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Commuter railroads across the country now have just 30 days - until September 4 - to secure nearly $402 million in excess liability insurance. That countdown began today when the U.S. Department of Transportation announced a statutory increase in the Passenger Rail Excess Liability Cap, raising the required coverage by nearly 20% over the 2021 level. For publicly funded commuter railroads, this insurance is not optional. Contractual requirements imposed by host freight railroads, Amtrak, and technology providers require agencies to insure up to the federal liability cap. Yet obtaining that coverage is becoming increasingly difficult and expensive as insurers continue to exit the U.S. market, forcing taxpayer dollars to flow overseas to purchase coverage. The increase bears little relationship to actual risk. Commuter railroads operate under some of the nation's most rigorous safety regulations, and no commuter railroad's excess liability policy has ever been accessed anywhere near the current $323 million cap. The consequences, however, are immediate and tangible. Caltrain's insurance increase further deepens its $75 million operating deficit. North County Transit - San Diego Railroad may find it necessary to divert resources away from state of good repair projects while extending its hiring freeze. Metrolink, meanwhile, will spend an additional $600,000 on insurance this year, bringing its total premium to more than $10 million. Every additional dollar spent on insurance is a dollar that cannot be invested in equipment reliability, infrastructure, workforce, or the passenger experience. These are the investments that improve safety, strengthen reliability, and deliver better service for the millions of Americans who rely on commuter rail every day. Congress has an opportunity to fix this. The House Transportation and Infrastructure Committee's surface transportation reauthorization proposal, the BUILD America 250 Act (H.R. 8870), includes a provision that would extend implementation of future liability cap increases from 30 days to one year. That additional time would allow railroads to negotiate in a less constrained insurance market instead of competing simultaneously with more than 30 other agencies for limited capacity. The legislation would also replace the current CPI-based adjustment with a risk-based approach, ensuring future increases better reflect actual exposure rather than inflation alone. Public transit agencies already confronting severe budget pressures should not be forced to divert millions of taxpayer dollars each year to purchase increasingly expensive insurance in overseas markets - especially when the underlying risk does not justify this scale of expenditure. A risk-based approach would protect passengers, preserve scarce public resources, and allow commuter railroads to invest where those dollars have the greatest impact: delivering safe, reliable, and resilient service to the communities they serve. Congress should act before another unfunded mandate takes effect.
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