1. Amtrak 2011 Update Stephen Gardner, Vice President, Policy and Development AASHTO Meeting, March 4, 2011

2. 1 Amtrak 101 – basic company and system statistics Congressionally chartered corporation Amtrak mission: “provide efficient and effective intercity passenger rail mobility consisting of high quality service that is trip-time competitive with other intercity travel options” System basics: –21,100 mile system, 20,000 employees –308 daily intercity trains, 528 stations Record Ridership: –28.7 million riders in FY 10 –4 of last 5 years have been records – 37% growth since 2000 Record revenue of $2.5 billion in FY 10 –Covered 85% of operating cost –Our FY 10 farebox recovery was 76% - highest recovery in US Federal funding for Amtrak was $1.5 billion in FY 2010: –Roughly $1 billion for capital, debt, ADA –$563 million for operating support

3. 2 The Amtrak system Cascades California corridors Chicago Hub Northeast Corridor (NEC) Long distance routes connect major hubs and corridor services

4. 3 Business lines – what we do, and why we do it NEC - high-yield, short distance travelers –Financial Engine –Business Travelers -Acela 80%+ -Northeast Regional 35%+ Long Distance - high-value sleeper travelers, shorter haul coach markets –Network Connectivity –Foundation for Future Growth –Underserved Areas, Federal Operating Subsidy State Corridors - high-volume, low-yield short distance travelers –Feeders to Other Services –State Supported Commuters – revenue opportunities, economies of scale –For profit, contractual basis –Expand system connectivity Commercial Development – maximize revenue opportunities inherent in the property –Includes stations, advertising opportunities, utilities, etc. Ridership (millions) FY 10FY 09chg Amtrak Total28.727.15% NEC Spine10.39.94% Acela3.236% NER7.16.93% Short Distance13.8136% Long Distance4.44.26% Ticket Revenues (millions) FY 10FY 09chg Amtrak Total$1,742$1,5999% NCE Spine$899$8417% Acela$440$4097% NER$458$4316% Short Distance$390$34612% Long Distance$453$41110% Federal Gov’t States Federal Gov’t State Partners Commuter Authorities Municipaties, tenants li

5. 4 FY10 Revenue and Ridership Breakdown NEC makes up over half of Amtrak revenue and requires most of Amtrak capital funding State Corridors make up nearly half of Amtrak ridership Long Distance trains require bulk of Federal operating subsidy NEC

6. 5 The near-term funding situation Amtrak and HSIPR grants: –FY 11: -House-passed CR cut Amtrak to $1.413B – slightly more than FY 08 – and eliminates HSIPR funding -Sessions amendment to further cut to $966 million defeated on bipartisan vote –FY 12: -Amtrak requested $2.2B – right around the authorized funding level -Detailed discussion on this budget won’t start for some time – but will be protracted. -Lower baselines make increases harder Surface Transportation Reauthorization: -Administration proposes merging Amtrak/HSIPR into new consolidated rail program: -$4 billion for System Preservation (initially Amtrak) -$4 billion for Network Development (competitive) -Hinges on ability to raise revenues

7. 6 FY10 Intercity Travel Market US travel market has been shrinking due to recession and high unemployment: –Amtrak is growing –US Outlook -Leisure travel - modest growth (~50% of Amtrak ridership) -Business Travel – flat (~46% of Amtrak ridership) Amtrak market share strongest in high frequency markets, mainly in NEC and West Near-term growth through increasing rail market share: –Southeast corridors –California corridors –Chicago – Midwest

8. 7 Key Ridership Drivers – Fast, Frequent, Reliable, and Comfortable “ Hard” service improvements –On-time performance –Faster trip times –Frequency of service (departures) –Information and access “Soft” service improvements –On-board amenities/service –Station and equipment design features/elements consistent with customer expectations –Comfort, convenience –Personal space –Productivity support, business amenities (especially Acela)

9. 8 Amtrak is now the dominant provider in the NEC –Frequency, competitive trip times, OTP drive share shift Acela product quality also critical to increased share –Wi-Fi, Leather seats, quality of customer experience –Improved Food and Beverage service –En route cleaning, customer service focus Fast/Frequent Service Induces Modal Shift – NEC FY99FY00FY01FY02FY03FY04FY05FY06FY07FY08FY09FY10 DC-NY36%37%45%56%50% 51%55%56%63%61%69% NY- Boston18%20%27%41%35%39%38%36%41%49%50%53% Trends in Amtrak Share of Air-Rail Market

10. 9 Why do we need passenger rail? Competing modes are congested, and getting worse: –Number of urban areas with more than 20 hours of annual rush hour traffic delay increased sevenfold between 1982 and 2007 –Between 2000 and 2008, number of flight delays due to airport terminal volume increased by 42% Rail’s niche is the sub-500 mile intercity market: –More than 79% of total trips USDOT classifies as ‘long distance’ (50+ miles) fall into this category –Number of Americans living in urban areas expected to double (150M to 300M) by 2050 Top ten corridors – Air-rail share, FY 09 Where we can offer reliable and trip-time competitive service, Amtrak thrives – and demonstrates the latent and growing demand for intercity passenger service Where we can offer reliable and trip-time competitive service, Amtrak thrives – and demonstrates the latent and growing demand for intercity passenger service

11. 10 The rail network must evolve to address these needs Rail – including HSR – needs to be part of the solution Rail solutions must: –Match speed and operating characteristics to market demand - Auto? Air? Both? –have connectivity – other modes must feed nodes –Tailor investment to address the mobility challenges, particularly in places like: -California -Northeast -Florida -Chicago area HSR Express (150+ mph) HSR Regional (110-150+ mph) Emerging HSR (90-110 mph) Conventional Rail (up to 90mph) Commuter Rail Light/Heavy Rail Auto and BusPeds and other transit

12. 11 State Partnerships… States are vital partners for Amtrak and together, we form a cooperative system States provide: -Service initiatives and planning -operating funds - $191 million annually, or 23% of total costs. With revenues and state payments, 76% of fully allocated costs -Capital investments (stations, equipment, etc) -Intermodal integration -Service focus and innovation Amtrak provides: -~25% of fully-allocated costs of all corridor services -Railroad access -Liability arrangement -Major systems (reservations, etc) -Equipment & facilities -Service planning

13. 12 trains less than 750 miles, most in partnership with 15 states Are only service at 203 of Amtrak’s 528-served stations 220 daily trains – more than half our total! We are dedicated to working with states to: Improve current services Develop plans for the future Pursue joint processes (Sec. 209 & 305) Support and pursue investment opportunities (HSIPR) 2011 Partner Satisfaction Program: Annual survey of partner satisfaction Integrated local teams to focus on partner top priority issue Responsiveness and empowerment ….. are Amtrak’s future

14. 13 Corridor trains are the key to system growth Top Ten Performers – Ridership Growth Piedmont+46% Blue Water+18.7% Vermonter+16.5% Missouri River Runner+14.4% Alb-N Falls-Toronto+13.8% Adirondack+13.4% Chicago-St. Louis+13.1% Cascades+13.0% Heartland Flyer+11.1% Carolinian+11% Top Ten Performers – Ridership Growth Piedmont+46% Blue Water+18.7% Vermonter+16.5% Missouri River Runner+14.4% Alb-N Falls-Toronto+13.8% Adirondack+13.4% Chicago-St. Louis+13.1% Cascades+13.0% Heartland Flyer+11.1% Carolinian+11% Top Ten Performers – Revenue Growth Piedmont+39.1% Cascades+31.6% Missouri River Runner+24.4% Vermonter+19.1% Carolinian+17.9% Chicago-St. Louis+17.6% Hoosier State+17.5% Blue Water+15.3% Adirondack+14.0% Heartland Flyer+13.5% Top Ten Performers – Revenue Growth Piedmont+39.1% Cascades+31.6% Missouri River Runner+24.4% Vermonter+19.1% Carolinian+17.9% Chicago-St. Louis+17.6% Hoosier State+17.5% Blue Water+15.3% Adirondack+14.0% Heartland Flyer+13.5%

15. 14 Partnerships with Host Railroads Most Amtrak train-miles (70+%) run on freight railroads – We have longstanding relationships with all Class I carriers – Work with them on grant agreements, as well as daily service issues All Amtrak trains on host railroads rely on Rail Passenger Service Act access authority to any US railroad: –Amtrak gets access in exchange for host railroads not having to offer passenger service –Basis for entry is contractual – but a host railroad cannot simply refuse to permit: - new or additional trains - Higher speeds –Can’t insist unilaterally on dedicated tracks as long as Amtrak and states willing to make improvements needed for safe and practicable service Access is at incremental cost not market rates Passenger trains receive preference over freight Hosts increasingly seeking to modify arrangement based on concern over freight growth and capacity.

16. 15 Amtrak and High Speed Rail Establishing new Amtrak HSR Department –Green field projects – participate in design and operation of new HSR corridors –Lead Next-Gen HSR development on the Northeast Corridor -Major reductions in trip time and significant increases in frequency -Increases in speed up to 220mph, using dedicated trackage and some new alignments We have the experience needed for HSR –150 MPH service, largest electrified operation, maintenance, panning and engineering experience Working with partners –Amtrak’s principal interest is operational –NEC Next-Gen HSR: International peer review underway –FLHSR: partnered with SNCF and Bechtel –Interconnectivity: integrate new and existing services, especially during development

17. 16 Fleet Needs Age, utilization, and Fleet age, utilization, mileage, and demand are all issues – Hardest-run fleet in America – Average age at an all-time high – No capacity to accommodate growing ridership More than 2,000 pieces of rolling stock Issued fleet plan in 2010, update out in March First tranche of orders last year: – 70 electric locomotive – 130 single-level long distance cars Bob Pickering photo Amtrak Average Annual Car Mileage

18. 17 Working with the 305 Equipment Pool Committee Incorporating 305 Activities into Amtrak Fleet Strategy – Will utilize 305 Specifications – Helps achieve: -Standardization -Opportunities for state corridor(s) joint acquisitions/partnerships -Economies of Scale -Orders of sufficient size to help rebuild the domestic equipment industry -Create pool of equipment that can be flexibly deployed as necessary Implementation framework will be of great importance –Acquisition and management structure –Financing

19. 18 Questions?? Thank you!