(The following article by Robert Cohen was posted on the Newark Star-Ledger website on July 27.)
WASHINGTON — Amtrak could save millions of dollars a year by eliminating sleeper-car service and dining facilities on its money- losing long-distance trains, according to the Department of Transportation’s inspector general.
As the financially strapped national railroad pleads for increased federal aid to avert possible bankruptcy, the inspector general said it could save between $75 million and $158 million annually by doing away with dining, lounge and sleeper cars, checked baggage service and food and beverage service on its long-distance runs.
Eliminating the sleeper cars would also save Amtrak $79 million in annual capital spending, Inspector General Kenneth Mead said.
Mead noted some Amtrak critics have suggested the rail line eliminate all long-distance trains to save money.
“This report considers a less drastic measure, namely to selectively reduce costs while continuing to provide basic long-distance service to meet the mobility needs of rural communities that may not have access to other transportation alternatives,” his report said.
In fiscal 2004, Amtrak’s 15 long- distance trains (those with routes over 500 miles) carried 3.9 million passengers and lost more than $600 million. The average share of sleeper-class passengers across all long-distance routes was 16 percent, with the rest opting for coach seats.
The report said passengers receiving sleeper-class services are subsidized with federal aid ranging from $269 per person on the Auto Train, which runs from Virginia to Florida, to $627 on the Sunset Limited train from Florida to California.
The inspector general also said Amtrak must find ways to provide food service in a more efficient manner to eliminate the need for federal subsidies. He said options include outsourcing the service, increasing food prices, having passengers obtain meals in stations during regular stops or distributing boxed meals that have been prepared off the train.
Amtrak’s board of directors acknowledged it must reduce expenses on its long-distance service. The board said in a statement it will launch a number of pilot projects to address the issues identified by the inspector general.
Amtrak, with a $635 million operating loss in 2004, is currently battling for increased federal aid to maintain national operations while promising to institute reforms. The White House has called for zero funding for Amtrak, pressing for the national rail line to be privatized and broken up into a number of smaller, regional units.
Amtrak has asked Congress for $1.8 billion for 2006, up from $1.2 billion appropriated for this year. Amtrak has said it will become insolvent without the $600 million increase.
The House in June voted to provide $1.2 billion in subsidies, rejecting plans to cut all long distance routes and provide the rail line only $550 million. Earlier this month, the Senate Appropriations Committee voted to give Amtrak $1.4 billion next year, prompting a veto threat from the administration.