Amtrak shutdown delayed, changes around the corner

In this game of Monopoly, Amtrak president David Gunn – broke and mortgaged to the hilt – is still hoping to play a little longer.

But the banker, Secretary of Transportation Norman Mineta, looks uninterested in granting Mr. Gunn a "Get out of jail free" deal. The Bush administration wants a controversial restructuring of the ailing rail service, including a handover of Amtrak's tracks and tunnels to a new agency, before committing more money.

Talks between Mr. Mineta and Amtrak board members ended Monday without a decision on a federal loan that would stave off a nationwide shutdown of passenger trains. Amtrak says it needs $200 million to continue operating until the new fiscal year, which starts October 1. Amtrak officials, while pushing back the timetable, warned that until new funding arrives, a shutdown still looms. The group will meet again later this week.

"I am confident that we will be able to avoid a shutdown of services," Mineta said after the meeting.

Amtrak finds itself at the mercy of the federal government after the recently installed Gunn discovered that his company lost $160 million more last year than previously thought. Commercial creditors, meanwhile, downgraded Amtrak's credit status, making it impossible for the ailing company to get a loan without federal backing.

Congress, a traditional defender of Amtrak, is taking steps to pass an emergency appropriation to cover the company during the busy summer travel season. However, the spending would have to be passed quickly to happen before Congress recesses for the July Fourth holiday. And presidential veto power gives the administration the upper hand in shaping the final solution worked out between the various players.

"The burden is not on the administration alone to save the rail system from bankruptcy nor should it be," Mineta said. "It will take all parties, including Congress, to show initiative and build a solution to Amtrak's fundamental problems."

The latest gamesmanship reflects this year's struggle between advocates and reformers over the future of the long-ailing rail system.

Five years ago, Congress set this year as the deadline for Amtrak to achieve financial self-sufficiency. At that time, Congress also created a new oversight board, the Amtrak Reform Council (ARC), charged with developing a plan to restructure Amtrak if it failed to meet the deadline.

Not only did Amtrak fail to achieve profitability, the company posted a record loss for 2001 and notified Congress that it needed much greater subsidies to keep operating. Meanwhile, the ARC submitted a dramatic proposal calling for the split-up of Amtrak into separate agencies, and opening up operations to private competition.

Last Thursday, the White House threw its support behind ARC's proposed measures, and said it would oppose congressional moves to increase Amtrak's funding without structural changes.

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