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7/15/2004



Rail News: Rail Industry Trends

Amtrak's outlook is stable, Standard & Poor's says


Yesterday, Standard & Poor’s (S&P) Rating Services raised its corporate credit rating for Amtrak from "BBB-" to "BBB." The agency also raised the national passenger railroad’s senior secured debt rating from "BBB-" to "BBB."

"The rating action reflects Standard & Poor’s increased comfort with Amtrak’s financial position, due to evidence of continuing government support, management’s increased focus on revenue and cost management, and improved financial controls," according to S&P.

Amtrak’s financial situation has stabilized since summer 2002, when the agency received a $100 million governmental loan and a $205 million supplemental appropriation grant. In addition, fiscal-year 2003 and 2004 appropriations have enabled the railroad to continue operating its existing network, said S&P.

Although the appropriations are below requested levels, they are higher than the Bush Administrations’ proposals. Congressional support likely has been bolstered by Amtrak management’s focus on improving the efficiency of day-to-day operations, S&P officials believe.




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