May 17, 2018

The lack of progress in implementing Positive Train Control (PTC) on the part of some commuter rail lines fell under scrutiny at a hearing Wednesday of the Senate Appropriations Committee, Subcommittee on Transportation, Housing and Urban Development, and Related Agencies.

The hearing, called by Subcommittee Chairman Susan Collins (R-ME), came at a critical time: earlier this week, the Federal Railroad Administration (FRA) posted its first-quarter 2018 PTC installation stats, which showed 12 commuter rail lines at risk for not hitting enough milestones to qualify for an extension of the Dec. 31, 2018 deadline for railroads to fully implement their PTC systems. That number was two down from 14 at year-end 2017, as the Metropolitan Transit Authority (MTA), Florida East Coast Railway, and Conrail all made significant installation progress during Q1 2018, while Caltrain made changes to its PTC system and so fell down the list.

Also this week, the FRA released a notice of funding opportunity for $250 million in PTC implementation grants included in the FY18 omnibus spending deal passed by Congress earlier this year. Eligible projects, according to the criteria, must be used to deploy PTC systems technology, and not to operate and maintain existing systems. In other words, the $250 million is just for those railroads that are lagging behind in deployment.

Testifying at the hearing were Federal Railroad Administrator Ronald Batory; Stephen Gardner, Executive Vice President and Chief Commercial Officer at Amtrak; Patricia Quinn, Executive Director of the Northern New England Passenger Rail Authority (NNEPRA manages the Downeaster rail service operated by Amtrak connecting Maine to Boston, which is of particular interest to Chairman Collins); and Art Leahy, Chief Executive Officer of Metrolink, a commuter rail system in southern California. Metrolink has fully implemented PTC, and a 2008 Metrolink collision with a freight train that caused 25 deaths and many injuries was what broke a longstanding legislative logjam and got Congress to enact a PTC mandate in the first place.

Commuter Rail Lines Lagging Behind on Installation

The main focus of the hearing was the dozen commuter rail roads who are currently at risk not only of missing the Dec. 31 deadline, but also of failing to meet the statutory criteria to qualify for an extension. All 12 have installed less than 80 percent of the necessary hardware.

Under the 2008 PTC statute (as amended in 2015), qualifying railroads must fully implement a PTC system on all required route miles (those running more than 12 trains a day) by December 31, 2018 unless it qualifies for an “alternative schedule” (a two-year extension of the deadline). The law is very clear and precise – to qualify for that extension, a commuter railroad must meet all of the following criteria:

• Hardware – Installed, by December 31, 2018, all PTC system hardware required for system implementation consistent with railroad’s PTC Implementation Plan (PTCIP);
• Spectrum – Acquired, by December 31, 2018, all spectrum necessary for implementation of the railroad’s PTC system;
• Employee Training – Completed the employee training required under 49 CFR part 236, subpart I for all applicable personnel in any territory, or segment thereof, where the PTC system is currently being operated in revenue service demonstration (RSD) or revenue service;
• Advanced Testing and/or Implementation – for commuter railroads and Amtrak, the railroad has initiated FRA-approved RSD on at least one territory that is required to have operations governed by a PTC system, or met any other criteria established by FRA.

Administrator Batory said during the hearing that he has advocated to Transportation Secretary Elaine Chao that the fines assessed on those railroads should be “nothing less than maximum.” But there’s more at stake: Gardner confirmed that while Amtrak believes most of its partners (most of Amtrak’s track ownership is along the Northeast Corridor, and elsewhere in the country they are a tenant of another railroad) will have PTC operational by the 2018 deadline or else qualify for an extension, Amtrak plans to suspend service on noncompliant routes.

The Q1 2018 stats paint an interesting picture: While all Class 1 (freight) railroads and Amtrak are on schedule to meet the deadline, it’s the commuter rail lines that are lagging behind. According to Batory, 60 percent of required freight rail miles are now covered by PTC, but less than 25 percent of required passenger rail miles have PTC in service. Over the past year, railroads increased the total amount of installed hardware from 77 percent to 93 percent, but that was mostly because of Class 1 railroads, which skyrocketed from 18 percent in operation in Q1 2017 to 60 percent now. Passenger rail, meanwhile, only increased from 24 percent to 25 percent in that same time period.

One notable laggard: New Jersey Transit, the third largest transit system in the country (85.5 million passengers in 2017), has just 13 percent of its required hardware installed and is also way behind on employee training. Its next door neighbor, MTA, on the other hand, went from 63 percent to 86 percent over the past three months, thereby bringing it out of at-risk territory.

Pressed by Chairman Collins on why commuter rail lines are lagging behind, Batory said FRA has met with all 41 to-be-compliant railroads individually and pulled out four common themes:

First, over the 10 years that have passed between the 2008 PTC law and today, the first few years most railroads were unable to make any progress because suppliers needed to develop the technology and await the writing of the regulation so that the equipment could be developed properly to fulfill the regulation. This got railroads off to a slow start, Batory said.

Second, commuter railroads have seen a level of leadership turnover (in Boards of Directors and executive leadership positions) greater than other sectors of the railroad industry. “Sustained leadership,” he said “is paramount.” He pointed to Metrolink as a “poster child” of the importance of leadership in getting PTC installed.

Third, money is an issue for some: Batory said that two of the dozen lagging railroads do not have the money to fulfill their PTC obligations, one in New Mexico (the New Mexico Rail Runner Express, or Rio Metro) and one in Northern California (Caltrain, in part because they fired their primary contractor late last year). He seemed to imply they would be priority recipients for PTC grant funding.

Fourth, there are capacity issues among suppliers, which Batory continually referred to as a “boutique supply industry.” FRA met with 10 leading suppliers of PTC hardware and learned that as late as 2015, over half of railroads with PTC obligations hadn’t engaged the supply industry at all. There’s been an “avalanche of demand” since 2015 as the deadline approaches, and suppliers are struggling to keep pace with demand.

For all of the focus on laggard railroads, none of them were present at the hearing: Leahy was quick to mention that Metrolink was the first commuter rail in the nation to have PTC implemented on all of its territory—no small feat given its footprint includes the second-busiest Amtrak corridor in the nation—and is 95 percent compliant on all of its right of way. Then again, its fatal 2008 accident was largely behind the urgency with which Metrolink pursued PTC.

NNEPRA is an interesting case study. Part of the Downeaster route is required to be PTC compliant while part of it isn’t: Amtrak only runs 10 trains daily from Boston to Portland, so the portion of rail in Maine and New Hampshire is exempt, but the rail in Massachusetts (MBTA territory) is above the 12 train threshold and so PTC is required there. Quinn said the interaction of the PTC-compliant segment with the non-PTC segment is a concern that NNEPRA is working with its partners to address. Gardner said Amtrak wants all of its railroads to be as safe as a PTC-complaint segment and is working with NNEPRA and others on individually tailored safety solutions for each non-PTC route it operates.

FRA Funding Decisions Also Under Scrutiny

Batory was put in the hot seat when it came to the amount of funding FRA is providing for PTC implementation grants. The subcommittee provided $593 million in the FY18 funding bill for the Consolidated Rail Infrastructure and Safety Improvements (CRISI) grant program, $250 million of which was set aside specifically for PTC. This week’s NOFO was for that $250 million, and there’s been no announcement about the remaining $343 million.

Ranking Member Jack Reed (D-RI) took issue with FRA’s decision to make just the $250 million available, implying that Congress’s intent was for the $250 million to be a floor and not a ceiling. He also accused Batory’s FRA of sitting on the remaining money. “You could have allocated more than $250 million,” he said. “I suspect the need is much greater.”

While Reed accused FRA of “unnecessarily delaying important safety projects,” Batory was unfazed. “The amount of applicants we get [in response to the NOFO] will determine whether the amount of money will satisfy the need,” Batory said. The Administrator said FRA’s focus now is on getting the first round of money out the door: he pointed out they cut the application window in half from the traditional 90 days to 45 days, and they are planning webinars with the American Public Transit Association (APTA) and other associations to help spread the word.

(Ed. Note: The FY 2019 House Transportation-HUD appropriations bill, unveiled this week, would provide an additional $300 million for the CRISI program, no less than half of which is set aside for PTC grants to commuter railroads, and would also order FRA to put out the entire $300 million through a single NOFO.)

Watch the full hearing here.