Will Canadian National’s subsidiary Illinois Central allow the recently announced new Amtrak trains to operate over their tracks? That’s today’s question for lawyers. Amtrak signed an agreement with CN recently allowing the moves, but now, it appears, CN is backing out. On October 14, these engines were ready for work near Chicagoland’s 18th Street Bridge.
Amtrak, CN at odds over contract, new trains
By Leo King
The Canadian National Ry. is apparently trying to pull the pin on a new agreement with Amtrak.
Amtrak said yesterday it is “prepared to seek an emergency order requiring Canadian National-Illinois Central (CN-IC) Railroad to honor the existing agreement” between the two railroads allowing the addition of new passenger trains between Chicago and St. Louis and between Chicago and Carbondale.
Amtrak said it would seek relief from a National Arbitration Panel or a restraining order in federal court, should the CN-IC make a final decision not to honor the agreement.
The service expansion, being carried out by Amtrak for the Illinois DOT, (IDOT), is set to begin on October 30 and runs over tracks owned in part by the CN-IC. In July, Amtrak and the CN-IC signed an agreement permitting the new trains to operate on the CN-IC tracks.
On October 19, according to Amtrak, “CN-IC attempted to change the agreement to reduce the number of trains and shorten its term. Illinois rejected this proposal by CN-IC.”
Already popular with passengers, the carrier stated in a press release, some of the trains are sold out during the upcoming holiday season.
Following a Carbondale news conference on September 25, tickets have been on sale for the Saluki (train Nos. 390 and 391) and Illini (Nos.392 and 393). Ticket availability for the Lincoln Service (Trains 300, 301, 302, 305, 306 and 307) to and from St. Louis was announced on October 14.
“Canadian National’s unilateral move to violate its existing agreement allowing trains to operate is an affront to Illinois and its rail passengers,” said William Crosbie, Amtrak’s senior vice-president for operations.
He said, “Amtrak has been in communication with CN-IC officials since March concerning this service. Amtrak has hired and trained employees, renovated train equipment, purchased advertising and mounted a series of public events – some of which CN was a participant – supporting the new train frequencies.”
Crosbie charged, “CN-IC is now trying to back out of the agreement,” pointing out Amtrak and IDOT “will be resolute in enforcement of the pact to add new frequencies on downstate Illinois routes, in response to legislative action and to satisfy public demand.”
He said Amtrak has no plans to cancel these additional trains, and is continuing to accept reservations and sell tickets on all routes and frequencies.
Expanded service on the Chicago-Quincy route is unaffected, he added.
Amtrak explained it, IDOT and other railroads “have invested capital on the Chicago-Joliet route to increase capacity and improve reliability for passenger trains. Less than 37 miles of the 284-mile Chicago-St. Louis route is on tracks owned by CN-IC between Chicago and Joliet.”
Three Amtrak trains and three commuter trains make round-trips on this route, with no commuter trains on weekends. Under the agreement with CN-IC, two more daily round-trips by Amtrak trains will be added for eight passenger train round-trips on weekdays, and five passenger train round-trips on weekends.
Nearly the entire 310-mile Chicago-Carbondale route is on tracks owned by CN-IC. Two Amtrak trains currently make round-trips on this route, with all commuter trains using dedicated tracks nearby.
Under the agreement with CN-IC, one more daily round-trip by Amtrak trains will be added for a total of three passenger train round-trips daily.
The expanded service comes after news that all state-sponsored Amtrak routes posted record ridership levels for Illinois’ Fiscal Year 2006 and with an increase in state funding for passenger rail service by Amtrak from $12.1 million to $24 million approved by the Illinois General Assembly and Gov. Rod R. Blagojevich.
The Chicago Sun-Times reported this morning, “CN has told Amtrak that the CN official who approved the expanded access did not have the authority to make the agreement, railroad sources said. CN officials say there is not enough track capacity on the two lines to operate the additional Amtrak trains without inconveniencing other freight railroads that also use the CN tracks.”
CN officials appear to be open to a possible compromise.
“We are in discussions with Amtrak right now regarding expanding Amtrak service over our lines to Carbondale and Joliet,” said Jim Kvedaras, senior manager of U.S. public and government affairs at CN.
Amtrak law contracts are focus of an investigation today
The results of a lengthy ongoing federal investigation into allegations of questionable spending practices and the lack of oversight by the Amtrak Legal Department over the private sector law firms it uses will be released at a press conference this morning, according to a press release from the House Committee on Transportation and Infrastructure.
“The report is the product of a joint investigation by the Amtrak Office of the Inspector General and the U.S. Department of Transportation Office of the Inspector General into Amtrak’s legal department activities,” the statement read.
Amtrak receives approximately $1 billion dollars each year from the federal government, of which it is estimated the Amtrak Law Department spends approximately $150 million in annual legal and settlement expenses.
“Such a high percentage of legal costs in comparison to Amtrak’s overall budget has raised serious questions about the appropriateness of Amtrak’s legal spending practices.”
U.S. Rep. John Mica, R-Fla., a senior member of the committee, and committee chairman Rep. Don Young, R-Alaska, requested the investigation.
The hearing began at 10:00 a.m., 2167 Rayburn House Office Building in Washington, D.C.
Participants are expected to include Mica and D. Hamilton Peterson, Deputy Counsel and Director of Special Investigations in Amtrak’s Office of Inspector General.
Since 2004, according to the press release, the House Transportation Committee has been conducting oversight investigations concerning Amtrak operations in coordination with the Government Accountability Office (GAO), the Amtrak Office of Inspector General, and the Department of Transportation Office of Inspector General.
“Broad ranges of issues have been evaluated with the recent focus being on the operations of the Amtrak Law Department.”
Specifically, “issues have been raised about the extent to which the Amtrak Law Department has followed its own established rules and procedures for managing outside counsel, whether the relationships with outside counsel have been truly at arm’s length, and whether the Amtrak Law Department documents and maintains complete records of its activities.
The House subcommittee is also looking into whether legal service contracts are managed properly to protect the interests of both Amtrak and U.S. taxpayers, and whether the Amtrak Law Department has “prudently overseen and spent the taxpayer funds Amtrak receives from the federal government each year.”
Young and Mica requested that both the Amtrak Inspector General’s Office and the DOT’s Inspector General’s Office jointly investigate the procedures and expenditures by the Amtrak Law Office, with an emphasis on the top 10 law firms paid by Amtrak in recent years.