Legislation to be proposed on Wednesday would open ownership of Amtrak's Northeast operations to private investment as a catalyst for developing high-speed service on the heavily used route.
Amtrak, a for-profit federal corporation, is the only long-haul passenger rail service in the United States, and for years a political hot potato over billions of dollars in U.S. government subsidies and losses.
U.S. Representative John Mica, chairman of the House of Representatives Transportation Committee, is promoting a bill that would transfer ownership of Amtrak's Northeast Corridor crown jewel to the Transportation Department.
The agency would then establish a committee that would manage infrastructure and operations between Washington, New York and Boston.
The panel would then seek private investors, who may include overseas operators or other interests, for a stake in Amtrak's most popular business. Amtrak could have a role in the new system, possibly as operator.
After 40 years of highly subsidized, poorly managed Amtrak operations, it's time for Congress to change the direction of America's failed high-speed and intercity passenger rail service, said Mica.
Amtrak officials had no immediate comment on Mica's plan but previously have said the railroad has worked hard to streamline management, boost revenues, and improve capital investment.
Additionally, the rail line's Northeast service has experienced sharp growth in ridership, especially among business travelers as an alternative to air travel. Driving is still the dominant mode of transportation in the region.
Congressional Democrats, supported by the Obama administration, are open to private investment in transportation projects but support Amtrak. The Transportation Department last month granted $450 million to Amtrak to help pay for Northeast infrastructure upgrades to improve high-speed operations.
Amtrak was created from the remnants of failed privately owned passenger railroads in 1971. Transportation experts have long been skeptical that large-scale U.S. passenger rail will ever attract sustained interest from the private sector due to capital costs and its history of losing money.
Amtrak's net operating loss for the fiscal year that began October 1 through April was $707 million, down nearly $60 million from the same period last year, according to the latest available data.
Northeast ridership was up nearly 5 percent for the period to 6.1 million passengers with revenues running 10 percent higher at $545.6 million.
Amtrak runs half of its 300-train daily service on the Northeast Corridor, which also services commuter lines.
Infrastructure is a major challenge with currently $5 billion in deferred maintenance in the Northeast, including more than 224 bridges beyond their design life. There are also three Civil War-era tunnels in Baltimore that have become slow-speed bottlenecks.
(Reporting by John Crawley; Editing by Tim Dobbyn)