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Amtrak upgrades would boost ridership, cost millions

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Improvements to Amtrak’s Hoosier State service between Indianapolis and Chicago would boost ridership and revenue, but there’s no scenario under which the line would pay for itself, according to an analysis commissioned by the Indiana Department of Transportation.

That doesn’t mean the upfront investment and ongoing subsidies couldn’t be justified, though, consultant CDM Smith Inc. concluded. The cost-benefit analysis will figure into INDOT’s negotiations with Amtrak over continuation of the Hoosier State line, and it will help cities served by the line decide whether they want to pitch in on upgrades.

Indianapolis resident Doug Yerkeson, part of a grassroots group lobbying to keep the Hoosier State, said the study’s conclusion was no surprise.

“I don’t think there’s a passenger train in the world that makes money,” Yerkeson said. “It’s a service.”

The Hoosier State is in question because the federal government will no longer support passenger rail lines shorter than 750 miles, and Amtrak says it needs $3 million a year from Indiana to keep it going. The service runs four days a week, alternating with the long-distance Cardinal line, which will continue.

INDOT says that giving Amtrak $3 million a year for the Hoosier State would amount to $80 per round trip, based on the rail line’s fiscal year 2012 statistics. The Hoosier State had 36,670 riders and generated $883,000 in revenue that year.

Amtrak offered four improvement options in terms of scheduling, number of round trips and reducing all trip times by 30 minutes. All four options would boost ridership and revenue, but they would also require track improvements at an annualized cost of $18 million.

Here is a rundown on the possible improvements and expected results:

Option 1: change schedule to tie into long-distance connections, 88,270 riders a year, $2.3 million in revenue.

Option 2: change schedule to favor local ridership, 86,000 riders a year, $2.2 million in revenue.

Option 3: add second daily round trip with departures from Chicago and Indianapolis around noon, requiring three train sets, 164,000 riders and $4 million in revenue.

Option 4: add second daily round trip, departing Chicago early morning and evening and Indianapolis morning and afternoon, requiring two train sets, 153,000 riders and $3.8 million in revenue.

The improvements would cut the per-rider subsidy significantly, to $32 under the first option, or to $42 under the third option, CDM Smith noted. The subsidy doesn’t take into account the cost of capital improvements, estimated at $231.5 million, or $18 million a year.

Beech Grove is watching closely what happens with the Hoosier State because losing the service could mean Amtrak will send less work to its major repair facility there. Mayor Dennis Buckley said he’s in no position at the moment to promise financial support, but he said, “I support Amtrak, and let’s hope this all works out.”

INDOT started negotiating with Amtrak in time for the Hoosier State to continue past the mid-October termination date set by Amtrak, INDOT spokesman Will Wingfield said. 

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  • We?
    Who is “we”? Are you certain that you pay the exact amount of taxes for the services that government provides? What if a person doesn’t use the interstate and only drives around town? Does that person’s gas tax fund your use of the interstate highway system? Is it appropriate to provide an incentive to reduce congestion on the interstates? Is it appropriate to reduce emissions and incent economic development in the city’s core? The alternative is for INDOT to expand existing and add more interstates and continue suburban sprawl. IEDC is backstopping the direct flight to SF. If the revenue falls short then "we" will make the difference. Is that a subsidy? Is that an appropriate use of tax dollars? maybe.
  • Not So
    Indymoon... The price is $50 PLUS the $80 subsidy. $130. Would you take the train if we weren't paying more than half your fare for you?
  • Amtrak pay its own way?
    The Colts and Pacers don't pay their own way either, but we certainly throw plenty of money their way. Sure, let's stop train transportation to Chicago and show the world once again that we prefer our backwoods status.
  • What Transportation Pays Its Own Way?
    Rail service deserve subsidies as much as roads for cars and trucks, airports for airplanes, and waterways for pleasure boats and barges.
  • Airline
    The State and local gov'ts also find dollars to build new airports, including the $1.1 billion spent on IND, and $1.5 million to backstop flights to SF. But there's no money available to keep and enhance an alternative mode of travel from Indianapolis, Lafayette and other Indiana cities that is found in this study to reduce air emissions, reduce highway congestion and maintenance, increase mobility and access for dependent populations, improve underutilized properties, and stimulate investment. Brandon, How is the cost twice as much? The train is $50 round trip, which is roughly equal to the cost of gas. Then, consider the cost to park in Chicago. The time required is a valid criticism and the report details ways to address that issue. However, it requires investment and foresight, which appears to be lacking.
    • Pay for it self?
      The Interstate system does pay for it self either! Gas tax! Why do Hoosier/INDOT think so small?
    • Reality Track
      We paid a consultant...it won't make money! Too slow. If if was profitable and wanted, a private train company would run it. NOW...if it was Thomas the Tank Engine (James, Percy, Edward, etc.) or the Polar Express, people (families!) would flock to it. Fun meals. Destination goals (sports, museums, shopping). Nice depots. Quit wasting our money.
      • Better way
        Why is it that we have unlimited millions of dollars to continue building more & more roads, yet we can't find a relatively minor amount of money to provide rail service? This state will never advance with the mind-et of INDOT & elected officals to continue with road construction. Rail will bring much needed Economic Opportunity to those rural communities served by it.
      • Amtrak
        I would love to take the train from Indy to Chicago if 1) it didn't take almost twice as long to get there by train than car and 2) it didn't cost twice as much to do it. I'll pay the fare but I cant have it take 5-6 hours to get there. That ruins a day trip.
      • more Cardinal service?
        How about just getting Amtrak to run the Cardinal Line 7 days a week in the interim? Wouldn't that provide the same result we have now without additional local funds?

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