Last week, Portland’s city auditor discovered that the city had been overstating streetcar ridership by 19 percent. It turns out that the Portland Streetcar isn’t the only government-sponsored transportation enterprise that has problems with simple arithmetic.
The January issue of Trains magazine reports that Amtrak has been overcounting its riders for years (the story, “Ridership down, revenue up,” isn’t available on line). It had to reduce its F.Y. 2014 ridership numbers by 705,000 because it actually started counting the number of people who ride its trains using “uncollectible multi-ride tickets” rather than just estimating them. That’s only about 2.3 percent of total 2014 ridership, but it meant that it had to show a decline from 2013 instead of the expected increase. (This is also noted in a footnote on page A-3.5 of Amtrak’s September, 2014, performance report.)
This 2.3 percent isn’t as drastic an overcount as 19 percent, but it spurred me to look at Amtrak’s historic numbers. When counting the number of trips people take on Amtrak each year, the railroad’s business has grown by nearly 40 percent since 1990. But when measured in passenger miles, the growth has been less than 10 percent. This means that the average length per trip has declined from 273 miles in 1990 (and a peak of 286 miles in 1993) to just 215 miles in 2014.
Some of this may be due to other miscounting problems. But a large part must be due to the growth of Amtrak’s state-supported services and the short trips they offer. For example, the California-supported Capitol Corridor goes from San Jose to Sacramento, just 133 miles (and most riders probably just take it the 90 miles between Oakland and Sacramento). The Keystone goes 195 miles from New York to Harrisburg, but most riders just take it the 91 miles between New York and Philadelphia. Most Downeaster trains go from Portland to Boston, a distance of 116 miles. The Piedmont goes 173 miles from Raleigh to Charlotte.
Based on Amtrak’s 2014 year-end performance report, I can roughly estimate that the average trip length on Amtrak’s Acela was 225 miles, and other Northeast Corridor trains was 170 miles. But the average length on the Keystone was just 90 miles; on the Pacific Surfliner was 87 miles; the Piedmont was 107 miles; and the Capitol Corridor was 68 miles. Of these, the Keystone, Surfliner, and Capitol Corridor trains carry enough passengers to significantly affect average trip lengths.
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(Amtrak publishes the ridership by train on page A-3.5, but it doesn’t show passenger miles by train. I calculate passenger miles by comparing the “fully allocated contribution (loss) per passenger mile” with the “fully allocated contribution (loss)” by train on page C-1. Then I divide passenger miles by trips to get average trip length.)
In other words, when Amtrak brags that it is breaking its own ridership records (which, because of the overcounting revelation, it didn’t do in 2014), it is because of lots of people taking heavily subsidized trains for fairly short distances. Why is anyone subsidizing such short trips when they could easily be carried, without a subsidy, by Megabus or some other private, intercity bus company?
These trains are partly state subsidized, but partly federally subsidized as well. After counting the state subsidy as revenue, Amtrak claims that many of these state-supported trains make money. But, as the Antiplanner has previously noted, Amtrak has snuck the cost maintenance out of its operating costs and into capital costs. Although maintenance is really an operating cost, this allows it to claim that many of its routes make an operating profit when really they don’t. Why do the feds need to subsidize these trains, most of which don’t cross interstate lines?
Thanks to shorter trips, the average number of Amtrak trips that the average American takes each year has grown by 23 percent from 0.079 in 1990 trips to 0.097 trips in 2014. But the average distance each American travels by Amtrak has fallen by 2.9 percent from 21.5 to 20.9 miles.
Amtrak’s per capita passenger miles are declining, but they just aren’t much in the first place. The average American travels almost 100 times as many miles by commercial airliner as on Amtrak, and of course they travel by car nearly 750 times as much as on Amtrak. So, tell me again, why are we subsidizing intercity rail?
So, tell me again, why are we subsidizing intercity rail?
Because people like Michael Setty think passenger rail is like a colored man in that it’s been discriminated against and now needs a leg up (and billions in subsidies) to make it in this cruel, heartless world.
“So, tell me again, why are we subsidizing intercity rail?”
After I have argued that Amtrak is hopelessly cost ineffective with anyone who thinks Amtrak service should be subsidized, they make these two arguments most of the time:
1) Even though they infrequently take Amtrak they like having the service available in case they or someone they know cannot drive on a particular trip.
2) They like riding on a train and it is a treat to ride on one on the rare occasions that they do ride on them.
They usually don’t know anything about the subsidy. However, when faced with the cost to them in increased taxes, which probably amount to fifty dollars per person per year (divide $1.4 billion Amtrak by 300 million taxpayers) most say that having the option of the train is worth it, even if they never take it. Even assuming with local taxes the subsidy is one hundred dollars a year many are happy to pay this just to have the option of the service.
I do not agree with this and would be happy to have the experience of riding on a double decked bus instead. However this option of “having the service available if needed” appears to be a major reason for Amtrak support.
Go apply for a bank loan and give false information. That is a crime and, if federal dollars are involved, it is a serious federal crime. You get in trouble.
Give false information to the feds for billions of government subsidies – you get invited to (taxpayer funded) dinners or conferences with government regulators and members of congress. They applaud you for Amtrak’s “success”.
Hey, Metrosucky, I would be satisified if the Feds just paid back the federal excise tax collected on rail passenger tickets during the early to mid-20th Century, with accumulated interest, as partial reparations for the many trillions of subsidies passed out to the automobile over the past 90 years. If you don’t believe such subsidies to driving aren’t real, your head is stuck firmly in the sand.
“Denial” ain’t a river in Egypt.
As for Paul, those criticizing the arithmetic errors by Amtrak and others should get their own arithmetic right before pontificating.
$1.4 billion in Amtrak subsidies divided by 319,404,381 U.S. residents (Census estimate for 2014) is $4.38 per person, not $50.00. Heck the $500 billion+ in “free” (sic) parking structural subsidies is considerably more than $1,500 per person, excluding all the other auto structural subsidies to driving.
$1.4 billion in Amtrak subsidies divided by 319,404,381 U.S. residents (Census estimate for 2014) is $4.38 per person, not $50.00.
Except that far fewer than 319 million people in this country pay federal taxes. You can basically take out the entire under-16 population and keeping whittling away from there.
I would be satisified if the Feds just paid back the federal excise tax collected on rail passenger tickets during the early to mid-20th Century, with accumulated interest, as partial reparations for the many trillions of subsidies passed out to the automobile over the past 90 years. If you don’t believe such subsidies to driving aren’t real, your head is stuck firmly in the sand.
Apart from the matter that abstract modes cannot pay or receive ‘reparations’, where are these excise taxes you refer to?
Heck the $500 billion+ in “free” (sic) parking structural subsidies is considerably more than $1,500 per person
Again, parking isn’t free, it is paid for by the owner of the property and often passed through to tenants, customers and workers on site. Hence why no serious economic analysis treats it as a ‘subsidy’.
Poor msetty. It’s the same, old tired lines…..”reparations blah blah blah, evil auto blah blah blah, Campbell Soup subsidized me yesterday by giving me a 50 cent coupon on cream of tomato blah blah blah”.
MJ: If the government forced a business or housing development to pay for the cost of extending a rail line, building a transit station, or maintaining the station would you call it a subsidy for transit?
What about commuter benefits that let transit riders pay for passes with pretax dollars, is that a subsidy for transit?
“However, when faced with the cost to them in increased taxes, which probably amount to fifty dollars per person per year most say that having the option of the train is worth it, even if they never take it.”
A $50 yearly tax increase isn’t a whole lot of money. Two different $50 tax increases are more, but likely affordable for a lot of people. How about three? Four? Twenty-six?
“It’s only $X” is just what the special interests are counting on, as it’s not worth the average person’s effort to try to get these subsidies ended. But when you add them all up, it’s a good chunk of change. Wouldn’t you prefer to spend it on things you want instead of things other people want? It’s your money, after all. Isn’t it?
If the government forced a business or housing development to pay for the cost of extending a rail line, building a transit station, or maintaining the station would you call it a subsidy for transit?
No, I wouldn’t. You don’t seem to understand the difference. business owner or developer still wouldn’t own the rail line or transit station. On the contrary, a business owner who provides parking (‘free’ or otherwise), still owns the property and is free to charge (or not charge) for its use. And to pre-empt the all-too-predictable rebuttal, no I don’t think parking requirements are good policy. But that is not the same thing as arguing that parking is free.
What about commuter benefits that let transit riders pay for passes with pretax dollars, is that a subsidy for transit?
It is a subsidy for transit users in the short term, but in the long term is probably just compensated for by employers offering lower wages and other fringe benefits.
If the government forced a business or housing development to pay for the cost of extending a rail line, building a transit station, or maintaining the station would you call it a subsidy for transit?
As a follow-up, this not a particularly useful example either, since it would not be constitutional.
I didn’t say parking was free. But requiring parking to be available and plentiful everywhere makes it hard to charge for, and is a subsidy for drivers.
Why is forcing a developer to pay a tax surcharge to support local infrastructure unconstitutional? Isn’t that pretty common? Or forcing a developer to use some of their land to build and maintain a transit station? How is that different from forcing them to build a parking lot?
I think you need to look up the word subsidy in the dictionary. Just because something is plentiful, that does not mean it is subsidized. Quite the opposite, in fact. That which is plentiful needs not a subsidy.
I didn’t say parking was free. But requiring parking to be available and plentiful everywhere makes it hard to charge for, and is a subsidy for drivers.
You obviously have a very different definition of ‘subsidy’ than I do. As I was explaining, even under the ‘free’ parking scenario, drivers ultimately end up paying the cost of the parking, even if it is in an indirect manner in the form of higher prices or lower wages. Who is left to pay the ‘subsidy’ in this case?
Why is forcing a developer to pay a tax surcharge to support local infrastructure unconstitutional? Isn’t that pretty common? Or forcing a developer to use some of their land to build and maintain a transit station? How is that different from forcing them to build a parking lot?
Your example of the government forcing a landowner to pay for rail station would be unconstitutional, as it would almost certainly fail a ‘rational nexus’ test, as established in the case of Dolan v. Tigard. As in that case, the government cannot force a private landowner to provide a good or service that the government would otherwise have provided itself. It is the equivalent of a regulatory taking.
For example, if the government wanted to build a station on the landowner’s site, they could negotiate to compensate the owner for the land needed for the station and build the station themselves. They could even impose a charge on the owner to cover part of the cost if they could demonstrate that the owner was receiving a benefit equal to or larger the cost of the tax/fee. But they cannot force the owner to provide the station and then insist that it is to be used as a public facility.
Back to my original point, even if a landowner is forced to build a parking lot as a condition for permission to develop, the landowner still owns the property and can decide how it is to be used, including how it will recover the cost of the parking lot from customers or employees. If you want to argue that it is a ‘subsidy’, then you have to identify who is paying the subsidy and who is benefiting from it. If they are the same people, then it’s hard to argue that a subsidy exists.