- The Washington Times - Saturday, December 15, 2001

A government board is considering proposals that would eliminate much of Amtrak's passenger rail service for small communities and turn over operations between large cities to private companies.
The Amtrak Reform Council met yesterday to put together a recommendation that would permanently change the railroad from the centralized structure it has maintained since its creation in 1971. It would be replaced by regional privatized organizations focused on providing passenger rail service along key corridors.
"The implication of this is that Amtrak would be broken up and corridors would be the basis of the new entity," said Milwaukee Mayor John Norquist, a member of the Amtrak Reform Council.
The Council is scheduled to deliver a final recommendation Feb. 7 to Congress and the Bush administration, which then will decide the fate of the railroad.
The main unresolved issues yesterday were how much control states would have over the new railroad and the degree that private companies would control operations.
"What we have with Amtrak right now doesn't work," said council member Bruce Chapman.
Amtrak lost $405 million in the first eight months of this year. In recent years, it has operated on half-billion a year subsidies, which are part of the $24 billion in subsidies the railroad has consumed since 1971.
Among problems cited by the council yesterday was Amtrak's practice of using revenue from its Northeast Corridor routes the only profitable ones to pay for expenses on other routes. As a result, the railroad lacks money for proper maintenance and equipment along the Northeast Corridor.
Council members also said Amtrak's management was inefficient compared with private railroads.
"The problem is a bloated management structure," said council member Paul Weyrich. "Amtrak sometimes has four times the number of people as a comparable freight railroad."
Congress set a deadline of Dec. 2, 2002, for Amtrak to become self-supporting on its operational costs. Last month, the council concluded Amtrak could not meet the deadline and began work on a plan to reorganize it.
Congress set up the Amtrak Reform Council in 1997 to monitor Amtrak's progress toward financial self-sufficiency.
The nine proposals for reorganization considered yesterday ranged from a national passenger railroad completely owned by the government to one that receives no public money and operates as a series of small private railroads regulated by the government.
The council members most strongly favored five proposals that combined private operation with government oversight. Private companies would be required to bid competitively on the contracts.
"Competition sharpens the blade of the saw," council member Christopher Gleason said.
Under those proposals, the national passenger railroad could be replaced by regional railroad authorities focused primarily on making main corridors profitable. Intercity buses would connect with the railroads at hub stations.
An Eastern rail authority, for example, could franchise the Northeast Corridor passenger service to private railroads, like Norfolk Southern railroad. Other possible corridors are between Los Angeles and San Francisco; Portland, Ore., and Seattle; or Milwaukee to Chicago to St. Louis.
The U.S. Department of Transportation has designated 10 corridors for development of high-speed rail. Amtrak's Acela Express high-speed rail service already operates along the Northeast Corridor.
Long-haul routes and service to small communities are among the least profitable for Amtrak. Private companies could contract to operate the routes under the proposals the council is considering, although subsidies for them are uncertain.
Amtrak declined to comment.
Most of the 11 council members agreed efforts should be made to protect Amtrak's 24,000 employees.

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