Tuesday, July 26, 2005

The Bush administration yesterday endorsed a recommendation from the Transportation Department inspector general that Amtrak eliminate its food service and sleeper cars on some long-distance routes in a drastic effort to cut costs.

The dining and sleeper cars cost Amtrak more money than they generate, but railroad officials have told Congress they are important parts of their customer service.

“Overall, our analysis shows that eliminating sleeper cars, dining cars and other amenities on Amtrak’s long-distance routes could save between $75 million and $158 million per year in operating costs and avoid an additional $79 million in planned annual capital expenditures,” a report released yesterday by Transportation Department Inspector General Kenneth Mead said.

Other amenities the report recommends cutting include on-board entertainment, lounge seating and checked baggage service.

Transportation Secretary Norman Y. Mineta agreed with the report, saying, “It is time for Amtrak’s management to show its commitment to preserving and improving passenger rail service in this country by acting on the [inspector general’s] recommendations without further delay.”

Amtrak officials did not dispute the inspector general’s findings.

“In the months to come, Amtrak will be launching a number of pilot projects intended to identify the most effective strategies for addressing the long-distance operating cost issues you have highlighted,” Amtrak Chairman David Laney wrote to Mr. Mead.

However, on previous occasions Amtrak has said cutting its amenities would hurt the railroad more than help it.

Amtrak officials told the House Transportation and Infrastructure railroads subcommittee during a June 9 hearing that without the services, ticket sales revenue would drop.

“There are people on these trains,” said William L. Crosbie, Amtrak senior vice president. “It’s not just a piece of steel running up and down a track.”

The food service for passengers “was never intended to be a profit center,” he said. “When it’s dinner time, they expect to be served dinner. It will never be profitable.”

Of Amtrak’s 19,600 employees, 1,155 work in the food and beverage service, which is offered on 90 percent of the railroad’s trains.

The inspector general said alternatives to the dining car could include serving passengers boxed meals or selling packaged food from carts, like the airlines have begun doing.

Sleeper cars are used by 16 percent of Amtrak’s long-distance passengers each year, the inspector general’s report said. The other 84 percent ride coach class.

Last year, Amtrak lost $600 million on its 13 long-distance routes of more than 500 miles.

They include the Capitol Limited that operates between Washington and Chicago and the Auto Train the runs between Lorton, Va., and Sanford, Fla., near Orlando.

The Capitol Limited lost $208 per passenger in sleeper cars last year compared with $112 per coach passenger.

None of Amtrak’s routes nationwide operates profitably, when infrastructure costs are included, including the 23 shorter regional routes, such as Pennsylvania’s Keystone route and California’s San Joaquin route.

Amtrak carried more than 25 million passengers last year.

The inspector general’s report said Amtrak should “selectively reduce costs while continuing to provide basic long-distance service to meet the mobility needs of rural communities that may not have access to other transportation alternatives.”

Amtrak’s long-distance trains operate in 41 states and are the only intercity passenger rail service in 23 of those states.

The Bush administration has recommended eliminating Amtrak’s federal subsidy.

Amtrak is getting a $1.2 billion federal subsidy this year and is seeking $1.82 billion for fiscal 2006.

The inspector general’s report brought scorn from Amtrak’s supporters.

“He might just as well shut the trains down,” said Ross Capon, executive director of the National Association of Railroad Passengers, an advocacy group. “With the train, you take away the food service and you have made it impossible for the majority of revenues to stay with you. This is just a backdoor way of wrecking a $3 billion corporation.”

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