contract to states and/or Amtrak.
The request includes $525 million in direct federal subsidies for
Amtrak capital costs. This amount allows Amtrak and its state
partners to continue to address the most pressing investment needs
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on the northeast quarter infrastructure, as well as the essential

equipment investment. In addition, the budget includes the aforementioned, the hundred million, to expand the new Intercity Passenger Rail Grant Program, which awards competitive grants to
States to finance the cost of state driven capital improvements, priorities associated with intercity passenger rail services. This program encourages state involvement in planning and decision-making for intercity passenger rail service, allowing them to identify
where mobility needs justify public investment. Additionally, State
involvement in planning and decision-making helps prioritize infrastructure improvements, such as stations, and lets the states assure connectivity to other forms of transportation supporting intermodalism within the state.
State involvement in funding intercity passenger rail service also
provides an added discipline on Amtrak to continually seek ways
to provide the highest quality of service. The notification of funds
availability for this program was published in the Federal Register
just a week or two ago.
The Administrations request also includes $275 million for operating expenses that are to be made available to Amtrak, as they
demonstrate and achieve efficiencies. Under this account, the 2009
request proposes establishing a new competitive pilot program that
will allow the Secretary to test viability of using non-Amtrak operators on selected routes to provide passenger rail services.
Finally, I would like to offer a brief update on the Rail Line Relocation and Improvement Program. As you know, just over $20 million was appropriated for this program for 2008. FRA is taking aggressive steps to implement the program and has developed regulations governing its implementation. These regulations are currently
being cleared with the Administration. We expect to issue them
this spring with the first grant awards under the program beginning in 2009.
I appreciate your attention. I will be happy to answer questions.
[The information follows:]
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Mr. OLVER. Mr. Kummant.

Mr. KUMMANT. Good morning, Mr. Chairman, and thank you for
the opportunity to testify today. As you may know and have already mentioned actually, fiscal year 2007 finished as a strong year
for Amtrak and fiscal year 2008 has gotten off to a good start, as
well. You mentioned the annual ridership record of 25.8 million
passengers that we set last year, which was the largest in company
history. We have had a record several months, and a record
Thanksgiving, which are also important indicators of the traveling
publics preferences and confidence. We have seen double-digit
growth on many of our routes and our new corridor operations in
the Chicago area have grown rapidly. Finally, as you all have been
very involved with and are aware of, we have concluded agreements with most of our unions after years of negotiation. While the
organizations are currently going through the ratification process,
we hope our employees will find the terms of the agreements to be
good and acceptable. We are following the recommendations of the
Presidential Emergency Board in providing wage increases and retroactive pay to our employees and our employees will also be making contributions to healthcare.
More and more, it looks like passenger rail service has a bright
future. To help shape the next few years, Amtrak is focusing its efforts on a set of key priorities. We are working to increase revenue
generation on all of our operations, reduce our costs, and improve
both trip times and system-wide on-time performance. We are also
in the process of developing a comprehensive plan for equipment
procurement in the coming years. The acquisition of additional
equipment is a small component of the fiscal year 2009 capital request, but we expect it to grow as our fleet of electric engines and
our Amfleet cars approach the end of useful lives.
We are also working with a number of states to grow our short
distance corridor operations, increase state involvement, and develop new corridor operations in markets where the demand clearly
exists. We are, however, quickly bumping up against the limits of
our existing equipment capacity at a time when states are seeking
new services, which underscores the need for new rolling stock.
To realize these priorities, Amtrak will continue to require a certain core level of operating assistance and capital investment from
the federal government. In fiscal year 2009, Amtrak will need a
total of $1.671 billion in federal assistance. Of this total, $506 million will be required to meet operating costs, $801 million will be
invested in capital projects, and $19 million will be required for the
funding of Amtraks Office of Inspector General, and $345 million
will be spent on debt service. All of these figures represent increases over our fiscal year 2008 spending levels and I will give you
some background on them. We have provided additional detail in
our legislative and grant request, which I would ask to be made
part of the record.
We foresee significant cost inflation, as we see across the Nation,
in several important areas in fiscal year 2009. The most significant
cost will be increases in wages, benefits, and fuel. Wage increases
will be a byproduct of the labor agreement and will add about $27
million to our fiscal year 2009 budget. But the largest single category of cost increases is going to be benefits. This is principally
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a reflection of the growing cost of healthcare. We expect our total

benefits cost to rise by $50 million in fiscal year 2009 and expenses
associated with medical treatment and drugs are at the core of it.
If we had not obtained cautionary agreements in our recent labor
negotiations, they would have been larger.
I think it is also important to mention at this point that we have
a single additional expense that will come due in fiscal year 2009.
As you may know from 2002 and forward, this company and many
of its unions were unable to agree to the terms of contracts for our
employees. In November 2007, the Administration appointed a
Presidential Emergency Board under the terms of the Railway
Labor Act to hear the dispute and recommend a settlement, which
it did in early January of this year. The management of Amtrak
has accepted this recommendation and we concluded a series of
agreements with nine of our bargaining partners last month, the
basis of it. The ratification process is on-going.
The PEB recommended that Amtrak make lump sum retroactive
payments to its employees to effectively extend the raises it offered
back to the beginning of the negotiating period and Amtrak agreed
to do so. Amtrak believes, at this time, that it has a financial
wherewithal to meet our fiscal year 2008 wage and retroactive pay
obligations, as well as its wage obligations in fiscal year 2009 and
2010. However, the sixty percent of the back pay, which totals
about $114 million, that payment that the PEB recommended be
made in fiscal year 2009 is noted separately in our grant request
summary on page three and is not contained in Amtraks fiscal
year 2009 operating costs. The PEB was aware that Amtrak did
not have the means to pay the additional sixty percent and recommended that the decision to fund this amount lies with Congress.
To fund our fiscal year 2009 capital programs, Amtrak is asking
for a total of $801 million. Of this total, we intend to use five-hundred-and-seven million to pay for the on-going state of good repair
programs dedicated to the rehabilitation of our plant and equipment. In addition to meeting day-to-day state of good repair requirements, we are undertaking an ambitious capital program in
fiscal year 2008. The replacement of the lift span on the Thames
River bridge in New London, Connecticut, will be the centerpiece.
We are planning a large-scale blitz on our New England division
in June, which will undertake repair and replacement work on
electric catenaries, several interlockings, and most of the smaller
projects. We intend to continue our capital investment program effort in fiscal year 2009, but our program to replace the lift span
on the Niantic River bridge will hit its stride. Big projects like lift
bridge replacement are expensive, but enduring. We expect to complete its span to last for a lifetime. Though we have an aging fleet,
we will also be spending significant capital on bringing it into a
state of good repair.
We are also working to comply with the Americans with Disabilities Act and our 2009 budget includes $69 million for that effort.
ADA compliance is going to be a significant challenge and Amtrak
is seeking an extension of the current compliance deadline of July
26, 2010, because even if we had the regulatory guidance and resources to comply, it would still be impossible to achieve compli-
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ance by that date. Amtrak is fully focused on making its service accessible and we are pursuing compliance under the terms of ADA,
but we will need additional time to accomplish that. New rules proposed by the DOT would materially change the standards for compliance under the Act with respect to station platform level requirements, would add millions of dollars to the compliance costs, and
would deprive that aspect of compliance of any clarity and certainty. Even under the current law, Amtrak will need more time
and more resources to achieve full ADA compliance.
On the whole, I think our projections for the upcoming year are
responsible and realistic and we can accomplish what we set out
to do. There are a lot of points that must be considered and the
rising cost of fuel and healthcare and our concerns over the financial health of the economy will all have a bearing on our plans. We
are going to need new equipment and the age of our fleet is, if not
an immediate concern, certainly a future one. But from where I sit,
the leading indicators continue to trend in the right direction. I believe there is a pent-up demand for intercity passenger rail service
in the United States. In the coming year, we will work to inform
this discussion and to meet the expectations and needs of our customers. I would like to take the opportunity to conclude by telling
you how hopeful I am that we will soon have new labor agreements
fully ratified. I think we are going to have some big opportunities
ahead and we will need a strong, skilled, and well-trained workforce with high morale, if we are going to make the most of them.
I appreciate all of the hard work our employees put in everyday,
sometimes in difficult or trying situations, and I am glad that we
have been able to conclude a workable settlement and trust that
our employees will embrace it. I, also, want to thank our Board of
Directors, particularly Joe Boardman, of the FRA for their on-going
support and their counsel. Thank you. I will be happy to answer
any questions.
[The information follows:]
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Mr. OLVER. Okay. She is working on a different keyboard than

I am working on.
Mr. BOARDMAN. That is the trouble Alex and I have.
Mr. KUMMANT. That is right.
Mr. OLVER. Okay. As usual, we will takeI and the Ranking
Member will take ten minutes on the first round and then we will
go to five minutes.
I want to go back over this funding for Amtrak slightly. Mr.
Kummant, you have asked for $1.785 billion and that includes an
amount, which is $114 million, so that the comparative, without
that labor accord issue to be considered, is the $800 million that
has been asked by the Administration versus $1.671 or something
like that. So, that is in defense of my comment that your request
was more than twice what the Administrations request was and
turns out at the $1.785 billion level, it would be $460 million. And
that $110 million less, it would be $350 million, higher than we
were able to give you in this years budget.
Now, I usually ask Mr. Kummant, what impact an $800 million
funding level would have on Amtraks service, its maintenance and
capital improvements, and this time I am going to ask you, Mr. Administrator. You were in the position of being the Administrator of
the Federal Railroad Administration, which has no line authority
over Amtrak. But, you have to have a sort of a sense of what our
purpose is on rail issues, and I will get a little bit later again in
another round of questioning. But, you have that behind you. And
you are also a member of the Board. So, you are right on the Board
there in an influential position. And I need to ask you, what you
think would happen if $800 million was all that we did? What are
the exact kinds of changes in the route structure that you think
would happen, the administrative changes that would happen or
would have to happen, or the vision, for that matter, of the Administration of what it ought to look like, if we were to come up with
that number? We have had the same number put before us year
after year after year and Congress has refused to do it. Of course,
we have been operating without authorization for all of those years.
So, let me give you a try on that.
Mr. BOARDMAN. One of the things I wrote down as Alex was talking was the process. And under that category, I thought about exactly what you are asking me and that is, and not the essence of
what you caught and how do you do the cost structure and what
happens, but as the FRA Administrator, what is my role as sitting
on the Board? And it is not just as FRA Administrator, because
that hat that I put on, and Alex, and the senior staff here from
Amtrak can tell you, that I think I talk about putting my different
hats on as I sit on the Board. And it is the safety hat. It is the
hat for the Secretary. It is the hat that is the Board member,
which is a Board member of a private company, a private for-profit
company, and also the hat of a passenger all believer. I think that
passenger rail and intercity passenger rail are particularly critical
for the mobility for the future of this country and the connectivity
that that brings.
So, there is a disconnect, what appears to be a disconnect, at
least, in terms of what the Administration proposes as assistance
to Amtrak with the intercity passenger rail. And, yet, I would say
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that there is an explanation for part of that disconnect. And the

first explanation is that when you look at the capital side of this,
there is a proposal to provide $525 million of capital money to the
Amtrak. And I think when Alex and I wrote the number down,
Alex, I might be wrong, but he talked about the need for state of
good repair was $507 million. And I think the first piece of this,
then, is when you have your safety hat on, your FRA Administrator
hat on, the need for safety, the necessity to maintain a state of
good repair is critical and that is reflected in what the Presidents
budget proposes.
Secondly, the thing that I think was new last year, is still critically important for the future, and that is to bring the states into
a more important role in the future of Amtrak, because whether it
is you, yourself, or whether it is Mr. Knollenberg or it is others,
you see the fact that there is a necessity here to get the cost and
control or the balance between the cost and the expenses of Amtrak
for the future. So, there is an intent
Mr. OLVER. A more important role is to get the States to put
more money in, to pay more money.
Mr. BOARDMAN. Yes.
Mr. OLVER. Okay. That is what I get from the more important
role, is that they have got to put a lot more money into passenger
rail.
Mr. BOARDMAN. I think that is a good question, a good point. I
think the need to have a debate about that is important, because,
here, a couple of years ago, there was a congressional requirement
for us to go out and do aFRA, to go out and do an access fee with
the commuter railroads along the northeast corridor. And the result of that was that the commuter railroads in the states along the
northeast corridor were, in fact, putting the dollars in that they
needed to put in to support Amtrak and intercity passenger rail
services. The fact was, and David Gunn, and I almost was going
to make a joke earlier that I called Nova Scotia this morning to
find out what would happen to Amtrak if you only got $800 million,
but I knew what Davids answer would be, so I did not call.
And soI mean, from the standpoint of looking at the states, we
have a very uneven level of support across this nation for intercity
passenger rail services and that is part of what Alex is talking
about, in terms of corridors, especially in the Northeast, especially
in my former New York State and partly Pennsylvania.
Mr. OLVER. Okay. I guess, you would agree that there has to be
a difference in the way the states fall on this. However, let me
justbecause ten minutes will be gone here very fairly. Mr.
Kummant has asked for $800 million for capital improvements, although, apparently, from the nod that I saw when you said $25
million commented that he was asking $507 million for state of
good repair, how do those numbers fit with the working groups
that I mentioned, which is part of NTSB, which is also very much
involved in safety issues? How does that difference in numbers
allow us to get out the backlog of $5 billion, which I thought was
their estimate of the backlog just to reach state of good repair?
Both of you will have to comment on this to kind of explain this
difference to me, in the time that we accept.
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Mr. BOARDMAN. I think there is, as with everything in Amtrak

and intercity passenger rail, there is no really consensus agreement
that $5 billion is a right number, or if it is $7 billion, or if it is
a different number of what is needed to bring the Northeast Corridor up to a state of good repair or to maintain it. I think that
there has been progress made, especially in the last few years, but
the progress has to go at a level, at a rate that you can actually
get the work done and not disrupt the reliability of the corridor, as
well. So, there is that particular part of it in this process and in
this discussion.
Mr. OLVER. All right. Mr. Kummant, also, indicated that just
reaching ADA compliance would cost $500 million. I think that was
the number. Sometimes, I lose $500 million versus $5 billion. But,
I think $500 million was roughly what was being said. That is also
in there. And Mr. Kummant went through a long list of things that
included the catenaries. The very catenaries on the Northeast Corridor are the one thing that allows a higher speed rail passenger
system to function on those areas. And it seems to me that those
are very necessary to keep going. How do we manage to even get
toward higher speed rail in this country, a real passenger rail system, if we do notif we are not able to do that on the Northeast
Corridor, which carries half of all of our people? And he is saying
we need $800 million to do that, to keep that up. I am still having
a hard time understanding where the Administration thinks $525
million will do that, when he is saying $800 million is necessary
just to keep the improvements to get the higher speed on the
northeast system. And there are tunnels and bridges and so on and
so forth in that area. I have gone red, but you can answer that,
if you would like, either of you.
Mr. KUMMANT. Well, what I was going to say is, let me talk
about areas where I actually think we do agree on. I do not want
you to walk away with the impression that there is some big void
here, because there really is not. Again, I take the Administrations
proposal to say, Keep driving cost reductions and keep looking for
ways to create a financial structure, including the states, that is an
equitable cost-sharing structure. We just cannot do it this year.
That is going to be a multi-year effort.
Do I think ultimately there is a $100 million of savings in our
maintenance operations? Yes, we are working on that.
Do I think this a reasonable number, $40 to $60 million in savings on our overall systems implementation? Yes.
Do I think we have to go after the $300- or $400 million in cost
sharing with the States? Yes, but that is probably also a six- to
eight-year type of trajectory to get there, particularly given the difficult state of the U.S. state budgets.
So, I do think there are multiple $100 million we could ultimately take out of our support number. That being said, I go back
to what David Gunn estimated that the state of good repair would
take about a $600 million a year funding over about ten years to
catch up. The number I have in my mind is about $1.5 billion backlog in kind of day-to-day track issues and about $3 billion in major
projects. So, the issue we have had over the last couple of years,
we have lost ground a little bit, because we have only been funded
between the $4 to $5 million level.
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Mr. OLVER. Okay. I am going to pass on to my Ranking Member.

I am going to have to put these questions and ask each of you to
answer, because I really want to know what you think happens to
the Administrative picture and the personnel picture and the restructure picture in the scenarios that we are laying out. Thank
you. Mr. Knollenberg.
Mr. KNOLLENBERG. Thank you, Mr. Chairman. I am going to
start off with a little waste, fraud, and abuse question. Mr.
Kummant, I am continually concerned about waste, fraud, and
abuse, particularly in the Federal Government, and I believe it is
the responsibility of this committee to root out these problems. I
would note that the subcommittee has enacted the FAR measures
and asked to address problems in Amtrak. And I want to thank the
Chairman for procuring those provisions in this years bill.
I believe Amtrak has been working with the Inspector General
on this. But, I have a question about Amtrak employees bringing
their own food and beverages onto the train, employees that sell
these items at a profit and pocket the profit for themselves. I understand there are some corrections underway. Some have been
made. But, could you give me a little detail on what you have done
about that issue?
Mr. KUMMANT. Well, to my knowledge, if that is going on, it only
goes on at very de minimis levels at this point. We have a very effective internal Inspector General. We have worked very hard on
our overall food service. We have a great and effective out source
contract with Gate Gourmet. We are putting in systems on the
point of purchase inventory tracking and revenue management.
Mr. KNOLLENBERG. Let me ask you this.
Mr. KUMMANT. Yes.
Mr. KNOLLENBERG. What measures, if any, are in place to discipline the employee, to punish him, or to remove him, or what?
What is taking place?
Mr. KUMMANT. We have a standard procedure that we internally
and our Inspector General both follow and to my knowledge, this
has really not been an issue for multiple years. I stand to be corrected by my staff, but that is certainly not a significant issue, at
this point. Our fundamental focus has been on the effective operation of the food service, itself.
Mr. KNOLLENBERG. I would like to have some information on it.
Mr. KUMMANT. Sure. I would be happy to provide that.
Mr. KNOLLENBERG. And I would like to see that. The GAO study
on Amtrak has recommended, and I am quoting here, We examined the entire structure,this is for Mr. Boardman, by the way
We are examined the entire structure of intercity passenger rail
service with the focus on optimizing its performance on benefits
with the federal and non-federal expenditures. In your opinion, is
this economic benefits test the best, is it the only basis on which
to base decisions about a particular passenger rail service?
Mr. BOARDMAN. The answer to whether it is the best, I do not
know. The answer to whether it is the only is that it is not the only
and it should not be the only way to look at passenger rail service.
If you will repeat, sir, the last part of that. I do not know if I
picked up just exactly what the question was.
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Mr. KNOLLENBERG. Well, the only thing I asked was that in your
opinion, is the economic benefits test the best and only basis on
which to base decisions about a particular passenger rail service.
Mr. BOARDMAN. No, I do not think economic benefitsI do not
think that cost benefit analysis in this country, especially for infrastructure today, really defines what we need to maintain our mobility and connectivity for the future and it has to be other than just
cost benefit. And the expectation is when you take anything forward today, that cost benefit is only one of the elements that we
really look at. We, also, have to look at the strategic purpose and
the necessity to connect and provide those kind of things for the
future.
I had recent argument with some of the folks over at DOT in the
policy area that many of our interstate highways would never have
been finished had it been a cost benefit analysis that drove that,
because it said do not build it on a cost benefit analysis. But, as
soon as they were built, they are now full of trucks to maintain.
So, no, I do not think that is the only answer.
Mr. KNOLLENBERG. If we were to adopt the GAO recommendation, the analysis is actually quite straightforward. Each rail line
and the amount of service and types of service on each line, such
as where to stop and how often to stop, can be evaluated and it either generates a positive return over time or it does not and is
axed. However, is there any case to be made, in your opinion, that
with a national transportation system, at least some benefits transcend the straight application of returns for the dollar invested?
For example, the environmental cost that increased auto traffic resulting from the lost of passenger service increased congestion and
other systems stress comes along, too. Can those be quantified, can
those issues be quantified and factored into a benefits cost test for
a specific rail line feature or features?
Mr. BOARDMAN. Certainly.
Mr. KNOLLENBERG. That is the answer? You said
Mr. BOARDMAN. Certainly, those can be quantified. I can expand
on the answer some.
Mr. KNOLLENBERG. I would suggest, is there something that you
would select that might be worth pointing out in responding in
writing on that issue?
Mr. BOARDMAN. Yes. I think that it is worth pointing out and I
pointed it out in a recent board meeting that one of the strongest
pieces of leverage that Amtrak has is their national connectivity
and their connectivity to all those commuter railroads and other
operations across the country and that I thought one of the critically important things for the future was for Amtrak to have a
seamless payment method for the people that want to ride Amtrak
or commuter railroads or intercity transit or bus services. So, just
like EZ Pass that really with a low-cost, back offish cost for Amtrak would become a revenue producer for Amtrak.
Mr. KNOLLENBERG. Let me go on to a question for Mr. Kummant.
I want to challenge you a little bit about your request for a moment. Your testimony states that your request is for $1.671 billion.
But, if the Committee were to provide exactly that amount, how
would you pay for the 60 percent back pay that you have agreed
to pay in 2009 and then what are the consequences of not providing
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the additional $114 million that is required? Even the detail, the
justification states that these funds are needed above your request.
Mr. KNOLLENBERG. What is youris that cost not partwhy is
not part of your request?
Mr. KUMMANT. I do not think it is necessary to have a semantic
argument. Look, we fully support
Mr. KNOLLENBERG. I am not asking for an argument. I am asking for why is it notwhy is that cost not part of your request?
Mr. KUMMANT. Well, it is not a core operating number. That is
all that was suggested. Look, we support any and all efforts to fill
that gap. Our position going into the labor negotiations, particularly the last round, is entirely consistent with what the PEB stated. Our offers early on were about 40 cents to the dollar on back
pay we said we could manage. So, it is simply a reflection of the
fact that there is the gap and we are very supportive of any and
all efforts to fill that gap.
Mr. KNOLLENBERG. Well, it is, indeed, a gap. Let mehow much
time do I have? Okay. Let me go intoyour testimony refers to
record increases in ridership, double digit growth on many routes,
higher revenues across the board from virtually every aspect of the
business. Yet, your demand from the taxpayer for 2009 is nearly
$350 million above the 2008 budget and you project a net loss of
$500$600 million in 2009, which is up from $457 million in 2008.
Can you explain to me why all this good news is costing more and
is that a long-term trend or a short-term phenomenon? I will stop
there.
Mr. KUMMANT. That is a great question and, to break it into two
pieces, first is the operating piece. We are in an inflationary period.
There is no question that going forward with our wage settlements
is a piece of that, $27 million. We are seeing fuel costs going up
quite dramatically and with, again, a lot of varying forecast going
forward. And, of course, medical benefits had a flat period for a
while in the 1990s and, unfortunately, medical benefits costs for us
are going up dramatically.
Mr. KNOLLENBERG. You have suggested that there will be
deductibles and cost-sharing.
Mr. KUMMANT. That is right, even with those cost-sharing numbers. But let me, also, reflect for a moment, if you take that support number as a percentage of our total operating budget, it is actually the second smallest number in the last 5 years. We are having a very good year this year with essentially good ridership. We
still see the tail end of cost containment. But, cost curves, unfortunately, have kinks. I have run many businesses where you run into
that. A few years ago, we all saw the commodity price increases.
I was in an electronics-based business and copper prices went
shooting through the roof. There was not much you could do about
that. And we are facing those same pressures today.
Mr. KNOLLENBERG. I am going to another point. I will try to get
this in the time left. The budget you presented is based on a 312
percent increase in growth in revenues, which is slightly below the
5-year average.
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Mr. KNOLLENBERG. However, during the economic slowdown back

in 1991, which was a mild short-term slowdown, ridership dropped
by fifteen percent.
Mr. KNOLLENBERG. In todays market, is business-related travel
still a dominant source of revenues for Amtrak and, overall, how
sensitive are your revenue projections to the overall economy? And,
finally, one of the consequences of your 2009 budget request, if that
same drop in ridership, it could be worse
Mr. KNOLLENBERG [continuing]. Which will occur.
Mr. KUMMANT. Well, that is the question. It is a great question.
There are never easy answers to that. There is a fundamental approach, when you are looking at the question of what is the economy doing, and when is there a horizon effect, is there going to be
a recession or not, how deep is it. The only thing you can do is pick
a conservative revenue number and manage costs very hard. We
are taking a lot of cost containment actions across the business
today. If I turn it around, I guess I would say, what are the alternatives? The alternatives would be to actually sit here and ask you
for a whole lot more money or to say, we have to
Mr. KNOLLENBERG. You have not.
Mr. KUMMANT [continuing]. We have to initiate
Mr. KNOLLENBERG. I am.
Mr. KUMMANT [continuing]. We have to initiate radical route reductions today speculatively, because we do not know what the
economy is going to do. So, what we chose to do and, again, what
I have done in many other businesses, you pick a conservative revenue ridership number, and you see the revenue number of three,
three-and-a-half percent, as opposed to a seven or eight percent, because we do not know, and then you really contain your costs as
hard as you can and then, we are going to have to just keep a
sharp eye on it. But, if ridership drops fifteen percent, yes, we will
have a tough issue.
Mr. KNOLLENBERG. I do not want to be funny, but maybe sometimes when ridership drops, maybe you would make more money
than you would if it was spiking.
Mr. KUMMANT. Well, not in the Northeast Corridor, that is for
sure.
Mr. KNOLLENBERG. Understand. There are certain sectors that
are doing fine. Thank you, very much.
Mr. KUMMANT. Thank you.
Mr. OLVER. Mr. Pastor.
Mr. PASTOR. Good morning, Mr. Chairman. Thank you. First of
all, I want to thank the subcommittee, the Chairman and Ranking
Member. As I begin to learn more and more about this intercity
passenger rail program that got funded, the $30 million, I think it
gives flexibility to the FRA Administrator and State agencies to be
able to develop planning grants and submit proposals. So, I want
to congratulate you and I agree with the CEO of Amtrak, this will
probably be something that is going to do well and this subcommittee may be asked to increase that amount. So, first of all,
I want to congratulate you and I want to thank the FRA Administrator for allowing Mark Yachmetz and Mark Schnabel to be in Ar-
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izona. We had a great, great meeting and Arizona ADOT is coming

forward with a plan, and that happened because of a conversation
we had last year. So, thank you, very much, and I want to commend those two gentlemen for the fine work they did over in Arizona.
I want to talk about the PEB. As I understand, that decision
came sometime in December. But, I want to ensure that since that
decision was made and to date, that you have ratified negotiated
contracts with nine of the unions.
Mr. KUMMANT. Actually, it is up to 12.
Mr. PASTOR. Up to 12.
Mr. KUMMANT. Because, there are unions that were not in the
PEB that have already come in that we have tentative agreements
with.
Mr. PASTOR. And that is for future
Mr. KUMMANT. That is correct.
Mr. PASTOR. That is for future.
Mr. KUMMANT. It is basically the same.
Mr. PASTOR. And I guess they are in the ratification process?
Mr. KUMMANT. That is correct.
Mr. PASTOR. Do you see any problems? I am sure you keep contact
Mr. KUMMANT. Well, not to my knowledge. It is essentially a
quiet period. One does not really know. We do not expect a problem. But until it is said and done, you just sort of keep doing what
you are doing until the tallies are in. But we do not really anticipate an issue.
Mr. PASTOR. In a worse case scenario, if there are some non-ratifications, do you expect then to renegotiate?
Mr. KUMMANT. Well, I think we would probably come back and
sit down with you and sit down with union leadership and it may
beI do not know the answer to that. I do not want to be too speculative there. I really think we have done everything the PEB has
asked us to do and I just think we will have to cross that bridge
when we come to. March 10, I believe, is the ratification date for
the first nine. So, we are almost there.
Mr. PASTOR. As I understand, the first installment is going to be
about $76 million or around that ballpark figure.
Mr. KUMMANT. The forty percent.
Mr. PASTOR. Yes. Is it covered by your budget request?
Mr. KUMMANT. We have managedagain, we have workedyou
have to put this in perspective. We have actually worked very hard.
For all the comments we get about what are you doing on cost reductions, we have actually worked very hard in the last five years
to even this year be able to say, Hey, we can manage that. So,
the cost reductions that we have driven over the last five years
have allowed us in fact to manage paying the wage increase out of
operating funds. So it really is the result of the work that has gone
on and all the efficiencies there have been made.
Mr. PASTOR. When Secretary Peters was here a couple weeks
ago, I asked how is this going to be handled in 2009, and at that
point, she said, because the decision came out so lateDecember
that the probability was it was not included. The second installment, the 60 percent, was not included in the 2009. But I read in
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your testimony on page five that you have put it in, oh, what account is it?
Mr. KUMMANT. Well, we have always said that the second piece,
$114 million, is a gap that we within our own finances cannot
close. We are supporting any and all efforts to work through that,
and that is again why the contracts have a contingency piece related to that.
Mr. PASTOR. But you put it in on page three of the legislative
and grant request. Now what does that mean?
Mr. KUMMANT. Well, we have not budgeted for that. We are not
able to budget for that. We just referenced that. I mean, that is the
gap that needs to be closed. You mean in the chart, the bottom
line?
Mr. PASTOR. No, from your testimony at page five, you say
Mr. KUMMANT. Oh, my testimony.
Mr. PASTOR. Yes, your testimony. The summary table on page
three of the ledge and grant request. So is that a line item that
is already funded?
Mr. KUMMANT. Oh, it is not funded. We are referencing that as
the gap. That is clearly the requirement to fill the gap that, again,
we identified even before the PEB, that the PEB referenced.
Mr. PASTOR. Okay, well, I am in yellow now. So possibly the employees bringing food and selling may be because of the lack of contract for the past eight years, and they are augmenting their salaries. [Laughter.]
Mr. KUMMANT. Well, you know, you will have to get testimony
from them on that.
Mr. PASTOR. Well, I just thought about that. That may be a way
that you can meet your 2009 back salary. Thank you, Mr. Chairman.
Mr. OLVER. Is it not the accumulation of those back salaries
something close to 30 percent? I mean, just to suggest that that
might be exactly true; anyway, Mr. Berry.
Mr. BERRY. Thank you, Mr. Chairman.
I believe that you testified that there were several places where
you thought there was some savings. I remember one number, $107
million. Was that right?
Mr. KUMMANT. I said in maintenance processes over the next five
years, we felt we could probably achieve about $100 million in savings.
Mr. BERRY. Then you mentioned another $40 million to $60 million?
Mr. KUMMANT. Well, I said we have a complete basically rebuilding of our systems infrastructure. That is a very difficult number
to pinpoint to say, what are the specific savings. Because that enables really a lot of other projects to be effective. But I think if you
took a rough number of $40 million to $60 million over time, I
think that could be achieved.
Mr. BERRY. I would be really interested in more details about
why you think that.
Mr. KUMMANT. Sure, we will be happy to provide that.
Mr. BERRY. In the time that I have been in the Federal Government, we always used this phantom number out here of waste,
fraud, and abuse.
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It is an old term. It still hangs around, but it seems like that

never gets done. No matter what happens, there is always more
waste, fraud, and abuse that somebody is referring to, and it is
quite elusive. I would like to know more about it.
Mr. KUMMANT. I would be happy to do that. I have hung around
the private sector for the last 20 years, and we are not allowed to
do that. So I am certainly very committed.
Mr. BERRY. You are not allowed to pull these numbers out of thin
air?
Mr. KUMMANT. Not entirely, no.
Mr. BERRY. Okay.
Mr. KUMMANT. We are actually called on the carpet, and it is
suggested we go do other things if we do not achieve those.
Mr. BERRY. That might be a good thing.
Thank you, Mr. Chairman.
Mr. OLVER. Thank you, Mr. Berry.
You know, I do not mean for my comments to sound
confrontational in any kind of a way.
Mr. BOARDMAN. I suspect that is for me then? [Laughter.]
Mr. OLVER. Well, no, in both cases, I was looking at you, Mr.
Boardman. As you know, I commented that I was hopeful at some
point that we would create a passenger rail that fit into a balanced
transportation system. That is the way I think of it.
You have said that you are a believer in intercity passenger rail.
Now you did not go on to say how it is fit into the balanced transportation system. But that, I think, is almost a given. I can almost
hear it being part of that being said.
I want to get some vision out of you two here. In the ISTEA bill,
now more than 15 years ago, there was a whole pattern of high
speed rail corridors that were created. They have been changed a
little bit, including one that I made in the northeast corridor in the
authorizing bill of three years ago, and there may have probably
been some others.
At that time, there were even some authorizations for programs
which might have been considered as important pieces. In one of
those authorization bills, and I am not sure that I remember precisely, there was a rail relocation program of $350 million per year.
No money was ever appropriated for that.
But it has continued; and this past year, we started out suggesting $35 million, which you have commented on, that yes, you
are there and you are working on a set of regulations to allow that
to be implemented. Ultimately, we ended up having to cut it to $20
million.
Then while there is no authorization for Amtrak, the idea has
crept in, in the last couple of years, for $100 million for intercity
grants, state grants, which are 50/50. So it sort of indicates where
you think that capital ought to have been paid for, for a national
rail system, through all these states, all of them putting in 50/50
or something. I will leave you to tell me a little bit about that in
the earlier question that I put forward.
Last year, we could not keep that at the level. We started out
with $50 million in what the Committee came out with. But by the
time conference was over, that had been reduced to $30 million. So
it is only $30 million, but all of that is left as discretionary money.
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I am not even sure whether that is done by you, Mr. Kummant,

or by you.
Mr. BOARDMAN. Yes.
Mr. OLVER. But it would presumably have connections to our
other passenger rail systems. It would be sort of silly to have it disconnected to those other things.
Mr. BOARDMAN. Let me address this, if I can. It crept in there
because it was proposed by this Administration, by myself, for $100
million.
Mr. OLVER. Right.
Mr. BOARDMAN. It was to continue to move forward on some of
the direct basic requirements for reform that included the states
involved with this. Our proposal included a 50/50 matching, where
there was a lot of debate.
I think at the time, if you remember, Congressman, that maybe
it ought to be 80/20, like highways and so on and so forth. Well,
my own belief was that we would get a lot more done with 50/50,
because the state would actually have to put serious dollars up in
order to make improvements.
But it is an incremental issue. It is an incremental way to improve railroads. But it has to get started somewhere, and you recognize that. The members all recognize that; let us get going with
thing, and let us certainly find a way to advance this. It puts us
on the map, so to speak, with a program that never existed before,
for the states.
Mr. OLVER. Okay.
Mr. BOARDMAN. Now if you will permit me, because you are asking for some vision on how it connects and how it does not connect.
Mr. OLVER. I did not even finish my question. But that is okay.
[Laughter.]
Mr. BOARDMAN. All right, let me stop.
Mr. OLVER. Finish where you are. I am going to let it pass and
go on, because I am going to come back exactly where I stopped
and try to tie those things together; Mr. Knollenberg.
Mr. KNOLLENBERG. Thank you, Mr. Chairman, and thanks to
both of you. I know that some of these questions are difficult, but
we would like to ask them anyhow.
Turning to the cost side for just a moment, and first to Mr.
Boardman, DOT is proposing $525 million for capital grants to Amtrak for 2009. This can be a quick answer. How much of that do
you estimate is to service the $3.9 billion in debt?
Mr. BOARDMAN. None of that.
Mr. KNOLLENBERG. None?
Mr. BOARDMAN. I do not believe, no.
Mr. KNOLLENBERG. You do not want to verify and let us know?
Mr. BOARDMAN. No, it is not.
Mr. KNOLLENBERG. It is not? The reason I am asking is because
Amtrak appears to have a large amount of debt that is very vulnerable in todays market. In particular, there is almost $900 million
in defeased leases that at the moment is highly vulnerable.
Specifically, I mean the AMBAC, which insured all $900 million,
appears to be at risk of losing its AAA rating, because of its involvement with securities or insecurities; like, for example, the subprime mortgage business.
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Given the turmoil in the industry, that is being written about

every day, why would it not be in the Governments interest to
eliminate that debt as soon as possible? DOT could. It could have
included funds to do that, and would have still been at well below
the 2008 enacted levels.
So I want to ask Mr. Kummant, what is your view on this issue;
and what are the implications of Amtraks defeased leases, if the
credit rating of AMBAC is lower, through an insurance company?
Mr. KNOLLENBERG. They got into this thing a little over their
heads. So how does that impact you; how severe is that?
Mr. KUMMANT. That is right. The number of the exposure is
probably about $150 million. There might be about $150 million in
debt that we would have to go out and pay off. It is possible.
But let me also say, if that were to happen, that is all subject
to negotiation. It is not clear. We have a good record, in fact, on
how we have managed our debt in the last five years. We have reduced our debt $600 million. We have added no new debt. This entire market is hardly being worked today by the letter and comma
of agreement.
So $150 million is probably the worst case. But we will have to
see where it goes. I mean, I think the stories on Ambac vary daily
with, Here comes the bail out to The bail out is not a enough;
here is a little more bail out. So we will just have to see how that
goes. We have outside counsel.
Mr. KNOLLENBERG. We will all have to watch that.
Mr. KUMMANT. Let me say, in general, on the debt question, we
have proposed a larger debt service number, as you see. About half
of that is for debt service and half is for repayment.
We would like to accelerate debt principal repayment, and that
is why we are asking for a slightly larger number, to continue the
good streak we are on; but also to open up some debt carrying capacity to also deal with the equipment issue we have coming over
the next five years. We would like to take out $500 million in debt,
over the next five years.
Mr. KNOLLENBERG. With respect to the labor agreement, as I see
it, you owe $536 million in back pay, and another $86 million in
additional COLA adjustments in 2009, based on the agreements
about to be ratified.
Further, there is a prospect of more than a five percent increase
in wages and benefits each year, into the future. Is that relatively
close?
Mr. KUMMANT. It is close. I would quibble with them a little. It
is more like four-and-a-half and four percent.
Mr. KNOLLENBERG. And for that, you got no changes for this decision, no changes in work rules, cut costs or run the corporation
more efficiently in the agreement. Is that correct?
Mr. KUMMANT. That is correct, yes.
Mr. KNOLLENBERG. Can you give us some idea how this benefits
package, if you will, compares to the Federal Service package?
Mr. KUMMANT. Well, the overall benefits package is pretty similar. I think there are some differences in medical. There probably
are some elements in our medical package that are a little bit better. But they are, I would say, really in the same ballpark.
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You know, again, on the overall wage issue, the two out years,
I believe, are four and four-and-a-half percent; and look, we have
been criticized for not exercising fully the work rules we have access to today. We certainly intend to continue to do everything we
can to reduce costs, and we will have to avail ourselves of some of
those opportunities.
But let me also say, I do think that it is impossible to put a number on putting this behind us, the overall coming together of management and the front lines, and the improvement in morale. But
let me say that it is real, and I do expect a good couple of years
of co-operation.
Mr. KNOLLENBERG. Is there any economic benefit being gained as
a result of the higher employee cost, going forward?
Mr. KUMMANT. Well, I mean, I think by definition, you could say
no. But I do think the morale piece is real; and at the end of the
day, our employees are being paid market. We never really had a
quibble with the core wage number. That was very close to our
original proposal. It was our ability to manage the back pay piece
that really was the sticking point for so many years.
Mr. KNOLLENBERG. Thank you; thank you, Mr. Chairman.
Mr. OLVER. Mr. Pastor.
Mr. PASTOR. I want to yield my time to Mr. Boardman and I congratulate him. Because I think what you have done, in organizing
and implementing this program of providing grants to states to develop in conjunction with Amtrak and other inter-modal systems,
a passenger rail system, is very important.
I think the step you took with the Ranking Member was probably a larger step than most people realize. So I would like to hear
also the vision, because I think we all have a chance to utilize this
grant. So I will yield my time to Mr. Boardman.
Mr. BOARDMAN. Thank you; let me go back then to where I was
in terms of the incremental approach that we saw was absolutely
necessary in order to make progress.
As you began to look out, what would states really use this for?
What would they begin to try to do? What we found was, there
were a lot of activities that could occur. One of them is perhaps a
planning for a new line, such as Tucson to Phoenix.
There also was, how do we make sure that our intercity and our
long distance trains stay on time? How do we get on-time performance, so that people can trust the reliability.
I think that Amtrak has done an excellent job on that, on the
Northeast Corridor. They have made the changes. They have made
the improvements necessary to stay on time, and they had reliability. Reliability in transportation, whether you are in a car or
a plane, or a train, is absolutely critical for the future.
So there were things that the States could do, in concert with the
freight railroads. Part of the discussion that you had earlier, Mr.
Chairman, was in that number of $7 billion-something that Frank
Busalacchis group came up with, which was on a lot of the private
railroads that are out there today, whether it is the UP, or the
BNSF, or CSX, or whether it is a Norfolk Southern, is that they
had always in the past made changes that accommodated freight
rail, and not necessarily passenger rail.
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In order to get these trains on time, they needed to make some

changes. They had to have some passing sidings, for example, so
that they could get by the slower freights, to get them on time, to
those kinds of improvements. This program allows that, and it allows the states and/or the freight railroads to participate in this;
so that there were those improvements.
But the other thing I wanted to jump to was, how do you make
the larger improvement on reducing the time of mobility? High
speed rail can be defined different ways by different people. It can
be the Maglev. It could be a conventionalized speed rail. It could
be, the Europeans talk about, that they already have a high speed
rail.
I recently met with William Spur with Bombardier, who talked
about his equipment being already available to do high speed rail.
We are supporting, in our research right now, the next generation high speed rail tracks that we are looking at, because of the
difficulties that we had on the Acela project, and the heavy weight,
and the creation of the difficulties on the tracks that were on our
existing high speed rail trains.
The problem that we run into, and it is disconnect passenger rail
all over the world, is that the European concept, they believe, can
come to the United States, be put on our tracks, and operate on
our tracks. But our tracks are freight tracks, for the most part.
They are heavy freight tracks.
So the FRA has some very stringent and important safety requirements for buff strength on these trains. When you take an existing design and try to just add more weight to it, to meet our buff
strengths, you run into the kinds of problems that we saw with
Amtraks Acela program.
So part of what we are also looking for is the states to work with
us, in concert with us, just like when Colorado Rail Car wanted to
have a new, approved rail car. They came to the FRA, and they
worked from the ground up to build a train that could be used on
our freight tracks, be safe, meet our requirements; and that we
could expand service with that train or their DMUs.
We want the same thing for the future. So when Amtrak talks
about an equipment plan, an equipment vision for the future, he
is talking about two pieces of it. One is to take the equipment that
they currently have, get it re-built, and use it for the future; but
also to add the kinds of services that we are going to need for reducing travel time.
The reason I am talking about us reducing travel timethere is
a guy who had a high speed rail program in New York called the
Turbo Program. What we really began to understand is what we
wanted between one stop and the next, or the full distance of the
length of the trip, is to have a reliable, reduced travel time between
those two locations.
It did not matter whether we were doing 115 miles an hour, 130
miles an hour, 180 miles an hour, or 60 miles an hour. In some
cases, and you brought this up yourself, Mr. Chairman, we could
make the most improvement by improving our time through Baltimore, in order to really improve the Northeast Corridor. That is a
critical element.
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But there is also a huge cost in getting those few minutes added
to our time. So there are other things that can be done with this
same money; this talk about working with the states.
When FRA went out and had a practical look at, for example, the
alignment here just in Virginia, to improve the commuter services
with VRE, what we found was, if you just raised the height of the
platform, and reduce the dwell time for the trains, you actually can
do more to improve not only ADA compliance, but also improve the
travel time between Richmond and Washington, D.C.
So it is connected together. If you were going to jump forward
and have a huge improvement, in my mind, it is a grade-separated,
electrified rail service from Miami to Maine. The way you do that,
and the reason you do that, is because you already have the alignment. But it is a private alignment, and we do not have the policies
to deal with the private sector that already owns the lines. We
have policies that we are working on that we have public sector infrastructure, that we want to privatize. But we are talking about,
for the future, for rail; to have the way to find a public partnership
with a freight railroad such as CSX or Norfolk Southern to make
that real for the future.
It may be as simple to start with as providing a 100 year lease
to move this concept, this idea forward. That is not a job for Amtrak. That is a job for us at the Federal level, to really talk about,
how do we get that done for the future. It is a job for Amtrak to
operate on that in the future.
When we look at what is needed first, and I know I am going
over my time and I will stop, in the congestion that we are dealing
with in the northeast today, it makes absolutely no sense to go
from Atlanta, in aviation, to Charlotte, by way of Philadelphia,
when you have a line that you could operate.
That is part of what is happening to air congestion in the northeast; is that we are going from a milk run from Atlanta into Philadelphia or Dulles, and then coming back to Charlotte to deliver the
transportation service from Atlanta to Charlotte. It makes no
sense. It should be from Atlanta to Charlotte by rail, and I will
stop.
Mr. OLVER. Thank you; Mr. Berry.
Mr. BERRY. I do not have any more questions, Mr. Chairman,
thank you.
Mr. OLVER. Ms. Roybal-Allard.
Ms. ROYBAL-ALLARD. I believe that this was mentioned earlier,
and that is the fact that the Administration did not include the
$114 million second payment for the labor agreement in its 2009
request. The question I have is, since it is not part of that request,
how does Amtrak plan to fund the second installment of its retroactive wage increase?
For example, does the Administration plan to make a request for
an Emergency Supplemental to fund the second installment; and if
not, what plans does Amtrak and the Administration have to ensure that the second installment is, in fact, funded?
Mr. BOARDMAN. I will handle this, at least first. The Administration initially was told, I think it was in the $150 million level. So
we look at what Amtrak has done thus in determining what those
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costs are, down to $114 million, I think is the number that they
put in there at this point in time.
As we talked about earlier, Congresswoman, we do not have a
ratification yet with the unions. So from a technical standpoint, we
do not know if that really works yet, or whether it does not work.
We are not planning on proposing, at least at this point in time,
anything different than what we are proposing for Amtrak funding.
Yet, we understand that there is this difficulty there. We are looking ourselves at this number at this point in time to see, is there
anything else that could be done at this point about these numbers,
and we have not determined that there is. So, no, we are not going
to propose it.
Ms. ROYBAL-ALLARD. The concern, that everybody has is that we
risk returning back to the status quo of the last several years,
where there is no contract and we have the threat of another
strike. So this is something that does need to be looked at and
hopefully resolved to the satisfaction of everyone.
Mr. BOARDMAN. I understand.
Ms. ROYBAL-ALLARD. Mr. Boardman, in your prepared testimony,
you say that your 2009 budget proposes establishing a new competitive pilot program to test the viability of using non-Amtrak operators on selected routes to provide passenger rail service.
Can you please elaborate on this pilot program, and what criteria
the Secretary will use to choose the routes for the pilot projects.
The concern I have is that it will be counter-productive to transfer
operations of any successful routes to a pilot program that would
be run by private operators.
Obviously, if that were to happen, at the end of the pilot, Amtraks bottom line definitely would look worse, not better. Can you
tell me what the plans are?
Mr. BOARDMAN. Sure, first of all, the Secretary would not choose
any routes; neither would the Administrator. This is a proposal
that goes back to the basic reform that the Administration has
been looking for with Amtrak. That is to introduce competition to
Amtrak to improve their operating position.
So that was what the proposal was. We would be looking to Amtrak to identify some places where this could occur.
Ms. ROYBAL-ALLARD. It actually would be Amtrak then that
would be identifying?
Mr. BOARDMAN. Yes.
Ms. ROYBAL-ALLARD. Okay, thank you, that is all I have.
Mr. OLVER. I am going to yield, because my Ranking Member
needs to leave to go some place else.
Mr. KNOLLENBERG. Thank you, Mr. Chairman. I will be fairly
brief. A gallon of diesel fuel, as you gentlemen well know, has risen
from $2.10 a gallon to about $3.50 a gallon in just the last two
years; and you face, I believe, about $1.5 billion in the near term,
to meet requirements under the ADA, which is a solid chunk. That
is about right, is it not, about $1.5 billion?
Mr. KUMMANT. It depends on what base assumption you use. If
you use a range, it is anywhere from $300 million to $1.5 billion,
depending on what course is taken.
Mr. KNOLLENBERG. I will not hold you to that. But that is in the
ballpark, is what I am trying to suggest here.
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How much would the ridership have to increase to cover these

costs? Have you have an idea of that?
Mr. KUMMANT. Well, at the end of the day, frankly the ridership
cannot increase enough to cover that. I mean, we could grow our
ridership perhaps, you know, 15 to 20 percent by 2015, and that
would give us, you know, a 30 to 40 percent revenue increase. But
ridership increase could not cover that total.
Mr. KNOLLENBERG. What other cost-cutting measures are available to you, to help you balance these cost increases?
Mr. KUMMANT. We are working very hard on our maintenance
processes, which is a big cost, but it is also an enabler to drive
more revenue, as you free up more equipment. I think long term,
as Joe mentioned, the cost shift and cost sharing with the states
is a path we have to go down.
Our overall systems implementationand we have spent a lot of
time with the Canadian National who went through a similar process and found it a real enabler for them to manage the business
differentlyis a large piece of that.
So again, I think we work on that every day. But at the end of
the day, I think when large external costs are imposed, you simply
cannot answer the bell on all of those.
Mr. KNOLLENBERG. Your justification also indicates that in many
circumstances, you are running up against capacity limitations in
key revenue-related areas, such as the Acela, and I think we were
talking about that a moment ago.
Mr. KNOLLENBERG. If that is the case, why do you think you can
maintain about the same level of revenue growth as you have in
the past, and how quickly can you realistically increase capacity in
higher revenue areas?
Mr. KUMMANT. Well, we do not actually maintain that we can
keep this revenue growth going. I think that if you look over the
next five to seven years, we could probably continue revenue
growth at a four to five percent compound annual growth rate, with
a ridership of maybe about three to three and-a-half percent. So
there is a lot of price management involved in there.
For example, today, there are about three million riders on the
Acela product and about seven million riders on the rest of the
Regionals on the Northeast Corridor. We have to manage our pricing and do revenue management, and also attract more riders to
the Regional product.
Mr. KNOLLENBERG. A final question, how much of this annual
cost could possibly be passed on to the States?
Mr. KUMMANT. Well, in fact, we work this a station at a time.
There are partnerships with communities, with local real estate
people. The ownership of stations varies greatly. Even freight railroads have pieces of them. So every individual station has really
its own financial solution. So there are a lot of different players involved in that.
Mr. KNOLLENBERG. Thank you very much. Mr. Chairman, thank
you and gentlemen, thank you very much for being here today and
taking all the questions. We appreciate it.
Mr. OLVER. Mr. Boardman, I am going to go back to where I was
because I was sort of developing a point. I had commented about
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the States matching-grant program, which we talked about, and

also about the rail relocation.
The next thing that I was going to mention was the next-gen
planning program. It seemed to me that those three things are the
only things over the years that I have served in Congress, which
just about goes about to the ISTEA date.
In fact the first thing that was being debated when I first came
into Congress in 1991 was the ISTEA Bill, which carried that original high-speed rail authorization, the original set of corridors, five
or so of them at that particular point. It seems to me that those
are the only real things that have been appropriated for in this,
and we have made no significant progress on it.
In the meantime, and maybe even before that, and over a period
of time, many of the countries in Europe: Germany, France and
Spain, and connections to Belgium and the Netherlands, and so
forth out of France and Germany, as well as China.
China, now, I think the one working Maglev that actually functions and has been operating for a year or two for only a 30-mile
distance or so from Shanghai to its airport, but it is there and it
is going. I do not know of any other one that is actually taking passengers on a regular schedule. It is more in an experimental kind
of a role, but there are.
France has used conventional high-speed rail on rails that go almost as fast as the Maglev, any in the same range, just about within a few miles per hour of the same range.
Now, those conventional high-speed rail systems all function on
the basis that they are within 500 miles with a group of large cities
that may sit 100 miles apart or so is a good place to have highspeed rail. There are strings of pearls in this country of essentially
the same sort of thing.
The whole Northeast Corridor from Boston to Washington is.
But, in the other direction, another 500 miles gets you to Atlanta,
and you made the comment that you would like to see it from
Miami to Maine, or at least Boston, let us say, because you do not
have any 100,000 population areas north of cities, north of Boston.
But you would like to see that kind of a high-speed rail system
that covers that, and you laid out that there are problems because
it is all on private track.
Well, many of these, if not all of them, in the places that I have
mentioned, at least in Europe, and I know less about say Korea,
but I know that Japan has a dedicatedwhich is passenger rail
and no freight. The extensions of Japans core high speed rail system will be publicly owned and then contracted with an operator.
That is the only thing that runs on it. It is going from these great
large populations.
The other kinds of places where there are strings of pearls, from
Seattle to say Vancouver, down through to Portland and maybe Eugene, to cities of over 100,000, roughly 100 miles apart, somewhere
in that range, or the connections outside of Chicago, in all directions there fit into that kind of rubric.
And, by the way, it is roughly the same thing as Phoenix to Tucson, and I, too, am grateful for your sending Mr. Yachmetz and Mr.
Schnabel out to look at the situation out there. I think it is a perfectly good kind of a place to go.
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How do we get there? We have had 15 years. We have been stuck

on trying to figure out what to do with AMTRAK and never funding it well enough to even have high-speed rail, just its major line
from Washington to Boston, which is trackage that we own. We
have not gotten there. Those others run on averages of 90 to 120
mph. At their tops, they are on rails that are rated for 200 kilometers per hour, I guess.
I am saying numbers too quickly I think here. But how do we
get there? By the way, I have the greatest respect for both of you.
This is going to have to be answered in writing, at some point, because I am already on red. But I have the greatest respect for you,
and I suspect if we had you with an Administration that wanted
to solve this in a realistic way, I think we might make some
progress. I particularly think so because you come out of New York.
You could not come out of New York without having some understanding of this situation.
And what a huge amount of traffic in the air space which is more
than doubling over the next 10 or 15 years in what you described
from Atlanta and Charlotte and Philadelphia, and that whole corridor along that way that I described south from Washington to Atlanta.
I have not given you any time to answer at all. I will pass on
to Mr. Pastor at this point. You will get a chance, though.
Mr. PASTOR. I will help you with the answer. Let me go back. It
is a step that this subcommittee took to allow the FRA Administration Office and the state, and the state with all its stakeholders,
which includes brake lines that are involved in the state; and, in
Arizona, the two that are there are in a dilemma because they
have so much cargo coming from Los Angeles and the Long Beach
Port, coming through Arizona, so they are retracking. They are
looking at what their future needs are going to be. You have the
need to connect Maricopa County with Pima County, with Pinal
County in between. That is going to be, if not the fourth, probably
the fifth, mega-city. When you talk about mega-cities, it is going to
be a mega-city, so now is the time.
You, the subcommittee, have been given the opportunity for the
FRA Administrator and the state, with its stakeholders, to meet
and begin saying, incrementally, this is what can be done. This is
what is available, with the Indian tribes, with the State trust
lands, with the cities and towns in between, with the counties, to
begin developing a plan.
That is what it can do. The first step is going to be: developing
a plan. It brings in all the stakeholders. Once you connect, then
you start talking about how this links up Tucson with Amtrak; and
the possibility of another Amtrak in Maricopa County.
So this step, where you said: We are not going to look to Amtrak
to do the planning of future sites and what it is going to look like,
but it is going to be the Federal Government, the FRA Administrator, and the State, and its stakeholders, to come together and
begin planning. It is going to be incremental.
But I will tell you what: It may be a dedicated line, and that
dedicated line is going to be a string of pearls, You basically have
allowed them to take that first step to say: You guys begin working
towards the future.
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I am just going to
Mr. OLVER. Would you yield?
Mr. PASTOR. I will yield, yes, as long as you want.
Mr. OLVER. I just want to know: Mr. Boardman, have you made
a commitment to do the Tucson-through-Phoenix route?
Mr. BOARDMAN. No, no, no.
Mr. OLVER. Among the first group that you haveyou do not
have to answer that.
Mr. PASTOR. No, mostly Mark did. No, they have not. But what
I have learned from having this meeting is that, for the first time,
you have the ability of the Federal Government to meet with the
State, and talk about a relationship to deal with rail. That has
never happened before.
You do with all other modes of transportation, and now is the
first time that we have taken the step to say: The state has the
ability to plan with the FRA Administrator to develop a plan that
affects the State, but connects to this National railroad system.
By taking that step, you now have states, and you will have
states coming up and saying: Hey, we can connect. A plus would
be that we will connect to Amtrak, or we can build this line, but
5050, whatever the match is.
I think that step you took is a major step because now you have
the states and the railroad administrators working together.
But it is interesting. I was looking at the energy consumption per
passenger mile. Domestic airlines: about 3300 Btus; Intra-city
buses: 3500 Btus; Amtrak: 2100 Btus; autos: 3500 Btus.
As you develop, the new rail, along with the electric locomotives,
it will become more efficient. Not only would you connect the nation it will be more energy efficient, I think that is going to be another plus in this whole system.
The more I learned about the system the more impressed I was
that this is the first time that we have developed this model, where
we allow the FRA Administrator an increased rolebefore they
had to go to Amtrak, and Amtrak had to make those decisions
where the lines would go.
Now, it is between the FRA Administrator and the State to determine this. I think it was a great step that you took, and I want
to congratulate you and recognize you for doing it.
Do you want to comment on the energy efficiency while I have
the time?
Mr. KUMMANT. Let me say: I think a critical framing for transportation overall is, first of all, all the dialogue needs to be on a
multi-modal model. What are the trade-offs between highway, rail
and air? How do those align?
Second is overall framing. It is difficult to do, but it is so necessary today. We are in an infrastructure crisis. We are in a transportation crisis. Infrastructure, mobility, environment and energy
are all linked. It is all one package today and that is something we,
collectively as a nation, really need to come to grips with and think
through.
Finally, I look at our air-rail-share numbers, which we track on
the corridor. For example, New York to DC, in the fourth quarter
of 2007, we had 61% of that travel share, if you put air and rail
together.
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Even Boston to New York, where we are not quite as competitive, in the fourth quarter, we had 47% of that share. To steal Joes
thunder, we need to look at electrifying from DC to Richmond, then
Richmond to Charlotte. Then we need to look at St. Louis-Chicago;
we need to look at Las Vegas-L.A. There are opportunities out
there, and there is a lot that we can do at 100 mph. It does not
need to be 200 mph plus.
You asked Mr. Boardman about the commitment between Phoenix and Tucson. I can use his support, but I need your commitment. [Laughter]
Mr. OLVER. Okay. Mr. Berry.
Mr. BERRY. Mr. Chairman, if we are giving away railroads, I
want to sign up for mine.
Mr. OLVER. What is Little Rock near to?
Mr. BERRY. I do not know, but we will find something.
Mr. PASTOR. They gave a bridge at Thunder River.
Mr. BERRY. We do have Amtrak corridors in the First Congressional District of Arkansas. We are thankful for it, and we are glad
we have it.
I have so psyched myself with the remarks of the distinguished
gentleman from Arizona, we do need to work together. If we do not,
we are going to pay a big price in this country, in the years to
come, for not taking care of our infrastructure. We cannot be a successful Nation with our infrastructure falling apart. We all know
that. That is one of the reasons we are on this Committee. Thank
you.
Mr. OLVER. Mr. Wolf. I think Mr. Wolf probably has a good
Maglev project for you guys.
Mr. WOLF. I have no questions. I am filling in for Mr. Knollenberg. He is at the other Committee.
Mr. OLVER. You do not even want to talk about Dulles?
Mr. WOLF. Well, we are hopeful that the Dulles project will go
forward
[Laughter.]
Mr. OLVER. Depending on what funding comes with it.
But I suppose it could conceivably fall into the idea of going from
Washington to Dulles by an arrangement that was made with the
Federal Transit Administration.
Mr. WOLF. Well, it could be, although I think we have a pretty
good proposal now, Mr. Chairman, to take it to Metrorail.
Mr. OLVER. If you can get it through Metro, okay.
Mr. WOLF. Thank you.
Mr. OLVER. Well, look, I went on for a long time before. I would
ask either of you who wishes to comment to that. We are sort of
running down here and most of the questions that I had have been
asked by someone else. but I would like to see what it is we need.
What do we need to do tofirst, do you think we really ought
to make the commitment to get the passenger rail in these kinds
of corridors that I have described as strings of pearls, and I only
mentioned a few of them.
What impact do you have in thinking about what happens to our
idea of long-distance trains? What is in the back of your minds?
What do we do with them?
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Mr. BOARDMAN. Alex has some thoughts that I am sure he is

going to share with you in a minute. I have asked him for two minutes. I know I have used up some time previously, but let me just
answer.
Your question was: What do we do? Where do we go?
Let me say to you that it is not just the price of fuel. Six years
ago when this whole reform process started, we had a barrel of oil
at $27. We are now at $100. So we have some major changes that
have occurred, I think, globally for us for the future.
So where do you start? You start by reducing the cost with electrification to the extent that you can. You start by changing the
way that you charge for the use, yourself and others. You base it
on time, which is the biggest constraint that we really have.
You begin to look at separating the freight from the passenger
as much as you can. You cannot do it totally, but you should do
it as much as you can. But have that common use because that is
the only way you are going to be able to efficiently afford to make
the changes that you are really looking for.
You celebrate the successes, and we have had successes. Some of
us talked about some of them this morning in terms of what has
happened with their market share between New York and Washington, and between New York and Boston, and the reliability of
it as well.
You focus on the places that are going to be successful, and he
also identified those a couple of minutes ago but I will not go back
through them.
And you do not believe that congestion is totally bad for the economy because it is a damn good measure for us that we are still
doing well as an economy to have this kind of traffic out there. You
do not want to disturb that as well. That is all I have.
Mr. OLVER. You mentioned the oil increase. I take it you were
saying that the cost of oil, being what it is, is going to have an affect upon air travel and on highway travel?
Mr. BOARDMAN. It already is having an affect on foods in our
stores.
Mr. OLVER. I am sure, of course.
Mr. BOARDMAN. It affects everything.
Mr. OLVER. Are you saying that, relatively, the cost of those are
going to be less compared with the cost of rail if we do the rail correct?
Mr. BOARDMAN. I am not sure I have understood the point. But
if we do rail correctly, long term, how do we reduce the energy use
is electrical
Mr. OLVER. Okay, that is what I was trying to get at.
Mr. BOARDMAN. Maybe it was maladroit in the way I was trying
to get to that point.
My relative position, in essence, over time, with the cost of oil,
the cost of road travel and air travel is going to continue to go up
and it will be lesser because you are not expecting to go through
all of that oil usage.
I think we have an obligation to do electrification where it makes
the most sense and where it is going to be successful.
Mr. OLVER. Yes.
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Mr. BOARDMAN. I think we ought to fund the corridors on the

Northeast Corridor.
Mr. OLVER. Yes.
Mr. BOARDMAN. And I do think that we need to get to a highspeed rail in those places where we really mean to do improvements in the 90 to 120 average.
Otherwise, if you are much less than that, if you are back on
rails that are mixed with freight, and on rails that are at a maximum grade rating of 79 mph, you are going to be having average
speeds which are less than what you can do on an interstate system.
I have already taken too much time.
Mr. OLVER. That is quite all right.
Mr. BOARDMAN. It seems to me it is about national political lift.
So we can show people some real trains and some real quarters out
there. Again, at the 100 to 110 mph range.
For example, St. Louis-Chicago, there is a fairly sparely used UP
line that is in good shape where we can go 110 mph. And with
maybe less than $100 million of infrastructure improvement, there
is some signaling, some crossings. If we got a wonderful European
train as a demonstration, it would sell out, it would sell out.
And I think there is an opportunity to take Detroit to Chicago.
We own and operate 96 miles there where we can go 110 mph.
That would be more money. It is very congested from Indiana into
Chicago. But, let us say for less than $1 billion, you can have 100
mph travel between Detroit and Chicago.
You look out west, in Vegas-L.A. there are opportunities. So if we
went out and targeted individual corridors, and just showed people
what could truly be done, you could over time develop the political
lift to then say: Okay, let us really grade separate and let us develop the 150200 mph trains.
But I think there is an intermediate step that can really gain
dividends.
Mr. OLVER. Okay, thank you very much.
Mr. Wolf.
Mr. WOLF. Thank you, Mr. Chairman. I wanted to ask you one
question, and it is one that I have strong support on.
From the years when I was chairman of this committee. The one
question that I have wanted to ask you, though: I was taking rail.
I take the Metroliner up to Philadelphia where I am originally
from. My family has lived there, and up to New York City.
It went through my old neighborhood the other day. I was looking out and the filth, the garbage on the sides of the track. Has
there ever been a program, certainly on the Northeast Corridor,
whereby there would be a time when you can clean up some of the
garbage, and the cans, and the paper, and all the filth along there?
Is there any program to look at that?
Mr. KUMMANT. We actually work at that, probably every day. It
is a significant issue. It is all about money. It is all about manpower.
We usually have to divert maintenance-of-way people who are
laying new rail or ties to do that. But we do have to do that, and
various areas are better or worse than others. It is just something
that you have to keep up with.
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Mr. WOLF. How do you compare it today versus say the way it
was ten years ago?
Mr. KUMMANT. I would have to ask my colleagues on that. I
think we have actually made progress, I think people would say.
We have worked on that very hard. If I may say so, I cannot resist but that happens to be a work rules issue as well. If we could
out-source that, it could be done.
Mr. WOLF. Why must you out-source that?
Mr. KUMMANT. Because, basically, we end up in long conversations with our unions on whose work it is; and how to get that
done. It is one of those typical friction points that we have.
Mr. WOLF. Okay. Again, I appreciate the job that Amtrak does,
but I just think that to clean-up some of those areas would make
a tremendous difference. When you ride in a train in Europe and
you look out, you do not really see the scene as you do up in our
region.
Mr. KUMMANT. That is right. There is, of course, a different legacy there. We do have a freight legacy, and an entirely different
kind of environment that those trains are going through. Okay,
Penn Coach Yard Cleanup.
There have been significant individual clean-up efforts, but it is
a problem and it is something that we keep working.
Mr. OLVER. Okay.
Mr. KUMMANT. Thank you, Mr. Chairman.
Mr. OLVER. Ms. Kaptur.
Ms. KAPTUR. Hi, Mr. Chairman. I apologize for not being here
earlier. We had a concurrent Defense subcommittee, a meeting on
defensive missile capability. Now, we are into offensive transportation capabilities, so it is good to be here this morning.
Welcome, gentlemen. I will try to be brief. I am from the northern part of Ohio, and represent the longest coastal district in Ohio.
Amtrak is very important to us. Our private railroads are very important to us.
Right now, freight is trumping passenger service, and passenger
service has really gotten horrendous. Our passenger-rail service is
severely degraded. The options for rail travel across our region
used to be pretty significant even going to Chicago.
But if I want to take a train today from Washington back to my
home town of Toledo, there are just two available options. The earliest, getting to Toledo at 4:56 a.m. tomorrow morning. I have done
that one. Otherwise, I would need to travel through New York City,
which is a lengthy diversion.
So my question, which I do not expect you to answer, is: How
much worse can it get? And how can we treat passenger rail more
robustly in the same way as we have special assistance for our airlines and airline ticket fares, which we helped to invest in the system?
If one looks at vehicular transportation and the gas tax, for example, we do not have revenues sources going into passenger rail
at the same level, so I am interested in your thoughts about how
do we make the funding system more robust?
Also, let me just share a thought. I keep looking at the whole
system, whereas our dear Chairman worries about the east coast,
I have to selfishly worry about our corridor by the Great Lakes.
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And I always hear Detroit-Chicago, Detroit-Chicago. What about

Pittsburgh-Cleveland-Toledo-Chicago?
And involving the Governors of Pennsylvania, Mr. Rendell is
very interested in passenger rail; the Governor of Ohio, who is one
of our former colleagues here, Mr. Strickland; the Governor of Indiana and the Governor of Illinois, who was also one of our former
colleagues here.
My thought is: I represent the Turnpike. We send cars down the
Turnpike with tolls. What if we were to use that easement because
we have all these conflicts with freight right now? So, even if you
used existing track, you cannot move passenger trains. What if we
were to get those governors together, and our port authorities together, and look at a blended system for some type of high-speed
passenger transit across our region, using the respective statebonding authorities along with what you already do?
I keep looking at our Turnpike and thinking: My gosh, I represent Cedar Point. We have got these mono-rails and every other
ride that goes up in the air over there. Why cannot we just make
it horizontal and take it from Pittsburgh to Chicago using some of
those existing right-of-ways?
But that is not the way the studies have gone. The studies are
looking at fixed bed, and, you know, the traditional way of thinking. But what if you were to look at segments? And get the respective players, look at revenue sources from that, and try to get
something that really works rather than having a system that is
cobbled together?
And, frankly, with Canadian rail being right over my district in
Canada, are there any across-lake or around-lake systems that we
could conceive of?
If you are ever interested in having that discussion with public
officials from our region, or our port authorities from that region,
look at our combined bonding authority. I think it is a discussion
that we ought to have because the current system just is absolutely
not working for the convenience of passengers. It keeps bumping
up against rail.
I extend the hand of friendship, and would love to have that type
of discussion in our region, and would work with you. I cannot
guarantee the governors time but I think we could get the governors from the region and take a look at this issue of a high-speed
rail corridor.
Mr. Boardman.
Mr. BOARDMAN. Do you want the answers?
Ms. KAPTUR. Yes, but I want to ask my second question and then
I will listen to the answers.
For the FRA, we need help in making these private carriers responsible. Some of our worst railroad bridges, literally, I can take
you to my district and chunks are falling off of these bridges onto
the streets where kids walk under these trestles to get to school.
CSX is one of the worst violators. I hope there is somebody from
their organization in the room today because I want you to hear
me say that on the record. They should be fixing up their property.
How can we work with you to get these companies to do maintenance, especially when they are making huge money, you know,
their profits annually? How do we get them to be community re-
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sponsible? How can you help me do that in my region? I will take

you to specific places in my district that are terrible and need to
be repaired.
Those are my two questions.
Thank you, Mr. Chairman.
Mr. OLVER. Thank you.
Mr. KUMMANT. I will just take two minutes, Joe.
Mr. BOARDMAN. You have got it.
Mr. KUMMANT. First, let me say the areas there are dear to my
heart. I grew up in Amherst and sailed on Lake Erie many years.
I worked for the original Sohio before the BP America and I still
know a lot of people of that refinery, so I know that area well.
My father also lives in Pittsburgh, and just getting in to D.C.,
and when I send him back, he gets to Pittsburgh at like I think
it is 11:30, or 11:45 p.m. It is a difficult route to serve western
Pennsylvania and Ohio.
Number 1, I hear you. Number 2, we are in conversations with
36 different states. I think we are really trying to move the ball
in terms of our ability to pivot. We have been saying for a year the
state DOTs are our future, so we would welcome that discussion.
Thirdly, if anybody
Ms. KAPTUR. May I just interject, Jolene Molitoris, the former
FRA Commissioner, is the chair of our Rail Commission in Ohio.
We have special assets in place that were not there before.
Mr. KUMMANT. I am on the Visiting Committee of the Case
School of Engineering, where we are talking about all these things.
How can we, in Ohio, work on infrastructure, on energy, on transportation from the point of view of the Engineering School at Case?
I am very much with you on those.
Ms. KAPTUR. What a gift. Maybe this is why we are here today.
Mr. KUMMANT. Finally, I would say if you all were to come up
with a dedicated funding source, we would say wonderful. I think
that is one of the issues that turns us into such a political footballbecause of the annual kind of appropriation cycle that I think
creates such political tension.
If there were at least a partial dedicated funding source for a
baseline, I think that might defuse some of the political intensity
around us because we are such a large discretionary spending
piece.
Ms. KAPTUR. Mr. Kummant, could you suggest for the record, or
privately, knowing the system as well as you do, what would be the
likeliest options for that?
Mr. KUMMANT. Well, there again, unfortunately here I will claim
to be the private sector industrial guy. I am not a budget expert.
I am probably not that good.
We can certainly chat with your staff about that, but I would
suspect your committee probably has more solutions on that front
than we do, but we can certainly proffer some thoughts.
Ms. KAPTUR. Thank you.
Mr. OLVER. Joe, I think your penciled note was great but I have
to go.
Mr. BOARDMAN. Well, we are well over. But let me just say this:
We will have our staff reach out to your staff and identify the difficulties that you are talking about and have a discussion with you.
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Ms. KAPTUR. Thank you very much.

Thank you, Mr. Chairman and members.
Mr. OLVER. Thank you. Let me say that I am going to offer one
question to you in writing about the 100,000 rail bridges, related
to those all over the country. It clearly is a problem, and there will
be some questions that staff is going to try to put in a little bit
more coherent manner from my earlier comments.
Otherwise, thank you very very much for being with us today.
We will adjourn the hearing.
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Insert graphic folio 787/1000 here 43800A.704
733
WITNESSES
Page
rfrederick on PROD1PC67 with HEARING
Anderson, A. P .........................................................................................................
Anthes, R. A .............................................................................................................
Anthony, A. S ...........................................................................................................
Bernstine, Nancy .....................................................................................................
Boardman, Joseph ...................................................................................................
Brubaker, Paul .........................................................................................................
Capon, R. B ..............................................................................................................
Corzine, J. S .............................................................................................................
Dexter, Jennifer .......................................................................................................
Douglas, Jim ............................................................................................................
Glynn, A. C ...............................................................................................................
Johnson, Collister, Jr ..............................................................................................
Kummant, Alexander ..............................................................................................
Lofye, Andrea ...........................................................................................................
Millar, W. W .............................................................................................................
Monks, Janice ..........................................................................................................
Narvaiz, Susan .........................................................................................................
Paterson, D. A ..........................................................................................................
Ramirez, S. N., Jr ....................................................................................................
Raymond, C. G .........................................................................................................
Sees, M. R .................................................................................................................
Simpson, T. D ...........................................................................................................
Sperling, Andrew .....................................................................................................
Zaterman, Sunia ......................................................................................................
(i)
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724
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541
1
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724
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675
713
685
663
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INDEX
Federal Railroad Administration and National Railroad Passenger
Corporation (Amtrak)
Page
Accident Rates .........................................................................................................

CAB Technology Integration Activities ..................................................................
Cause of Fatalities ...................................................................................................
Civil Penalties Initially Assessed in FY07 to Freight Railroads .........................
Close Call Confidential Reporting System (C3RS) ...............................................
Contract Support .....................................................................................................
Defect Summaries ....................................................................................................
Derailments .......................................................................................................... 111,
Efficiency Incentive Grants Unobligated Balances ...............................................
Fines Initially Assessed to Freight Railroads .......................................................
FRA Railroad Code ..................................................................................................
Freight Trains Blocking Public Highways .............................................................
FTE ...........................................................................................................................
Grade Crossings .......................................................................................................
Hazardous Materials and Chlorine/Anhydrous Ammonia ....................................
High-Speed Passenger Trucks ................................................................................
High-Speed Rail .......................................................................................................
Inspection Data ........................................................................................................
Level Boarding .........................................................................................................
NTSB Safety Recommendations .............................................................................
Offsetting Collections ..............................................................................................
Opening Statement by Alexander Kummant, President and CEO of Amtrak ...
Opening Statement by Chairman John W. Olver .................................................
Opening Statement by Joseph Boardman, FRA Administrator ...........................
Opening Statement by Ranking Member Joe Knollenberg ..................................
PA Station Redevelopment .....................................................................................
Passenger Equipment Crashworthiness Program ................................................
Questions for the Record from Chairman David R. Obey ....................................
Questions for the Record from Subcommittee Chairman John W. Olver ...........
R&D Reimbursable Program ..................................................................................
Railroad Fines ..........................................................................................................
Railroad Rehabilitation & Improvement Financing (RRIF) .................................
Railroad Research and Development Grantees .....................................................
Railroad Warnings ...................................................................................................
Rulemaking: Final Regulations............................................................................. 48,
State of Good Repair ...............................................................................................
Status of High-Speed Rail Corridors ......................................................................
Status of Railroad Bridges ......................................................................................
Written Statement by Alexander Kummant, President and CEO of Amtrak ....
Written Statement by Joseph Boardman, FRA Administrator ............................
(iii)
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164
105
135
394
47
159
167
127
118
390
504
538
160
136
120
109
52
153
107
145
86
9
1
3
2
119
114
538
47
108
398
116
93
166
122
117
58
88
12
6
iv
Page
Saint Lawrence Seaway Development Corporation

Written Statement by Collister Johnson, Jr., Administrator Saint Lawrence
Seaway ..................................................................................................................
Development Corporation:
Asset Renewal Program: Cost Estimates ..............................................................
Asset Renewal Program: Overall Cost ...................................................................
Asset Renewal Program: Schedule .........................................................................
Asset Renewal Program: Seaway International Bridge .......................................
Asset Renewal Program: St. Lawrence Seaway Management Corporation ........
Asset Renewal Program: Staffing ...........................................................................
Ballast Water ...........................................................................................................
Capacity ....................................................................................................................
Delays .......................................................................................................................
Emergency Reserve Account ...................................................................................
Full-Time Employees ...............................................................................................
Harbor Maintenance Trust Fund ...........................................................................
Offsetting Collections/Non-Federal Revenue .........................................................
Questions for the Record from Chairman John W. Olver ....................................
Seaway Statistics .....................................................................................................
Seaway Traffic .........................................................................................................
Trade Development ..................................................................................................
541
564
559
560
566
565
565
556
552
555
545
545
548
546
545
555
550
548
Research and Innovative Technology Administration

Written Statement by Paul Brubaker, Administrator, Research and Innovative Technology Administration ..........................................................................
Research Planning, Investment and Control Process (RPIC) ..............................
Vehicle Infrastructure and Integration (VII) .........................................................
Nationwide Differential Global Positioning System (NDGPS) ............................
Airline Data Improvements ....................................................................................
Transportation Information for Decision Makers .................................................
569
570
570
571
572
572
573
Federal Maritime Commission

Written Statement by A. Paul Anderson, Commissioner, Federal Maritime
Commission ...........................................................................................................
Area Representatives ..............................................................................................
Awards ......................................................................................................................
Employee Retirements ............................................................................................
Equipment ................................................................................................................
Full Time Employees ...............................................................................................
Funding Level ..........................................................................................................
Other Services (25.0) of Salaries and Expenses ....................................................
Travel ........................................................................................................................
575
593
607
589
621
586
584
590
584
597
National Transportation Safety Board

10-Year Funding History ........................................................................................
Budget Request ........................................................................................................
Emergency Fund ......................................................................................................
Fatalities ..................................................................................................................
Most Wanted List ....................................................................................................
New Maritime Activities .........................................................................................
NTSB Training Center ............................................................................................
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623
623
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648
643
649
640
v
Page
Recommendations ....................................................................................................
Staffing .....................................................................................................................
647
624
Outside Witnesses
Written Statement by the American Association of Service Coordinators
(AASC) ..................................................................................................................
Written Statement by William W. Millar, President, American Public Transportation Association ...........................................................................................
Written Statement by Andrea Lofye, Vice President, Capital Metropolitan
Transportation Authority, Austin, Texas ...........................................................
Written Statement by Sunia Zaterman, Executive Director, Council on Large
Public Housing Authorities .................................................................................
Written Statement from the Easter Seals Project Action and The National
Center on Senior Transportation ........................................................................
Written Statement by Charles G. Raymond, Chairman, President and CEO,
Horizon Lines .......................................................................................................
Written Statement by Milton R. Sees, Secretary, Illinois Department of
Transportation ......................................................................................................
Written Statement by Nancy Bernstine, Executive Director, National AIDS
Housing Coalition .................................................................................................
Written Statement by Andrew Sperling, Director of Legislative Advocacy,
National Alliance on Mental Illness ...................................................................
Written Statement by Saul N. Ramirez Jr., Executive Director, National
Association of Housing and Redevelopment Officials .......................................
Written Statement by Ross B. Capon, Executive Director, National Association of Railroad Passengers .................................................................................
Written Statement by the National Congress of American Indians ....................
Written Statement by Astrid C. Glynn, Commissioner, New York State Department of Transportation .................................................................................
Written Statement by Amy S. Anthony, President, Preservation of Affordable
Housing, Inc ..........................................................................................................
Written Statement by Thomas D. Simpson, Executive DirectorWashington,
DC, Railway Supply Institute, Inc ......................................................................
Written Statement by Susan Narvaiz, Mayor, City of San Marcos,
Texas.................................................................................................................. 716,
Written Statement by the Coalition of Northeastern Governors ..................... 724,
Written Statement by Richard A. Anthes, President, University Corporation
for Atmospheric Research ....................................................................................
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House Hearing, 110TH Congress - Departments of Transportation, and Housing and Urban Development, and Related Agencies Appropriations For 2009

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House Hearing, 110TH Congress - Departments of Transportation, and Housing and Urban Development, and Related Agencies Appropriations For 2009

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DEPARTMENTS OF TRANSPORTATION, AND

HOUSING AND URBAN DEVELOPMENT, AND

JOE KNOLLENBERG, Michigan

KATE HALLAHAN, DAVID NAPOLIELLO,

Federal Railroad Administration and National

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Printed for the use of the Committee on Appropriations

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DEPARTMENTS OF TRANSPORTATION, AND

SUBCOMMITTEE ON THE DEPARTMENTS OF TRANSPORTATION, AND

JOE KNOLLENBERG, Michigan

KATE HALLAHAN, DAVID NAPOLIELLO,

Federal Railroad Administration and National

U.S. GOVERNMENT PRINTING OFFICE

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JERRY LEWIS, California

ROB NABORS, Clerk and Staff Director

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DEPARTMENTS OF TRANSPORTATION, AND

Mr. OLVER. The committee will come to order. Let me make a

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eight years, would come to $56 billion, if my grade school math is

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on the northeast quarter infrastructure, as well as the essential

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Mr. OLVER. Mr. Kummant.

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a reflection of the growing cost of healthcare. We expect our total

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