FY14 Budget, FY15 Budget Request, FY14-18 5Yr Plan Documnt

[afigg]

Amtrak has posted a combined FY2014 Budget and Business Plan, FY15 Budget Request Justification, and FY14-FY18 Five Year Financial Plan omnibus document. It is a rather lengthy document at 156 pages with everything from the breaking of the company operations into 3 parts: NEC, State corridor, and LD services to NEC Gateway plans to tables of projected capital project spending for FY14 and FY15.

Lots of bits of info throughout the document. How the NEC capital funding is to be structured. More than just hints at future developments for the LD train services. Bits like under capital program descriptions that state that Wi-Fi will be extended to the remaining trains system-wide, including the LD fleets. Details and spending on NEC Gateway for the next several years. Details on capital projects for the near term.

If anyone wants to take a shot at summarizing the info and plans in the document, be my guest.

 

[Caesar La Rock]

In the document, it states the Viewliner IIs will enter revenue service in the fourth quarter of 2014. All the cars should be delivered by March 2016. Looks like we won't see any replacements for the Genesis until 2024, assuming funding will be available in 10 years from now. That means the Genesis will be between 23-31 years old by that point.

 

[Paulus]

Wasn't the Viweliner II order around $298 million? Wonder what's caused the increase to $342.8 million. Could be spare parts or financing I suppose.

Half hourly Acela service should be a significant improvement.

RailPAC will be ticked, no Superliner III plans or long distance diesel locomotive replacements in next five years.

 

[Andrew]

1. Will half hourly Acela Service be able to operate into Manhattan during AM and PM Rush Hours?

2. When Amtrak says that they are looking into connecting the tunnel box from Penn Station to the Hudson River, are they literally referring to extending the tunnel box underneath 10th Avenue to the Penn Station Throat, and then literally extending the tunnel box to the Hudson River Bulkhead?

"Gateway Program Cost Estimates

[SIZE=11pt]The current five year plan call for $1.8 billion in spending, $0.2 billion to be funded through a grant via the Federal Transit Administration (FTA) and the remaining through the annual General Capital and Debt grants. The $1.8 billion includes the majority of work to complete the North Portal Bridge, finish the remaining portion of the tunnel box from Penn Station to the Hudson River and complete all studies for the Gateway program. The bulk of the expected project work and spending will take place after FY2018 which includes the two Hudson River Tunnels, new tracks, station expansions, and the South Portal Bridge. Current estimate for all work is expected to exceed $15 billion. "[/SIZE]

 

[Anderson]

Andrew,

My understanding is that at present, Amtrak should be able to wrestle the extra hourly slots for the Acela (and presumably half-hourly Regional slots as well) without that much difficulty.

 

[jis]

Amtrak has 4 slots per hour in the rush direction. They can use them however they please. NJT has 20.

Sent from my iPhone using Amtrak Forum

 

[neroden]

The main thing that popped out at me is that the so-called "Long Distance Business Line" is responsible for the *entire* Chicago hub system, including all the corridor services.

The Long-Distance Business Line is responsible for the day-to-day operations of several

State-Supported routes, including the Blue Water, Hiawatha, Heartland Flyer, Hoosier

State, Illini-Saluki, Illinois Zephyr-Carl Sandburg, Lincoln Service, Pere Marquette, River

Runner, and Wolverines. Long-Distance will maintain positive and productive

relationships with partners in the State Supported Business Line to operate these trains

with the goal of achieving their strategic objectives, and work to provide competitive trip

times, on time performance, and good communications within Amtrak and with State

DOTs.

The supposed business line division is whacked out.

Anyway, page 69 gives us, for once, the *true* costs of the "long distance business line" as a whole, with the **** of overhead allocation separated out. It's quite clear that most of the "shared costs" are nothing to do with the long distance trains in particular and would exist with or without them.

It matches what was in Boardman's presentation two years ago. Eyeballing the chart gave me $149 million -- this report tells us that the true avoidable costs are now $142.8 million.

Unfortunately, this time it doesn't break out the costs by individual train service, so we can't tell whether there are internal changes. We know from Boardman's presentation that the Auto Train, Palmetto, and Silver Meteor are pretty much profitable on an avoidable-costs basis, while the LSL costs less than $2 million a year. By contrast, the California Zephyr costs about $30 million, the Southwest Chief about $27 million, the Sunset Limited about $23 million, and the Coast Starlight about $17 million.

For some reason the current report is doing its best to obscure that. I really hope this isn't a conspiracy to attack the successful east coast trains based on the expense of the Western trains.

Frankly, I think Amtrak is approaching this all wrong. Amtrak should probably go to Congress and ask for separately specified full funding of the fixed overhead costs. Allocating these costs to *any* individual service is incorrect.

On the food-and-beverage stuff, this is the only interesting comment:

Pilot de-linking of sleeper and meal service.

This would make it much clearer that the sleeping cars are profitable for Amtrak (at least on the trains where they're profitable, such as the LSL). On the other hand, it sure isn't going to help the financial appearance of the dining cars, which are never going to be profitable.

 

[Paulus]

Anyway, page 69 gives us, for once, the *true* costs of the "long distance business line" as a whole, with the **** of overhead allocation separated out. It's quite clear that most of the "shared costs" are nothing to do with the long distance trains in particular and would exist with or without them.

It matches what was in Boardman's presentation two years ago. Eyeballing the chart gave me $149 million -- this report tells us that the true avoidable costs are now $142.8 million.

Do feel free to elaborate on which of the shared costs would exist without the long distance trains and ought to be removed from their accounting.

 

[NE933]

Amtrak has 4 slots per hour in the rush direction. They can use them however they please. NJT has 20.

Sent from my iPhone using Amtrak Forum

In 1996 or so came MidTown Direct, aka the Kearney Connection, which took NJT runs from a more than adequate Hoboken, and put them into a now at capacity Hudson River tunnels into Penn Station. It would've been wise to have the Gateway bridge / tunnel done first and not the other way around, but someone f-up and now the slots are max-ed out.

 

[Green Maned Lion]

Amtrak has 4 slots per hour in the rush direction. They can use them however they please. NJT has 20.

Sent from my iPhone using Amtrak Forum

In 1996 or so came MidTown Direct, aka the Kearney Connection, which took NJT runs from a more than adequate Hoboken, and put them into a now at capacity Hudson River tunnels into Penn Station. It would've been wise to have the Gateway bridge / tunnel done first and not the other way around, but someone f-up and now the slots are max-ed out.

One of the big problems with it is too many NJT trains go into Penn Station. The reason for that is manifold, and include the fact that they have cost dis-incentivezed travel to Hoboken Terminal (its more expensive to go to Hoboken and use PATH than to go direct to Penn Station) and the reasons why they did that have to do with real-estate development and general NJ corruption. The best way to free up slots is to connect Hoboken to the Northeast Corridor in a way that would allow some NJCL and NEC trains to divert to Hoboken, use those slots to shove in some RVL trains, and you could probably even sneak in an additional Amtrak train. Plus, there is no reason why NYMA originating Amtrak regionals couldn't originate at Hoboken. Frankly, depending on where in the city you are, that might actually be preferable.

 

[neroden]

Anyway, page 69 gives us, for once, the *true* costs of the "long distance business line" as a whole, with the **** of overhead allocation separated out. It's quite clear that most of the "shared costs" are nothing to do with the long distance trains in particular and would exist with or without them.

It matches what was in Boardman's presentation two years ago. Eyeballing the chart gave me $149 million -- this report tells us that the true avoidable costs are now $142.8 million.

Do feel free to elaborate on which of the shared costs would exist without the long distance trains and ought to be removed from their accounting.

From page 69 of the report:

MoE Supervision Training and Overhead

MoW Support

Yard Operations

Marketing and Distribution

Police/Environmental and Safety

T&E Overhead and Operations Management

Utilities

Casualty, FELA, and other Claims

Data Processing Services

Communication

Property Insurance

Other General and Administrative

Is that clear enough for you, Paulus? A small number of the Shared Stations are arguably just for LD trains (most are for corridor trains). Some of the "Yard Operations" is arguable, small fractions of the "MoE supervison training" and "ToE overhead" are arguable. You could argue for some portion of the "property insurance" (the part specifically insuring the long-distance cars), but that's not tracked by individual car, and the cars are swapped between long-distance and "short distance" service.

The rest is not arguable -- it's overhead which stays around when you cancel train service. Including 25.9 for "Police/Environmental", 26.3 for "Marketing/Distribution", an enormous 81.2 for "Other General And Administrative", etc.

To be quite fair, this stuff should be removed from the NEC and State Supported Corridor accounting too. (Both will look even better.) There should be a "national system overhead" bottom line and Congress should be told that this is the price of running trains period.

 

[Paulus]

Except of course that many of those costs are variable and are not fixed overhead. For instance, you don't have yard operations costs if you don't run trains. Cancel long distance trains and you aren't running expenses for PPE, HAZMAT, additional environmental clean up, etc. Others are fixed overhead for particular routes, but are appropriately charged to the routes and business lines and should not be considered a national charge (especially as they would be considered an avoidable cost of running that route or collection of routes). Cancel the Silver Service trains and a significant chunk of shared costs evaporates for instance. Add the Desert Wind and Pioneer and you'll see shared costs rise in most all categories.

 

[afigg]

Wasn't the Viweliner II order around $298 million? Wonder what's caused the increase to $342.8 million. Could be spare parts or financing I suppose.

The $298 million was the contract with CAF. There may have been cost increases due to change orders, don't know. The $342.8M is stated as the total project cost which includes assembling of the bid packages, designreviews, program management, costs to Amtrak for testing, training, possibly upgrades to maintenance facilities, and so on.
For example, the contract with Siemens for the ACS-64s was announced as a $466 million contract. Amtrak took out a $562.9 million RRIF loan to fund the total costs of the project which is listed as including spare parts and facility improvements. Works out to the contract cost plus 20% which is not unusual.

 

[afigg]

2. When Amtrak says that they are looking into connecting the tunnel box from Penn Station to the Hudson River, are they literally referring to extending the tunnel box underneath 10th Avenue to the Penn Station Throat, and then literally extending the tunnel box to the Hudson River Bulkhead?

"Gateway Program Cost Estimates

The current five year plan call for $1.8 billion in spending, $0.2 billion to be funded through a grant via the Federal Transit Administration (FTA) and the remaining through the annual General Capital and Debt grants. ..."[/size]

Yikes, another tunnel box question. The tunnel box will likely be extended as far as it needs to preserve the right-of-way from the Hudson Yards development project. Perhaps it will be extended a little further to be able to be used for future construction of the Hudson River tunnels on the Manhattan side. But why would they extend it to the Hudson River bulkhead? Breaching the bulkhead is a significant engineering effort, so my guess is that part will be left to the multi-billion dollar construction of the new Hudson River tunnels whenever that happens.
Of the $1.8 billion for the NEC Gateway in the 5 year plan, I think the odds are good that Amtrak will receive several hundred million more from the Sandy mitigation funds for the tunnel box extension and NYP flood proofing upgrades. The challenge is assembling the remainder of the funds (~$1.4B) for the North Portal Bridge, Sawtooth replacement bridge design (and start of construction?), and engineering & environmental studies. It will be a piecemeal process. But if the NEC commuter agencies and states step up with increased capital support payments under a new NEC financing arrangement along with direct contributions from NJT, perhaps PANYNJ, Amtrak may be able to get the $1.8 billion lined up.

 

[neroden]

Except of course that many of those costs are variable and are not fixed overhead.

No, they're not.

For instance, you don't have yard operations costs if you don't run trains.

Sure. Are you planning to cancel all the corridor routes out of Chicago?
No? Then you have to pay for Chicago yard operations.

:eyeroll:

I know you hate the LD trains, but get a clue!

(There is theoretically a variable component to the cost of yard operations. It's not clear how much it is, and based on current Chicago yard practices and union contracts, I suspect it's negligible.)

Cancel the Silver Service trains and a significant chunk of shared costs evaporates for instance. Add the Desert Wind and Pioneer and you'll see shared costs rise in most all categories.

I mentioned this in regard to "shared stations". It's not a significant part of the allocated costs, as we see from the breakdown.
Remember, *$81.2 million* in "General Administrative and Overhead". *$26.3 million* in "Marketing/Distribution". This isn't going away.

 

[neroden]

Cancel long distance trains and you aren't running expenses for PPE, HAZMAT, additional environmental clean up, etc.

No, you are still running those expenses. Please get a clue, Paulus.
Amtrak is paying, right now, for environmental cleanup on yards it has *NEVER* operated out of. You get precisely zero savings on environmental costs when you cancel a train service. Zero. You don't understand how environmental liabilities work.

 

[Andrew]

2. When Amtrak says that they are looking into connecting the tunnel box from Penn Station to the Hudson River, are they literally referring to extending the tunnel box underneath 10th Avenue to the Penn Station Throat, and then literally extending the tunnel box to the Hudson River Bulkhead?

"Gateway Program Cost Estimates

The current five year plan call for $1.8 billion in spending, $0.2 billion to be funded through a grant via the Federal Transit Administration (FTA) and the remaining through the annual General Capital and Debt grants. ..."[/size]

Yikes, another tunnel box question. The tunnel box will likely be extended as far as it needs to preserve the right-of-way from the Hudson Yards development project. Perhaps it will be extended a little further to be able to be used for future construction of the Hudson River tunnels on the Manhattan side. But why would they extend it to the Hudson River bulkhead? Breaching the bulkhead is a significant engineering effort, so my guess is that part will be left to the multi-billion dollar construction of the new Hudson River tunnels whenever that happens.
Of the $1.8 billion for the NEC Gateway in the 5 year plan, I think the odds are good that Amtrak will receive several hundred million more from the Sandy mitigation funds for the tunnel box extension and NYP flood proofing upgrades. The challenge is assembling the remainder of the funds (~$1.4B) for the North Portal Bridge, Sawtooth replacement bridge design (and start of construction?), and engineering & environmental studies. It will be a piecemeal process. But if the NEC commuter agencies and states step up with increased capital support payments under a new NEC financing arrangement along with direct contributions from NJT, perhaps PANYNJ, Amtrak may be able to get the $1.8 billion lined up.

Do you by any chance know how far the second section of the Tunnel Box will go (in other words, will it really end up at 12th Avenue or perhaps a 100 or so feet east of there?

Thus, are you saying that, over this time period, the Tunnel Box will not be connected to the Penn Station Throat that begins on the east side of 10th Avenue?

 

[Paulus]

Except of course that many of those costs are variable and are not fixed overhead.

No, they're not.

For instance, you don't have yard operations costs if you don't run trains.

Sure. Are you planning to cancel all the corridor routes out of Chicago?
No? Then you have to pay for Chicago yard operations.

:eyeroll:

I know you hate the LD trains, but get a clue!

You pay significantly less if you cancel the long distance trains because there is less yard work required to be done. Amtrak is not the post office and they do not operate under a flat rate "if it fits, it ships."

Cancel long distance trains and you aren't running expenses for PPE, HAZMAT, additional environmental clean up, etc.

No, you are still running those expenses. Please get a clue, Paulus.
Amtrak is paying, right now, for environmental cleanup on yards it has *NEVER* operated out of. You get precisely zero savings on environmental costs when you cancel a train service. Zero. You don't understand how environmental liabilities work.

Those are yards that it owns however and you do have savings for spills and whatnot that are cleaned up at or near the time of the occurrence rather than decades later.

 

[neroden]

You pay significantly less if you cancel the long distance trains because there is less yard work required to be done.

Given what I've heard about Chicago yard operations, I actually don't believe this is the case right now.
Apparently the workers get paid for hours after they've wandered off and gone home early.... think about it for a minute.

There is clearly something deeply wrong with the yard operations.

I do not believe that assigning the cost of this wrongness to specific trains makes any sense. It should be allocated to the yard operations.

Cancelling the trains doesn't fix the mess which is the yard operations.

Once the yard operations are *fixed*, we might be able to get a real sense of the variable costs of handling another train, and *then* it might make sense to assign those costs to a train.

---

I should note that even some of the purported "direct costs" aren't actually variable at the moment. Amtrak noted in some report or other that certain trains are running more dining car staff than officially recommended by Amtrak staffing policy -- but that it may not save much money because the staff *may have to be paid anyway if not working*, according to the union contract.

Yeah, this isn't a good set of union contracts.

 

[afigg]

Do you by any chance know how far the second section of the Tunnel Box will go (in other words, will it really end up at 12th Avenue or perhaps a 100 or so feet east of there?

Thus, are you saying that, over this time period, the Tunnel Box will not be connected to the Penn Station Throat that begins on the east side of 10th Avenue?

Do we look like the engineering department for Amtrak? The Environmental Assessment for the tunnel box extension will provide answers to your many questions when it is made available for public review and comment. And, before you ask, don't know when that will happen.
Meanwhile, there are many interesting bits of information in the budget and 5 year financial plan document that don't concern the NEC Gateway project.

 

[afigg]

One interesting item in the plan document in the LD Business Plan discussion section. I don't know if the LD trains have had a focused marketing effort before to emphasize use of the LD trains for corridor services for city pairs or if this is a new effort aimed at giving the corridor service component higher visibility. The odd part is that it proposes to add premium service such as newspapers which, of course, are getting dropped from the LD trains to cut costs. Excerpt from the plan document:

Provide shorter coach trips competitive with other travel modes (C3)
Long-Distance will develop services for city pairs less than 750 miles aboard Long-Distance trains to serve markets not currently served by a State-Supported Corridor. By providing premium service to these customers, such as beverage service, newspapers, early boarding and Wi-Fi, Amtrak will become a more appealing alternative to competitive modes of transportation and will increase revenue with minimal investment.

Could this also be part of an effort to emphasize the most active city pairs to build ridership and collect data to support efforts to persuade state DOTs to consider starting a separate state supported corridor service on the route? Which would, in most situations, improve the cost recovery of the LD train because it is no longer the only passenger train for the stations over the segment and get the state to provide funds for track improvement projects. The success of the Lynchburg service shows the potential for using the demonstrated ridership demand on the LD train to get political support for adding a corridor service.

 

[Crescent ATN & TCL]

One interesting item in the plan document in the LD Business Plan discussion section. I don't know if the LD trains have had a focused marketing effort before to emphasize use of the LD trains for corridor services for city pairs or if this is a new effort aimed at giving the corridor service component higher visibility. The odd part is that it proposes to add premium service such as newspapers which, of course, are getting dropped from the LD trains to cut costs. Excerpt from the plan document:

Provide shorter coach trips competitive with other travel modes (C3)

Long-Distance will develop services for city pairs less than 750 miles aboard Long-Distance trains to serve markets not currently served by a State-Supported Corridor. By providing premium service to these customers, such as beverage service, newspapers, early boarding and Wi-Fi, Amtrak will become a more appealing alternative to competitive modes of transportation and will increase revenue with minimal investment.

Could this also be part of an effort to emphasize the most active city pairs to build ridership and collect data to support efforts to persuade state DOTs to consider starting a separate state supported corridor service on the route? Which would, in most situations, improve the cost recovery of the LD train because it is no longer the only passenger train for the stations over the segment and get the state to provide funds for track improvement projects. The success of the Lynchburg service shows the potential for using the demonstrated ridership demand on the LD train to get political support for adding a corridor service.

Sounds to me like they want to create business class on the LDs. Having a few perks for an upcharge in coaches with better seating would probably work.

Now as far as cutting wine, cheese,free soap, shampoo and lotion in sleeper, who cares as long as these items are available for purchase to everyone at reasonable prices.

A better level of coach is needed, one that is doable overnight rather than the current seats which to me only work for 3-4hr trips. I wouldn't call it business class but deluxe coach would work since most business people will be making overnight trips in sleeper.

 

[Crescent ATN & TCL]

This also brings up an issue, going forward how hard would it be to remove a booth or two from each cafe in rebuilds or in new cars to have more space for storing product to be sold enroute?

A major problem in most of the cafes seems to be storage. With more storage and better stocking from the IT upgrade in the sales and inventory system it should be possible to get more revenue out of the cafe cars.

 

[Eric S]

One interesting item in the plan document in the LD Business Plan discussion section. I don't know if the LD trains have had a focused marketing effort before to emphasize use of the LD trains for corridor services for city pairs or if this is a new effort aimed at giving the corridor service component higher visibility. The odd part is that it proposes to add premium service such as newspapers which, of course, are getting dropped from the LD trains to cut costs. Excerpt from the plan document:

Provide shorter coach trips competitive with other travel modes (C3)

Long-Distance will develop services for city pairs less than 750 miles aboard Long-Distance trains to serve markets not currently served by a State-Supported Corridor. By providing premium service to these customers, such as beverage service, newspapers, early boarding and Wi-Fi, Amtrak will become a more appealing alternative to competitive modes of transportation and will increase revenue with minimal investment.

Could this also be part of an effort to emphasize the most active city pairs to build ridership and collect data to support efforts to persuade state DOTs to consider starting a separate state supported corridor service on the route? Which would, in most situations, improve the cost recovery of the LD train because it is no longer the only passenger train for the stations over the segment and get the state to provide funds for track improvement projects. The success of the Lynchburg service shows the potential for using the demonstrated ridership demand on the LD train to get political support for adding a corridor service.

Sounds to me like they want to create business class on the LDs. Having a few perks for an upcharge in coaches with better seating would probably work.

Now as far as cutting wine, cheese,free soap, shampoo and lotion in sleeper, who cares as long as these items are available for purchase to everyone at reasonable prices.

A better level of coach is needed, one that is doable overnight rather than the current seats which to me only work for 3-4hr trips. I wouldn't call it business class but deluxe coach would work since most business people will be making overnight trips in sleeper.

That was my thought as well. I immediately thought about the Coast Starlight PIP that suggested adding business class on that train.

 

[afigg]

Sounds to me like they want to create business class on the LDs. Having a few perks for an upcharge in coaches with better seating would probably work.

Now as far as cutting wine, cheese,free soap, shampoo and lotion in sleeper, who cares as long as these items are available for purchase to everyone at reasonable prices.

A better level of coach is needed, one that is doable overnight rather than the current seats which to me only work for 3-4hr trips. I wouldn't call it business class but deluxe coach would work since most business people will be making overnight trips in sleeper.

That was my thought as well. I immediately thought about the Coast Starlight PIP that suggested adding business class on that train.

I think you are right. I was overthinking that bit in the LD plans with the reference to <750 mile city pairs. The "premium service" is about seeking to add business class to the LD trains, such as the plan for the Coast Starlight stated several years ago. Looks like Amtrak is considering where it would be worthwhile to add a BC section to other LD trains.