WASHINGTON, D.C. — Amtrak said yesterday that it will run its full passenger train service for another week but added that it will have to begin an orderly shutdown July 4 or July 5 if it has not received a federal loan guarantee or a direct appropriation of emergency funds, the Washington Post reported.
Railroad President David L. Gunn, who had said he might set a shutdown schedule as soon as today, and Transportation Secretary Norman Y. Mineta said separately they think a solution will be found to Amtrak’s cash crisis. Mineta told union representatives and others that he is “very, very” optimistic.
Gunn has said the railroad, which has lost money throughout its 31-year history, needs $205 million to carry it through the rest of the fiscal year. An Amtrak shutdown also would affect commuter railroads, including Virginia Railway Express and MARC, that operate on Amtrak tracks or use Amtrak crews.
Meetings and conferences peppered the Washington official landscape yesterday, with talks at the White House and news conferences on Capitol Hill. Whatever is decided, it is clear that it will come down to the wire as Congress prepares to head home, and there is always the danger of a misstep or miscalculation.
The question boiled down to whether the administration will give Amtrak a loan guarantee under a program for which Amtrak may not be eligible, or whether Congress and the administration will agree to insert a direct grant to Amtrak in a homeland security supplemental appropriations bill now moving through Congress. There were developments on both fronts yesterday.
Mitchell E. Daniels Jr., director of the White House Office of Management and Budget and no admirer of Amtrak, said it is “not out of the question” to include Amtrak in the homeland security bill. He said he can identify “offsets” that have not been used that could accommodate stopgap bailout money, possibly meaning cuts in the Senate’s homeland security funding, which Bush considers excessive.
Daniels said the administration is determined to keep Amtrak open, but he had harsh words for Amtrak’s board of directors yesterday after meeting with Vice President Cheney and Senate Minority Leader Trent Lott (R-Miss.).
“We’re determined to keep Amtrak and also to see the beginnings of change at Amtrak,” he said. “Very honestly if this board was serving in a private sector capacity it probably would have been forced to resign, if not faced some severe sanctions.”
In another development Rep. Don Young (R-Alaska), chairman of the House Transportation and Infrastructure Committee, sent a lengthy letter to Mineta asserting that Amtrak is not eligible for a loan guarantee under the program the administration is considering, the Railroad Rehabilitation and Improvement Financing Program. He said only an appropriation is proper.
“If Amtrak wants a loan, let’s follow a truth in non-lending policy,” Young said. “We all know that Amtrak will either not repay the loan or will use appropriated federal funds to repay the loan. Let’s keep the money transfer clean and just appropriate it to them and not try to disguise it from what it really is — a taxpayer bailout.”
Meanwhile, Gunn said that if Congress leaves town for its July 4 recess by Friday without appropriating emergency funds and a loan guarantee plan also falls apart, he will have to begin preparing for the shutdown. Congress does not return until July 8.
“I think ultimately we’ll get a loan guarantee or a supplemental, but I can’t be sure,” Gunn said.
If a shutdown does occur, Gunn said, long-distance trains would stop running first, with commuter and corridor trains that operate on Amtrak tracks or use Amtrak crews halting perhaps four to five days later. Chief Operating Officer Stan Bagley said he would prefer to halt corridor and commuter runs at midnight on a Saturday to avoid stranding commuters or business travelers, meaning that shutdown could come as early as July 6 or as late as July 13. Commuter operators expressed relief that they had at least an extra week to prepare.
Pete Sklannik Jr., VRE’s chief operating officer, said the delay might allow the commuter railroad to forge the necessary labor contracts and hire enough qualified engineers and crew members to get the system back up relatively quickly if Amtrak shuts down — using the L’Enfant Plaza station instead of Union Station.
Gunn, in a news conference, confirmed reports that the Bush administration Monday had suggested a loan guarantee of a little more than $100 million, coupled with savings by Amtrak, which he said could not be done.
Gunn confirmed that the administration asked about mortgaging Chicago’s Union Station but that was quickly discarded as “not practical.” In the end, no ideas seemed to work, Gunn said.
“I won’t say it was a dry hole, but there wasn’t a lot of water in it,” he said.