He said Horizons Regional Council, Greater Wellington Regional Council and Waka Kotahi had put together a business case for 22 new commuter trains prior to the Budget, and were committed to investing $762 million themselves.
"There was an expectation it would be in the Budget. It wasn't," he said.
The letter said there was an opportunity to quadruple services from Wellington, through Levin and Shannon, linking to stations in Manawatū. There was currently just one passenger train linking those regions to Wellington.
Tuino said in the letter that oversized roading budgets locked the country into car dependency at the expense of investment in passenger rail.
He said investment in rail was needed if New Zealand was to meet its climate emission target of reducing transport emissions by 10 per cent by 2030, and that more investment was needed in passenger rail.
Ferguson said investment in more frequent passenger rail was a "no brainer" with petrol prices and the cost of living both increasing.
Horowhenua has an elderly population that needs public transport for their well-being, and a younger generation that needs access to employment and education opportunities outside the region.
"There are 100 reasons to back up the argument for increased investment in rail. It's better value for money, better for the environment, better for community well-being... we have to get off fossil fuel," he said.
The current stock was not going to last forever and stations needed upgrading too, he said.
The call for increased investment has also found support from the Rail and Maritime Union. Secretary Wayne Butson said ongoing underfunding had caused problems with regional passenger services, notably between Wellington and Palmerston North.
Butson said new hybrid-electric trains and improved infrastructure would provide greater reliability and lead to an increase in passengers.
Lobby group Save Our Trains spokesperson Dr Paul Callister was a regular commuter of the Capital Connection service that runs from Wellington and travels to Palmerston North.
Dr Callister said with a growing population, improved train services were essential.
"The replacement of aging rolling stock, double tracking to Ōtaki and electrification of the line between Waikanae and Palmerston North are essential to provide reliable service now and to allow better frequency in the future," he said.
