Segment 2 Of 3     Previous Hearing Segment(1)   Next Hearing Segment(3)

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PLEASE NOTE: The following transcript is a portion of the official hearing record of the Committee on Transportation and Infrastructure. Additional material pertinent to this transcript may be found on the web site of the Committee at []. Complete hearing records are available for review at the Committee offices and also may be purchased at the U.S. Government Printing Office.







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FEBRUARY 7, 10, and 13, 1995

Printed for the use of the

Committee on Transportation and Infrastructure


BUD SHUSTER, Pennsylvania, Chairman

WILLIAM F. CLINGER, Jr., Pennsylvania
THOMAS E. PETRI, Wisconsin
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HOWARD COBLE, North Carolina
JOHN J. DUNCAN, Jr., Tennessee
WILLIAM H. ZELIFF, Jr., New Hampshire
BILL BAKER, California
JAY KIM, California
STEPHEN HORN, California
BOB FRANKS, New Jersey
PETER I. BLUTE, Massachusetts
JOHN L. MICA, Florida
ZACH WAMP, Tennessee
RANDY TATE, Washington
RAY LaHOOD, Illinois
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NORMAN Y. MINETA, California
NICK J. RAHALL II, West Virginia
ROBERT A. BORSKI, Pennsylvania
ROBERT E. WISE, Jr., West Virginia
JAMES A. HAYES, Louisiana
BOB CLEMENT, Tennessee
MIKE PARKER, Mississippi
ELEANOR HOLMES NORTON, District of Columbia
PAT DANNER, Missouri
JAMES E. CLYBURN, South Carolina
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BOB FILNER, California


SUSAN MOLINARI, New York, Chairwoman

SUE KELLY, New York, Vice Chairwoman
JAY KIM, California
BOB FRANKS, New Jersey
JOHN L. MICA, Florida
BUD SHUSTER, Pennsylvania
(Ex Officio)

BOB CLEMENT, Tennessee
NICK J. RAHALL II, West Virginia
ROBERT A. BORSKI, Pennsylvania
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NORMAN Y. MINETA, California
(Ex Officio)



Proceedings of:

February 7, 1995

February 10, 1995

February 13, 1995



FEBRUARY 7, 1995
  Downs, Thomas, President, National Railroad Passenger Corp., AMTRAK, accompanied by Tim Gillespie, Vice President, Government and Public Affairs, AMTRAK

  Mead, Kenneth M., Director, Transportation Issues, Resources, Community, and Economic Development Division, U.S. General Accounting Office, accompanied by Dr. Frank Mulvey, Assistant Director, Ron Wood, Assistant Director, Deborah Justice, Evaluator, and Rick Jorgenson, Evaluator
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  Molitoris, Jolene M., Administrator, Federal Railroad Administration, Department of Transportation, accompanied by Donald Itzkoff, Deputy Administrator, Federal Railroad Administration and Mark Lindsey, Chief Counsel, Federal Railroad Administration


  Mineta, Hon. Norman Y., of California

  Molinari, Hon. Susan, of New York

  Lipinski, Hon. William O., of Illinois

  Nadler, Hon. Jerrold, of New York


  Downs, Thomas

  Mead, Kenneth M

  Molitoris, Jolene M


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  Downs, Thomas, Chairman and President, Amtrak, chart, State of Mississippi, Amtrak Facts

Mead, Kenneth M., Director, Transportation Issues, Resources, Community and Economic Development Division, U.S. General Accounting Office:

Chart, Federal Appropriations for Amtrak Fiscal Years 1988—95

Amtrak's Working Capital Surplus/Deficit, Fiscal Years 1987—94

Aging of Amtrak's Car and Locomotive Fleets

Ridership on Amtrak's Rail Passenger System FY 1993

Report, Intercity Passenger Rail Financial and Operating Conditions Threaten AMTRAK's Long-term Viability, February 1995*

  Molinari, Hon. Susan, a Representative in Congress from New York, response from the Railroad Retirement Board concerning impact of workforce reductions on Railroad Retirement Board trust funds

Molitoris, Jolene M., Administrator, Federal Railroad Administration, U.S. Department of Transportation:

Responses to questions from Rep. Lipinski
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Response to question from Rep. Nadler

Letter to Rep. Molinari, February 17, 1995

Examples of Approved Private/Public Partnerships Under ISTEA

Breadth of Private/Public Project proposals
Examples in the Partnership for Transportation Investment, chart

*Retained in subcommitte file.

FEBRUARY 10, 1995

  Barrett, Hon. Thomas M., a Representative in Congress from Wisconsin
  Barton, Hon. Joe, a Representative in Congress from Texas
  Bass, Hon. Charles F., a Representative in Congress from New Hampshire
  Biden, Hon. Joseph R., Jr., a U.S. Senator from Delaware
  Blute, Hon. Peter, a Representative in Congress from Massachusetts
  Castle, Hon. Michael N., a Representative in Congress from Delaware
  Clayton, Hon. Eva, a Representative in Congress from North Carolina
  Ehlers, Hon. Vernon J., a Representative in Congress from Michigan
  Gejdenson, Hon. Sam, a Representative in Congress from Connecticut
  Gekas, Hon. George W., a Representative in Congress from Pennsylvania
  Hefley, Hon. Joel, a Representative in Congress irrom Colorado
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  Hilliard, Hon. Earl F., a Representative in Congress from Alabama
  Hoekstra, Hon. Peter, a Representative in Congress from Michigan
  Jacobs, Hon. Andrew, Jr., a Representative in Congress from Indiana
  Moakley, Hon. John Joseph, a Representative in Congress from Massachusetts
  Montgomery, Hon. Sonny, a Representative in Congress from Mississippi and John Robert Smith, Mayor, Meridian, MS
  Neal, Hon. Richard E., a Representative in Congress from Massachusetts
  Pomeroy, Hon. Earl, a Representative in Congress from North Dakota
  Torkildsen, Hon. Peter G., a Representative in Congress from Massachusetts


  Barton, Hon. Joe, of Texas
  Biden, Hon. Joseph, Jr., of Delaware
  Blute, Hon. Peter, of Massachusetts
  Castle, Hon. Michael N., Delaware
  Clayton, Hon. Eva, of North Carolina
  Gejdenson, Hon. Sam, of Connecticut
  Gekas, Hon. George W., of Pennsylvania
  Lipinski, Hon. William O., of Illinois
  Neal, Hon. Richard E., of Massachusetts
  Torkildsen, Hon. Peter G., of Massachusetts

  Smith, John Robert, Mayor, Meridian, MS
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  Bachus, Hon. Spencer, of Alabama, statement
  Deal, Hon. Nathan, of Georgia, statement
  Frank, Hon. Barney, of Massachusetts, statement
  Rose, Hon. Charlie, of North Carolina, statement
  Wolf, Hon. Frank, R., of Virginia, statement

FEBRUARY 13, 1995

  Burnley, James H., Former Secretary of Transportation, (1987—1989)
  Capon, Ross, Executive Director, National Association of Railroad Passengers
  Downs, Thomas M., Chairman and President, Amtrak, accompanied by Tim Gillespie, Vice President, Government and Public Affairs
  Harper, Edwin L., President and CEO, Association of American Railroads, accompanied by Rob Blanchette and Charles Dettman
  Knappen, Theodore, Government Affairs Representative, Greyhound Lines Inc

  Lawler, Gregory E., Executive Director, Safe Transit and Rail Transportation (S.T.A.R.T.)


  Lipinski, William O., of Illinois

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  Burnley, James H
  Capon, Ross
  Downs, Thomas M
  Harper, Edwin L
  Knappen, Ted
  Lawler, Greg


Downs, Thomas M., Chairman and President, Amtrak:
Letter to Rep. Molinari, March 14, 1995
Response to question from Rep. Mica
Chart, Allocation Comparison to Annual Cost Payments FY95 Dollars (millions)
Northeast Corridor Common Use Costs Alternative Allocation Examples FY95 Dollars (thousands)
Amtrak Northeast Corridor Commuter Service Estimated Annual Train Miles (Train miles over tracks maintained and controlled by Amtrak) By User
Response to questions from Rep. Lipinski
Chart, Breakdown, by Railroad, of train and engine employees who have prior rights to freight railroad employment
Appendix C—2 to the National Railroad Passenger Corporation Agreement
Harper, Edwin L., President and CEO, Association of American Railroads:
Chart, FELA: Annual Trends, employment; injuries; payout: 1981—1993
Response to question from Rep. Molinari
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Letter and chart from M. Walrave, Chief Executive, Union Internationale des Chemins de fer, February 9, 1995


  Carmichael, Gilbert E., Former Federal Railroad Administrator, statement
  Carpenter, A.R., President and CEO, CXS Transportation, Inc, statement
  Hill, Barry T., Associate Director, Transportation Issues, Resources, Community and Economic Development Division, U.S. General Accounting Office, statement
  Horth, David R., Chairman, National Railroad Construction and Maintenance Association, Inc., statement
  Reistrup, Paul H., Chairman Emeritus, High Speed Rail/Maglev Association, statement



House of Representatives,

Subcommittee on Railroads,

Committee on Transportation and Infrastructure,

Washington, DC.

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  The subcommittee met, pursuant to call, at 10:07 a.m., in Room 2167, Rayburn House Office Building, Hon. Susan Molinari (chairwoman of the subcommittee) presiding.

  Ms. MOLINARI. Good morning. I don't have my gavel so I am pencilling you to order.

  Thank you and welcome to the Member's testimony on Amtrak issues hearing. I know that we have been joined, although he has been momentarily detained, by the Chairman of the full Committee on Transportation and Infrastructure, the Honorable Bud Shuster. We are also joined by the Ranking Minority Member, the Honorable William Lipinski.

  Bill, do you have an opening statement you would like to make?

  Mr. LIPINSKI. I have an opening statement that I will submit for the record, without objection. I just want to say that I am happy to be here to listen to our colleagues and what they have to say about the situation.

  Ms. MOLINARI. Thank you.

  [Mr. Lipinski's prepared statement follows:]

  [Insert here.]

  Ms. MOLINARI. We are joined by Mr. Mica from Florida. No statement. Mr. Quinn from New York.

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  Mr. QUINN. Good morning.

  Ms. MOLINARI. Good morning. Great.

  Now, if you all testify just that quickly, we will be done in no time. All right. Our first panelist we have this morning is the Honorable Joel Hefley from Colorado. Also, Joe Barton, if you would like to take your seat next to Mr. Hefley; you are also on our first panel. Thank you.


  Mr. HEFLEY. Thank you, Madam Chairwoman. I love Mr. Quinn's opening statement. If more committees operated that way, we would be in better shape.

  Madam Chairwoman, thank you for this opportunity to address your committee regarding the future of Amtrak. In the past, my efforts to reform Amtrak have not always been viewed with kindness. Last year, for instance, the chairman of Amtrak accused me of causing train wrecks. Just this December, the president of the Transportation Workers Union questioned my wisdom, my fairness, and my common sense. He then wished me a happy New Year.

  Well, it is a new year and in that spirit, I offer my support to the gentleman because whether he knows it or not, I may be the best friend that Amtrak has. Simply put, if Congress fails to enact major reforms, Amtrak will cease to exist, which presents Congress with a very clear choice. We can either maintain the status quo and watch Amtrak fade away or we can enact radical reform. Let me outline what Amtrak faces if we do nothing.
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  This year, Amtrak will receive $972 million from the Federal Government out of a total budget of $2.4 billion and will still incur a $76 million deficit. Every route, including the eastern corridor, loses money. Amtrak's cash reserves are gone, ridership is declining, service is poor, and many of its cars are literally falling apart.

  To slow the bleeding, Amtrak recently announced cuts of 21 percent of its services and 24 percent of its union employees. These cuts are part of a plan to reduce annual expenses by $430 million. Despite these actions, the GAO reports that Amtrak will still require annual subsidies of almost $1 billion, plus in addition to those annual subsidies, $1.3 billion over the next 5 years, plus approximately $4 billion in capital costs. Further, Amtrak must renegotiate its labor contracts and its track use agreements in the next few years, and I think most of us in the room know how difficult and costly these negotiations are likely to be.

  That is a bleak picture if Congress fails to act. Amtrak must attract an additional $10 to $15 billion through the end of the century to maintain its current services or it will be forced to continue cutting routes and employees. Amtrak's employees may retain their great severance packages but they simply won't have jobs.

  Now, here is what I think we can do to solve the problem.

  First, immediately reduce the excessive severance packages that Amtrak is required to pay. The current 6-year severance package represents a liability to Amtrak of over $2 billion. Free Amtrak from this and other excessive labor costs and they will be able to make the tough business decision other managers are free to make.
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  Second, eliminate congressional micromanagement. Under the congressional oversight, Amtrak is told how to operate and where to operate. The question of whether to open or to close a route is not a business decision, it is a political decision. We need to eliminate this meddling and allow Amtrak's management to focus its resources on its most promising routes.

  Third, slowly phase out Amtrak's subsidy. In order to succeed, Amtrak must be given the opportunity to fail. Until we wean Amtrak from Federal subsidies, it will never make the tough choices it needs to survive, even as it continues to prevent other operators from offering passenger rail service.

  Now, let me quickly address some of the criticisms raised against privatizing Amtrak.

  First, critics point out that all forms of transportation are subsidized, not just passenger rail. That is correct and maybe we ought to inspect some of the others as well. On the other hand, the bill for Amtrak over the next 5 years will far exceed any existing subsidy we provide. Spending $10 to $15 billion to provide intercity rail service to less than 0.3 percent of total intercity traffic is simply unjustifiable.

  Second, critics point out that most of our trading partners have government-run passenger rail services. The implication is if they do it, so should we.

  My first response is that most of these countries also have double digit inflation, excessive tax and regulatory policies and slow economic growth, and I don't think any of us would want to imitate that example. And further, most of these countries, including Sweden, Japan, and Argentina are privatizing their systems. In fact, most of the countries around the world are desperately trying to get loose from their government-operated or subsidized rail systems. But the United States shouldn't play follow the leader to anyone. If France wants to waste its money for subsidizing an inefficient transportation system, let them. Congress should make its own decisions based on the needs of the American people and the American people don't need a deteriorating rail system managed by politics rather than economics.
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  In a recent Los Angeles Times poll, 65 percent of those polled said cut Amtrak. I am asking the Members of this committee to listen to the American people, help save passenger rail service in the United States, and preserve the jobs of conductors and engineers across the country. Government mismanagement is killing passenger rail service in the United States. Let's privatize Amtrak and give it an opportunity to survive.

  Thank you, Madam Chairwoman and committee Members.

  Ms. MOLINARI. Thank you, Congressman Hefley.

  Congressman Barton.


  Mr. BARTON. Thank you, Madam Chairwoman. It is an honor to be invited to testify before your panel. I have got a written statement that I will submit for the record and I will summarize, hopefully, within the 5-minute green light period.

  I have a--I am here for two reasons. Number one, I have a stand alone bill that would change the current severance package requirement for Amtrak employees which gives them 1 year of severance pay for 1 year of service up to a maximum of 6 years. I have a bill that would reduce that 6-year severance package down to 6 months.

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  In 1970, when the U.S. Congress created Amtrak, there were 1,500 employees that had worked for the private railroads. The Congress at that time felt that it was uncertain whether passenger service would continue very long and so they granted a very generous package of severance to the existing employees of 1,500 people at that time, the 1 year of service up to a maximum of 6 years, which would give them 6 years of severance pay.

  Today in 1995, there are 24,000 Amtrak employees. Of the original 1,500 that transferred from the private sector, 35 of those are still on the payroll, 20 management and 15 nonmanagement employees, but we still have the same severance package for all 24,000 employees, which is 1 year per year of service up to a maximum of 6 years.

  If we terminated all 24,000, and we are not advocating that at all, but if that were to happen, it would cost $3 billion in severance. There is no other industry in the world that we can find that gives 1 year of severance pay up to 6 years, or a total of a 6-year severance package. The airline industry for some of their management employees have a 6-month severance package. The parcel post delivery system have 3 months. The aerospace and defense industry averages about one-and-a-half months, and bus line employees get no severance at all. So what my bill does is take the 6-year severance package requirement and take it down to 6 months, which would still be by industry standards the most generous in the United States of America.

  It is pretty straightforward. If you are pro-Amtrak, you should be for this because it will give management the flexibility to determine which routes to continue and if they have to move employees, which employees to move.

  Another portion of the law says that if you ask an Amtrak employee to move more than 30 miles and they refuse to do so, they also can get the 6-year severance package, so my bill eliminates the 30-mile rule requirement. So it just gives flexibility to Amtrak so that if they decide they need to move employees, if they decide that they need to terminate employees, they still get a very generous severance package but it is not the 6 years.
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  The other piece of legislation that I am testifying on behalf of is a bill that Congressman Frank Wolf and I have cosponsored. It sets up a commission based--similar to the Base Closing Commission, except we call this the track Commission. It would go out and take testimony from around the country. It would be a commission appointed by the President, and it would look at all the Amtrak routes, come back to the Congress and make recommendations on which routes might need to be eliminated.

  There are about 24,000 miles of Amtrak routes in this country. That has not significantly changed since the early 1970s. Some of these routes are mandated by Congress, so unless you have some sort of a base closing commission apparatus where it is an all or nothing situation, it is probably going to be very difficult for Amtrak to make any route rationalizations.

  So I am here for two reasons: A severance commission, a severance package change which would give Amtrak employees 6 months, but not 6 years, and an Amtrak route commission that would look at Amtrak routes like our Base Closing Commission has looked at the military bases.

  Ms. MOLINARI. Thank you very much, Congressmen.

  I would like to call on and recognize for an opening statement or questions at this time, the Chairman of the full committee, the Honorable Bud Shuster.

  Mr. SHUSTER. Thank you very much. We certainly welcome your testimony. I have had conversations with you individually about my dedication to streamlining Amtrak, and I couldn't agree with you more that we either have to streamline it to save it or it is going to be abolished, and so we have some tough choices and I hope that we make the right ones. Thank you.
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  Ms. MOLINARI. Thank you, Mr. Shuster. Mr. Lipinski.

  Mr. LIPINSKI. I want to thank both of you gentlemen for your testimony here. Unfortunately, there is very little common ground between your position and my position, so we won't waste anyone's time today going over that, but thank you very much for being here.

  Mr. BARTON. An honest man.

  Ms. MOLINARI. Let me see. Mr. Quinn--oh, I am sorry. I didn't see John leaning back there. Congressman Mica.

  Mr. MICA. I will pass. Go ahead.

  Mr. QUINN. I want to thank both gentlemen and the other panels we will have today, because this subcommittee, under the leadership of Ms. Molinari, will look at this in this coming year, and it is an expensive, expensive proposition. At the same time I think our efforts need to be channeled in such a way that we can keep train operation viable in this country. So we look forward to your help not only in this committee but outside with Members on the Floor in the House as we look at this issue in the next few months.

  Thank you.

  Ms. MOLINARI. Let me ask two quick questions and I will have a chance to go through your testimony and legislation for in-depth questions. First of all, Mr. Hefley, you are not talking about a zeroing out. You are talking about a phase out over how many years?
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  Mr. HEFLEY. I think our legislation does it over 4 years but we are not married to 4 years. The idea that we would like to get started would be that it is going to be a phaseout. Two things that you are going to phaseout, the subsidies in a certain period of years, and, secondly, you are going to release Amtrak from the micromanaging we do so that they can make business decisions.

  Ms. MOLINARI. And your phaseout would be towards the ultimate goal of privatization?

  Mr. HEFLEY. Privatization, yes.

  Ms. MOLINARI. Thank you.

  Mr. Barton, your bill says that the maximum severance that can be allowed for an Amtrak employee is 6 months, is that----

  Mr. BARTON. Yes, ma'am.

  Ms. MOLINARI. And that would not stand for the 30-mile rule requirement, that is basically what that one bill says?

  Mr. BARTON. My bill also eliminates the 30-mile rule requirement. Under current law, if you asked an Amtrak employee to move more than 30 miles from their current location and they refuse, they can invoke the severance requirement which gives them 1 year of severance pay for each of the first 6 years of service up to a maximum of 6 years. We would just repeal the 30-mile rule, and if you asked an Amtrak employee to move, let's say in my State from Houston to Dallas and they did so, obviously they would retain their job. If they did not do so, if they wanted to stay in the Houston area and find another job, they could get 6 months of severance pay but not 6 years.
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  Ms. MOLINARI. Let me ask another question about your track proposal. What if this commission found a line that was not profitable, yet the Governor or the mayor wanted to put up a larger percentage to keep that line running? How would you accommodate that under your proposal?

  Mr. BARTON. I am not as familiar with the track commission as Congressman Wolf, but my understanding is that if the local--not just the mayor, but if any local group wanted to take over the line, they could, but they would not receive any subsidy from the Federal Government for Amtrak. It would have to be privatized.

  Ms. MOLINARI. Is there a time line for that under the bill?

  Mr. BARTON. I can't answer that.

  Ms. MOLINARI. Okay. Well, we will look into those. Those are both very interesting proposals.

  As you know, we are going to go going to markup on March 21, so obviously we will be getting back to both you gentlemen before then. I want to thank you very much for your ideas and insights.

  Go ahead, Joe.

  Mr. BARTON. I didn't state in my opening statement, but I am told that the Amtrak management does support my severance realignment.
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  Ms. MOLINARI. Yes, I bet they do. Thank you very much, Joe. I appreciate that.

  Ms. MOLINARI. Our next panel, we are waiting for Congressman Frank Wolf who was supposed to be part of that panel. He is in a markup so we will fit him in when he comes in. In the meantime, we are going to be hearing from our next panel, the Honorable Sonny Montgomery, accompanied by the mayor of Meridian, Mississippi. I would just like to say before you begin, Congressman Montgomery, that Congressman Spencer Bachus was also here. He has left his testimony. He is in a markup, too, and will try to come back and join us afterwards. So----

  Mr. MONTGOMERY. If you get him to come back, I have his statement to be put in the record.

  Ms. MOLINARI. Thank you. We appreciate that. Without objection, so ordered and welcome.


  Mr. MONTGOMERY. This is the first time I have ever been here when the red light was on.

  Ms. MOLINARI. You have got to learn to speak a little faster, Sonny. What can I say?

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  Mr. MONTGOMERY. I am going to bring Barney Frank over here.

  Ms. MOLINARI. Thank you very much. Would you please proceed?

  Mr. MONTGOMERY. Madam Chairwoman, I wanted to congratulate you. You have the nicest nameplates on the House side. I want to thank you for giving us this opportunity and for the Chairman, Bud Shuster, and others here today, good friends. Thank you for having this hearing to let us participate.

  Now, passenger rail service is important to communities in Mississippi from an economic viewpoint. Millions of people, as you know, depend on it each day for riding the Amtrak, and let me point out, Madam Chairwoman, that a lot of people are really afraid to fly, especially in the deep South, and they need some way to go long distances. It is important that we keep rail service, and we are not particularly proud of this, but the income of the people of Mississippi, as well as other States that surround us, it is a lower income. They don't have automobiles. They can't fly. They don't have the money and Amtrak and rail service is the only way that they can move about, so we are totally supportive of Amtrak.

  I know it needs cleaning up some. It is in trouble financially. As I talked to you earlier, it is your job to work out how we finance it.

  I might say, at this time with your permission, Madam Chairwoman, I would like to introduce my mayor from my hometown, John Robert Smith. He has been quite involved in efforts to save Amtrak service in the southeast corridor. He is not only representing Meridian but he is speaking on behalf of the National League of Cities and Conference of Mayors. And the future of Amtrak is a big issue for all the mayors. Mr. Smith will share those concerns and recommendations, and I appreciate very much being able to yield to Mayor Smith.
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  Ms. MOLINARI. Thank you, Congressman Montgomery.

  Welcome, Mayor, please proceed.

  Mr. SMITH. Thank you, Congressman.

  Representative Molinari, other Members of the committee, I am honored to have this opportunity to address you this morning as the mayor of Meridian, Mississippi, one of the 530 Amtrak cities across our country. As the Congressman said, I am also speaking for the U.S. Conference of Mayors and the National League of Cities, which together represent thousands of our communities, large and small, throughout this country. Many of those communities have been negatively impacted by the cutbacks or elimination of service that Amtrak implemented on February 1.

  I want to call your attention to a letter which is attached from the president of the U.S. Conference of Mayors, Mayor Victor Ashe of Knoxville, Tennessee, which underscores my point and I would ask that his letter be made a part of the record.

  The rail passenger needs of our communities are diverse. Some cities need Amtrak for commuter service, others to bring our rural residents into our metropolitan centers, and still others for those trips that span our Nation's length and breadth. I think it is interesting to note that in Meridian, Mississippi, our monthly boardings of Amtrak are near the maximum allocated and those are just slightly below the boardings at our regional airport. So I think that also underscores that in our area we have a real demand for reliable rail passenger service.
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  While our communities may vary greatly in their size and demographics, there are two fundamental points that bind us together. The first, our cities, States and Nation will continue to face the challenge of moving our people from place to place, for providing linkages between our rural residents and our urban centers, and for fueling economic development.

  Secondly, we cities are firmly committed to the principle that Amtrak's mission is to provide efficient, effective rail transportation service nationwide. We are not interested in pitting one line against the other, vying for service. What we clearly must be about is working together to build and improve that nationwide network which our people need and demand.

  All of us affected by Amtrak understand that Congress has mandated that Amtrak cut costs, and we agree, but when those decisions for cutting back were formulated, the leaders of our cities and States had no opportunity to express their views as to how Amtrak could become more productive and still meet the market demand. The cutbacks were announced and slightly more than a month later they were implemented. This gave our cities no time to form the alliances necessary to address such an issue.

  The cities along the Crescent route, which runs from New York to New Orleans, did come together from Anniston, Alabama, to New Orleans, Louisiana. We have asked Amtrak for two things: First, a 90-day moratorium on these cutbacks and, secondly, that a 7-day, coach-only service along the Crescent south of Atlanta be instituted instead of the cutback to 3-days only full service.

  While we had no voice prior to Amtrak cutbacks, we cities must and are fully prepared to be partners in formulating long term, as well as short-term solutions, and I come to you today with two recommendations. First, that you impanel a special committee of railroad experts and elected officials to take the next 90 days to study the proposals on the table and bring them back to Congress. Secondly, that during that 90 days, full Amtrak service be restored.
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  I will try to be brief and close.

  States need the flexibility in using their Federal transportation funds to address corridors that better serve our people. We need that flexibility. Cities play an important role because we provide the infrastructure for Amtrak. We can reduce the number of grade crossings, making the trains more efficient.

  Two things Meridian has already done. There are 100 cities building multimodal transportation centers, Meridian is one, which brings all of the modes of transportation together under one roof, air, rail, and bus are coordinated in those services.

  We can also help merchandise Amtrak. I believe we have the resources necessary to make these decisions. I believe we have the collective will to make these decisions and I offer the support of mayors throughout this country to be a part of that process. We ask to be at the table when those decisions are made. Thank you very much.

  Ms. MOLINARI. Thank you very much. Mayor, you raised some very interesting proposals.

  I would like to welcome Congressman Hilliard.


  Mr. HILLIARD. Thank you very much, Ms. Chairman, and also thank the committee for giving me the opportunity to speak to you this morning about something that is very important, not only to the district that I represent, not only to the State of Alabama, but to this entire Nation, and if the committee reserves, I would like to have the opportunity to revise and extend my remarks.
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  Madam Chairwoman, one of the problems that we have had with Amtrak has been the lack of capital, the lack of capital in terms of modernizing the fleet. It has not had the opportunity from the old Penn State days to come up with the necessary capital to finance its expansion, to finance its growth, and to remain modern. So because it was saddled with this burden, it has never had the opportunity to operate at a break even point.

  I realize that there is a growing deficit, but I also realize that for the future of this country, we need to maintain this service for several reasons. The most important reason that I can think of is the ever increasing demand for transportation linkages between our major cities, and even within the cities of this country. We know that there will be many more hundreds of thousands of cars on the highways. We know what the demand would be on our highways. The only way we are going to be able to adequately plan for the transportation needs of this country is to make sure that we have alternate forms of transportation. Amtrak will provide that in the future.

  But over and beyond all of those other things, if we would just look at the environmental concern, we would realize that Amtrak is ill and should be the number one mode of transportation in the 21st Century. It is pollution free virtually, and there is no other mode of transportation that can claim that access. So we must preserve, protect, and expand on that.

  Now, in the past, Congress has set up a highway trust fund. It has set up an airport tax to expand the need of our air services. I feel that one of the things that we must do and the President has asked for it in his budget is to temporarily borrow funds from those trust funds and set up another one that would protect the integrity of the rail transportation system until one can be put in place so that we would be able to provide for the future rail transportation as we provide for highways, as we provide for airports.
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  There is a dire need for this. The market is going to be expanding, and let's face facts. Rail is clearly the transportation of the future, and I realize that everyone is in a deficit reduction mood, including the Speaker, but there are several things that we must take into consideration, and it is the future of transportation in this country.

  I would like to submit my entire text for the record, but at this time, Mr. Chairman, I would be happy to answer any questions you may have.

  Ms. MOLINARI. Thank you very much.

  I would like to welcome and introduce the Vice Chair of this committee, the Honorable Sue Kelly.

  Sue, do you have any?

  Mrs. KELLY. No, thank you very much. I will reserve the right to insert a statement in the record at a later date though, Sue. Thank you very much.

  Ms. MOLINARI. Without objection, so ordered.

  We would like to welcome Mr. Cramer.

  Mr. CRAMER. Thank you, Madam Chairwoman.

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  Just very quickly, I am your neighbor in north Alabama there and I understand the problems that we have there with rail service. We are in an awful mess, though, with Amtrak and we have got to make some really tough decisions, but I think it is important that we hear, mayor--Sonny, you brought the mayor here. I think it is very important that we hear your perspective in this as we work through this. I know, Earl, we have heard from your constituents as well, so thank you for bringing this important message to us.

  Thank you, Madam Chairwoman.

  Ms. MOLINARI. Thank you, Mr. Cramer. Mr. Boehlert from New York.

  Mr. BOEHLERT. I will be very brief, Madam Chairwoman.

  I just think what you are saying is music to our ears because anyone who looks at the situation knows full well that rail passenger service is an efficient way to move people from point to point. It is low cost, it is energy efficient, it is environmentally sound, and we have got to make it work.

  There isn't an industrialized nation in the world that doesn't subsidize rail passenger service, and we should lead the way, and I think what we are doing in cooperation with the leadership of Amtrak will prove that we can do it smarter and better in the future.

  Thank you all very much for your willingness to share with us your points of view.

  Ms. MOLINARI. Thank you, Mr. Boehlert. Mr. Lipinski.
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  Mr. LIPINSKI. Thank you, Madam Chairwoman.

  Mayor, you were saying that you are--are you representing the U.S. Council of Mayors here?

  Mr. SMITH. Yes, sir, I am.

  Mr. LIPINSKI. And what is the other?

  Mr. SMITH. National League of Cities.

  Mr. LIPINSKI. Have they taken a formal position in regard to the Amtrak situation?

  Mr. SMITH. You have a letter from Mayor Ashe and there is also a statement included in my remarks which you have before you from the president of the National League of Cities supporting the cities being at the table in this solution and a nationwide rail service. This is not just a metropolitan issue. This is a rural issue as well. It affects the northern tier of States as well as the Southeast, so they are in support. We have only had a month now so it has been hard to impanel the mayors for a formal statement, but I have requested such and Mayor Ashe will call for Amtrak mayors to convene.

  Mr. LIPINSKI. Have the mayors had any discussions on trying to come up with some additional subsidy for Amtrak in order to keep it going out of their own revenue pool?

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  Mr. SMITH. No, sir. We see--I am speaking now just personally. I see----

  Mr. LIPINSKI. We will get to you personally. But they haven't made any statements or passed any resolutions saying that as the National League of Cities, or the U.S. Council of Mayors, they would be willing to consider helping to subsidize Amtrak to keep it coming into their community?

  Mr. SMITH. No, sir, they have not been impaneled yet.

  Mr. LIPINSKI. You want to speak for yourself?

  Mr. SMITH. I would say that the cities' part in this is providing a well-located, safe and secure location for all of its transportation services for making--for reducing the rail crossings, which greatly increases the speed of Amtrak and the safety of Amtrak, and helping market Amtrak services. That is where I think the city comes in. If the State had the flexibility, for example, through Mississippi, to have a passenger mouth from Meridian from Jackson and Vicksburg on to Dallas making a complete link from the west through to Washington and New York, then we need that flexibility at the State level to use transportation funds to make such a commitment.

  Mr. LIPINSKI. Would the--do you have any idea if the State of Mississippi would be willing to add to the Amtrak subsidy to keep the trains running in Mississippi at the present time?

  Mr. SMITH. I think if the State of Mississippi had the flexibility to use some of its Federal transportation funds for newer additional services at this time, until Amtrak has a course set for the future, I think the State would be reluctant to use State funds, not knowing where the future of Amtrak lies. I think we need that vision.
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  Mr. LIPINSKI. Well, in the State of Wisconsin, as you may or may not know, there was a route, the frequency between Chicago and Milwaukee was being, oh, probably cut by two-thirds, and Governor Thompson had a meeting just the other day with Amtrak, and he came forth with $150,000 from the State of Wisconsin's transit funds to keep the frequency going on this route for a particular period of time while they continued to negotiate a long range solution to the problem.

  So I am saying precedent has occurred where a State has come forward to maintain either their route or the frequency of their route. That is why I was asking if Mississippi would be inclined to do so to preserve what you have at the present time.

  Mr. SMITH. And I obviously can't speak for Governor Fordice and I am familiar with Governor Thompson's actions. I have read his letter to President Downs and I am certainly aware of--I believe it is the Hiawatha line that was cut back so remarkably and it has affected his State in a very severe way.

  Mr. LIPINSKI. That is correct. Thank you very much, Mayor.

  My colleagues, thank you very much for testifying here, appreciate hearing from you. Thank you, Madam Chairwoman.

  Ms. MOLINARI. Thank you, Mr. Lipinski. Mr. Quinn.

  Mr. QUINN. Thank you, Madam Chairwoman.

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  Mayor, I am a former elected official in the town of Hamburg, in upstate New York, so I am pleased to have you here for us to hear firsthand the situation in the city and with the local elected officials. Let me just ask you, not a technical question, but for a sense that you may or may not have. Are the residents, your constituents, or Sonny's constituents, are they aware, do you think, of the financial conditions we are talking about here with Amtrak?

  Mr. SMITH. In Meridian, I believe they are because, obviously, our local paper has followed my fight in this situation. They understand Amtrak's financial crisis. What they don't understand is that Meridian boards 1,700 passengers a month. There are frequent months between November and March that we turn away 1,700--we can't board because there isn't room. I tried to get passage on Amtrak for the National League of Cities meeting here in March. There was no room, et cetera, left for me and my two children. There were only five seats left on the whole train. Our citizens don't understand that if the train is maxed out in boardings, then where is the financial problem? We have got the ridership.

  Mr. QUINN. The tough decision that Mr. Lipinski and others have talked about here, will have to be made in a partnership situation with cities and towns and States and the Federal Government are important. I think one of the challenges for us as elected officials, yourself and the people here and our colleagues on either side of you at the table, is to make sure that we explain that difficulty and then our solutions to that.

  Mr. SMITH. Our city, besides closing grade crossings, is committing over a million dollars, combined with ISTEA funds, for a $5 million project of a transportation center for Meridian, Mississippi. We have two interstate highways, three major railroads, longest runway in the State, so we understand transportation is important. We are doing that. We are making that commitment. If the States had more flexible use of their Federal transportation funds, I think they would be more agreeable to participate.
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  Mr. QUINN. That is good. Thank you. And I would like to thank of course our colleague, Mr. Hilliard.

  And, Madam Chairwoman, if I may indulge for just one minute, I had an opportunity with Mr. Sonny Montgomery at the other end, I guess, when he was our Chairman in Veterans and I served with Sonny on the Veterans Affairs Committee. He is the Ranking Member now, and for the record, I would like to mention his hard, hard work on behalf of your constituents at the veterans' hospital and the phone home program that he and I worked on the last year or two to make sure that your constituents and our constituents are best served, whether it is a transit question with Amtrak or whether it is our veterans who have served the country. So, Sonny, I want to thank you for your leadership on that issue. Thank you for having the mayor here today. Thank you, Madam Chairwoman.

  Ms. MOLINARI. Thank you, Mr. Quinn.

  Mayor, let me just ask you one question. In reauthorizing the legislation, and you can sort of get the sense from the questions that my colleagues are asking, we want to bring local officials, whether it is to determine if there are other opportunities to present an argument, albeit probably nonbinding to Amtrak, and in many cases to give people the opportunity to see if there are alternative funding sources, whether through the transit fund or other areas of the State or city budgets, would you--would you or the National League of Cities be willing to take a position in support of a portion of the Amtrak reauthorization that states--I am just thinking this through on the basis of your testimony--that before there can be a reduction in service, and we will have to define that as more stringently than being a half-hour late or something like that, but before there is a drastic reduction of service or before there is an elimination of a line, that we put forth some kind of assessment period where the operators of Amtrak have to come to the affected community, hear public testimony and negotiate?
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  Mr. SMITH. Well, we would--at least the city of Meridian would certainly welcome that, and I think other mayors have asked for an opportunity to be heard and an opportunity to participate.

  Ms. MOLINARI. I guess what we are hearing more and more from elected officials, in some cases House Members and Senators, is that if they only knew, they would be willing to put up a larger portion of their State or city resources because while that line may or may not make economic sense, it makes very important transportation sense to the people there and so therefore they would be willing to increase subsidization, but they weren't given the opportunity.


  Mr. MONTGOMERY. Madam Chairwoman, I think you are right on target there. I think that the States and local communities have to get involved in this and help out, but I think it is going to be left up to this committee to kind of give us some guidelines, and as you and I talked earlier, you are going to have to change some of these laws that affect the crews and the way you run this railroad system. We had that problem in Mississippi. We maybe had too much crew by State law and we changed that and now the railroads, private railroads are making a good profit, and it can be done and it is really up to your committee now to tell us how to do it.

  Ms. MOLINARI. Your point is well taken. Thank you very much.

  Congressman Hilliard.

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  Mr. HILLIARD. Yes, Madam Chairwoman, we have in Alabama what we call the Council of Cooperating Governments. Actually, it was started in Alabama but it consists of Georgia, Mississippi, Louisiana, and several municipalities will be in those States, and the State of Alabama I know because I have served on the Finance Committee for years, has made contributions to rail service in the millions in Alabama in order to maintain certain routes, and now the Council of Cooperating Governments also made a similar proposal in order to get a train experimentally from Tuscaloosa to Atlanta before and during the Olympics, and each one of those municipalities has already contributed money to this effort, and each one of those States, by the way. So I sense from that experiment that these municipalities and these States are willing to contribute to maintaining the service.

  Ms. MOLINARI. So not only do we have to contact the affected municipalities or States, but in some cases entertain joint ventures between localities and States to see if, based on the financial conditions, if there is a cooperative agreement that can be made.

  Mr. HILLIARD. Absolutely.

  Ms. MOLINARI. And I guess all that may need is some statutory requirements and some time. Okay. Well, thank you very much.

  Mayor, Congressman Montgomery, Congressman Hilliard, I thank you very much for not only bringing your concerns but your suggestions to the table. They will be--we will give them some serious thought and look forward to working with you towards the future reauthorization to see what we can do.

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  The gentleman sitting at either side of you do a tremendous job of representing their constituents and the fact that you are here, Mayor, is a testament to all that you can do to provide service to your constituents and we thank you for your time and energy to be here this morning. Thank you. Thank you very much.

  Congressman Hilliard, I just would like to add also, you weren't here when Congressman Spencer Bachus was here too, but to assure you he is a very active Member of this subcommittee and I am sure that the constituents of your States will be well represented while we are doing the behind-the-scenes marking up, too. So I just wanted to let you know he was here and he left.

  Mr. HILLIARD. Thank you.

  Ms. MOLINARI. Thank you.

  Ms. MOLINARI. Our next panel will be the Honorable Peter Hoekstra, the Honorable Andy Jacobs, the Honorable Vern Ehlers.

  Vern, you may speak from here or there, whichever you prefer. Is the Honorable Thomas Barrett here? Here he is. Tom, why don't you come in and take a seat. And Earl Pomeroy is late. So if he comes in while you are giving your testimony, we will sit him down.

  I would like to thank all three of you for being here and welcome you. We will begin with the Honorable Peter Hoekstra.

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  Mr. HOEKSTRA. Good morning. Madam Chairwoman. I would ask that--I will be brief and--shorten my comments and ask that the entire statement be put into the record.

  Ms. MOLINARI. Without objection, so ordered.

  Mr. HOEKSTRA. I am here today because I want to talk a little bit about what has happened with Amtrak in my district.

  They eliminated a route in my district, but that is only part of the process. I was disappointed when I heard that, but as a former businessman, I can appreciate the business decisions that Amtrak has to go through to try to enhance efficiencies and make Amtrak profitable, or at least economically viable. This is especially important as we all prepare to tighten our belts and I don't want to present the classic case of do whatever it takes, just don't do it in my own backyard.

  However, I do believe that we are entitled to certain things and one of those things is information, information that would confirm that Amtrak's decision to eliminate the route makes sound business sense. Many of my constituents are negatively impacted by Amtrak's decision, and I want assurances that the decision was a last resort and that all other options have been considered carefully.

  Unfortunately, my experience with Amtrak has not been very good. For the past 2 months I have experienced a lot of trouble getting information, that I need. Upon learning of Amtrak's decision to eliminate service on the Pere Marquette line on September 19, I sent a letter to Amtrak President Tom Downs with four sets of detailed, yet I thought straightforward, questions with regard Amtrak's decisions. Today, I have not received satisfactory information answering those questions.
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  At a time when some had proposed privatizing the railroad or eliminating all Federal subsidies to the railroad, I would have expected that when Amtrak came out with these announcements, that they would have a well-conceived plan to explain its reorganization efforts and to work with Members of Congress, but perhaps more importantly, with local officials to gain support for the proposal.

  My experience with Amtrak so far demonstrates that I was pretty much off track. I am very concerned about the process undertaken by Amtrak in making and announcing this decision. I think that confirms what you heard from the previous panel. The process needs to be improved. Taxpayers and community leaders have a right and a need to know the specifics about how route decisions are made. That information has been difficult, if not impossible, to receive.

  Also, it seems reasonable to ask Amtrak to attempt to work with State and local officials to see if there are any ways to save a route before making decisions to eliminate it. Yet the local officials along the Pere Marquette line were given no prior knowledge that the route might be eliminated. In effect, they were given no opportunity to help solve the problem, help solve Amtrak's problem and their constituents' problems.

  To be fair, the process is now improving. I am encouraged that the Michigan Department of Transportation and Amtrak currently are discussing possible ways to keep the line running, and in fact held an extensive meeting on this subject in Chicago this past Monday. I encourage this process to continue. Nonetheless, overall communication between all interested parties needs to improve. And I believe that the burden should be on Amtrak, not the State and local representatives, to communicate its plans.
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  I encourage Amtrak to continue to work more closely with Federal and local officials as it tries to streamline the railroad and make it more economically viable, but I also encourage this committee to work with Amtrak to develop legislation that will allow Amtrak to stand on its own feet, to provide a reasonable, affordable and effective transportation alternative for our country. Amtrak is a great potential service. I come from a marketing background and I believe that Amtrak has not been fully marketed. I also challenge this panel to put in effect market forces, creativity that will enable rail service to become an effective profitable component of our transportation system.

  Thank you, Madam Chairman--Chairwoman.

  Ms. MOLINARI. Whatever. Thank you, Congressman Hoekstra.

  Congressman Barrett.


  Mr. BARRETT. Good morning. Thank you, Chairwoman Molinari, for providing this opportunity to discuss the future of Amtrak. Many people in Milwaukee County, which I represent in Wisconsin, build their lives around reliable rail service and the uncertainty that surrounds the fate of Amtrak is keeping people from making informed decisions about their jobs.

  In many ways, my experiences are similar to the experiences of the previous Speaker. In December of last year, Amtrak announced the elimination of the Hiawatha which connects Milwaukee to Chicago with seven round-trips daily. This route is extremely important to the people of Milwaukee County. It was insane that Amtrak provided no advance warning that the Hiawatha was targeted for elimination, particularly after a study that did not even consider reducing the number of daily trips before announcing total elimination.
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  Earlier this week I was pleased with the announcements that the Hiawatha will be maintained, at least until June 30 of this year, under an agreement between Amtrak and the State of Wisconsin. The number of daily round-trips will shrink from seven to four and the State will contribute $150,000 towards the operation of trains. Amtrak has also tentatively agreed to continue service through June of 1996 pending a formal agreement between Amtrak and the State.

  Ironically, since 1989, the Hiawatha has led all other routes in ridership growth by a considerable margin, accounting for over 30 percent of Amtrak's growth nationwide from 1989 to 1993. While Amtrak's revenues nationwide have stagnated, revenues for the Hiawatha have doubled since 1989.

  I understand that Amtrak must act quickly to eliminate its revenue shortfall. Unfortunately, the consultant study commissioned by Amtrak was only a snapshot analysis of 1 year's performance. It completely ignored the growth this route has experienced and we should make sure that the routes with the most promise are retained if we hope to have an effective intercity passenger rail system in this country.

  I ask you, Madam Chairwoman, and Amtrak to help me in preserving a route with such promise and I ask that you remain mindful of the importance of passenger rail beyond the eastern seaboard. Unfortunately, Amtrak seems to think that when you are talking about the United States, you are talking about the original 13 colonies. This bias is reflected in the President's new budget. For fiscal year 1996, the President recommends that funding for the Northeast Corridor increase by $35 million while operating and capital subsidies for routes across the rest of the country or across the country decrease by $188 million.
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  Because I am convinced the Milwaukee-Chicago corridor could be a profitable investment, I am looking into legislation that will give Wisconsin the freedom to secure passenger rail service for years to come. Specifically, we should study how to involve companies in--interested in operating a route and we should look at letting States use their highway funds to cover some of the costs of passenger rail. I hope to work together with this committee in putting this legislation together.

  Under the agreement reached between Amtrak and the State of Wisconsin earlier this week, the State plans to open the route up for competitive bidding for service beginning in July of 1996. The president of Amtrak has already said that Amtrak will be one of the bidders. In order for private entities to consider taking over the line in 1996, something I am interested in, Congress would have to remove the legal obstacles that currently limit passenger rail service to Amtrak alone.

  Right now Amtrak is the only corporation authorized to provide such a service. As Amtrak continues to scale back service, we should consider providing other rail corporations the authority to work directly with the States. We also need to look at letting States use highway funds to help defray rail costs. Without passenger rail in a heavily traveled corridor like Milwaukee to Chicago designated as a nonattainment zone under the Clean Air Act, congestion and air pollution caused by highway traffic will worsen.

  It is also time for Federal agencies to work together. At a time when EPA tells us that it will not enforce a mandate to reduce emissions from cars because it is unworkable, it makes sense for States to have the freedom to use highway funds to alleviate congestion and air pollution. As this Congress asks more and more of the States, we should also give the States the freedom to choose a transportation project it considers most worthwhile, like intercity passenger rail.
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  The people of Milwaukee are not looking for a handout or a fat subsidy for an inefficient line. If Amtrak doesn't want to serve this area, I ask Amtrak to give us a fair lead time to find investors. I ask Amtrak to give us all the information, all the information it has on this run so we can work with people who want to work with us, and I ask Amtrak not to expect support from legislators beyond the original 13 colonies.

  Thank you again for the opportunity to appear before you and I express my thoughts on this important issue.

  Ms. MOLINARI. Thank you very much, Congressman Barrett.

  Congressman Jacobs.


  Mr. JACOBS. Whatever, I think it might be best, just as it is, Mr. Chairman, to address you as Mrs. Chairwoman. Just a recommendation for the record. My sister is fond of replying to salesmen who call her ''madam'' by saying, ''Don't call me madam, I just work here.''

  Ms. MOLINARI. Why am I not surprised somebody in your family would have that as a response?

  Mr. JACOBS. I am privileged to appear before at least one-half of the 10 most prestigious married couples in the United States. Yes, if you read Roll Call and they refer you to People, and then you really know.
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  Ms. MOLINARI. It is romantic couples. It is the 10 most romantic couples, but my husband would probably prefer that I didn't remind you of that.

  Mr. JACOBS. But I'm you are. If you viewed rail transportation strictly as one more business, then of course much of Amtrak is indefensible as a government operation. If on the other hand you view it as partly a public service, in which much of the public does not participate but one day much of the public might wish that it had not disappeared, then you get a different view of it, something more like the problem that we had in 1983 with the social security system.

  It was desirable to continue the social security system. We had what we call the bailout. The bailout involved sacrifices, both on the part of the working public who paid more social security tax, and on the part of the retirees who were best off to pay a little bit of income tax on their social security benefits. That income tax was immediately redeposited in the social security trust fund. But that, in essence, was deemed to be a national purpose.

  The Postal Service these days is a little bit controversial, but the fact remains that for 32 cents you can mail a letter to your neighbor across the street, or to your Aunt Bertha in Mule Shoe, Texas. Now, that is not a profitable line from most people's houses, let's say, north of the Mason Dixon line down to Mule Shoe, Texas, but it is thought to be in the public interest and Benjamin Franklin would probably still think it is a good idea.

  I think that we should give some exercise to viewing the Amtrak system as being in the nature in a sense of one of our national parks. In the midst of the Civil War, Abraham Lincoln said, this is one Nation and we shall continue the construction of the Union Pacific Railway.
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  When I was 18 years old, I thought it would be a good shot to join the Marine Corps Reserves because you got to wear the uniform once a week and, frankly, it was easier to get dates in my town that way. You usually pay for little slick operations like that, and a year later the Korean War broke out. I didn't crawl far enough underneath my front porch and they took us by the southern route across the Rocky Mountains. If anybody has never done that and doesn't understand the concept of Amtrak and public subsidy being in the nature of a public park, you ought to do it and then you would not want to foreclose that possibility for your progeny.

  So I think as all of the witnesses have said, almost all, that there should be sacrifice, both from the participants and from the general public, but I would say, using the words of honest Abe, that we ought not let it perish from this part of the earth.

  Ms. MOLINARI. Thank you very much.

  Congressman Pomeroy.


  Mr. POMEROY. Madam Chairwoman, thank you, and I also want to extend my congratulations. It is better to be one of the most romantic couples than one of the most prestigious couples. I am sure my wife would tell you I have managed to be neither.

  Ms. MOLINARI. We might get her up here to testify.
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  Mr. POMEROY. I wish I could tell you this morning I have got the silver bullet for Amtrak funding, but I don't. I do want to tell you a little bit about how important Amtrak is to North Dakota which surely represents some of the most sparsely settled terrain that Amtrak presently runs through.

  In 1993, 80,000 North Dakotans road the Empire Builder, the northern tier route from Minneapolis to Seattle. This may not seem like a high number, particularly with regard to the Northeast Corridor but it represents a full 13 percent of my State's population. North Dakotans from all along the Amtrak route--Fargo, Grand Forks, Devils Lake, Rugby, Stanley, Minot, and Williston have been contacting me and expressing their concern about the recent service reduction and about the future of passenger rail service at all. In fact, a bill has been introduced into the State Legislature urging restoration of the service cuts and the continued funding of Amtrak.

  Why do we feel so strongly about rail service in North Dakota?

  To understand you would probably have to visit our State. If you have been there, you know North Dakota is all about wide open spaces. It is one of the reasons we love it, however, our remoteness poses a serious challenge in keeping people connected to the national transportation system.

  Today, agriculture accounts for half of our economy. However, the continued modernization of agriculture means fewer people are actually employed on the farm and as a result, North Dakota's top priority is to attract new economic development, provide new opportunity for our young people. Unless we are an integrated part of a national transportation network, we are not going to be able to be very successful in that pursuit. Amtrak is a vital part of that system.
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  Amtrak service is even more important as our regional air service is now threatened by cuts not just in the fiscal year 1996 budget, but rescissions proposed by this administration on essential air service cuts, endangering air transportation.

  Some of the same areas served by Amtrak, I might add, are going to be really hit hard in the event those rescissions go through. Many of the areas served by the Empire Builder have few public transportation alternatives. As you can imagine, in the dead of winter in North Dakota where road conditions are treacherous, the train is far preferred by many as a transportation opportunity. In fact, for the seniors, the disabled, and many without access to private transportation, the train is a necessity. Others will give you some justification for the Amtrak budget but I believe a few numbers bear repeating.

  In 1994, Amtrak funding constituted a meager 3.1 percent of the total transportation investment, down more than half from the 7.3 percent in 1982. In the opinion of this Member, passenger rail service is well worth this relatively small amount of money.

  Madam Chairwoman, thanks for hearing me and that concludes my testimony.

  Ms. MOLINARI. Thank you very much.

  We appreciate both you gentlemen testifying and I know we have a vote, but I suppose it is safe to assume you would concur with the direction that we were taking in the prior panel relative towards, if there is a financial need according to Amtrak's board of directors to eliminate a line, that we, in the reauthorization, make sure that they come back to a community to hear their response and to see what the community response would be.
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  Congressman Pomeroy, Congressman Jacobs, I assume from what you have said you think that there is an opportunity for States and cities, if we free up perhaps some transit trust fund monies, for them to come in and compensate in areas where the need may be.

  Mr. POMEROY. I think that Representative Barrett makes a good case and when you look at Milwaukee to Chicago, you have got an entirely different opportunity for local financing than you do running from Rugby to Minot, a town of 50,000. And the opportunity for local contribution is simply going to be more strained in a more rural area like I represent.

  Mr. JACOBS. But it is still worth it.

  Ms. MOLINARI. Thank you very much. Thank you, gentlemen.

  As you all know, we are about to go for a vote. We will be back in about 5 minutes to reconvene.

  [Brief Recess.]

  Ms. MOLINARI. Good afternoon, Senator Biden. Your timing is impeccable. Sorry, guys. You don't have to bow, Peter, you just have to let him speak first.

  The meeting of the Transportation Subcommittee on Railroads will now reconvene and at fortuitous timing. I do in all seriousness want to thank my House Members, Congressman Torkildsen, Congressman Bass, Congressman Gejdenson for yielding their time at this moment so that we may hear from Senator Biden. He is on a very tight schedule and for those of us who are in the House, we know when we have to testify on the Senate side, that oftentimes that puts too much strain on our schedule and we are anxious to hear from you. So Senator Biden, thank you very much for being us with.
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  Senator BIDEN. Thank you, Madam Chairwoman. I want to thank my colleagues. I do want you to know the Judiciary Committee just had a hearing and we put Charlie Rangel on first, so--but I thank you very, very much. I will be very, very brief, Madam Chairwoman.

  Let me start off by, in the spirit of full disclosure here, we had a very difficult vote on Amtrak in the early years of the Reagan administration as to whether or not to continue to fund it, and Bob Dole, who is known for his great sense of humor, in addition to his legislative skills, as we go up to vote on our--on our side of the building, there is always a little yellow sheet that lays out what the nature of the vote is, and it is usually characterized, and Dole or someone on the Republican side, as well as the Democratic side, had put on top of the sheet, this vote is about keeping Biden in Delaware, which means that if, in fact, Amtrak goes, I have to move to Washington. So that may be the strongest reason why people might not want Amtrak to be funded.

  Ms. MOLINARI. After having to debate you during the crime bill----

  Senator BIDEN. Better to have me in Delaware, I guess. So I want--full disclosure, I am a daily commuter on Amtrak and have been for 22 years. I commute every day from Delaware, so I want to--in terms of full disclosure, it is in my naked self-interest that Amtrak, at least the Northeast Corridor, continue to prosper and continue to be in place, but let me make three broad points very quickly.

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  Number one, I believe that on the debate we are having now, I think a long overdue debate about the role of Federalism and the role of the Federal Government versus the States and the relative responsibility and what is a mandate and what is not a mandate, I think one of the central things we have to determine is what is the role of the national government. What areas must the national government be involved, and I would strongly argue that this is one of those areas--that a national passenger rail system is a national responsibility. It is a national responsibility.

  Now, I know, because I have debated this issue a number of times, not always particularly eloquently, but I know that occasionally my friends from the West will say, well, Joe, why should we pay to subsidize rails in the East when, in fact, we don't get it in our State? And I point out from my--for example, last time I had a debate with my friend from Colorado who is no longer here, Senator Armstrong, I said, why should my mother pay to subsidize the drinking water of your mother in Boulder, Colorado when we get our water all right; we don't need to be subsidized. Why do we have water projects that we spend billions of dollars on, billions of dollars on, not millions of dollars on like Amtrak? We do it because we are a Nation and it is a national responsibility to make up for the weaknesses and with the strengths of one section of the country to the other.

  So the first point I would like to make is, one, that we don't often speak to but I think it is national passenger rail service is a national responsibility, and private passenger rail service lost its market back in the 60's as more and more people went to automobiles and the only alternative was for the national government to get involved in it.

  As an alternative mode to transportation, second point I would make, is Amtrak relieves congestion in our highways and our airports, and in doing so, relieves costly pressures to expand those aspects of our infrastructure. It is Amtrak's--this is Amtrak's charge, it seems to me. Just in the Northeast Corridor, as the distinguished Congresswoman from New York State understands, and particularly in the corridor, there are twice as many people, more than that, twice as many people who take Amtrak's all rail service combined in the corridor.
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  So the third point--I see the red light is on. The third point I would like to make is that additional costs to these infrastructure requirements would be in the billions of dollars if in fact we had no Amtrak and particularly if we had no Amtrak in the corridor.

  I would also point out that when we come to the discussion of subsidization, and I will ask unanimous consent at the appropriate moment to put my entire statement in the record, but if we look at what we subsidize in terms of the--I often hear people in my State will say, darn, Joe, why are we subsidizing a ticket on Amtrak? I mean, we don't do that.

  Well, we do do that for automobiles and we do do that notwithstanding the gasoline tax, and we do do that for the airline industry. For automobiles, counting the tax that we impose on all people, is $20 billion a year that we subsidize, and in terms of air service, it is $8 billion a year we subsidize nationally--I will submit the backup rational for those figures--and we also subsidize municipal mass transit in our various States, $4 billion a year, and there is not a single solitary passenger rail service in the entire world that I have been made aware of, there may be, but I don't know of any in the world that meets its operating budget that is totally--that is, no subsidy, not in the whole world.

  And so I would argue that the amount of, quote, subsidy that we provide for Amtrak is the biggest bang for the buck we get for any transportation--any part of our transportation infrastructure in the entire United States, and is warranted, and I thank you for your time, Madam Chairwoman.

  Ms. MOLINARI. Thank you very much, Senator Biden.
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  I see that we have been joined by your colleague in the House from Delaware, Congressman Michael Castle. If you would like to come up, Michael, you are part of this panel. Thank you, Michael.

  Senator BIDEN. He will answer all the questions for me.


  Mr. CASTLE. Well, I missed Senator Biden but I have heard him before one time or another so I have a pretty good idea what he may have said. May have told the stories about us traveling on Amtrak.

  I have prepared testimony which I would like to submit for the record, if I may, but--and I also realize you have had a lot of witnesses and we will have more here today, so I don't want to try to repeat the same conclusions maybe you have been hearing.

  I just would like to beg the attention of this Congress and of this subcommittee and of the distinguished Chairwoman in whom I have tremendous confidence of this subcommittee so that we really focus on the problems of Amtrak. We could talk about the management issues, and I think they start all the way from the board, which is not focused entirely, through too many people in management, through the labor issues; we could focus on the capital needs. We could focus on the route problems or whatever it may be. But I have absolutely no doubt, and I am a beneficiary. Wilmington, Delaware, as I am sure Senator Biden has said, is located in the heart of this. I think we are the tenth most used train station in the country. We have a relatively small population area, so clearly we benefit from it and we have, frankly, important installations that do maintenance work there.
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  But the bottom line is that I think it is absurd to abandon mass transit. When I look at the subsidies for air, the subsidies for our shipping, the subsidies for our highways, and then to suggest that, gee, we are putting too much money into rail, passenger rail, I just think is a total mistake, and my view is that what we really need is full attention to this problem. It is very difficult when the government has inserted itself in sort of a managerial sense, certainly with our labor laws and all the other aspects that pertain to this. It clearly is a funding matter. But we are not really the managers. We don't manage particularly well anyhow, and we tend to run from it as a focus, and my hope today, rather than try to tell this distinguished committee what to do, is just to ask that this committee look at this as intensely as it possibly can.

  I listen to all these different ideas and concepts and I don't think one of them should be elimination of Amtrak, but I have no problems with greater efficiency, no problems with reducing costs, no problems with route changes, including reductions if need be, those that affect my home area. I can't imagine they can eliminate passenger service in my area but maybe some efficiency needs to be practiced. All these things need to be looked at.

  I just think there has been a lot of passing the buck on the subject of Amtrak by the Congress of the United States over the years, and if we can do nothing more, I would hope that we could focus in such a way that we--the board is made to deal with these issues, we are made to deal with these issues, it is presented fairly in the Congress of the United States, and we go through it seriatim in such a way that we are dealing with each of the funding issues, each of the management issues, each of the law issues, and all the other different things which exist out there.

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  You have wonderful staff who can help bring that all together and do it. But to do less than that, in my view, would be an abandonment of what this Congress should do.

  My hope is that in doing all this, we can save money, that we can practice efficiency and save money in that fashion. I have had my problems on Amtrak. I would be the first to tell you, I have missed trains because the computers are down and you can't get tickets, and I have been on trains where they have changed the hours on one train, the regular train. I was on one train and all of a sudden all the Metroliner passengers got on it from a stop someplace between Baltimore and Wilmington. One of them happened to be Governor Carper who is on the Amtrak board. I think that was his first meeting. I thought that was justification that Amtrak had come to a stop someplace in the middle of his ride.

  These problems do exist and we see this on a regular basis, but I think the problem has been brushed under the rug far, far too long. And I don't like to be involved anymore than we have to be. We are involved in this. If we are going to be involved, we should be involved better than we are today.

  So my message, beyond specific recommendations which are in my testimony, is that we need to really pay attention to this, to really make it work, and I would just absolutely oppose any efforts to totally discontinue it, but certainly it could perhaps be less expensive than it is today too.

  Ms. MOLINARI. Thank you very much, Congressman. Senator.

  Congressman Lipinski.
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  Mr. LIPINSKI. Thank you very much, gentlemen, for your testimony here this morning. I have a policy, I never ask House Members any questions when I am in this position, so my 22 questions are for Senator Biden.

  Senator BIDEN. I think it is a good policy, Congressman.

  Mr. CASTLE. I know Senator Biden. In your 5 minutes, you will get one answer. He is a friend, I can say this.

  Mr. LIPINSKI. I think that is the way it is with everyone who holds public office myself. I only have one question for you, Senator. Do you know, would Delaware be willing to--the State of Delaware be willing to subsidize in any way Amtrak? Because, you know, Amtrak loses money all over the country.

  The Northeast Corridor, of course, is one of the most heavily utilized areas of Amtrak, but we are trying to see if we can find any municipalities or any counties or any States that would be willing to subsidize to a certain extent the Amtrak operation, such as Wisconsin is planning on doing in the Hiawatha line immediately. It has already been worked out.

  Senator BIDEN. The answer is, the Governor--former Governor would be better able to answer that question than I. He was Governor for 8 years, Lieutenant Governor for 8 years, 16 years involved in it. But I have never known a Governor of any party, either party that wishes to spend any money on anything for any reason, good or bad. They all want to--so I will ask my--you don't ask congressional people questions, I will ask him a question.
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  Mike, what do you think Delaware would do?

  Mr. CASTLE. Well, it is a very good question, and the States are a little bit limited, all of them, not just Delaware. Delaware may be in better shape than some. But there are a lot of problems. For example, we have been negotiating with SEPTA, which is a Philadelphia local service, in terms of a run to Newark, Delaware, and our greatest problem is the cost of insurance.

  And I was on--I got on the Amtrak the other day and there was a cafe car and I tried to sit--I sat in the cafe car because it was open and the conductor came along and said, you can't sit here because we are still loading the food. I said, so what, because there was an empty car and all the other cars were filled. He said, well, we have a liability suit on our hands because somebody got hit by one of the boxes when we were loading it. And I said, when will it be ready to go. He said, probably around Baltimore. This was a train going to Montreal or someplace like that. So this was a whole particular car not being used simply because they had a liability problem.

  So the insurance issues are huge, eat up so much money. We are trying to deal with Amtrak to provide that same service.

  So I believe that the States are willing to deal locally on this. You know how they are. They don't want to pay any more than they have to. But I think it is fair to say to the States that in a measurable way, you should contribute something. I don't know what that is. I can't sit here and tell you it should be 10 percent of all costs in a particular route, jurisdiction through a State or something like that, but I don't think it is unfair for Congress to make some requests in that area, not mandate, but make some requests in that area, negotiate, or whatever it may be, but I think we have to understand, as Members of Congress, States aren't going to be willing to go very far, you are not going to get a whole lot out of them, but, frankly, if they buy in a little bit, they may be more interested too, in terms of advancing service and that kind of thing. So I would not say it is impossible.
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  As I said, we buy into SEPTA now to help us with our service from Wilmington to Philadelphia. We have a lot of people that work between the two cities. We are trying to extend it to another town in Delaware. I think if you get situations like that you would be willing to see some local contribution. It certainly should be on the table for discussion.

  Mr. LIPINSKI. Thank you, Senator, for asking the former Governor that question. Thank you both, gentlemen.

  Ms. MOLINARI. Senator Biden, and let me also say that clearly I go through your State every time I take Amtrak to my State, and use it particularly on Fridays when they are forecasting snow, so I, too, have a personal interest in this.

  Senator Biden in discussing the reauthorization of the legislation which this subcommittee will be prepared to take up on March 21, several things that we will be examining have to deal with changing some of the labor statutory requirements. Do you have a position on any of those? Can we find those?

  Senator BIDEN. I think if you take a look, labor has, as they say, given at the office already on--in terms of negotiations with management over the last 15 years. I will take your--I won't bore you with it now but if your staff goes back and looks, and you probably already know this, there are a number of commitments made to labor that if they took cuts back in the 1970s and then took cuts back in the 1980s and then took cuts in terms of the number of personnel they would have on per car, per train, that when Amtrak moved around, that they would in fact be recompensed and so on.
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  So I think you are going to find that there can be more done. They are willing to negotiate on work rules. They are willing to make additional changes, but I think, as Mike suggested, that what we should be doing is letting the labor management function function, and one of the things that happens, every time there is talk of a change in labor rules, we, the Congress, step in. It is ironic. We the Congress say, Amtrak is not very essential for our national interest, and then labor says, okay, we are not very essential. You have now renegotiated our contract, you have done the following things, we are going to go on strike, and then immediately the President comes along with the Congress and calls for a cooling off period under the law, preventing them from being able to go on strike and they then end up getting the benefit of whatever management wanted them to have, not what they wanted, and we say, no, it is a national emergency because without it, we can't function as a Nation, but we are going to cut it later because we don't need it.

  So it gets--I am being a little facetious but I am serious. I think what we don't do is we don't let--I think we should let this negotiation go under way and if they want to go on strike, let them go on strike. Either this is a national treasure--this is in the national interest to keep the rail service going or it is not. If it is not, why do we impose upon them what we don't impose on anyone else? If it is, then let's impose it, but let's also fund it.

  Mr. CASTLE. If I could just comment on that? I don't disagree with what Joe is saying but there are--I have looked at Amtrak and they have a huge percentage of their employees in management. We talk about labor but I am not sure what is labor and what is management. It seems to me that the classification sometimes gets very obscured when you deal with Amtrak.

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  In addition, I suspect, although I do not know this, that there are, because it is railroads and because this has always been sort of a Federal issue to some degree, that there is probably some protective statutes that need to be examined at this point in terms of termination pay and perhaps some other areas that do need to be looked at so management can really work.

  Management has to be given the opportunity to work. I am very much in favor of team type concepts in terms of management and labor working together. And I think early retirement options can work in some instances to help ease the problem. I think it does need--it does need to be looked at in some way or another, not in a detrimental way to anybody, but in the sense of just making it work better than it has, and Joe is right, there has been some concessions recently. That doesn't mean there aren't still some laws on the book that make it awfully hard to really make Amtrak work.

  Senator BIDEN. Madam Chairwoman, they tell me I have four minutes left on the vote on the constitutional amendment. We are also going to make this a constitutional amendment. We in the Senate make everything a constitutional amendment, but we are about to vote on the aspect of the balanced budget amendment, and with your permission, I will go do that, if I may, okay?

  Ms. MOLINARI. Thank you very much, Senator. We appreciate the fact you have----

  Senator BIDEN. You have my proxy.

  Mr. CASTLE. See you on the train.

  Ms. MOLINARI. Congressman Castle, just to conclude, Glenn informed me, to highlight your point, that Amtrak is very unique in handling management employees covered by the 6-year labor protection, so that is just----
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  Mr. CASTLE. And a lot of this is in court I think in Federal statutes. I don't know. The experts would know that. We cannot ignore these things if we are going to straighten out the problems and make this a more efficient operation.

  Ms. MOLINARI. Thank you, Michael.

  Congressman Mica, do you have a question for Congressman Castle.

  Mr. MICA. I just had a quick question. Maybe staff could answer it, too. Do we have a listing of what sequence people have entered the work force? I keep hearing about these laws to protect people in the 1960s and the 1970s and some of the other labor laws that were enacted. I want to know how many people got on the train and at what stations. Are you aware? Glenn?

  Mr. SCAMMEL. Amtrak gives annual reports that are route specific in terms of passenger load route by route. If you are talking about----

  Mr. MICA. I have heard 20 to 24,000 employees and how--you know, they made these great sacrifices over the years. It sounds like most of them ought to be with a cane or in a walker.

  Mr. SCAMMEL. You are talking about turnover. I think the Congressman mentioned in his statement that of the roughly--and I should mention that Amtrak started out using contract employees mostly from the freight railroads and then later went mostly to its own work force, but Congressman Barton's statement included the figure that of the original 1,500 Amtrak transfers from the freight railroads when they started in 1971, something like 35 are still left on the payroll.
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  Mr. MICA. But we are extending these obligations that they are talking about to people in management and everybody else who has gotten on board even after the whole dynamics of this situation has changed. Is that the case?

  Mr. CASTLE. You know, John, I don't know the details, but my--I hear the same things you do. I think you are sort of repeating the same things we all hear as rumors. That is exactly why I think this committee is so important. If this subcommittee did nothing but focus on this issue for 2 years, it would be doing this country a tremendous service because we need to get the answers to those things. Some are rumors that are unfair. Some are rumors in which changes are probably needed if I had to guess.

  Mr. MICA. Thank you.

  Ms. MOLINARI. Thank you very much.

  Do you have a question?

  Mr. EHLERS. Thank you, Madam Chairwoman.

  I just simply wanted to comment and indicate my support for Governor Castle's statements. In particular, I think a major reorganization is needed, but also I think we have to get the facts, and I am astounded at the number of rumors that I encounter as well, some of which may be well-founded, some of which are not, and I really think this subcommittee is going to have to act in an investigative role and dig out all the facts that we need on the issue.
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  If I may, Madam Chairwoman, if you would care to dismiss this witness, may I just have your permission to enter a comment on the previous panel.

  Ms. MOLINARI. Absolutely. I would just like to dismiss Congressman Castle, get the next panel seated and then I was about to acknowledge you. Thank you very much, Congressman Castle.

  Mr. CASTLE. May I make one final point in response to something Vern said? I know from my own experience here in Congress, and in particular you tend to get a little more removed from the programs than you do at a State level and you don't necessarily know how they are carried out at the State level. In my own case, everything I do, if I understand how everything works, it makes voting on things, understanding budgets and everything so much simpler, and that is why I really beg this committee to really understand these problems, and I think some of the solutions will become very clear as that happens, and that doesn't happen in Congress a lot, and this could be an exception and it could be a wonderful exception curing a longstanding problem that I think ultimately could really help with a significant problem, which is mass transit in the United States.

  Ms. MOLINARI. Thank you, Congressmen. You put a lot of pressure on us, but we appreciate your confidence.

  Ms. MOLINARI. Our next panel, if you can get seated while we listen to Congressman Ehlers, who is from a panel prior to the Senator, will be Congressman Blute, Congressman Torkildsen, and Congressman Gejdenson. I would like now like to acknowledge Congressman Ehlers.
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  Mr. EHLERS. Thank you, Madam Chairwoman, and I ask unanimous consent that these comments be entered into the record after the panel which contained Congressman Hoekstra.

  I wanted to comment on Congressman Hoekstra's comment. His district adjoins mine, and his experiences are very similar to mine. We put a lot of work into getting the Grand Rapids-Chicago line, known as the Pere Marquette line, in place many years ago, and we were very pleased when it was put in place and it was quite successful for some time. But that work has gone down the drain, in spite of the fact that Congressman Hoekstra's major city has gone to the major expense to build a terminal. My city has put in a terminal and has plans on the books for an intermodal terminal to combine bus, rail, and transportation to the airport.

  What I find particularly disturbing is a point that Congressman Hoekstra made, and it parallels my experience, and that is the lack of information from Amtrak. I am sure everyone in the Congress realizes that when a Federal agency or a quasi Federal agency makes changes of this magnitude, they let the Congress know. In our case, we haven't been able to get the information even after the decision was made.

  My staff contacted Amtrak as soon as the rumors emerged that the Pere Marquette might be cut and the first call told us that there was no danger it would be cut. The second call told us it would cut, the decision had been made, there would be no sense in objecting to it. Third and fourth calls were not answered. That is no way to convey information to the Congress. It makes it very difficult for us to do our job.
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  Furthermore, in my local community, the Grand Rapids Chamber of Commerce has also let me know that they want to put together a package with the State to try to maintain that line and they have not been able to get information from Amtrak as to the precise amount of money that would be needed, the amount of losses and so forth.

  My State Department of Transportation agency has talked to me and they are interested in perhaps putting some additional funding into that line to try to preserve it, and again, have had difficulty working things out. I think it is very important that we have a complete investigation by this subcommittee, as I mentioned a moment ago, to try and determine the facts in this situation, because it is clear that we are not getting all the information we need, and I certainly hope that we can preserve as much of Amtrak as possible.

  I think with proper marketing, as Congressman Hoekstra has mentioned, we should be able to maintain the service and, in fact, improve it a great deal, but I am convinced that with adequate equipment, good service, and better management, Amtrak can make it and I hope we can move in that direction. Thank you very much.

  Ms. MOLINARI. Thank you very much, Congressman Ehlers.

  We appreciate--I know you have been a very vociferous defender of your constituents in this area and in particular with regard to the lack of communication that has taken place between those we are trying to save, the system, the service and Amtrak, and we look forward to working with you to resolve that.

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  Congressman Gekas.


  Mr. GEKAS. Yes, if it please the Chair, my colleagues have allowed me to speak for one minute, so I will speak for three.

  Ms. MOLINARI. By all means.

  Mr. GEKAS. But I thank the Chair for its indulgence.

  I wanted to register for the record my support of Amtrak generally as support for the railroad system in our country which in one form or another is a tenet of our national security or, if it isn't in the opinion of some who oppose Amtrak, it can, at an instant's notice, become a question of national security. At any rate, so generally I support railroads. Second, I do support the proposition of continued transitional subsidies for Amtrak.

  Having said all of that, I also want to put into the record the notion that my office is conducting an independent review and analysis of the recent decision made by Amtrak based on ridership, trackage, mileage, costs, and everything else that they have used as justification for the elimination of the runs that are in their latest run of cuts. And so we are intent on giving alternative opinions to the Congress when the time comes for that.

  Having said that, I just want to ask, then, permission of the Chair to submit a written statement for your committee's records.
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  Ms. MOLINARI. Without objection.

  Mr. GEKAS. And that is it.

  Ms. MOLINARI. Thank you very much, Congressman Gekas. I don't think that was three minutes, but thank you very much and we do look forward to working with your office. As I have told people from time to time, we have set March 21 for our reauthorization date so we will get back to you.

  Congressman Blute.


  Mr. BLUTE. Madam Chairwoman, Members of the committee, thank you for giving me the opportunity to testify before the Subcommittee on Railroads on Amtrak.

  Preserving passenger rail service is an issue of great importance to Massachusetts and the rest of the Northeast region, as well as the Nation as a whole. Even though ridership nationwide for Amtrak accounts to about 1 percent of intercity travel in the Northeast Corridor, it accounts for 40 percent. In fact, the Northeast rail corridor observes a great deal of traffic that otherwise could not be supported by our region's highway and air transportation infrastructure. In addition, train travel is safe, relatively inexpensive, fuel efficient, and an environmental friendly mode of travel.
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  While passenger rail service is vital in my region of the country, there seems to be a growing chorus in Congress of those who find it hard to justify sustaining Amtrak's subsidy which costs the taxpayers about a billion dollars a year. Consequently, Amtrak's deteriorating financial condition has prompted numerous efforts in the past to cut its funding. In this climate of deficit reduction, it is no surprise that Amtrak's opponents have come out again in full force. While myself and other Amtrak supporters in Congress have successfully defended the corporation's funding in the past, it is my belief that current circumstances require a fresh, aggressive approach to dealing with the larger issues involved. No matter where you stand on Amtrak, it is quite clear that the status quo will not be maintained.

  Consequently, we here in Congress face some very tough decisions about Amtrak's future and the government's role in subsidizing its service. Amtrak recently took steps to try and get its fiscal house in order by streamlining its organization, but I must tell you I am extremely concerned about the rationale behind the numerous proposed route reductions and eliminations.

  On April 1, Amtrak is eliminating four out of five daily round-trip trains that run from Springfield to Boston. This line stops in Worcester, the second largest city in New England. For years, the Springfield-Worcester-Boston line has been a vital transportation link, not only between western Massachusetts and Boston but also between Worcester and New York and Washington. According to Amtrak, the ridership for the Worcester area in fiscal year 1994 was 373,393. Now those Worcester area residents will have--will have access to only one train a day and must try to get a connection south.

  I strongly oppose these this route being eliminated in my district. I believe the committee should demand that Amtrak show how they intend to become financially solvent. Otherwise, we are left in the Congress with a situation in which Amtrak is asking for more and more taxpayer money for less and less service. This is unacceptable. What is the larger game plan that ultimately will improve Amtrak and make it more cost efficient so that service in the corridor can be maintained?
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  It is my belief that innovative reforms are needed, especially those that will give Amtrak the flexibility to truly run its operation like a for-profit which is, which is exactly what Amtrak was created as. Quite frankly, the Federal Government is in large part responsible for much of Amtrak's financial crisis. The history of the relationship between the Federal Government and Amtrak has been one marked by an increasing imposition of regulatory and statutory requirements that have hindered Amtrak's ability to manage its operations. That is why I support some form of statutory reform because it will lessen the financial burdens Washington has imposed on Amtrak.

  I know that the Chairwoman has indicated a willingness to speak to the State governments, the State transportation secretaries about bringing them to the table, and I look forward to working with this committee on solving the chronic problems that Amtrak now is experiencing and hopefully put Amtrak on sound footing for the future. It is an important national resource.

  Thank you, Madam Chairwoman.

  Ms. MOLINARI. Thank you, Congressman Blute.

  Let me state also for the record you have been extremely helpful in helping us guide at least some concerted effort in the Northeast Corridor, and look forward to continuing to work with your office as we bring together those representatives of the Governors from the Northeast Corridor to see what we can do to get the high-speed rail and all our plans for that area in better and accelerated shape. So I want to thank you for your leadership on that issue.
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  Mr. BLUTE. Thank you.

  Ms. MOLINARI. Congressman Torkildsen.


  Mr. TORKILDSEN. Thank you, Madam Chairwoman, and I will just summarize and submit my statement for the record, if that is okay. I--rather than repeat what Congressman Blute has said, I will quickly get to the point.

  I, too, believe that Amtrak is essential. If Amtrak closed down, the burden on our roadways and our airlines would be enormous. We would be looking at many more billions of dollars in expenditures just trying to handle the capacity. So clearly Amtrak, especially in the Northeast Corridor, plays a vital role.

  In my own district, we are looking at the expansion of high-speed rail for a Portland to Boston link. Eventually, we want to see that go to Washington, D.C., so that is part of a future plan that I think is important, but I just want to emphasize my support for Amtrak as part of an intermodal transportation system, something that is environmentally friendly, economically friendly to the taxpayers as well.

  A lot of people do say, why do we need subsidies, and I think we have to look at every dollar we are spending, but the alternative is much more expensive, much more expensive to the taxpayers, much more damaging to the environment as well, and as the committee is grappling with these difficult questions, if they take those into consideration, as I know you have been, I think the answer will be, yes, let's make Amtrak more streamlined, let's make it more efficient. Let's see what innovative changes we can make, but the core of rail transportation, especially in the Northeast Corridor, is essential to the transportation needs of our country, and I will make that my very brief summary.
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  Ms. MOLINARI. Thank you very much, Congressman Torkildsen.

  Congressman Gejdenson.


  Mr. GEJDENSON. Thank you.

  I would just like to make two points, and ask permission to put a statement in the record. One is that when other parts of the Nation needed assistance in the 1950s and 1940s coming out of the Great Depression, and even into the 1960s, northeastern Members of Congress and the Senate were ready to help them because this is a Nation and that is how you build a Nation. Whether it was water projects or electrification projects in vast areas of the country, we didn't abandon our responsibility just because there wasn't a direct benefit to our constituents.

  This is a Nation--national interstate transportation--interstate transportation is a national issue, as it ought to be. We got here in a simple way. Private funding of railroads don't work in this country. They don't work anywhere else in the world, either, and when you look at the alternatives, particularly through your part of the country and my part of the country, there isn't enough room to add enough lanes of highway to move the people that we need to do the Nation's business.

  Old statistics that I once saw showed that Germany, a country about the size of Illinois or Indiana, somewhere in that range, actually provided more dollars in subsidies to their rail system than the entire United States does. There is certainly room for private-public partnerships in all this but it is a public responsibility. It is the most rational way to move people and it would be irrational for us to go in another direction.
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  Part of our problem is the way our society distributes responsibility. If you take a look at almost any city in this country, the cheapest way to generate new electricity is through conservation. If you take the entire community and you spend an additional dollar, the cheapest way for that community to create a new watt of electricity is to spend it on conservation, but there is no way to put that in the rate base to get the money back so we constantly end up building new energy capacity.

  I would say the same thing goes for rail transportation. The most efficient way for society to move forward, the best way to keep us competitive internationally is to invest in a seriously modernized rail system. The problem is we don't have the revenue stream that gasoline taxes and all the other taxes and all the other infrastructures that are designed to help the automobile, and that is why this stands out in some ways.

  The reality is, we have to look at a societal cost, not just one line item in one budget. We have to take a look at what it does to States, what it does to our ability to move people in a country and what it does to our economic competitiveness.

  To clog our highways is to make our on-time manufacturing virtually impossible, which means we will be less competitive internationally. Amtrak is an essential part of keeping those highways unclogged.

  I ask permission to put my statement in the record and apologize for having to run off. Thank you very much.

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  Ms. MOLINARI. Thank you very much, Congressman Gejdenson. I appreciate your input.

  Congressman Bass.


  Mr. BASS. Thank you very much, Madam Chairwoman. I am also in the middle of a vote around the corner, so I will be extremely brief.

  If we had provided the rail system in this country with anywhere near the kind of subsidies that we have over the years, starting with the Eisenhower administration, provided the interstate highway system, I think we would not be here today talking about a mode of transportation that basically appears to be obsolete and on the way out of existence.

  Transportation is crucial to the Northeast. It is the way that we remain viable in our Nation's economy. We require good roads and we require good rails.

  Now, Amtrak has considered as of late the elimination of the Montrealer, and I am not here to say that we should necessarily subsidize rail indefinitely, anymore than we should any other facet of government, but people in my district and people in the State of Vermont have asked Amtrak for facts. They have asked them to come to public hearings and explain why, on a financial basis, why this route is being eliminated, and to date I am not aware of the Amtrak individuals being willing to come to any of these meetings.

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  I think we owe it to the people of New Hampshire and Vermont to give them the opportunity to present to Amtrak options and alternatives, perhaps running the rail a shorter distance, perhaps changing the schedule somewhat, but to eliminate it completely will eliminate from western New Hampshire and the State of Vermont a very important mode of transportation that is critical to our economy.

  So I appreciate the opportunity to appear here this morning and hope that you will excuse me and allow me to go cast my vote around the corner.

  Ms. MOLINARI. Thank you very much, Congressman Bass.

  We don't want you to miss a vote but appreciate very much the suggestions that you have brought up in terms of the public participation in the reduction of service and the closing of lines, whether it is quote, unquote, a financial emergency or not, is something that this committee is taking into serious consideration, so we look forward to working with you, and we thank you in the short time you have been a Member of Congress for being so tremendously protective of your constituents.

  Congressman Moakley, welcome. We would also ask Congresswoman Clayton and Congressman Neal to come up and join us on our last panel. Thank you and welcome. Good afternoon.

  Mr. MOAKLEY. I will be Molinari.

  Ms. MOLINARI. That has been the historical seating pattern. Normally you are up here and I am down there. Thank you very much, Congressman Moakley. It is an honor to have you here with us this afternoon.
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  Mr. MOAKLEY. Thank you very much, Madam Chairwoman, and Members of the subcommittee. I want to thank you for giving me the opportunity to be here this morning to share my views with you on Amtrak.

  Let me start by saying that I grew up in a railroad family. My uncles and my cousins all worked for the railroad, so I have always been extremely aware of the important role that railroads play in our society. That is why I am particularly disturbed when I hear some of my colleagues argue that we don't need a strong national passenger rail service, that it is too expensive, or that there is no longer a market for it.

  Madam Chairwoman, a safe, convenient, and effective national passenger rail system is not a luxury but a basic and vital component of our transportation system and the economy. The suggestion that the greatest Nation on earth should become the only major industrialized country in the world without national passenger rail is just irresponsible and illogical.

  According to its national annual report, Amtrak travel nationally, measured in passenger miles, has increased by 48 percent from 1982 to 1993. To me, this does not appear to be a diminishing market.

  For those people who travel by train, Amtrak is not some luxury and it is not some service only other people use, it is about whether or not they get to work in the morning.
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  Let's take the Northeast Corridor. This 460-mile stretch from Washington to Boston carries over 100 million commuter passengers each and every year. If Amtrak is eliminated or if service is substantially reduced, it will be impossible for our transportation infrastructure to absorb all of these people who currently utilize this environmentally safe, energy efficient mode of transportation.

  Our highways are already too congested and our airports aren't much better. I think you would be hard pressed to convince the public that putting more traffic on the capital beltway or on the central artery in Boston is good public policy. Those of us who fly in and out of Logan, LaGuardia or National Airports know firsthand that these facilities are already stretched to their limits.

  Another important fact, Madam Chairwoman, to be aware of is that Amtrak serves over 11 million inner-city passengers along the Northeast Corridor. I represent a largely inner-city district and I can assure you that most of the people who depend on the train just don't have any other alternatives. A major cut to Amtrak will hurt those who can least afford it, the middle class and the working poor.

  I am very pleased that the President has displayed leadership by sustaining funding for the Amtrak in his budget and for making the necessary investment in the improvement of the Northeast Corridor. I believe it is essential for the Congress to demonstrate the same type of leadership. So the question before us is quite simple: Are we prepared to provide Amtrak with the resources it needs to remain viable? The answer, I hope, will be yes.

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  According to the International Railroad Journal, there are 34 countries in the world that make larger per capita investments in their railroads than we do, and I think some of the names may even surprise this committee: Iran, Botswana, Slovakia, Latvia, Venezuela, Guinea, and Thailand all spend more. And there are only nine countries below the U.S. and I think we can all agree that we don't want to emulate countries like Bangladesh, Albania, or Pakistan.

  There is also another component to this debate which is also too important to ignore. It is the human component. Amtrak employs more than 20,000 hard working men and women and these are assuredly the railroad's most vital resource. In the early 1980s, these people made the financial sacrifices necessary to keep Amtrak afloat while at the same time increasing productivity in the face of declining work force levels.

  In 1983, Amtrak recovered 53 percent of its revenues to operate the system. Today, it is nearly 80 percent. So that is testament to these workers, and I just don't think Congress should turn their back on them. Instead, we have to give Amtrak and its employees the resources they need to continue to make progress and to ensure that the national passenger rail service remains a vital part of this service.

  Believe me, Madam Chairwoman, I understand our budgetary dilemma and I intend to work with our new leadership in order to get our Nation's finances in order.

  But I would respectfully suggest to the new Republican leadership that Amtrak is an infinitely wiser investment for our country than the starwars weapons fantasy which unfortunately seems to be making a very expensive comeback.

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  Madam Chairwoman, Members of the committee, I thank you very much for the opportunity to come before you and address your very august panel.

  Ms. MOLINARI. Thank you very much for your input, Congressman Moakley.

  Congressman Neal.


  Mr. NEAL. Thank you very much, Madam Chairwoman.

  I would also like to acknowledge that Mr. Blute and Mr. Torkildsen from the other political party were here in advance of Mr. Moakley and I, but we are all here on the same stated principle.

  I would like to submit my official testimony for the record and I will just take portions of it here.

  I am here today to speak in opposition to some of the Amtrak's suggested service cuts and employee reductions. Specifically, I want to discuss the effects this proposal will have on Massachusetts. The service cuts recommended by Amtrak eliminate the option of rail transportation for a large portion of Massachusetts and New England.

  The Northeast is a unique area. Massachusetts specifically, Northampton, Springfield, Worcester and Boston, is home to hundreds of thousands of college students, many of whom rely on Amtrak as their primary source of transportation. I have also heard from hundreds of senior citizens and retired persons who will be devastated by this service reduction. These people rely on Amtrak because it is not only affordable, but it operates regardless of New England's often unpredictable and harsh weather.
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  Reducing the frequency of service on the inland route of Massachusetts from four trains to one train per day will make a 1-day excursion from Springfield to Boston virtually impossible. This reduction also affects the many Amtrak customers in the Worcester area who ride this train to Springfield and then continue to points south. They will now be unable to do so because the one remaining train on this route will arrive in Springfield 45 minutes after the last southbound train has left.

  I question the rationale behind the cuts in Massachusetts, particularly after reading the testimony of Kenneth Mead, Director of Transportation for the GAO, who spoke to this committee on Tuesday. Mr. Mead testified that the inland route between Springfield and Boston is one of the five routes that accounts for over half of Amtrak's national ridership. It appears that the Springfield to Boston route is one of Amtrak's most productive lines. I cannot understand why this route is being reduced. Cutting this service will put Amtrak in a precarious situation, particularly in western and central Massachusetts, as Mr. Blute has indicated. We all know that once these train routes are eliminated they will become much like the appendage that a surgeon amputates. They will never come back.

  I am seriously concerned with reducing the Federal deficit and believe that we should all share in the sacrifice. I think, however, that we must carefully consider the future ramifications of Amtrak's service cuts before we eliminate what I believe is a practical and productive transportation system. Without the Federal subsidies that Amtrak receives, this extensive, safe, energy efficient, and environmentally friendly transportation service will not be possible.

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  There is not a passenger rail service in the world that does not operate without a subsidy. On the world market, the United States ranks 35th in rail capital spending per year. This places the United States behind countries like Ireland, Iran, and Indonesia and just ahead of Turkey and Bangladesh. I believe that the United States should be a world leader in the area of transportation, and we should move forward, not backward on this issue.

  I support Amtrak and the service it has provided to the citizens of Massachusetts for 22 years, and I hope to see it continue. We should remember that funding allocated by Congress for Amtrak is more than a subsidy. It is an investment. The rest of the world understands the need for investment and I would hope that this Congress will proceed with caution as it considers drastic cuts in our system.

  Madam Chairwoman, this concludes my testimony, and I thank you as always for the courteous manner in which you always receive me. Thank you very much.

  Ms. MOLINARI. Thank you very much, Congressman Neal, for your input.

  Congresswoman Clayton.


  Mrs. CLAYTON. Thank you, Madam Chairwoman, and thank you, the committee, for the opportunity to address you. I also will be brief because we are being warned by the bells we have a vote coming up.
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  I want to register my strong support for Amtrak, but more specifically I want to register my concern and outrage really of the Amtrak's proposed cutting services in Fayetteville, North Carolina. It has recently come to our attention that Amtrak services, which already were limited, really had planned to cease the line which serves the Fayetteville area.

  I am greatly troubled by this action. It seriously curtails the availability of commercial transportation, not only for my constituents in Fayetteville but also for the residents in the southeastern part of North Carolina.

  Transportation options for the region have been drastically reduced over the last year, since all flights out of Fayetteville Regional Airport, American Airlines, as well as American Eagle have permanently discontinued. As a result, commercial transportation service to the largest military installation in the Nation, Fort Bragg, will greatly suffer as a result of that.

  Substantial losses like this are devastating to a community such as Fayetteville. In fact, the city of Fayetteville recently completed a comprehensive renovation of their Amtrak station in response to sustained increases in patronage. Over 45,000 people boarded Amtrak train in Fayetteville alone in 1994. That averaged out to 123 persons riding the train every day. What option will these 45,000 North Carolinians now have? Very few.

  The Palmetto was one of the only two trains currently stopping in Fayetteville, the other being the Silver Meteor. The Palmetto had the preferable departure, one, because of a more reasonable time. While I know that fiscal constraints requires that Amtrak look at their service, I think it is misguided to reduce services where already very limited service is available.
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  I want to join this committee and others that want to cut costs because we need to do that, but I also want to register my discontent and outrage at denying the services where they are so vastly needed.

  In addition to my Fayetteville area, the Southeast is not served well by Amtrak. Obviously, I have been joined by more people who are here from the Northeast. It is the South also that needs better service. Already we were curtailed because you made those decisions sometime earlier.

  Thank you very much for allowing me to address you.

  Ms. MOLINARI. Thank you very much, Congressman Clayton.

  As I said, I think prior to you getting here we are looking to reauthorize Amtrak on March 21 and we will be in touch with your office based on your interest today as we redesign the statutes, et cetera.

  Mrs. CLAYTON. Thank you for having this hearing and thank you for that openness that we can continue that


  Ms. MOLINARI. Thank you very much.

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  This hearing is now adjourned. I thank you very much. He is not here. I thank Congressman Lipinski for being here for the entire time, working with us, and Congressman Mica.

  [Whereupon, at 12:18 p.m., the subcommittee was adjourned.]

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