Amtrak Finance High-Speed Rail Intercity Rail

Revisiting Privatization in Intercity Rail

» Amtrak, as always, is being targeted for privatization by conservatives. But what approach leads to optimized public benefit?

Over the past few weeks, U.S. House Transportation and Infrastructure Committee Chairman John Mica (R-FL) has convened a series of hearings on the failures of Amtrak, America’s independent — but fully federally owned — national rail operator. Mr. Mica has used the meetings to wage an ideological crusade against the railway, arguing that it is too inefficient and expensive to continue receiving subsidies. Republican Presidential nominee Mitt Romney has also advocated selling Amtrak.

Democrats have mostly shot back, arguing that privatizing the agency would result in a significant reduction in services provided and increase ticket costs.

Here is the confusing truth about Amtrak, however: The rail agency, fully government-owned, is in many ways already a privatized operation that receives federal subsidies. The organization does not seem to have the larger public’s interests in mind in setting policies: It has some of the highest fares in the world for services in the Northeast Corridor, it provides no discounts for people of lesser means, and it actively promotes the use of intercity buses for people who want to pay less, in effect strategically reducing its market share. These are not the actions of a government enterprise acting in the public interest; these are the actions of a private corporation attempting to maximize profit.

Amtrak is an agency that, in its existing form, can satisfy neither the left nor the right.

And of course, Amtrak is not making a profit — it operates at a considerable deficit every year. But “privatization” can mean many things — and is a private alternative any better than the current circumstances?

Over the past month, Stephen Smith has published articles on the failure of Britain’s rail privatization, the success of Japan’s effort, and the potential for privatization of Amtrak services. The overall conclusion from the articles seems to be that there may be benefits from the movement of rail services out of the public sector, but that without vertical integration — in other words, single-company control of both tracks and services — difficulties are likely to ensue, as in the case of the U.K. Smith points to the structure of Japanese National Railways (JNR), in which six private companies control services in different parts of the country.*

Smith suggests that with privatization, Amtrak could radically improve its efficiency. The biggest problems with the rail agency, he argues, are related to low worker productivity. Despite Amtrak’s privately motivated interests that I pointed out above, much of its labor rules remain affected by politics and can be altered by Congressional action. Are we willing to accept reducing the influence of democratic actors in agency decision-making? It would mean restructuring labor agreements — reducing the income and health benefits that unions have fought for decades to acquire — and firing huge numbers of workers (a third in the case of JNR’s privatization).

If privatization slashes the number of workers needed to do the same job, rail in the U.S. could indeed become profitable, since most of Amtrak’s costs are labor related. For the transportation public, that could produce cheaper ticket prices and fewer subsidies. But it means, fundamentally, that we are bringing private companies in to do the dirty work that the government is politically incapable of doing.

Assuming that some privatization is accepted as “needed” to improve American rail service, in what form should it be implemented?

In general, there are four rough frameworks for such privatization:

  1. Publicly owned tracks with competition for services. This is being implemented in mainland European countries under E.U. regulations; public sector track owners (such as RFF in France) allow operators — both public and private — to run competing services on the same lines.** This allows riders to choose operators on journeys with the same origins and destinations, just as can be done for airline journeys.
  2. Publicly owned tracks with competition for contracts. This is the network organization in the United Kingdom; public Network Rail owns the tracks but then leases the rights to operating rail corridors to private companies. In general, contracts last around seven years and give each operator close to monopoly rights over each corridor.***
  3. Privately owned tracks with competition for contracts. This was the system previously operated in the U.K.; the privately controlled Railtrack owned all tracks in the country between 1994 and 2002. The tracks were moved into the control of a public operator, as described in the second alternative.
  4. Privately owned tracks with one private operator. This is how intercity rail operations are managed in Japan.

Smith and other critics have argued that separating track ownership from rail operations — that’s what happens in alternatives 1-3 described above — result in inefficiencies and potential competing motivations. The U.K.’s attempt to privatize both tracks and operations (alternative 3) produced a number of failures, reducing the safety of the services provided. These difficulties led to the nationalization of the track ownership (a switch to alternative 2), but the contractual relationships between the track owner and the rail operators continue to be a cause for concern. In both cases, the U.K. government has subsidized capital upgrades and in some cases it has subsidies operations.

The problems have expanded over time. Operators have failed to follow through on their commitments. In some instances they have promised too much. In the case of services on the East Coast Main Line, operator National Express East Coast gave up its contract following higher costs and lower revenues than expected; the result was that the government took over operations directly through publicly owned (but supposedly temporary) Directly Operated Railways. National Express’ promises to the government for fees it would pay over the years were abandoned.

The government announced that FirstGroup (owner of Greyhound and BoltBus) would in December take over operating services from Virgin on the West Coast Main Line, Britain’s most popular, and profitable, railway line. But Virgin, which was hoping to renew its contract, warned that the deal was a “recipe for bankruptcy” because of FirstGroup’s inflated estimates of future ridership, which were used to determine how much FirstGroup would pay National Rail over the next few years to use the tracks. Last week, the government admitted it had made a serious mistake, revoked FirstGroup’s winning bid, and refunded all four bidders for their work upwards of £5 million. This was an unnecessary loss of taxpayer funds and will force the contract to be re-bid in the next few months.

These circumstances are revealing of the problems with separating ownership of tracks and operations. Track owners want to maximize the amount of money they can charge companies to run their services there, and so in places with profitable operations, they will accept the highest — and potentially riskiest — bids. Meanwhile, operators have an incentive to maximize profits — either in terms of inflating estimates of future performance in order to win a bid (in the case of the current U.K. system) or skimping on services or maintenance — in order to pay the operation charges to the track owners.

It is hard to see how mainland Europe’s approach, the first alternative, would be much better. The track owners are setting standard prices for track use by each individual train, which will likely encourage intense competition on the heaviest-traveled routes but a lack of interest in operating services on lines with less passenger travel. This will reduce revenues per train on the popular corridors, making any kind of cross-subsidies currently instituted by national operators less likely and probably requiring increasing government aid for the continuation of services to less popular areas.

Thus the explanation for Stephen Smith’s call for privatizing in the mode of Japan’s railway; by integrating track ownership and passenger services, conflicting incentives can can be negotiated, rather than fought out. Ed Glaeser, the Harvard economist, wrote Sunday that potentially profitable lines in the densest sections of the U.S. — including the Northeast Corridor and parts of California — should “follow Conrail into unsubsidized privatization.” This implies, like in Japan, giving one company rights over both tracks and the trains that run on them.

The problem with this approach is clear: It is a recipe for monopoly control of a railroad by a private enterprise. Conservatives berate Amtrak and other government-owned enterprises for being “Soviet“-like (in the words of John Mica), but private monopoly control of rail services is worse — and market conservatives should agree on that fact. After all, monopolized services can inflate prices, provide poor service, and in general be unresponsive to customer concerns. Unlike Amtrak, which must respond to political demands in our democracy, private monopolies must respond only to their profit-seeking shareholders, who clearly have different demands than the public as a whole.

Some might argue that rail services in the U.S., even if controlled by one company, cannot constitute a “monopoly” since they are competing with air and road services, which are owned and operated by other entities. Yet if it is in the public interest to encourage fast, relatively inexpensive services on intercity rail lines (that is what we want, right?), we are effectively arguing on behalf of massively increasing rail share on specific intercity travel markets — and significant government subsidies dedicated to investments in new tracks would back this approach. Once we have done that, we do not want people to move back to cars or airplanes, and we will have made those alternatives quite unappealing — thus benefiting the monopoly. Japanese rail operators do not have to compete with air or auto travel for most of their services because of the extraordinary advantages of rail along their routes, allowing them to act as transportation monopolies.

The presumptive development of vertically integrated private enterprises for the provision of new rail services in Florida between Miami and Orlando and in the Southwest between Victorville and Las Vegas has led to excited speculation that there is a potential for future American private investment in intercity rail. These investments would produce rail monopolies, but their overall market shares — at least at first — would make them small enough to avoid the prospect of developing into transportation monopolies. So they offer considerable benefits and likely should be supported by the public sector if possible — especially since neither Florida nor Nevada seem likely to be promoting state-sponsored public intercity rail projects in the short term.

Yet as a national approach the vertical integration of railroads into privately controlled monopolies is problematic policy that could encourage higher ticket prices and little concern for the overall public interest. There is an argument to be made that effective regulation of such services, much as is done with private energy utilities in most of the country, could limit the profits and destructive effects of such monopolies. But utility regulation has hardly prevented price gouging among energy companies. Can we trust that private railroads in the U.S. would work as well as those in Japan?

Moreover, private companies will only be interested in operating lines that are profitable. The reason Amtrak continues to serve places like Montana and Kansas is not that the agency has fooled itself into thinking that these can be profitable routes, but rather that its political support from the federal government has been premised upon the continued operation of trains to places that do not “deserve” it. But there are few transportation options available for these areas, and there is a political concern for continuing operations there. Would it make more sense to continue having Amtrak operate those routes, and, as usual, privatize the profits and socialize the losses? Or should such routes be contracted out to the lowest bidder, knowing that such contracts may fall apart, as they have in the U.K.?

If there are significant reasons to be concerned about private monopolies on rail services and there is a consensus that separate control of infrastructure and operations causes more problems than desired, what, then, is the option? Amtrak’s role as a public enterprise with seemingly very little interest in the public itself does not set a particularly helpful precedent. But if a monopoly over all rail services in a specific area is the only reasonable option, is the public sector the more appropriate place to turn than profit-motivated private groups? There are no easy answers.

* The “private” nature of these companies is worth questioning. Of six railway companies, three (Hokkaido, Shikoku, and Kyushu) are fully owned by the government entity Japan Railway Construction, Transport and Technology Agency. In other words, they are public enterprises, like… Amtrak.

** It should be noted that in some countries, like Germany and Spain, the historic nationalized rail company (DB and Renfe, respectively) has a separate division that controls the tracks, on which competing operators can buy running rights.

*** One of the odd consequences of Britain’s privatization schemes (which extend beyond rail and into energy and other services) is a significant expansion of government-owned corporations from other countries entering the U.K. marketCertain bus services in London are provided by Paris Métro operator RATP; certain intercity rail lines are operated by Germany national railroad DB’s subsidiary Arriva. Meanwhile, the U.K. itself has no such state-owned enterprises that have the capability of competing for services in other countries.

High-Speed Rail Intercity Rail United Kingdom

UK Ramps Up Intercity Rail Investments

» Continued investment in the U.K.’s rail network comes at a considerable cost, but spending on existing services will complement planned high-speed rail route and further recent ridership increases.

Opposition to the United Kingdom’s second high-speed rail line, the £17 33 billion* connection between London and Birmingham called HS2, has been stewing for years. Critics of the line — much like opponents to rail programs in the U.S. — suggest that the project’s benefits do not justify its enormous cost (both monetarily and in terms of its effects on the rural landscapes trains will pass through) and that other investments on existing lines would be more effective.

While the U.K.’s Conservative-led coalition government, itself teetering and facing a double-dip recession, continues to maintain its support for the HS2 program, it has not limited its public investments just to that line, and this week it announced a £9.4 billion ($14.6 billion) scheme to electrify a number of routes throughout the country between 2014 and 2019. Certain of these projects were announced in 2009 under the then-Labour government. The improvements will provide for a significant expansion in capacity on existing lines, decrease operating costs, and allow the introduction of faster, more agile electric trains — in addition to clearing the way for more space for freight trains.

The spending, which will electrify routes from London to Cardiff, Manchester to Liverpool and York, and the Midland Main Line, is part of a £16 billion total investment in the National Rail route network planned for the five-year period, whose hallmark projects include the construction or improvement of two cross-London lines, Crossrail and Thameslink. It comes after fifteen years of £35 billion of concentrated investments in the U.K.’s rail system — spending in tracks, signals, stations and trains that has radically improved service and dramatically increased passenger counts.

A diesel East Midlands train running north from London on a line scheduled for electrification. From Flickr user Ingy the Wingy (cc)

Unlike HS2, the planned line electrifications are unlikely to see much opposition, in part because the investments made in the country’s rail network thus far have proven so popular despite their high cost. Though there is quite a bit criticism of the operations regime used in the U.K., in which private operators bid for routes (indeed, Labour is “flirting” with re-nationalisation), the publicly owned infrastructure has been improved to such an extent that the nation now boasts the second-most heavily used rail network in Europe, after Germany. Last year, 1.35 billion riders took to the rails, an increase of 50% over the past decade. Though Amtrak’s recent passenger growth has been impressive, its roughly 30 million annual passengers pale in comparison.** So there is cross-party support for projects that improve the U.K.’s railways.

This raises questions about the right approach for investment in rail systems in the United States. The only true high-speed rail project with any reasonable chance of even partial implementation in the U.S. currently is the California High-Speed Rail system, but that effort will require a significant infusion of future federal funds to move beyond an initial operating segment. On the other hand, there are major improvements being sponsored in states such as North Carolina and Illinois that will speed up existing passenger routes, improve freight operations, and expand the number of daily services. In many ways, those latter programs are much more like the British approach than the true high-speed investment proposed for California, and as the evidence has demonstrated, a serious effort to improve existing lines is likely to attract many more passengers.

Yet opponents have cried foul repeatedly in the U.S. Aaron Renn, whose view replicates that of many conservatives, wrote last week that Illinois’ investment in improving the corridor between Chicago and St. Louis represented little more than the implementation of “Toonerville Trolleys” because of the proposed trains’ relatively low 110 mph maximum speeds. He then bemoaned the high cost of the California plan and Amtrak’s Northeast Corridor project, while at the same time arguing that “high speed rail could play an important role in US transportation.” He suggests that supporters of high-speed rail will support every project with that name attached to it, but he himself does not seem willing to endorse any project of the type once it reaches the planning phase. Perhaps American supporters of rail are too enthusiastic, but half of that excitement is simply a reaction to the overwhelming, mind-numbing skepticism of opponents.

The fact is that there are reasonable quibbles to be articulated against most infrastructure projects, and it is possible that significant improvements to the U.S.’ existing rail system could be made at a lower cost. In addition, as Alon Levy has noted, improved cooperation between agencies is necessary; it is no surprise that the U.K.’s single rail infrastructure owner is better able to handle upgrades than America’s balkanized pattern of public and private track control. But it seems evident that working through problems where they exist and devoting money to improvements where possible will lead to increasing use of the country’s trains — as has been the case in the U.K.

Nevertheless, difficulties remain in Britain as well. Transport Secretary Justine Greening noted that the private passenger rail companies in the U.K. were operating with “waste and inefficiency” but that there was nothing to do in the immediate term. Meanwhile, because of inadequacies in government funding, passengers would have to take the fall for much of the cost of new spending, resulting in planned increases in fares equal to annual inflation plus 3%. That increase is probably worth it to riders, who will be getting better service as a result, but it will still take a toll on peoples’ finances and potentially limit future ridership increases. At the same time, a similar approach is nearly impossible in the U.S. because of the tiny number of existing passengers.

The U.K. has been a train-riding country for more than a century and it never abandoned its passenger services, unlike the U.S. So it has been easier — both politically and cost-wise — for it to build up passenger counts in recent years through systematic investment. Can the U.S. repeat its successes, despite the lack of existing riders (and related political will), the high construction costs necessary to improve services, and the lack of national control over rail infrastructure?

* The £33 billion cost quote includes links north from Birmingham to Manchester and Leeds.

** Though this figure does not include commuter rail services, of which many are included in the British number. However, even with commuter rail added to Amtrak, total intercity rail ridership in the U.S. is about 500 million a year — in a country five times as large as the U.K.

Intercity Rail Norfolk Richmond

A Bipartisan Push for Rail in Virginia Produces Ridership Successes

» An expanding rail network in Virginia serves more customers and demonstrates that the public will come when new and better train service is offered.

Despite the significant opposition to investment in intercity rail from Republican governors in states from Ohio to Florida, Virginia’s GOP leadership has taken a considerably different course. In office since January 2010, Bob McDonnell has presided over a significant expansion in Amtrak routes — and more is expected by the end of this year. In the meantime, the state’s population has gobbled up the service offered, seeing very significant increases in ridership, offering considerable evidence that Americans are perfectly willing to take the train — if the right routes are provided.

Amtrak service to the state capital at Richmond and points further south via services such as the Carolinian, Palmetto, and Silver Meteor/Silver Star has been offered for decades, as has a line to Newport News, which serves as an extension of the Northeast Regional route that serves cities as far north as Boston.

But in 2009, thanks to an agreement between Amtrak and the State of Virginia (under former Democratic governor Tim Kaine), new service was opened between Washington and Lynchburg, via Culpepper and Charlottesville, offering rail to the western sections of the state. Later this year, another route will be opened, adding Amtrak services to Norfolk as part of the Virginia intercity rail mix. Though the project, which cost $115 million in line upgrades, will provide only one daily round trip to Washington (in four and a half hours), two more are planned if the state can secure an additional $75 million for the purpose. Federal rail grants, which are now impossible to get because of a deadlock on transportation funding in Washington, would be very helpful.

As seen in the chart below, Amtrak ridership has increased steadily over the past three years on many major state-supported Amtrak routes. The Keystone Corridor, a route between Philadelphia and Harrisburg that I profiled in 2009, has continued to see major gains in ridership, increasing its monthly ridership in May from about 100,000 to more than 120,000. Much of that improvement is likely due to increased service frequencies and faster trains introduced as part of a capital investment partnership between the State of Pennsylvania and Amtrak.

In terms of percentage change in ridership, however, routes like the Keystone are expanding ridership only about as quickly as the system as a whole, or about 20% since 2009. As shown in the chart below, other routes have seen far higher increases in ridership, notably in Virginia and North Carolina. Since 2009, trains to Newport News have increased their passenger counts by more than 60% and those running to and through North Carolina (the Carolinian and Piedmont) by almost 80%. Since 2010, the first year for which data is available, Amtrak trains to Lynchburg have increased their ridership by more than 60% as well. Investments in improved Amtrak services appear to be producing beneficial results.

Though the Amtrak trains to Norfolk will start off with very limited service, the service seems likely to be popular in a state with such a record of late. Norfolk’s new light rail line — the Tide — stops at the future rail station, and it has seen higher ridership than estimated. Its 4,800 daily users far exceed initial predictions of 2,900 a day. With a lengthening of that route into Virginia Beach now being considered, access to Amtrak service will be even more convenient to thousands more.

In addition to the planned increase in service frequency, Virginia hopes to invest further in its intercity rail portfolio. It has already spent $370 million on the upgrade of the line between Richmond and Washington, and it hopes to extend the spur to Newport News further south to serve that city’s downtown. But the biggest proposal on the books is a significant improvement in service further south, into North Carolina, as part of the Southeast High-Speed Rail Project. Tolls on I-95 have been mentioned to help pay for that project (though they have seen significant opposition from some), and indeed some source of funding is necessary if the project is to be under construction within a year, as is technically possible.

But without additional federal funding, the likelihood of real rail improvement projects actually being implemented is limited at best.

Image at top: Map of planned Norfolk-Richmond rail services, from Virginia DRPT

High-Speed Rail Intercity Rail London United Kingdom

Defying Criticism, Government Finalizes Plans for U.K. High-Speed Rail

» A new route from London to Birmingham to be opened by 2026, with further extensions planned into 2030s. Project continues to face healthy skepticism.

Whatever the recession’s effects on government budgets, infrastructure development in Europe continues to advance at a steady pace. The United Kingdom government affirmed last week that it would move forward with the construction of a £18.8 billion ($29 billion) high-speed link between London and Birmingham, due for opening in 2026. This in spite of draconian cuts across all sorts of public services, both in Britain and across the continent.

The U.K.’s high-speed effort — it will effectively produce the nation’s first domestic truly high-speed line — follows almost two decades of travel to and from Paris and Brussels via Eurostar trains that operate under the English Chanel. Though those services have only recently met opening-year ridership expectations, Eurostar holds the large majority of the air-rail market share to these continental capitals, especially since following improvements completed in 2007 London finds itself within about two hours of its mainland peers. The popularity of that service surely had something to do with the government’s decision to move forward on a second line.

HS2 will bring measurable benefits: London to Birmingham in just 45 minutes, compared to 1h20 today, and eventually an hour off of trips to Manchester or Leeds, once extensions north to those cities are opened in 2032 at a cumulative cost of £36 billion. Direct trips between northern cities and Heathrow Airport and even the continent via the Channel Tunnel Rail Link will be put into place. London’s aging Euston terminal will be significantly spruced up. The biggest improvement, perhaps, will be the practical doubling of capacity between the capital and the Midlands by providing a release valve for the West Coast Main Line, which recently went through its own upgrading project but which is predicted to reach capacity with a dozen years. (It already handles more than 40% of the country’s freight and 75 million annual passenger journeys.)

Yet the enormous cost of the link up to Birmingham has been put in question repeatedly not only by those who worry about increasing public debt but also those who question the need for the new rail link — especially along the chosen alignment.

The questions vary, depending on the critique: Is it worth spending this much money, primarily to reduce travel times by half an hour on trips between London and northern cities? Is the West Coast Main Line actually at capacity, or can it easily be expanded? Will UK travel patterns change to a significant enough extent to justify more transportation connections?

Much of the criticism of the project has focused on the line’s segment through the Cotswolds northwest of London, a pristine section of Britain that also happens to hold the residences of some of the nation’s most wealthy. But project planners seem to be unable to find an alternative to that alignment; it has remained the same even after the political transition between Labour and the Conservatives after the 2010 elections. That opposition, however, comes across as nimbyism, especially since its prime backers call from the affected area.

But the complaint that there is not enough of an economic rationale for the project is more compelling. The government’s own study of the project suggests that the first section would have a shaky benefits-cost ratio of just 1.6. This means that each pound of investment in the project would lead to £1.6 in economic benefits (in today’s discounted currency). Public works projects should be considered in comparison with one another to prioritize investments, and this rating is low.* The government’s own study of the 51M alternative, produced by project opponents as a suggestion to expand capacity on the West Coast Main Line, suggested a benefits-cost ratio of five or six for that less costly scheme.

Up in the air is the issue of whether the system will ever be extended north of Birmingham, to Manchester and Leeds as suggested by current planning, and then further north to Scotland. Of course, the financing to make those expansions possible is lacking, despite the fact that they would improve the benefits-cost ratio of the program to between 1.8 and 2.5, a far better result.

Meanwhile, the delayed completion of the line (it will not enter the construction stage until 2018) forces us to ask whether governmental action today is “final.” The justification of the wait has been that the government wants to first complete the equally huge Crossrail urban rail project for London. But who knows what priorities the government of 2018 will have. Will the high-speed rail project by then have lost political support?

A low cost-benefit ratio, however, does not necessarily mean the project shouldn’t be built.** The 51M scheme would be fine, but according to the government, it would fail to provide the capacity expansions to the rail network the country necessitates. It would force increasing freight shipments onto congested roadways. As the U.K. plans for its future, it has a choice: Allow its existing infrastructure to become paralyzed by disinvestment and a lack of capacity, or invest to expand it. The latter choice will allow for expanded travel and trade, the former will not.

These issues plague the development of many similar infrastructure investment projects. The California High-Speed Rail project, which continues to attract significant criticism from across the country and which lacks the national commitment devoted to Britain’s program, nonetheless represents a fundamental choice about the future of that state. Will it invest in its mobility systems to guarantee that its future inhabitants have access to travel options? Or will it overwhelm its existing infrastructure with the pains of growth? It’s an expensive choice.

* The government’s insistence that the project will create a large number of jobs (and therefore that it is good) improves the benefits-cost ratio only to the extent that external (non-construction) employment growth occurs because of the rail project and wouldn’t otherwise. After all, construction jobs, if that were the priority, could come cheaper: We could pay people to dig holes.

** As long as the ratio is over 1. Otherwise, the project would then produce more costs than benefits…

Image above: Rendering of British High-Speed Rail, from HS2

Chicago Freight Intercity Rail

At the Heart of the U.S. Freight Rail System, Chicago Advances Grade Separation

» A grant from the U.S. Department of Transportation will speed up both passenger and freight trains by eliminating delays caused by a grade crossing.

Chicago is at the center of the American freight rail system, handling 40% of U.S. rail freight on 500 daily trains. It forms the primary junction of the four biggest American freight rail companies — BNSF, CSX, Norfolk Southern, and Union Pacific — in addition to the two big Canadian carriers, Canadian National and Canadian Pacific. But the complex and intertwined web of tracks that brings trains into and out of the city is hopelessly out of date and causing congestion that limits the number of both freight and passenger trains that can run there.

Last week, ground was broken on the Englewood Flyover, a major element of CREATE, a grand scheme to eliminate such delays in the Chicago area. CREATE — which stands for Chicago Region Environmental and Transportation Efficiency Program — is a series of 67 individual projects that would speed up freight, commuter, and intercity rail by increasing trackage along heavily used routes and eliminating intersections between competing roads and rails.

Thanks to a significant federal grant, some of those delays will be eliminated.

The Englewood Flyover, but one of the hundreds of infrastructure projects reliant on funds from Washington, is designed to reduce train conflicts for the 130 trains that run through the intersection of the Metra Rock Island District commuter rail line and the Norfolk Southern/Amtrak line just south of 63rd Street and near I-90/I-94 on the South Side. Rock Island trains run between Joliet in the southwest suburbs and LaSalle Street station in the Loop; Amtrak trains connect Union Station with destinations in Ohio, Indiana, and Michigan.

The two corridors currently intersect perpendicularly, meaning that trains can only pass through on one corridor at a time. A new bridge will not only separate the operations of the two rights-of-way, but will also increase the number of tracks on each line.

At $133 million, the Englewood Crossover is no major project when it comes to typical American infrastructure (one may question whether this cost is too high for a bridge and a few hundred feet of tracks), but the cumulative effect of similar investments is an improved rail system both for freight and passenger users.

Though this project is all about improving freight systems, the large majority of the project’s funding ($126 million) originated with the federal government and the DOT’s high-speed and intercity rail passenger program, the same funding source that has been much-maligned by GOP governors in states like Florida and Wisconsin. Illinois’ Jobs Now! program* will fund the remaining costs.

The CREATE project is far from the only intercity and freight rail improvement project being funded through public sector financing. Though the high-speed rail program, with its marquee projects such as the link between San Francisco and Los Angeles, has commanded much of the discussion and controversy in recent months, more mundane improvements will play a significant part in keeping the country moving.

Earlier this month, CSX announced that one-third of its major National Gateway improvement project is either complete or under construction. This project is designed to create a double-decker freight corridor between Mid-Atlantic sea ports and the Midwest. The major program will cost almost a billion dollars by itself and will have a majority of its costs paid by public sector sources.

Meanwhile, slow-speed Amtrak celebrated last Thursday its highest ridership ever: 30 million riders in fiscal year 2011. It may not have the class or the efficiency of its counterparts abroad, but the national passenger railroad has steadily increased its role in the lifestyles of Americans — by almost 50% since 2001. But it faces annual grilling sessions in Congress by conservatives who think the government should get out of the rail business.

Neither the freight rail system, nor the passenger rail system, nor even the highway system, could survive without subsidies from the federal government.

Bipartisan “agreement” in the Congress in September produced a deal that will fund intercity rail projects at just $100 million in Fiscal Year 2012 — not enough even to afford the small Chicago project, not to mention the dozens of similar improvements that are vitally necessary to keep the U.S. rail system in a state of reasonable repair. Projects like the Englewood Flyover have little to nothing to do with true high-speed rail investments, but they have a lot to do with making sure people and goods can continue to get around as they have for the last century.

* A state-level stimulus funding program that is intended to eventually pump $31 billion into Illinois’ economy. In addition to funds for roads, schools, and more, $3 billion will be distributed for transit improvements, $550 million for intercity rail, and $322 million for the CREATE project.

Image above: Amtrak passenger and Union Pacific freight trains near Chicago’s Loop, from Flickr user vxla (cc)