Philly to Reading Rail Service Plan: What’s Going On?

PHOENIXVILLE, PA — Residents along railroad lines between Philadelphia and Reading are miles north of the Keystone line’s service that goes to Harrisburg, but many wonder if the federal focus on transportation could bring train stops to their towns.

Reading, Birdsboro, Pottstown, Royersford, Phoenixville, and Valley Forge are proposed stops in a plan that PennDOT has considered closely and prepared an analysis of.

Lifetime Phoenixville resident Dave Meadows is a retired civil engineer who worked in USDOT compliance. He recalls that the Pennsylvania Railroad and Reading Railroad both served Phoenixville and nearby stops at one time.

Meadows said that there are discussions happening, but no certainties about when the rail service might return. He explained that much depends on funding, though there are other questions to be answered before train service would revive between Philadelphia and Reading.

Meadows pointed out that the federal government gave the railroad companies the land to build the railroads. This happened through land grants in the late 19th century.

American Jobs Plan Funding

Federal funding could certainly bolster languishing plans for rail service. The proposed American Jobs Plan includes $10 billion for railroads. The legislation, in part, reads, “Specifically, President Biden’s plan will: Fix highways, rebuild bridges, upgrade ports, airports and transit systems. The President’s plan will modernize 20,000 miles of highways, roads, and main streets. It will fix the ten most economically significant bridges in the country in need of reconstruction. It also will repair the worst 10,000 smaller bridges, providing critical linkages to communities. And, it will replace thousands of buses and rail cars, repair hundreds of stations, renew airports, and expand transit and rail into new communities.”

How that could support rail service between Philadelphia and Reading may seem a matter for fortune-tellers. Stakeholders and players in the process have been considering all aspects of rail travel in Pennsylvania and across the United States.

Amtrak’s Vision

Amtrak has announced its plans to expand rail service. Its Connect US Fact Sheet shows a lovely line between Philadelphia and Reading in an aqua blue color that represents Amtrak’s planned “new services.” A June 2020 Corridor Vision document outlines a plan for improving transportation across America.

Amtrak proposes that the federal government invest $75 billion over 15 years to develop and expand intercity passenger rail corridors around the nation in collaboration with its existing and new state partners, the document explains. Amtrak’s statement says this would bring economic, environmental, and other benefits.

Amtrak’s report states, “Our vision for the future is a modern passenger rail network that creates more than half a million jobs and delivers over $150 billion in economic benefit to impacted local communities by 2035. At the same time, traveling on Amtrak’s non-electrified trains is 47 percent more energy-efficient than driving and one-third more efficient than flying.”

PennDOT on Reading to Philadelphia Rail Service: Steps Along The Way

Amtrak, though, is just one player in myriad considerations. At the state level, PennDOT’s December 2020 Reading to Philadelphia Passenger Rail Analysis suggests six stops on the proposed line — Reading, Birdsboro, Pottstown, Royersford, Phoenixville, and Valley Forge.

A summary of PennDOT’s Final Report covers five steps toward securing the new line of rail service:

The first step is to identify an operator, and both National Passenger Rail Corporation (AMTRAK) and Southeastern Pennsylvania Transit Authority (SEPTA) are potential operators.

AMTRAK recently released a study of the potential Reading to Philadelphia that included a stop in Phoenixville — and a timeline bringing it by 2035.

The second step is to initiate a capacity study with Norfolk Southern (NS). Reading (Berks County) recently performed a capacity analysis for the potential passenger rail line and found that there would not be an issue for the transit to run on the same tracks as the current freight service.

The corridor between Reading and Norristown, the next stop beyond Valley Forge, is presently owned and actively used by Norfolk Southern. SEPTA’s existing Norristown to Philadelphia corridor is heavily utilized and may not be able to accommodate additional trains under current operating and infrastructure conditions, PennDOT’s report said.

The report notes the Reading capacity study did not utilize the Berkley Rail Simulation program called Rail Traffic Controller (RTC), a software package that can handle dispatching trains on a large scale. Although the Reading Study was insightful, it does not meet NS requirements and must be completed with RTC, the report explained.

The third step is to identify funding options. These can be worked on in conjunction with the first two requirements, as that will establish the scope of the project.

Act 44 required the Pennsylvania Turnpike Commission to provide PennDOT with $450 million annually for highways, bridges, and public transit; Act 89 of 2013 modified payments to dedicate the full amount to public transit.

In 2022, the Pennsylvania Turnpike Commission payments to Penn DOT for transit will be reduced to $50 million, and then $450 million will be provided from the state’s General Fund. Legislation would have to be passed to allow the local revenue sources to be invested in projects to accommodate and accelerate regional growth.

The report outlines how the construction and operating dollars, garnered on a local level, can be used as a match to secure federal dollars. Local dollars would be a combination of Borough, Township, or City funds, County monies, and Commonwealth of Pennsylvania funds as a percentage.

The local income would be comprised of:

  • Property Tax (Borough, Township, City, County)
  • Income Tax (Commonwealth)
  • Sales Tax (Commonwealth)
  • Parking and Fuel Taxes (Borough, Township, City and Commonwealth)
  • Toll Revenue (Commonwealth)
  • Business Activity Taxes (Commonwealth)
  • License and User Fees (Commonwealth)
  • Other Taxes and Free (Commonwealth).

The report explained utilizing property, income taxes, sales taxes, utility taxes, and business activity taxes has only one precedent — Pennsylvania’s Neighborhood Improvement Zone (NIZ). The NIZ in Allentown is a one-of-a-kind special tax district. Due to its unique features and incentive structure, it is unlike past Pennsylvania incentive policies.

The NIZ development most closely compares to tax increment financing (TIF), the report explained. However, unlike most TIFs, which generally divert only real-estate taxes, NIZ allows use of local non-property taxes, such as earned income. It also allows for sequester of state taxes, including payroll taxes, income taxes, cigarette taxes, liquor taxes, sales taxes, and capital stock taxes.

School tax revenue would not be part of the funding equation.

This kind of financing has only occurred three times in the United States: Allentown, Pa., Bowling Green, Ky., and in the dramatic makeover of downtown Kansas City, Mo. All required a legislative initiative to be passed to utilize funds that would be considered revenue in the state budget.

The fourth step is the development of the environmental documents, a National Environmental Policy Act (NEPA) categorical exclusion. This can not be achieved unless there is a correct scope, the analysis explained, and the scope cannot be determined until an operator has been chosen.

The fifth step is to enter into an agreement with the SEPTA and the property owner Norfolk Southern.

The projected capital costs come to $818,000,000. That breaks down like this:

Dual Mode Equipment and rolling stock — $145 million
Third Track construction in Norfolk Southern (NS) right of way — $510 million
High-Level Station Platforms — $53 million
Norristown Station Improvements —$36 million
Additional Yard and Service Area —$74 million.

It is uncertain if the $510 million third track construction would be necessary, based upon the Reading (Berks County) capacity study results.

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