House introduces plan to privatise rail

House Transportation and Infrastructure Committee chair John Mica said he could 'guarantee' that legislation to privatise Amtrak’s rail services and infrastructure in the Northeast Corridor will pass. But critics argue the plan lacks detail.

Republicans in the US House of Representatives have presented draft legislation that would enable the private sector to bid for rail services currently run by state-owned passenger rail carrier Amtrak.

House Transportation and Infrastructure Committee chair John Mica, a Florida Republican, and Bill Shuster, a Pennsylvania Republican who chairs the railroads subcommitee, outlined a plan to allow private operators to bid on the existing infrastructure as well as operations of the Northeast Corridor, which connects the cities of Boston, New York, and Washington DC.

The proposal would also allow private operators to bid to upgrade the Northeast Corridor to 220-mile per hour high-speed rail lines.

Amtrak has proposed upgrading the Northeast Corridor to high-speed rail at a cost of $117 billion over 30 years, and has issued a request for proposals for the development of the project’s business and financial plan. But Mica said Amtrak’s proposal was too slow and expensive, and argued that the US could attract private funding to reduce costs and complete the project in one-third of the time proposed by Amtrak.

“If you talk to folks on Wall Street, money will only chase projects for so long so there has to be some definition in time to attract that money,” Mica said.

Under Mica’s proposal, the Northeast Corridor would spin out from Amtrak. A five-member executive committee would head the corridor, and would enter into a 99-year lease with the US Department of Transportation, according to a statement. The public would maintain ownership of the Northeast Corridor.

Mica said he could “guarantee” that the legislation will pass within the next three years.

But Amtrak president Joseph Boardman dismissed the plan as being unclear and inadequate on specifics.

In a conference call with reporters, Boardman said passenger rail could not be developed in a “bum’s rush process”. He argued that Mica’s proposal focused on financing and real estate ahead of the development of a much-needed transportation corridor for the Northeast.

“It doesn't help us as an industry … to just get out and do a down and dirty fight with something like this,” Boardman said. “There really has to be a debate. This doesn't give us this kind of debate at this point in time.”

Boardman also challenged the idea that private sector competition would make US rail more profitable.

“There isn't any passenger rail company in the world that makes a profit from what it operates,” Boardman said. “The profit is really there because government still provides the basis for that to happen.”