Passenger vs. Freight Priority. Was: DOJ sues Norfolk Southern for making Crescent late

Reminder that we got to this discussion because DOJ actually IS going after NS for something other than deaths, trafficking, drug money.

Despite what Tad and John seem to be advocating, this is still a society of laws.

I'm a small business owner who has entered into many contracts and agreements. If I regret entering an agreement after several years, I cannot renege and say "well a contract isn't really a contract."

All that said, I will stipulate that I think Amtrak has a pretty sweet deal. If the private railroads really loathed giving access to passenger trains, they should have held out until '76 when they would have been forever freed of the burden (if I understand the RSPA70 correctly.) (and interesting that SOU and DRGW joined Amtrak late when Staggers was already law.)

I'll further say that I think Amtrak should pay the RRs a trackage right fee with a modest return for handling a light, short, fast train on a somewhat (?) predictable schedule, if they're not already. But this has to come from good faith negotiation.

Amtrak and DOJ are aiming at the wrong target. During the past 30 days I offer the following comparisons of trains arriving on or ahead of schedule:
CRESCENT 19 at New Orleans 22.6%
CRESCENT 20 at Washington 41.9%
Auto Train 52 at Lorton 48.4%
Auto Train 53 at Sanford 64.5%
SILVER STAR 91 at Miami 9.7%
SILVER STAR 92 at Washington 0
SILVER METEOR 97 at Miami 29%
SILVER METEOR 98 at Washington 6.5%
LAKE SHORE LIMITED 48 at Cleveland 54.8%
LAKE SHORE LIMITED 48 at Schenectady 48.4%
LAKE SHORE LIMITED 49 at Cleveland 64.5%
LAKE SHORE LIMITED 49 at Chicago 48.4%
CAPITOL LIMITED 29 at Pittsburgh 0
CAPITOL LIMITED 29 at Chicago 51.6%
CAPITOL LIMITED #30 at Cleveland 16.1%
CAPITOL LIMITED 30 at Washington 41.9%
Except for the portion of #49 east of Cleveland and 97 vs 19, NS is outperforming CSX.
NS does not operate as well south of Atlanta as north of Atlanta because many of the sidings to the south are too short to accommodate monster trains. Would be nice for NS to apply for some of there Federal/State partnership money to lengthen sidings south of Atlanta and agree to restoring the CRESCENT's pre 2022 schedule with 80% OTP in exchange for dropping the lawsuit. CS should be next in DOJ's crosshairs.
Andy

rohr turbo wrote: ↑Sun Aug 04, 2024 8:15 pm DOJ actually IS going after NS for something other than deaths, trafficking, drug money.

East Palestine could added to the list.

John_Perkowski wrote: ↑Sun Aug 04, 2024 4:34 pm Do you know the three criteria the various attorneys of the US Government use to determine who they are going to file a civil suit/ask for a grand jury bill of indictment against?

1) Deaths 2) Human trafficking 2) MONEY… lots and lots of money.

There are a gajillion violations of the US Code that CAN be enjoined or prosecuted, but aren’t because the return on the effort is just too small. So, yes. Tad nails the matter to the wall.

For fraud cases, the general unwritten rule is that the FBI would not be involved unless the amount is well over six figures (around $250,000), unless federal funds or prominent individuals (elected officials oftentimes) are
involved.

rohr turbo wrote: ↑Sun Aug 04, 2024 8:15 pm I'm a small business owner who has entered into many contracts and agreements. If I regret entering an agreement after several years, I cannot renege and say "well a contract isn't really a contract."

Sure you can. Contracts are abrogated regularly, via simple breach all the way up to bankruptcy.

Contracts without a specified term have been abrogated, and Amtrak's contract with the railroads would certainly fall into that category. Some states (Illinois included) view the lack of an explicit term as implying a contract that gets renewed annually automatically until one of the parties serves notice they no longer plan to honor it.

I'd love to see one of the host railroads serve notice that after 50+ years, Amtrak is no longer welcome on the property using pricing from 50 years ago....

rohr turbo wrote: ↑Sun Aug 04, 2024 8:15 pm DOJ actually IS going after NS for something other than deaths, trafficking, drug money.

Not just drug money, but MONEY in general.

R36 Combine Coach wrote: ↑Sun Aug 04, 2024 9:39 pm

John_Perkowski wrote: ↑Sun Aug 04, 2024 4:34 pm Do you know the three criteria the various attorneys of the US Government use to determine who they are going to file a civil suit/ask for a grand jury bill of indictment against?

1) Deaths 2) Human trafficking 2) MONEY… lots and lots of money.

There are a gajillion violations of the US Code that CAN be enjoined or prosecuted, but aren’t because the return on the effort is just too small. So, yes. Tad nails the matter to the wall.

For fraud cases, the general unwritten rule is that the FBI would not be involved unless the amount is well over six figures (around $250,000), unless federal funds or prominent individuals (elected officials oftentimes) are
involved.

Well, think about it. This is Amtrak paying NS for track rights (as much as they are paying them). It's still federal funds being used to run on that track, and if that money is just going for stuff that isn't performing to contract, well, the DOJ suing would fall under "MONEY being swindled out of the federal government."

From the Consolidated Financial Statement document on Amtrak's Website:

Host Railroad Agreements
Most of the rights-of-way over which Amtrak operates are owned by other railroads. Amtrak operates over such rights-of-way under agreements with these railroads. The terms of the agreements range up to 20 years, although they may remain in effect longer if neither party seeks to renegotiate. Payments to these railroads vary based on levels of usage and performance. The total amount incurred by Amtrak for operations over the right-of-way during FY2023 and FY2022 totaled $180 million and $155 million, respectively, and are included primarily in “Train operations” in the Consolidated Statements of Operations.

$180M for trackage use in 2023.... 36.2M train miles operated in 2023, but let's take away 10% of that to account for the NEC and owned trackage (probably on the high side).

That comes out to $5.50 per mile.

Using a rate of $0.19 per ton-mile, the average Amtrak train weighing around 500 tons would cost $95 per mile to move.

That $5.50 per mile seems quite low to me, but I'll let the smarter people here decide if it's a market rate or not.

Thank you for finding that @eolesen.

I would argue that Amtrak is paying approximately market rate.

Not sure where you got $0.19, but perhaps that's what a shipper pays a freight railroad. If so, a bit apples to oranges since shipper is not paying for the weight of the railcars or locomotives but IS paying for fuel and crew etc. Amtrak a different story. The Amtrak train perhaps only has a few dozen tons of 'people', but covers fuel and crew and depreciation of rolling stock....

Regardless, we should be talking trackage rights.

Quoting the late Randy Nellie Bly Resor who was in the STB and should know (from 2006) :

"On the Northeast Corridor, Amtrak charges freight railroads $1.04 per *car* mile. Railroads generally charge each other $0.30 to $0.40 per car mile."

Even if rates have doubled or tripled since then, we're in the ballpark. And I think over 10% of Amtrak train-miles are NEC.

Also good to know that there are periodic negotiations between Amtrak and host RR. Not 1971 rates in perpetuity as some here assume.

It might be "market rate" for time insensitive freight, but not for a "make a hole" priority traffic.

Any agreement on pricing that's over 5 years old is lowballing the market just by nature of inflation. Just look at how far $10 went in 2019 vs. now....

twropr wrote: ↑Sun Aug 04, 2024 9:11 pm Amtrak and DOJ are aiming at the wrong target. During the past 30 days I offer the following comparisons of trains arriving on or ahead of schedule:
CRESCENT 19 at New Orleans 22.6%
CRESCENT 20 at Washington 41.9%
Auto Train 52 at Lorton 48.4%
Auto Train 53 at Sanford 64.5%
SILVER STAR 91 at Miami 9.7%
SILVER STAR 92 at Washington 0
SILVER METEOR 97 at Miami 29%
SILVER METEOR 98 at Washington 6.5%
LAKE SHORE LIMITED 48 at Cleveland 54.8%
LAKE SHORE LIMITED 48 at Schenectady 48.4%
LAKE SHORE LIMITED 49 at Cleveland 64.5%
LAKE SHORE LIMITED 49 at Chicago 48.4%
CAPITOL LIMITED 29 at Pittsburgh 0
CAPITOL LIMITED 29 at Chicago 51.6%
CAPITOL LIMITED #30 at Cleveland 16.1%
CAPITOL LIMITED 30 at Washington 41.9%
Except for the portion of #49 east of Cleveland and 97 vs 19, NS is outperforming CSX.
NS does not operate as well south of Atlanta as north of Atlanta because many of the sidings to the south are too short to accommodate monster trains. Would be nice for NS to apply for some of there Federal/State partnership money to lengthen sidings south of Atlanta and agree to restoring the CRESCENT's pre 2022 schedule with 80% OTP in exchange for dropping the lawsuit. CS should be next in DOJ's crosshairs.
Andy

Using just a percentage tells nothing. Unless you know WHY the trains are delayed, you don't have a lawsuit.

eolesen wrote: ↑Mon Aug 05, 2024 1:39 pm From the Consolidated Financial Statement document on Amtrak's Website:

Host Railroad Agreements
Payments to these railroads vary based on levels of usage and performance.

Emphasis mine.

You can bet Amtrak would be paying more if their trains weren't constantly sidelined and delayed.

lensovet wrote: ↑Sun Sep 01, 2024 8:55 pm
You can bet Amtrak would be paying more if their trains weren't constantly sidelined and delayed.

Over the years, we’ve beaten the issue of incentive payments to the point the horse is dead. As I recall, the consensus was they are too small to be worth the effort.

If Amtrak wants clear and 110 MPH trackage, they need to pay for it.

I don't think Amtrak has any issues obtaining 110 mph clear trackage.

79 and below, though, seems to be a lot more challenging.

Anyway, the railroads agreed to this. The priority, the 20-year terms, everything. I don't get to stop paying my rent just because housing prices go down in my neighborhood. If I try to pull that stunt on my mortgage, the bank takes over the house.

lensovet wrote: ↑Mon Sep 02, 2024 11:30 am I don't get to stop paying my rent just because housing prices go down in my neighborhood. If I try to pull that stunt on my mortgage, the bank takes over the house.

Not entirely true. Banks have and still do short sales and loan modifications. After the housing crash in 2008, millions of homes saw balances due lowered by banks. Banks won by having people not default and continue paying on loans, or not winding up with additional properties they'd have to maintain and dispose of after foreclosure.

Bottom line is everything's negotiable when both parties have something to gain.

Short sales are something that the bank does on its own terms. The homeowner gets nothing.

I'm not sure I see the parallel of the loan modification here. In our hypothetical homeowner scenario, the homeowner agreed to pay their mortgage in return for giving the bank a lien on their property. If they stop paying, the bank can repossess, or if they choose, adjust the payment terms. In our scenario of Amtrak and trackage rights, the host railroad has decided to stop holding up their end of the bargain. They don't get to choose to adjust the payment terms – that's Amtrak's call. Looks like the DOJ is finally doing the equivalent of repossession – and it's about time.

The point you're missing is that everything is negotiable.

Amtrak as a business should negotiate for better access if they're not satisfied with how they're being handled, but they won't. Instead, they run to the Harris-Biden administration, who seems perfectly OK using the courts to fight their battles for them.

Let's sue NS for this, try to figure out who to sue for the Sunset Limited's performance issues, and threaten CSX over the Mobile service...

On the grand scale of things, shouldn't the DOT and STB have bigger fish to fry?