May 31, 2021 - TRA Newswire -
Rail Passengers Association (RPA) has issued an economic benefits analysis that shows if Amtrak's Sunset Limited/Texas Eagle service expanded from tri-weekly to daily service it would generate an economic return of 3.5 times to the towns and cities it serves.
In the analysis, they estimate that the total benefits of a daily Sunset/Eagle service along the present route from New Orleans to Los Angeles, which serves 44 cities in 8 states could reach $239.4 million every year, driven mostly by additional value-added economic activity stemming from induced visitor spending and highway-related savings from reduced vehicle miles traveled (VMTs). This compares favorably with an estimated $67 million annual cost to operate the train seven days per week in each direction.
The DC-based rail passenger advocacy organization issued the economic benefit report that in summary shows that a daily service would
induce additional employment and purchases of goods and services worth some $117.9 million a year spread across the eight states served on the route
giving passengers the ability to arrive or depart on any day of the week they choose will generate an additional $10.8 million in visitor spending each year
estimate that county, state and federal tax receipts will rise by $14.6 million each year
less highway wear and tear and accident avoidance would save local and state governments some $106 million a year
Rail Passengers’ President and CEO, Jim Mathews, has testified to members of Congress about these analyses, noting that it’s not a question of “if trains make money, it’s about who trains make money for".
Matthews said that rail corridors generate value by acting as economic engines in the communities they serve—through jobs, retail, mobility, tourism and real-estate development. The “profit” goes not to Amtrak, but to the communities served and the taxpayers who live in them, often to the tune of millions of dollars.
In Texas the annual economic benefit in visitor spending is estimated at $5,283,547; reduced traffic costs of $2,418,165; saved road maintenance of $81,110,194 and reduced pollution cost of $967,937. The tri-weekly Sunset Limited serves Beaumont and Houston before joining up with the Texas Eagle at San Antonio to serve Del Rio, Sanderson, Alpine and El Paso in the lone star state.
Rail Passengers Association indicated that the analysis results are tied to a simple and verified premise – passenger rail is an economic engine in the communities it serves. The existence of Amtrak buoys the economies of hundreds of towns and cities all across America. In the case of the Sunset and Eagle – combined in line with the Amtrak Performance Improvement Plan (PIP) submitted to Congress in 2010 – a daily service would represent a return on taxpayers’ equity of 3.52X, creating the preconditions for the private-sector economy to thrive in the communities served.
The organization issued the analysis in response to requests from congressional staff and other interested parties. The economic modeling tools used to measure the larger economic benefits of daily intercity passenger service to the states served by the route by tracing spending through local economies and measuring the cumulative effects of that spending found that a daily Sunset/Eagle service could produce an annual economic
benefit 3.5 times more than what would be spent to operate the train.
In 2018, the Rail Passengers Association co-developed a rigorous IMPLAN economic model with the University of Southern Mississippi’s Trent Lott Center to quantify the economic return on passenger rail corridors in a way that hadn’t been done previously.
In addition to the financial benefits, a daily Sunset/Eagle is especially compelling for at least five other reasons:
A daily Sunset/Eagle would connect nine large and rapidly growing Metropolitan Statistical Areas (MSAs) which are, with one exception, within 300 to 400 miles of each other.
A daily Sunset/Eagle would increase service to states that are now home to one in four Americans, and which continue to grow at a rate roughly one-third faster than the overall American population.
A daily Sunset/Eagle would serve the mobility needs of a large number of travelers that three times weekly service does not, inducing additional ridership.
A daily Sunset/Eagle offers a reasonable probability of generating enough incremental revenue to cover most incremental operating costs.
A daily Sunset/Eagle would require little in the way of additional operating support from the federal government.
Additional information on the economic analysis can be obtained through Rail Passengers Association in Washington D.C.