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problems in anybody's mind who is trying to run a railroad as to whether they can make it operate profitably.
Now, I would ask a couple of questions here. Have the authorities in Massachusetts, Rhode Island, New York, and Connecticut tried to get together to put into effect one operating authority in the four States for operation of this service!
Senator RIBICOFF. My understanding is that yes, the Governors of the four States met. I haven't a report, nor have I seen any newspaper accounts of what was achieved.
I would say there are a couple of problems and I would be less than frank if I did not recognize them and say so to the committee.
You have two basic problems on the New Haven Railroad. First, you have the commuter problem which encompasses one section in Connecticut, Fairfield County, and another section in New York, Westchester County. The commuters, 25,000 people from Connecticut and New York, every morning travel into New York City and every night travel back. This is one of the biggest burdens and is where the greatest loss has taken place.
Now, you have a second problem—the problem of carrying the passenger who might want to take the train from New York City to New Haven, to Hartford, to Providence, to Boston—the longer haul.
Of course, you also have the commuter problem between Boston and Providence. However, many fewer people use the railroad on a commuter basis between Providence and Boston than at the New York end. So the burden isn't as great, concerning commuters, on the States of Rhode Island and Massachusetts as it is on the States of Connecticut and New York.
Senator DOMINICK. I understand that. But it seems to me that this is simply an allocation of the division of responsibility between them.
Senator RIBICOFF. Senator Pell's bill seeks to set up authorization for a four-State regional authority and I am a cosponsor of this bill. The only problem that I see--and this is why S. 325 was introducedis that Senator Pell's bill will not solve the short-range problem. By the time the four States get together, by the time the four legislatures act, by the time the Congress acts, there may be no New Haven Railroad left.
So, S. 325 is a short-range proposal to preserve the New Haven, while the Pell proposal, and what you are questioning, Senator Dominick, comes into being. But I under the exigencies of the day, after the statement of the chairman, Senator Pastore, after these hearings are over, I feel the four States will get together.
Now, the question is raised, What is the Federal responsibility? I happen to think there is a Federal role. I happen to think there is a Federal responsibility because railroads are important to the life of this country.
Senator DOMINICK. That was on a nationwide basis, not just for one railroad.
Senator RIBICOFF. Right, but my bill does not apply to one railroad. And at this point, Mr. Chairman, I would like to put in the record the listing of the 66 railroads showing the losses from passenger commuter service, to indicate that this is a nationwide problem. The
bill that I propose would allow the ICC, on an emergency basis, to give help while a program was being set up on a regional basis.
The proposal that I have, and the testimony that I have given, indicates that on a matching basis, the ICC would be authorized to give some $6 million to take care of the immediate passenger loss of the New Haven Railroad in order to keep it going while the permanent solution, such as the Pell bill and the State authorities come in to take over.
Senator PASTORE. Without objection, the document that was suggested by the Senator from Connecticut will be included in the record.
(The document follows:)
TABLE 1.--Class I line-haul railroads conducting passenger service by districts and individual roads, year 1963
7, 763, 144 2,990, 416 7, 743, 134
18, 496, 694
1, 106, 215
6, 592 167, 074
Districts and railroads
Total, United States.
Baltimore & Ohio RR
Alabama Great Southern RR
12, 781 3, 273
426 1, 345
Chesapeake & Ohio Ry.
Western Ry. of Alabama.
Net income transferred to ACL-L. & N., lessees. 4 Included in Atlanta & West Point RR Co, report.
NOTE.-Totals do not necessarily add up due to rounding.
Source: Quarterly reports, OS-D, 4th quarter 1963, “Transport Statistics in the United
Senator PASTORE. May I ask a question on the point that was raised by Mr. Dominick? Does your bill provide for grant of money for operating purposes? I understood that your bill was merely for the purpose of new equipment, for the repair of old equipment, and for the repair of roadbeds? Is that correct?
Senator RIBICOFF. It does both. It is designed to aid the New Haven road in such a way as we work out the formula to give them enough money to operate the railroad through the formula. I could read
Senator PASTORE. It could be used for operating purposes?
Senator RIBICOFF. It could. That is in section 604. Section 605 is a provision for new equipment.
Senator PASTORE. Read that 604.
The maximum amount of financial aid available is determined under a three-part formula. The total Federal grant under 604 may not exceed the total of (1) the railroad's expenses for maintenance of right-of-way and structures directly related to passenger service-including passenger station upkeep and maintenance of rail lines used only by passenger trains.
(The New Haven's expenses in this category in 1964 were $2.5 million, according to figures I received from the New Haven's accounting office.)
Plus (2) direct State aid-appropriated funds for maintenance of way and structure directly related to passenger service. The Connecticut annual payment of $500,000 for maintenance of grade crossings and bridges falls in this category. Not all of the Connecticut payment would qualify. Some of its goes to maintain structures and crossings used by freight, but the ICC believes some of the $500,000 would qualify.
Plus (3) that part of the railroad's expenses for maintenance of way and structure assignable but not directly related to passenger service, which is equal to the amount of State assistance. The New Haven's expenses for way and structure maintenance assignable, but not directly related to passenger service, were $1.3 million in 1964. These would have included maintenance of lines and buildings used by both freight and passenger service. Under an ICC formula, part of the expense is charged to freight, part to passenger.
The bill here under (3) provides a subceiling, limiting the maximum amount of Federal aid to an amount matching the assistance of States and political subdivisions. The New Haven received $3.6 million of such aid from the States in 1964, all in the form of tax relief. Thus, $3.6 million is all the Federal aid it could qualify under subsection (3).
Now, if the States had given $5 million, or any amount of $1.3 million or more in tax relief and assistance, the New Haven would qualify for all $1.3 million—the amount of its expenses assignable but not directly related to passenger service. Thus, the total of section 604 formula aid would be $2.5 million under (1), some part of $500,000 under (2), and $3.6 million under (3), or a total of $6.1 million-plus.
Now, this isn't a mandatory amount. This is the maximum. The ICC would have the right to go into the railroad to look at the problem and make its own determination as to what portion up to the maximum of $6.1 million it deems necessary to save the railroad. The