New Grant Program Provides First-Ever Federal-State Funding Partnership to Improve and Expand Intercity Passenger Rail Service

WASHINGTON — For the first time ever, states will be directly eligible for federal funding to support intercity passenger rail service under a new grant program, U.S. Secretary of Transportation Mary E. Peters said.

“We want to encourage and support the kind of state investments that are making a difference for passenger rail services,” Peters said, noting that between 1996 and 2006, ridership on state-supported intercity routes grew by a robust 88 percent, vastly outpacing the 17 percent increase on all other routes combined.

Peters explained that the $30 million capital grant program is designed to support state efforts to improve intercity passenger rail service and requires a 50-50 funding match like most other transportation investments.  Projects that demonstrate an on-time performance standard of 80 percent or greater, reduce travel time, increase service frequency, or enhance service quality for intercity rail passengers will receive favorable consideration for funding, she said.

Eligible projects include, but are not limited to:  upgrading existing track to permit higher maximum operating speeds, adding or lengthening passing tracks to increase rail line capacity, improving track switches and signaling systems to advance reliability and safety, and purchasing new passenger rail cars to enhance the travel experience, Peters said.

“Rail passengers demand improved service and quality and this grant program will allow states to address these concerns,” said Federal Railroad Administrator Joseph H. Boardman, highlighting that individual or multiple states working together can submit applications.

Peters stressed that creation of a federal-state funding partnership was specifically called for by the Bush Administration as part of its long standing intercity passenger rail reform effort.  The Administration believes states need a larger role in deciding where and how intercity passenger rail is operated while focusing federal investments on capital projects that produce long term results.

The Federal Railroad Administration is administering this grant program and will begin accepting applications on March 18, 2008, with the expectation that awards will be made later this year.  The full Notice of Funding Availability can be found at