Mr. Speaker, I rise to discuss the importance of the State Assisted Fair Bid provision in the FY2004 Transportation Appropriations bill. The Conference Report contains a provision that will establish a pilot program to assist states that…
Mr. Speaker, I rise to discuss the importance of the State Assisted Fair Bid provision in the FY2004 Transportation Appropriations bill. The Conference Report contains a provision that will establish a pilot program to assist states that choose to contract with the private sector to provide intercity passenger rail service. I anticipate there will be at least two or three demonstration projects under this proposal in fiscal year 2004. The report provides the Secretary with up to $2.5 million to assist the states in implementing the competitive process. I have spoken with Appropriations Chairman Young, and he has assured me that the funding may be used for any purpose in the implementation of a Fair Bid Demonstration project, including providing insurance to states and operators in a manner that results in the lowest possible insurance costs. Furthermore, I understand that the Secretary is encouraged to use a portion of the $2.5 million in grant money provided to the states to subsidize alternative insurance arrangements as a part of the Demonstration Projects.
I want to be clear in my understanding that the states have a great deal of latitude in proposing Demonstration Projects under this provision. The only statutory requirement is that the state must assist the intercity service with a subsidy of some nature. My friend, Chairman Young, has assured me that this is so. Obviously, all of the current state-assisted operations, which are commonly known as 403(b) service, and are now being operated under contract with Amtrak, are eligible. One example of this service that comes to mind is my state's Missouri Mule, which operates between St. Louis and Kansas City. The state of Missouri attempted a competitive bid for the Missouri Mule service last year when Amtrak increased the state subsidy requirement. The process failed, because Amtrak refused to make facilities and equipment, or even access to its national reservation system, available to any bidder on reasonable terms. In many ways, it is the Missouri Mule example that resulted in the Fair Bid language being contained in this bill. Certainly, the Missouri Mule will be a candidate under this new provision.
However, there are many other candidates. The North Carolina Piedmont and Carolinian provide another example of such trains. The Amtrak Cascades Service between Vancouver, British Columbia and Eugene, Oregon is a 464-mile corridor that is subsidized by the Washington and Oregon DOTs. Services that are not current 403(b) services would also be eligible should the state choose to provide a subsidy. In another more general example, the State of Florida is interested in new conventional intercity passenger rail service along the East Coast, but Amtrak has declined to initiate the operation. In cooperation with the track
owner, the state has the option of putting that service out to competitive bid.
Another example is New York's Empire service between Albany and New York City. That service is currently not subsidized, but Amtrak has requested a subsidy from the state as a condition of operating New York's remanufactured 125 mile per hour turbo trains. The Empire corridor could be put out to competitive bid under the terms of this provision.