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Rail News Home Amtrak

9/20/2002



Rail News: Amtrak

Amtrak's Gunn presents board budget proposal


Amtrak President and Chief Executive Officer David Gunn Sept. 20 presented board members a proposed budget that would end express shipping services, emphasize wrecked equipment overhauls and repairs, and have states that sponsor rail service absorb incurred operating losses.



The repair and overhaul of more than 100 wrecked cars at Amtrak’s Beech Grove, Ind., facility has become a higher priority than in the past.



"If they’re not running, we can’t generate revenue," says Amtrak spokeswoman Karina VanVeen.



Generating revenue is one thing, but Gunn also plans to cut a lot of expenses from Amtrak’s books. In a July interview with Progressive Railroading Gunn announced he was "taking a hard look at Express. I’m not sure it makes us any money."



The verdict is in: Shipping express freight in cars towed by passenger trains costs Amtrak about $3 million annually — in addition to negatively impacting customer relations because transit times were lengthened to accommodate the freight.



Mail service, however, will continue.



Meanwhile, Gunn seeks to cut annual costs substantially — about $108.4 million — by having states that requested rail service pick up those routes’ operating losses.



Currently, only two of 18 state-supported routes (San Joaquins and Heartland Flyer) are supported by their states, California at $600,000 and Oklahoma at $9 million, respectively.



Annual operating losses for the remaining 16 routes range from $600,000 for the Vermonter to $26.1 million for the Pacific Surfliner. Other routes whose losses might need to be picked up by their states include Adironack ($700,000); Piedmont ($1 million); Kansas City-St. Louis ($2.1 million); Ethan Allen Express ($2.2 million); Pere Marquette ($2.5 million); Illinois Zephyr ($2.7 million); International ($2.9 million); Illini ($3.1 million); Carolinian ($4.0 million); Capitols ($4.4 million); Cascades ($6.3 million); Hiawathas ($13.3 million); Chicago-St. Louis ($16.1 million); and Keystone and Clocker ($20.4 million).



Board members plan to discuss the proposal next week, most likely by conference call.



Just about the same time, Amtrak’s non-agreement-covered employees might hear word — which must come by Oct. 1 — about how many employees, and who, will be laid off. If the board agrees to phase out Express service, at least some of the layoffs are likely to come from those ranks.



Kathi Kube


Contact Progressive Railroading editorial staff.

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