(The New Orleans Times-Picayune posted the following article by Bruce Alpert on its website on May 18.)
WASHINGTON, D.C. — For much of its 32-year history, Amtrak has been on the verge of financial ruin, surviving only with the help of last-minute infusions of federal money.
The cash often has been accompanied by plans and programs designed to bring the passenger rail line closer to solvency, if not profitability. The financial situation also is debated within the larger questions of whether the system is even still needed in the air-travel era and how much the government should have to subsidize the service.
This year, it is the Bush administration that is applying the carrot and stick: a budget offer of $900 million in exchange for the system making major changes to stop its financial bleeding.
“This funding comes with a strong message: Amtrak must undergo significant reform,” said Transportation Secretary Norman Mineta, who was quick to add that virtually no major passenger railroad in the world operates without some government subsidies.
Tightened belt
Mineta said the U.S. government is no longer insisting that Amtrak become self-sufficient, as Congress did in 1995 with what it billed as a seven-year plan toward independence, but it will require Amtrak to become more efficient.
Although the administration hasn’t yet spelled out its plan, likely targets include the system’s long-distance routes, three of which pass through New Orleans. Allan Rutter, administrator of the Federal Railroad Administration, said current losses for the 17 routes range from $131 to $551 per passenger. It might be better, he said, to consider allowing private companies to take over some of those routes.
Rep. Mark Kennedy, R-Minn., a critic of Amtrak, said that on some routes, including the Sunset Limited, which serves New Orleans and lost $32.7 million in 2002, it would be cheaper for the government to buy each of the passengers an airplane ticket to and from their destinations.
Amtrak President David Gunn has won praise from some Amtrak critics for developing a five-year plan to increase efficiency. He’s already trimmed the number of Amtrak vice presidents and recently unveiled a plan, dependent on continued federal subsidies, to make inroads in the estimated $6 billion backlog of maintenance orders and capital needs.
But the same lack of cash that has stymied previous Amtrak executives makes Gunn’s ambitious goals a long shot. Passengers and travel experts say that what would really make Amtrak a more popular choice for travelers is more frequent and higher-speed service, similar to what is available in most European cities. But those are advances Amtrak can’t provide without money.
Amtrak lately has had to follow the airlines’ strategy for attracting passengers: heavy discounting to persuade people to travel at a time when the economy is troubled and there’s a continued threat of terrorism. Last month, Amtrak offered a deal in which a family would pay full price for the first ticket, half for the second and get the third for free. It is now offering 25 percent discounts on some rail tickets bought on the Internet.
The discounting helped increase ridership on some routes. For example, passenger totals on the Crescent between New York City and New Orleans were up nearly 11 percent in April from the year before. But overall revenues were down about 10 percent during the first half of the 2003 fiscal year, though ridership stayed stagnant, with 13.5 million riders.
Creature comforts
Amtrak officials are trying to make train travel more desirable by promoting the notion that riders can enjoy the beautiful scenery along their route and that train seats are much bigger than the cramped ones found in coach sections of major airlines. They also argue that train travelers generally avoid the security lines and post-Sept. 11 hassles of airports.
They are busy tweaking schedules to avoid some of the early-morning departures and late-night arrivals that have alienated some travelers. But with long-distance trains operating only once a day, or in some cases once every two or three days, it’s inevitable that some trains will leave or arrive at some stations in the wee hours of the morning.
In comparison, train service between most major European cities is frequent, as often as once an hour, making it convenient for tourists to get off the train for some sightseeing on stops along their route, knowing another train will be by soon.
“Because of the time involved with Amtrak, it almost is left as a choice just for someone who is retired, or has enough time to take a leisurely pace to get to their desired location,” said Judy Carr of the American International travel agency in Metairie.
A recent Amtrak traveler, Purvis Thompson, 23, an English major at Dillard University, said the train offered a much better price for a recent visit to his family in Memphis, Tenn. But with only one train in each direction, Thompson had to take time off from work to make the mid-day departure from New Orleans and rise early in the morning to catch the 6:45 a.m. train back. “It takes a long time — about eight hours versus one hour to fly,” he said. “It would be better if there was more frequency of trips, and I would have liked to have seen more customer service agents on board.”
Congressional stop
Supporters of Amtrak say a lot of the blame for Amtrak’s shortcomings rests with Congress. Some members have insisted that Amtrak continue service to their hometown constituents, despite major losses. And Congress hasn’t been providing Amtrak with anything close to what it needed to maintain its fleet of trains, system proponents say.
Gunn, Amtrak’s president, already has rejected suggestions from some in the Bush administration and Congress that he eliminate some long-distance trains.
The Sunset Limited, which runs west to Los Angeles and east to Jacksonville and Orlando three times a week, generated, on average, about $142 per rider in 2002. But the cost to Amtrak was $477, resulting in a loss of $335 per passenger.
The City of New Orleans, which connects New Orleans with Chicago, Memphis and Jackson, Miss., among other cities, generated $74 per ticket, but cost Amtrak $181, for an average loss of $107 per passenger. The Crescent, connecting to New York City, with stops in Philadelphia, Washington, Charlotte, N.C., Atlanta, and Birmingham, Ala., among others, generated per passenger ticket revenue of $102, but cost Amtrak $226, or a loss per passenger of $124.
But Gunn said the savings of cutting the routes wouldn’t amount to much.
“Eliminating one of those trains does not affect the maintenance activities in any significant way in New Orleans, where you have 145 people, authorized positions in the locomotive shop and the car maintenance,” he said.
And the tens of thousands of passengers who use these routes, either because air service isn’t available or because they fear or can’t afford air travel, would be left with no viable transportation options, except to hit the congested highways.
Gunn said he and Amtrak managers are working to make railroad employees more customer-friendly and to keep rail cars and stations clean, essentially making the rail experience “more pleasant.” The key to success, Gunn said, is the railroad’s five-year capital improvement plan.
“While there has been much discussion of ‘reforming’ Amtrak in recent years, no matter what reforms policymakers may want, you have first got to get costs and reliability under control,” Gunn said. “This strategic plan focuses on running a fiscally tight business and bringing the railroad to a state of good repair so that it costs less to operate and costs less for the taxpayer to support it.”
But some in Congress are running out of patience. Rep. John Culberson, R-Texas, said it’s unfair to ask his constituents, most of whom never ride Amtrak, to continue to subsidize the national railroad. “I am just frankly appalled and outraged as a taxpayer at the sheer waste and the scale of the black hole for tax money that we’re pouring into Amtrak,” he said.
Rep. William Jefferson, D-New Orleans, said the federal government provides far more subsidies for highways, airlines and trucking companies than for Amtrak and that rail service provides concrete benefits. Among them, he said, are less congested highways, reduced pollution, “not to mention the tourists” that Amtrak brings to Louisiana.