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Facts to Support Amtrak Funding

February 23, 1986

The Jan. 9 edition of The Times carried a news story quoting Sen. Pete Wilson (R-Calif.) and others taking sides on the Amtrak funding debate. Debate on such an important issue is certainly in the public interest. However, to be useful, the public must be given all the facts supporting both sides of the argument. Therefore, I would offer your readers the following facts that I believe support a decision to continue adequate funding for Amtrak.

FACT 1: The people who benefit most from Amtrak are not the middle- and upper-income passengers, but the 46% of our long-distance riders who have incomes of $20,000 and less; or the 36% of our long-distance riders who are elderly; or the people in the small communities for which Amtrak is the only mode of public transportation available.

FACT 2: Last year, when the Reagan Administration suggested that the private sector would buy some of Amtrak's more "profitable" routes, all it heard was eerie silence. No one has come forward with an offer for the Northeast Corridor, Amtrak's best-performing route, where the fixed costs exceed revenues by $250 million. Nor has any state offered to pick up the full cost of operating any of Amtrak's trains. Secretary Elizabeth Dole testified before the House Commerce Committee last spring that her Department of Transportation could not find anyone interested in operating intercity rail passenger service.

FACT 3: The Los Angeles-San Diego route, which has seen extraordinary ridership and revenue growth in the last several years, is not owned by Amtrak, but by the Santa Fe railroad. San Diego acting Mayor Ed Struiksma's desire to purchase the trackage is not dependent on the elimination of Amtrak. Rather, he and the Metropolitan Transit Development Board would have to negotiate with Santa Fe.

FACT 4: The elimination of Amtrak's subsidy would contribute little to reducing the deficit, since Amtrak's federal funding represents only 0.3 of 1% of the $180-billion deficit. Amtrak is already self-sufficient and asking less and less from the government each year. Since 1981, federal outlays for Amtrak have decreased 19%, while total federal outlays have increased 44%.

FACT 5: At the same time Amtrak's need for federal funding has decreased, ridership and passenger miles have increased. This means that since 1975 the number of passenger miles per dollar of federal support has increased by 155%. Taxpayers are getting more value for their dollar.

FACT 6: Amtrak is not the only mode of transportation that requires federal support. Billions of dollars, over and above user fees, are spent each year on the air traffic control system and highway construction and maintenance. The beneficiaries are obviously the airlines, bus companies and others who, unlike Amtrak, are not required to openly request funding each year and include the amount in their financial reports.

The irony in Wilson's determination to "wipe out" the Amtrak subsidy is that Amtrak has never been in better shape--financially and operationally--and our performance is especially good in his own state. Ridership on the San Diego route increased 17.7% in the first quarter of fiscal year 1986 over the same period in 1985.

Systemwide in the first quarter, total revenue increased by 8.4% and passenger miles grew by 12.4%. This trend builds on our excellent performance in fiscal year '85, when revenue was up 8.8% to $825.8 million, and passenger miles grew by 6%, to 4.8 billion.

I believe we can continue these positive performance trends while we continue to need less federal support each year. However, the elimination of federal funding would mean bankruptcy for Amtrak and the loss of 24,000 jobs. The federal government probably would have to pay more than $2 billion in labor protection to those employees. Furthermore, it would be the end of intercity rail passenger service in this country. I am doubtful that the system could ever be rebuilt, since once the Amtrak organization is destroyed and its assets liquidated, the cost to replace it would be prohibitive.


President, Amtrak


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