Auditing and Financial Management:
Conrail's Track Abandonment Program
CED-79-45, Apr 2, 1979
The criteria for Consolidated Rail Corporation's (Conrail) route selection and track abandonment processes were evaluated including whether any new or different criteria, such as social or environmental factors, were advisable. Also reviewed was Conrail's study of its branch line from Waterbury to Torrington, Connecticut.
Although Conrail has been studying the effect on income of abandoning a number of its lines, it has not yet abandoned any. According to its February 15, 1978, 5-year business forecast, Conrail had planned to send about 100 abandonment applications to the Interstate Commerce Commission (ICC) between 1978 and 1982. Conrail's procedures and criteria for evaluating its branch lines were reasonable and provided an adequate basis for Conrail to identify those lines which could be made profitable and those which could not. Conrail has not estimated the social and economic costs and benefits of proposed abandonments. The method Conrail used to place a value on the Torrington line was composed primarily of preliminary estimates of the real estate and net salvage values of rails and switches. Such property value can be used to help estimate the subsidy payment to be made should the ICC permit abandonment and should a rail service continuation subsidy offer be made.