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The Future of Federal Support for Passenger Rail

In March 2013, the Brookings Institution released a policy report with recommendations for improving passenger rail in anticipation of the upcoming reauthorization of the Passenger Rail Investment and Improvement Act of 2008 (PRIIA). According to the report, Amtrak's ridership has soared in recent years along several short-distance metropolitan corridors, though it declined in long-distance markets. Further, Amtrak's short routes (less than 400 miles in length) produced a $47 million operating surplus in 2011, while its long routes suffered a $614 million operating deficit for the same period. On balance, Amtrak is running an operating deficit of $567 million.

With contentious annual debate around federal support for passenger rail, the report's authors discuss alternatives to current federal subsidies, such as shifting a greater share of rail responsibility to the states and building partnerships with the private sector.

Growing Ridership
Drawing on Amtrak's financial reporting and passenger statistics, Brookings identified several key trends since 1997, most significantly a 55-percent increase in ridership through 2012. Ten metropolitan areas, including Chicago, accounted for roughly two-thirds of this growth. Of all Amtrak trips between 1997 and 2012, 83 percent were less than 400 miles in length. These trips largely took place along heavily populated corridors of the East Coast and Midwest. For Brookings, this travel pattern presents several opportunities for PRIIA reauthorization.

First, the report recommends continuing the evolution of long-distance inter-metropolitan rail service. Building on existing state support for passenger rail, the report recommends that PRIIA reauthorization ensure that the states expand operating support for both short- and long-distance routes, including those over 750 miles.

Second, the report recommends that the federal government provide greater flexibility in the use of transportation funds, as well as dedicated funding for passenger rail. This two-pronged approach can alleviate states' burden in paying for passenger rail and would also allow states to scale up or down their level of commitment to passenger rail with respect to statewide conditions.

Lastly, the report urges the federal government to encourage the states to collaborate for joint procurement of railcars and to coordinate their respective state rail plans. Further, the report recommends that states should partner with the private sector to access capital markets and management expertise.

Amtrak and Metropolitan Chicago
The broader tri-state area that includes metropolitan Chicago, southeastern Wisconsin, and northwestern Indiana attracted about 3.7 million riders in 2012, making up six percent of total Amtrak ridership. This marks a 64-percent increase in area ridership since 1997, which is a significantly higher rate of growth than Amtrak's national average. Brookings analysis of data from a web-based interactive feature for the report shows that short-distance routes to or through Chicago saw ridership rise 102 percent since 1997, while ridership on long-distance routes increased 47 percent over the same period.

While the share of total Amtrak ridership is smaller in metropolitan Chicago than in cities on the East Coast, our region's higher than average growth share since 1997 underscores the increasing importance of passenger rail in the Midwest in general and in metropolitan Chicago in particular. The steadily growing demand for passenger rail should also inform debate about high-speed rail in Illinois and decisions about increased subsidy support if the federal government shifts an even larger share of Amtrak's costs to the states.