and on June 21, 1970, the railroad filed for reorganization in federal bankrupt- cy court. The Reading Company strug- gled on a little longer and filed for bankruptcy on November 23, 1971. With mounting losses and a crisis looming for all Northeastern railroads, the United States government stepped in with passage of the Railroad Revital- ization and Regulatory Reform Act of 1976, often referred to as the “4R Act,” creating the way for the formation the Consolidated Rail Corporation (Con- rail) on April 1, 1976. The Northeast Corridor including the line from Philadelphia to Harrisburg was trans- ferred to Amtrak with Conrail retain- ing freight service rights. The goal of Conrail was to rationalize
the Northeastern railroad network and revitalize the freight markets. Com- muter services were operated on a con- tract basis, though Conrail made it clear from the start it wanted nothing to do with passenger trains. Manage- ment demanded to renegotiate all con- tracts for increased subsidy. As Conrail took its first wobbly steps towards prof- itability, President Ronald Regan signed the Northeast Rail Service Act (NERSA) into law on August 13, 1981, mandating that Conrail exit the com- muter rail operations in New York City, New Jersey, and Philadelphia by the end of 1982. At the time, commuter railroading in the Northeast was a very
RIGHT: Some of the old Reading heavyweights were rebuilt and given new paint jobs. Towards the end of their careers, a fan trip pauses at Downingtown on March 25, 1990. RICHARD O. ADAMS PHOTO BELOW: A set of Blueliners sails across the Manayunk Bridge, which was closed by SEPTA in 1986. STEVE BARRY PHOTO
sorry state of affairs. Decades of neglect were taking its toll on the basic infra- structure including track, signals, bridges, stations, and the electrical propulsion and distribution networks. Because the trains were an essential public service, local governments sought a more permanent solution.
Under the Gunn
On September 1, 1979, David L. Gunn was hired as the new General Manager and Chief Operations Officer for SEPTA leaving his job as Director of Operations for the Massachusetts Bay Transporta- tion Authority in Boston. While at the MBTA, Gunn oversaw the purchase of the commuter operations of the Boston & Maine and negotiated the new operat- ing contract between the agency and the railroad. Gunn is famous for his “State
of Good Repair” management philoso- phy and while at SEPTA he cut operat- ing costs nearly 30 per cent while re- building the transit system.
One group of people that David Gunn
always leaves an impression with is or- ganized labor. As part of his cost-reduc- tion strategy Gunn instituted the “Fox Chase Rapid Transit Line” service on the ex-Reading between Fox Chase and Newtown utilizing Budd Rail Diesel Cars (RDC). Gunn billed this as an ex- periment to see if SEPTA could run the Regional Rail system on its own. At 8:15 a.m. on October 5, 1981, the first trip left Newtown for Fox Chase with RDC 9151 and one passenger. Gunn al- so replaced a traditional engineer and conductor with employees of SEPTA’s bus division who were paid much less than railway workers and did not pay
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