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Amtrak: LIRR's plan to withhold funds illegal

Withholding LIRR funds for Penn repairs illegal, Amtrak says

MTA Board members Veronica Vanterpool and Polly Trottenberg on Wednesday, June 21, 2017, discussed proposed withholding of funds for Amtrak. (Credit: Newsday / Alfonso A. Castillo)

MTA officials Wednesday urged agency leaders against carrying out threats to withhold about $46 million from Amtrak after the national railroad warned such a move would violate federal law and spark a legal fight that could jeopardize the LIRR’s future at Penn Station.

Days after the Metropolitan Transportation Authority’s executive director, at the urging of Gov. Andrew M. Cuomo, vowed to hold back annual subsidies to Amtrak, the railroad’s president in a letter to MTA leaders said doing so would be “in clear violation” of Amtrak’s decades-old agreement with the LIRR.

The four-page letter also said that withholding funding “ignores the impact such a course of action would have on LIRR’s passengers, on addressing immediate needs, and on maintaining existing train operations.”

“Refusing to pay Amtrak the money required to maintain will not solve the station’s many challenges,” Amtrak president Charles “Wick” Moorman said in the letter. “What it will do is harm the thousands of commuter railroad passengers who pass through the station each weekday aboard nearly 600 LIRR trains.”

And, “calls for such action reflect a fundamental misunderstanding of the causes of the current situation at Penn Station, and what needs to be done to address them,” he said.

Moments after receiving the letter, MTA interim Executive Director Veronique Hakim responded at a Wednesday meeting of the MTA Board in Manhattan that she “will be consulting with our attorneys and others about our rights and abilities to” withhold payments to Amtrak.

Hakim on Monday announced the MTA’s intention to go after Amtrak, which owns and maintains Penn Station, for the cost it will incur trying to move commuters to and from their jobs during most of July and August, when Amtrak’s planned $30 million to $40 million effort to replace aging infrastructure at Penn will require taking three tracks out of service.

The MTA’s plan includes running extra trains outside of the rush hours and providing express bus and ferry service.

MTA officials said they have not calculated the full cost of the plan. However, the agency revealed Wednesday that just one piece of it — giving truck drivers a 50 percent discount on tolls overnight to reduce daytime traffic — could cost the MTA up to $10 million in lost revenue.

“At the end of the day, what we know is that we don’t want the cost of this summer to be borne by Long Island Rail Road riders,” Hakim said Wednesday.

But after Moorman made it clear in his letter that Amtrak had no intention of reimbursing the authority for its costs, and that withholding funding would violate federal law and “immediately trigger contract disputes,” several MTA Board members urged their leaders to reconsider their stance.

Board member Veronica Vanterpool, executive director of the nonprofit Tri-State Transportation Campaign, said a potential court battle with Amtrak would be “misguided,” and said the authority should sympathize with the financial challenges faced by Amtrak, which is primarily funded by the federal government.

“I do not think it’s a wise use of our resources to focus on this at this time,” said Vanterpool, who urged the MTA to prioritize getting federal lawmakers to help fund a solution to the commuting crisis at Penn Station.

Hakim said later that getting the federal government to reimburse the MTA for its cost was also an option. But MTA board member and New York City Transportation Commissioner Polly Trottenberg was not optimistic about any of those prospects, and said that the matter was “not worth litigating.”

“I will boldly say I don’t think we’re getting the money out of Amtrak and, sadly, I don’t think Uncle Sam’s riding to the rescue either,” Trottenberg said. “I think we have to accept the fact that we’re going to be paying for all of this.”

MTA’s stance:

Because it owns and operates Penn Station, and has neglected to maintain the station properly over the years, Amtrak should reimburse the LIRR for the costs it will incur this summer, when an Amtrak infrastructure renewal project at Penn will take three tracks out of service. The MTA’s service plan includes running extra trains, ferries and buses, reducing fares for some customers by 25 percent, and discounting tolls for truck drivers by 50 percent during overnight hours to reduce daytime traffic. To pay for the plan, MTA has said it will withhold annual subsidies to Amtrak, which total about $46 million.

Amtrak’s stance:

The summer track work at Penn Station will inconvenience all passengers, including Amtrak’s, but is necessary to address the infrastructure problems created by decades of underinvestment by all the railroads operating there, including the LIRR, which runs nearly half the trains into and out of Penn but pays just a quarter of its capital costs. And the LIRR’s constant use of Penn has made it more difficult to take tracks out of service for extended period to perform the necessary maintenance work. The MTA is obligated — both by federal law and by contract — to pay Amtrak for its use of Penn and its tracks, and refusing to do so will only lessen Amtrak’s ability to properly maintain the station.

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