Amtrak's Wild Ride Could Get Bumpier

(MoneyWatch)  Railway travel is no longer a unique mode of transportation. California, long known as the car capital of the nation, boasts the highest number of people using Amtrak for both excursions and commuting. With the price of gasoline and airline tickets high, many are looking at alternatives.

That's why ridership on the passenger train service has climbed dramatically in recent months, experts say. More than 2.75 million people boarded in July -- the most of any month in Amtrak's 37-year history, according to its latest figures.

The cost is causing many people to ride for the first time, the Pittsburg Tribune-Review reports. Three round-trip airfares to New York would have cost Tony Gentile about $420 on either US Airways or Southwest Airlines, but Amtrak tickets cost $126. His two sons, both younger than 12, rode for free.

And many cities and counties are now begging for whistle stops. Idaho wants its old Amtrak Pioneer route reinstituted through the Pacific Northwest. In California, several cities in suburban Southern California are requesting stops by Amtrak. Indio, a city of 75,000 near Palm Springs, received six stops at a new station after negotiating with Amtrak for more than year. And about $400 million from Prop. 1B, the $19.9 billion transportation bond California voters approved in 2006, will be dedicated to adding and expanding railroad tracks.

"The ridership is there," Richard Silver, executive director of the Rail Passenger Association of California and Nevada told the Press-Enterprise. "As California has grown in the last 30 years, the need for more train service has grown with it."

Amtrak needs the revenue. It lost $1.12 billion in the year ending Sept. 30, 2007, after losing $1.07 billion in 2006. Those losses were after Amtrak received about $1.3 billion in federal subsidies each year. The train service hasn't turned a profit since its inception in 1970. Yet some experts are saying that record ridership could make 2008 the first time Amtrak approaches a profit.

It may not matter. Amtrak's funds could be halted if Congress doesn't iron out a bill to fund the train service --- and the money could be taken and earmarked for federal highways, according to news reports.

Because of the increase in commuting and alternate travel, revenues from federal gas taxes have declined. Instead of seeing this as a sign of a thriving transit system, Congress granted the lost $8 billion to the federal highway fund rather than expanding public transit. Congress will hold a hearing Tuesday to discuss broadening transit options, including Amtrak.