Pennsylvania Congressman Challenges Amtrak’s Description of How Well it is Doing Financially

An Amtrak vice president found himself under fire Wednesday by a skeptical congressman who expressed doubt that Amtrak’s finances are as strong as the carrier says they are.

Rep. Scott Perry (R-Pennsylvania) told Amtrak’s Stephen Gardner that he took issue with Amtrak’s description of its finances.

Perry said $235 million that states provide to Amtrak to operate corridor services are subsidies and not passenger revenue.

He also expressed doubt about Amtrak’s claim that it is close to breaking even on an operating basis.

In particular, Perry said Amtrak’s net revenue figures fail to account for $870 million in depreciation in 2019. “This represents a loss of over a billion dollars,” Perry said.

In response, Gardner, who is a senior vice president and chief operating and commercial officer, said the payments are “very transparent.”

He said depreciation is “a cost primarily associated with our vast Northeast Corridor infrastructure funded by the federal government.”

A analysis posted on the website of Trains magazine said Gardner was in effect admitting that the full costs of operating trains in the Northeast Corridor don’t enter into the profit-loss equation that Amtrak presents.

The exchange occurred during a meeting of the House Railroads, Pipelines, and Hazardous Materials Subcommittee.

The committee heard from six witnesses as it continues to work toward approval of surface transportation renewal legislation. The current surface transportation law expires on Sept. 30.

Rep Steve Cohen (D-Tennessee) continued to complain about Amtrak’s onboard dining services, saying he still hasn’t received any survey data from Amtrak that justified food service downgrades on eastern trains.

That comment was in reference to Amtrak’s replacement of full-service dining cars on overnight trains in the East, Midwest and South with a service now known as flexible dining.

Sleeping car passengers are served food prepared off the train in lieu of meals freshly prepared aboard the train.

Cohen said all he has heard from Amtrak passengers is that they don’t like the food, which is heated in a microwave oven.

“Millennials may like to look at their phones, but they don’t like bad food either,” Cohen said. “You need to put that back and attract more customers.”

In response Gardner said Cohen should receive the survey information by the end of the week.

“We have a variety of different services, and that requires us to experiment and try new ways to meet the requirements and needs of our traveling public,” Gardner said.

“We will continue to experiment to find the right mix, the right balance. For sure we know passengers expect a much broader set of food options — healthier choices than the historic railroad menu that had been offered. We also know people prefer a variety of different environments to eat in; it’s become quite clear that many people prefer to be served in their own rooms or to be able to use the dining car in a more flexible way.”

During his testimony Gardner appeared to contradict the feasibility of a plan put forth recently by U.S. Secretary of Transportation Elaine Chao that Amtrak should repair the tunnels leading into New York City from New Jersey beneath the Hudson River before building a new tunnel.

Amtrak and various public agencies in the two states have been seeking federal funding for a massive multibillion project to upgrade infrastructure in the Northeast Corridor.

The Gateway project includes building new Hudson River tunnels.

But federal officials have been resisting giving the project federal grants and have suggested the states need to greatly increase their financial contribution to the project.

Gardner initially tried to duck being critical of Chao’s proposal before finally acknowledging during questioning that he didn’t think rebuilding the existing tunnel before building a new one was a viable idea.

“We have to be able to excavate the current track structure, repair the drainage underneath, and inspect the tunnel lining — which hasn’t been looked at, frankly, in 109 years,” Gardner said.

“To do that during a four-hour slot in the evening or on a 55-hour weekend outage scenario could present incredible difficulty … which is why we have always proposed to do a full rehabilitation of the tunnels once new tunnels are in place, allowing us to maintain all of New Jersey Transit and Amtrak service.”

Rep. Stephen Lynch (D-Massachusetts) ripped Amtrak for using non-union contractors at a Chicago worksite.

“It shakes my confidence in Amtrak … With all the challenges we have,” Lynch asked, “do you really want to pick that fight to try to save a couple of bucks by bringing in workers who don’t have ongoing regular training on rail systems? As an iron worker, it’s a very different environment when you’re working on a live transportation system.”

Lynch is a former iron worker and organized labor official.

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