Amtrak saved, at least for 2003
Rail labor was successful once again in lobbying to ensure the future of Amtrak, helping the national passenger railroad survive at least one more year in the face of inadequate federal funding.
Amtrak President David Gunn said the railroad needed at least $1.2 billion in funding to survive. In mid-February, however, House and Senate negotiators compromised on $1.05 billion for Amtrak.
Gunn said the amount was "sufficient," even though the budget would be extremely tight.
The House originally voted to spend $762 million for Amtrak while the Senate agreed to allocated the requested $1.2 billion.
Like the House, the Bush Administration proposed $762 million for this year.
The BLE's National Legislative Office in Washington, D.C., reported that 32 House Republicans had signed a letter supporting full funding for Amtrak to House Appropriations Chairman Young (R-FL), who lead negotiations for the House.
In addition, various BLE State Legislative Board Chairman joined BLE Vice-President & U.S. National Legislative Representative Raymond Holmes in lobbying legislators in both the House and Senate to secure adequate funding levels for Amtrak.
The survival of Amtrak is crucial to the stability of the U.S. Railroad Retirement system. All working and retired railroaders have a vested interest in the Amtrak situation. If Amtrak were to go under or cease to exist, then its 23,000 employees would no longer pay into the Railroad Retirement system. This would create a potentially dangerous situation for thousands of other employees who depend on Railroad Retirement.
Gunn said Amtrak must have $1.2 billion or face a nationwide shutdown due to lack of funding. The Bush Administration offered less funding and proposed that the railroad eliminate some money-losing, long-distance trains.
The Bush Administration also proposed that Amtrak offer buyouts to some employees to reduce labor costs. The government would leave it up to Amtrak to decide if savings should come from its work force of nearly 23,000.
Amtrak came close to shutting down in July of 2002 because of a budget crisis that was averted by a $100 million loan guarantee from the Transportation Department and a $205 million appropriation from Congress.
President Bush and House Republicans want Amtrak to wean itself from federal subsidies by paring money-losing routes and forcing cities and states to pick up the tab for passenger rail. Senate supporters say Amtrak's service is vital and that nowhere in the world does passenger rail turn a profit.
Amtrak has never made money in its 32-year history and its debt is roughly $4 billion.
However, in a speech at Yale University on February 4, Gunn said Amtrak will never earn enough money to support itself. He said Amtrak will never make a profit, mainly because of the high cost of maintaining railroad ties, bridges and other infrastructure.
Gunn, credited with improving New York City's subway system, was named Amtrak's president in April, just as the budget crisis began to take shape.
Amtrak was formed in 1971 to relieve freight railroads from the cash-draining responsibility of passenger service and has struggled ever since to meet expectations that it break even or turn a profit.
Gunn said Amtrak would have a shot at continued existence in four to five years with an annual budget of less than $2 billion.
He said Congress is being unrealistic in insisting Amtrak become self-sustaining.
"Maybe we are sustainable, because they've tried to kill us for 30 years and we're still here," Gunn said.
Most long-distance trains operate through the Midwest and West, and require hefty per-passenger subsidies. The Sunset Limited from Los Angeles to Orlando loses $347 per passenger, and the Texas Eagle from San Antonio to Chicago, $258.
Some routes have political strings attached, with key members of Congress favoring the jobs and service the trains provide to constituents. Many lawmakers whose districts or states have no Amtrak service resent any subsidies at all.
© 2003 Brotherhood of Locomotive Engineers