The 1970s were a time of tremendous change in the railroad industry as competition from highways and aviation eroded demand for both freight and passenger rail services. Within a few years, many of the largest freight carriers declared bankruptcy, forcing Congress to pass two legislative reforms that would dramatically change the industry.
In the 19th century, Congress granted railroad companies vast tracts of land as well as the power to condemn private property in an attempt to promote network expansion and westward migration. In exchange for these benefits, railroad carriers were required to provide passenger rail services.
However, significant post-war investments in highways fostered the expansion of the freight transportation industry, which, combined with a burdensome regulatory structure, put strong economic pressure on freight railways. In the early 1970s, all six carriers that owned the tracks that became the NEC went bankrupt. Typically, a railroad company would use a bankruptcy filing to restructure its debt or possibly be acquired by another carrier.
In response, Congress agreed to eliminate the requirement that freight carriers continue to provide unprofitable intercity passenger rail services. In 1970, Congress passed the Passenger Railroad Act, which created Amtrak. By May 1971, the transition was complete, and Amtrak began providing passenger rail service nationwide.
The financial relief from the abolition of passenger service requirements was not enough. In 1973, Congress established a public railroad corporation known as Conrail, which took over the failed freight rail operations in the Northeast, including the tract that became the NEC. Finally, in 1976, Congress passed the Railroad Revitalization and Regulatory Reform Act, which allowed Amtrak to purchase the NEC from Conrail, effectively transferring assets from one subsidized public corporation to another.
In 2012, the Federal Railroad Administration launched a comprehensive planning process known as NEC FUTURE. This effort aims to develop a unified vision for the entire corridor, as well as a set of specific projects needed to move the vision forward. In the absence of a shared vision and a commitment from the federal government to make the necessary investments, Amtrak will have a difficult time continuing to provide essential mobility for millions of people each year.
The most significant obstacle to improving rail service along the NEC is the more than 100-year-old Hudson River tunnels. The tunnels provide commuter and passenger rail service between New Jersey and New York City. Each of the two existing single-track tunnels is capable of carrying a maximum of 24 trains per hour. During the morning and evening rush hour, there is simply no unused capacity to add more trains.