Having been rejected by Louisiana state officials in its bid for $300 million in federal stimulus money to develop high-speed rail between Baton Rouge and New Orleans about a decade ago, the Southern Rail Commission gathered in Mobile at the GM&O Building to make a critical decision.

“I remember us sitting around the room, including the Louisiana folks, and discussing whether we’ll either disband this thing or do something else,” said Knox Ross, a longtime SRC commissioner and former mayor of Pelahatchie, Miss., recalling a meeting that took place about seven years ago.

The SRC, formed in 1982, had long fought to advance passenger rail initiatives in Mississippi, Louisiana and Alabama. Now, it needed to fuel its own firebox. Was there a new project to rally around?

Emerging from that meeting was a focus on reviving passenger rail on the Gulf Coast.

On Tuesday, Mobile will serve as the location – once again – for a critical moment in the SRC’s 38-year history. In the City Council’s hands is the potential fate for the restart of Amtrak service connecting New Orleans to Mobile, with stops into four coastal Mississippi cities.

The Washington, D.C.-based Rail Passengers Association, on Friday, issued a warning that if the City Council doesn’t get on board with an endorsement, the entire Gulf Coast project is in jeopardy, along with economic investments totaling $170 million.

Mobile is being asked to commit up to $3 million over three years in city funds to pay for Amtrak service starting in 2023. That is the year that passenger rail trips between New Orleans and Mobile are expected to begin, if Mobile commits.

Both sides of the debate about Amtrak’s return – SRC rail advocates pitted against the Alabama State Port Authority’s leadership – have staked out strong positions.

“I am bewildered,” said Wiley Blankenship, president & CEO of Coastal Alabama Partnership and the leading voice on the SRC for Amtrak’s return into Mobile. “They are smart enough in Louisiana and Mississippi to support this. I really don’t see what the issue is in Alabama. If we don’t want it, quit stringing this out.”

‘Beneficiary’

Jimmy Lyons, CEO of the Alabama State Port Authority (photo provided by the Port Authority)

Jimmy Lyons, president and CEO with the powerful Port Authority – viewed as the leading economic driver in Mobile – believes that the trains will be underutilized and overly costly.

“You’re talking about connecting two cities with a population of a quarter million people each,” said Lyons, who supports Amtrak’s service in the large Northeastern population centers where commuter rail is viewed as essential toward daily commutes. “But we’re talking about little bitty Mobile here, and New Orleans isn’t much bigger population-wise.”

Other critics doubt that Mobile would benefit from a return of passenger rail. In their view, Mobile residents would jump on the train to visit New Orleans, but not vice versa.

But David Clark, president & CEO with Visit Mobile, said there is a relatively untapped European market of travelers who enter the U.S. at the Louis Armstrong International Airport in New Orleans, and spend three days in that city.

Then, he said, they’ll travel another 300 miles or so elsewhere during the course of the next three or four days. And the European model of travel, he said, is via rail.

Indeed, surveys in recent years show that many international visitors to New Orleans prefer traveling by rail, if possible. According to a 2015 study by the University of New Orleans’ Hospitality and Research Center, close to 12% trips in Louisiana involving visitors from France and Germany involved train travel. That figure is up substantially from 1999, when around 1% of travelers utilized trains for traveling in Louisiana.

Japanese visitors comprise the largest single international contingent traveling by train in Louisiana, accounting for 27% of all trips, according to the study.

Lyons said he doesn’t believe Mobile stands to gain much from a train service that is marketed for tourism. Said Lyons, “The big beneficiary for passenger rail is the casinos in Mississippi and New Orleans. I don’t see Mobile being a beneficiary.”

Some City Council members also wonder whether Mobile would truly see many visitors from New Orleans or Mississippi.

Blankenship said it’s a topic that has generated “heartburn” among city and regional boosters of passenger rail.

“I got a sense from City Council that there is a little attitude that Mobile is just not good enough and ‘Why would anyone come here?’,” said Blankenship. “That pisses me off. I believe in this town and this region and that it has something nice to offer. If you have public officials who think that, then they need to rethink their public position if they don’t believe in the community that they are in.”

Freight vs. Amtrak

Lyons also fears that passenger rail would interfere with the Port of Mobile’s activities. He said that nearly 65% of the port’s overall business activity is from freight rail, and that 16 trains run along the rail line daily.

Blankenship and the SRC have since pitched alternatives to ally the port’s concerns. For instance, a proposed Mobile train station would be constructed within the Brookley Aeroplex and on a rail track that is off the main CSX line.

Previous plans called for the station to be situated near Cooper Riverside Park downtown.

Lyons agrees that a Brookley location would be preferable. Overall, however, he’s firm in his opinion that Amtrak service will interfere with the port’s bottom line.

Lyons said the CSX line is a “single rail” that doesn’t have enough room to cope with freight and passenger trains simultaneously.

Responded Blankenship, “It’s like, ‘Here’s the goal line and here is what you need, but let’s move it 10 more yards back.’ That’s how we feel.”

As proposed, the Mobile-to-New Orleans Amtrak route would feature two round-trip daily trains with stops in Mississippi at Pascagoula, Biloxi, Gulfport and Bay St. Louis.

A study examining the impact on freight rail is expected to begin soon, though SRC members say that the issue has been examined before and has the backing of the Federal Railroad Administration and Congress. A Gulf Coast Working Group, formed by the Federal Railroad Administration in 2015, produced a report on the project’s restart that included input from CSX. The latest freight study would include input from CSX, Amtrak and Norfolk Southern, which operates freight trains into Louisiana.

Lyons said he can’t support the Amtrak project “until and unless anyone or someone can show me definitely it won’t interfere” with port activity.

“A (SRC) member once said, ‘we’ll take care of it,’” Lyons said, referring to his concerns about freight trains being interfered with by passenger rail. “That doesn’t mean squat. They are not railroaders.”

Lyons has also said that comparisons with other deep-water ports in the U.S. – where passenger trains do operate – is “apples and oranges.” Along the Eastern Seaboard, he said, port cities have multiple track lines for Amtrak. In Mobile, it’s a single track “that runs between here and (New Orleans) and we are running trains in both directions.”

“Quite honestly, every railroad in the U.S. is struggling to maintain service levels,” Lyons said. “It has to do with the competitiveness of shippers and we need the railroad to be successful. The alternative is to start putting it on trucks.”

The Port Authority has the backing of the powerful coal lobby as well. Patrick Cagle, president of the Alabama Coal Association, cited figures from a report released in December that said that coal generates “50% of the port’s annual revenues.”

In addition, the report showed that 777 full-time jobs, with an average annual salary of $93,000, are supported by coal operations at the Port of Mobile and the transportation of metallurgic coal to the port by both railroad and inland waterway.

Cagle, like Lyons, is advocating for the freight study’s completion before the City Council takes action.

“I would hope someone would wait before we start charging down this road and we get a study back that says definitely, (Amtrak service) won’t (interference with freight),” said Lyons. “The benefits of freight rail far outweigh the benefits for passenger rail.”

Blankenship said that if the majority of the City Council members feel the same way, they need to come out and say so.

“It’s like, ‘Let’s ask one more question and stretch this out,’” he said. “We’ve answered the questions. If the council feels they are comfortable making a decision and will not support it, then let’s move on.”

‘Worst case scenario’

Blankenship and rail advocates are also trying to counter what they say are inaccurate portrayals of the Amtrak project costs.

But opponents say that they’re citing figures provided by Amtrak that estimate ridership.

The Amtrak estimate, labeled by the SRC as “conservative,” pegs the rail line operating cost at $7 million per year. This assumes 35,000 annual riders spending $18.33 per trip, generating a total revenue of $700,000. For the three states, the annual operating deficit would require a combined appropriation of $2.3 million.

But Blankenship said he guarantees that the $18.33 per trip costs are not realistic, and calls it a “worst-case scenario” that has been “exploited” to argue against the train.

Blankenship said he anticipates riders spending around $30 to $40 per trip, for tickets and for buying snacks and meals on board.

The train operations would break even budget-wise if 155,000 riders boarded annually, each spending $50 on a combination of tickets and onboard food and beverages.

“We’re not running a train for an $18 ticket,” said Blankenship. “It has to be more than that. From Mobile to New Orleans, you’re looking at $25 to $30 for the ticket, plus a beer and that’s $8. So you’re spending $38.”

He added, “You’re going to have 50,000 to 70,000 people taking it, and what we keep telling them is that advertising on the train has not been figured into it. You’ll have advertising and that is revenue that goes into the bottom line.”

Mobile, though, would likely have to bear any further costs on its own. Alabama Gov. Kay Ivey has repeatedly sounded alarms about the service and its potential to harm port activity.

According to the Rail Passenger Association, Mississippi and Louisiana – in partnership with Amtrak – have committed $31 million toward capital improvements along the rail line. The $3 million commitment from Mobile toward the train’s operations is all that remains in order for the service to be running by 2021.

Alabama hasn’t made any commitment toward the capital improvements along the rail line despite the Federal Railroad Administration making a $33 million federal commitment last summer.

Amtrak is also focused on promoting more state-supported regional routes like Mobile-to-New Orleans, as the nation’s passenger railroad system ended its most recent fiscal year in September with its best-ever financial performance.

Amtrak CEO Richard Anderson’s goals include maximizing ridership and revenues on shorter routes, instead of the longer-distance trains that once rolled along the Gulf Coast before Hurricane Katrina damaged the rail line in 2005. Before the storm, the Sunset Limited connected Los Angeles to Jacksonville, Florida, but was criticized for its poor performance and reliability.

The Rail Association, in its news release Friday, attempted to bolster the route’s case by providing some examples of successes involving similar projects elsewhere:

-Amtrak Virginia. A decision by the Commonwealth of Virginia to invest in two new train services and three extensions to Amtrak’s Northeast corridor has resulted in $1.4 billion in economic returns, 1,400 jobs and $390 million in tourism spending.

-Amtrak Downeaster (Maine). The Portland, Maine, to Boston connection resumed in 2001 and now carries more than 500,000 passengers each year. The train provides $6.2 million in wages to directly employ 100 local workers.

-Amtrak Hiawatha (Wisconsin). The train service provides $4.8 million in wages to directly employ 62 Wisconsin residents, and addes $12.7 million in local businesses through vending contracts.

“While taxpayers have every right to ensure there is sensible oversight when it comes to public funds, the opponents’ of this train have made arguments that are misleading and fail to fully capture the tremendous benefits this train will bring to Mobile and the rest of the Gulf Coast,” said Rail Passengers President and CEO Jim Mathews in a statement. “We shouldn’t judge this service by the money it makes Amtrak. Trains deliver value to the served communities; the important conversation is taxpaying citizens collecting a ‘Return on Equity.’”