Amtrak Must Cede Operations for High-Speed Rail, Mica Says

Amtrak will have to give up some rights to operate trains in the Northeast U.S. to attract private investment in high-speed train service, said John Mica, chairman of the House transportation committee.

Amtrak will “never be able” to build a high-speed rail system, the Florida Republican said in an interview today at Bloomberg’s Washington office.

“Amtrak can move this forward,” Mica said. “But they are going to have to give up some of the operational activity. Nobody is going to come into this unless they get a piece of the pie.”

Mica has proposed a bill to transfer ownership of the 457- mile corridor between Boston and Washington from Amtrak to the Department of Transportation, which would then solicit bids from investors to develop and operate 220 mile-per-hour service.

“The private sector, if you put this up for tender and say you can share in the profits, they will invest the money to help you build this thing,” Mica said.

Amtrak carried 10.4 million passengers in the Northeast in fiscal year 2010, with 3.2 million riding the Acela and 7.2 million taking the Northeast Regional service.

“I’ll bet we could do three times that easily” with private companies running operations, he said.

Representative John Mica, a Republican from Florida, speaks during an interview on Thursday, July 14, 2011 at Bloomberg’s Washington office. “Amtrak can move this forward,” Mica said. “But they are going to have to give up some of the operational activity. Nobody is going to come into this unless they get a piece of the pie.” Photo: David Rogowski/Bloomberg Close

Representative John Mica, a Republican from Florida, speaks during an interview on... Read More

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Representative John Mica, a Republican from Florida, speaks during an interview on Thursday, July 14, 2011 at Bloomberg’s Washington office. “Amtrak can move this forward,” Mica said. “But they are going to have to give up some of the operational activity. Nobody is going to come into this unless they get a piece of the pie.” Photo: David Rogowski/Bloomberg

Aviation Impact

Mica said a well-run high-speed service would induce more fliers to choose the train, and free capacity at Northeast airports by reducing or eliminating shuttle flights. “I’m not hurting aviation. In fact, aviation can come in and partner as an operator or something and make money off of that,” he said.

Fewer shuttle flights would allow airlines to offer “longer-distance service and other service that makes sense. It gives me additional capacity,” Mica said.

Amtrak in April requested proposals for financing its 30- year, $117 billion plan for a dedicated corridor in the Northeast for 220-mph trains that involves building on its existing right-of-way.

“Congress will never, never, even no matter what happens, they’re never going to give them $117 billion,” Mica said. “They might give them a little bit here and little bit there. But then you get a half-assed, half-baked approach.”

Private Investment

Amtrak isn’t asking for $117 billion from the federal government, Steve Kulm, a spokesman for the national passenger rail service, said in an e-mail.

“We will try to maximize private investment” to reduce the government’s share of the cost, he said.

The rail company is evaluating the business plans submitted and hopes to chose one in August, Kulm has said.

“Amtrak is confident we can attract private capital and maintain our role as operator of the service,” he said in the e-mail.

Amtrak estimates it covers the cost of its operations in the region and makes an operating profit on its Acela service, which has a top speed of 150 mph. It owns 363 miles of the corridor. Amtrak says the Acela has captured 69 percent of the combined air and rail travel market between Washington and New York.

To contact the reporter on this story: Lisa Caruso in Washington at lcaruso7@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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