Rail Passenger Service Act (1970)

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Rail Passenger Service Act (1970)

Stephen C. Rogers

Congress enacted the Rail Passenger Service Act (RPSA) (P.L. 91-518, 84 Stat. 1327) in 1970 under the commerce clause of the U.S. Constitution to preserve intercity rail passenger service in the United States. For many years long-distance passenger trains were an essential mode of transportation in this country. By the second half of the twentieth century, however, competition from automobiles, buses, and airplanes had reduced passenger rail travel to a shadow of its former self and rendered the passenger rail business unprofitable.

THE ORIGINS AND GOALS OF AMTRAK

In the RPSA, Congress declared that "modern, efficient, intercity railroad passenger service is a necessary part of a balanced transportation system" and could help end highway congestion and overcrowding of airways and airports. To preserve such service, the RPSA provided for the creation of the National Railroad Passenger Corp., commonly known as Amtrak, which was originally meant to be a for-profit corporation in the District of Columbia. Amtrak was to take over responsibility for operating intercity service from any railroad that desired to get out of the passenger business, as all railroads eventually did.

The RPSA required Amtrak to provide passenger service between points within an integrated "basic system" of routes designated by the U.S. Secretary of Transportation, with a view to eliminating the least necessary operations. Supporters of the RPSA expected that by operating a streamlined and cohesive national system, Amtrak would make rail passenger service profitable again, particularly using new equipment such as the Metroliner trains that had recently been introduced in the Northeast.

Railroads transferring passenger service responsibilities to Amtrak were required to pay it an amount equal to only one-half of the railroads' financial losses from intercity passenger operations during a single year (1969). In addition, the RPSA authorized a $40 million federal appropriation and a $100 million loan guarantee program to assist Amtrak's start-up.

FINANCIAL TROUBLES AND FEDERAL SUPPORT

Amtrak has not succeeded in operating rail passenger service at a profit. In this respect, it is no different from any other national passenger rail system—all of them require government subsidies to sustain operations. Congress has amended the RPSA numerous times since 1970 in an effort to minimize Amtrak's need for federal financial support. Even so, a Senate committee found in 1997 that since 1971 Amtrak had received more than $20 billion in federal financial help but continued to struggle financially despite that assistance.

In 1997 Congress enacted the Amtrak Reform and Accountability Act of 1997 (ARAA), declaring its intention to terminate federal funding of Amtrak's operating losses after 2002. Congress also claimed the act would relieve Amtrak of legal constraints on its ability to improve its financial performance. The ARAA created an Amtrak Reform Council to monitor that performance. In November 2001 the council determined that Amtrak would be unable to function without federal operating subsidies after 2002. Despite its stated intention in the ARAA, Congress continued to fund Amtrak's operating losses after 2002 and renewed the debate over the future of Amtrak and of intercity rail passenger service in this country.

See also: Staggers Rail Act.