AMTK: Warns CSX Threatens Passenger Prospects

04.June, Washington DC – Amtrak’s CEO Bill Flynn released a strongly-worded statement, reiterating the national passenger carrier’s objections to proposed transaction that will give CSX control of PAR properties and rights throughout New England. The statement is a reminder of the several serious concerns that Amtrak detailed in its 17.May STB filing, “Notice of Intent to Participate” in the proceeding under STB Docket #FD 36472. Both statements illustrate Amtrak’s concerns that past interactions portend an obstructive approach to current Amtrak regional operations and route initiatives in the Amtrak Connects US (ACUS) program.

 

STATEMENT FROM AMTRAK CEO BILL FLYNN
ON PROPOSED PAN AM – CSX MERGER
04.June.2021

As currently proposed, the acquisition of Pan Am by CSX represents a significant threat to the American traveling public which relies on Amtrak and our state partners to deliver frequent, reliable and sustainable intercity passenger rail service. Unfortunately, we believe the proposed merger, in its proposed form, will negatively impact current passenger train service and future routes in Massachusetts and Northern New England that are identified in the Amtrak Corridor Vision (ACV). Our goal, as outlined in the vision, to provide new rail service to over 160 more communities and 20 million more passengers annually by 2035 aligns with the Biden administration’s infrastructure investment blueprint and any merger’s impacts on this goal should be considered by the Surface Transportation Board during its review.  

Amtrak’s primary considerations – as it would be with any railroad acquisition – are simple. First, Amtrak wants to ensure on-time performance of Amtrak trains over any impacted routes. Second, we want to ensure we will have a good partner in seeking to improve and expand existing state-supported and long distance services as well as planned expansions to new routes. After reviewing the CSX application, it is clear that the proposed merger, in its current form, will adversely impact the performance of Amtrak trains and threaten future growth opportunities. As the STB evaluates the proposed Pan Am-CSX merger, we urge the Board to recognize that intercity passenger transportation is a critical factor in maintaining and growing rail connections between communities, economic growth, social equity and sustainability.

Additional detail from Amtrak

At ANRP’s request, Amtrak specified prospective route impacts between ACUS and CSX in the region:

  • Pan Am owns the Boston-Brunswick, ME Amtrak route between the MA/NH border and Brunswick on which Amtrak Connects US would add additional service.
  • Pan Am owns the Boston-Concord, NH route between the MA/NH border and Concord on which Amtrak Connects US contemplates new Amtrak service.
  • CSX owns the Amtrak’s Albany-Boston route between the Albany area and Worcester on which Amtrak Connects US would add additional service (and on which CSX has agreed to give Norfolk Southern the right to operate nearly two mile long intermodal trains between the Albany area and Worcester if the Surface Transportation Board approves CSX’s application to acquire Pan Am).

{Amtrak representative Jason Abrams via email, 08.June.2021}

Details of the 17.May “Notice”

In its Notice to Participate {STB #302367} Amtrak is wary of CSX’s willingness to support the ACUS planned major expansion of passenger services on “Pan Am” tracks. Current services will be expanded and new services will be added.

An inverted value equation

The Notice asserts that the Board should apply extra scrutiny to the transaction, primarily because of two “unprecedented” vital aspects:

“[The proposed CSX-Pan Am transaction] is the first railroad merger in which passenger trains, not freight trains, account for the majority of the train operations over many of the [Pan Am] rail lines,” and

“[There is a high] level of public investment in the impacted rail lines. [Whereas private] railroads fund the vast majority of the capital investments on most of the nation’s freight network, …  that is not the case on the Pan Am lines. As [the CSX Amended Application presents], Pan Am has been awarded in recent years [or is awaiting award for a total of], over $60 million in federal and state grants for investment in its rail lines.” (The total amount of public funding in Pan Am network assets is likely even much higher than this figure – Ed.)

In a nutshell, the lines CSX is buying are of greater capacity value to the Public, and are arguably, partially “owned” by it. It is a valid conjecture that, CSX would be acquiring many fewer miles of serviceable Pan Am track, if not for the public funding invested to bring substantial stretches up to passenger standards.

And it has worked well

The Notice points out that Amtrak and Pan Am have mutually and cooperatively benefitted from this investment:

Pan Am has worked cooperatively with Amtrak’s state partners and Amtrak to expand and improve Amtrak’s state-supported services on its lines. Amtrak’s passengers, the communities Amtrak serves, New England’s economy and freight rail shippers have all benefited from the public investments for track upgrades and other infrastructure improvements that have accompanied the expansion of Amtrak’s services.”

Cause for concern

The Notice pulls no punches in expressing its greatest concern: that CSX will kibosh Amtrak’s — and the President’s — grand plans to revive a robust, nationwide passenger rail network, including rounding out its crowning New England franchise.

Allusions in the Notice to recent unhappy interactions with CSX validate Amtrak’s mistrust: “CSX has shown … recalcitrance” with Amtrak’s efforts to incrementally expand existing service between Albany NY and Pittsfield MA, and to restore service between New Orleans LA and Mobile AL. But the stew has been long in the oven, with the Notice ruing the “multi-hour delays Amtrak passengers experienced during the rail service meltdowns that followed CSX’s and NS’s June 1, 1999 implementation of their acquisition of Conrail …”