Train Stopped A-Rollin'?
Amtrak may finally go the way of the buffalo.
Amtrak's quarter-century chug at taxpayer expense may finally be running off the rail. The House Budget Committee has targeted eliminating its federal subsidy entirely by 2002. This year's funding bill, just out of the railroad subcommittee at press time, is only a tentative step; it trims federal subsidies over the next four years, with some reforms to allow more contracting out and ending some federal micromanagement of such matters as route cutbacks.
Amtrak squeezed $972 million from taxpayers in 1995 to cover its losses while taking some halting steps toward cutting the shortfall. Amtrak swears it can achieve $430 million in savings by cutting some staff and limiting a few of the most egregiously money-losing routes. (Every route loses money.)
But a recent study from the General Accounting Office concludes that those sort of half-measures will never get Amtrak off the dole. The GAO points out some problems for Amtrak that aren't being addressed by current reform ideas:
? For the past decade, Amtrak's equipment and facilities have averaged $60 million a year more in depreciation than new investment.
? The contract under which Amtrak leases its track from private freight railroads comes up for renewal in 1996, and the track owners will be looking for more than their current $90 million a year.
? Passenger revenues have declined by 12 percent just since 1990.
The GAO report doesn't address restrictive labor regulations, including mandated severance packages that can run as long as six years under the Railway Labor Act and the Federal Employees' Liability Act. This year's Amtrak bill doesn't eliminate those regs, but it puts in motion a bargaining process that might result in ending them.
But even after eliminating those rules, it remains to be seen whether intercity train travel as a daily part of the nation's transportation grid can ever be truly profitable. The GAO argues that it can't be, pointing out that even in Japan and Europe, "where population densities and geographical conditions are more conducive to rail travel than they are in the United States, intercity passenger service requires substantial public funding."
With the will to continue that funding apparently fading in the face of the quest for a balanced budget, Amtrak's final ride may be right on schedule.