Deteriorated Financial and Operating Conditions Threaten Long-Term Viability
T-RCED-95-123: Published: Mar 2, 1995. Publicly Released: Mar 2, 1995.
- Full Report:
GAO discussed its recent report on Amtrak's financial and operating conditions and its funding request for fiscal year (FY) 1996. GAO noted that: (1) Amtrak's deteriorating financial and operating condition jeopardize its ability to provide quality services; (2) federal subsidies have not covered the gap between Amtrak's revenues and expenses; (3) Amtrak efforts to reduce its losses have diminished service quality and reliability, which in turn have decreased ridership and revenues; (4) Amtrak plans to further cut service and staffing, retire its oldest cars, and improve productivity and services, but its success depends on increased government financial support and legislative changes; (5) Amtrak faces intense fare competition from airlines and other transportation sectors; (6) Amtrak's fastest growing source of revenues is commuter rail contracts which produce more passengers than its intercity service; (7) Amtrak needs over $4 billion to repair its equipment, facilities, and track, but increasing funding shortfalls and expenses will severely hamper Amtrak's repair efforts; (8) if Amtrak is privatized, only a few potentially profitable, well-travelled routes would remain; (9) if funding remains the same, Amtrak will have to further reduce its services; and (10) Amtrak is requesting $260 million in operating assistance and $600 million in capital assistance for FY 1996, although it is not known how much of Amtrak's total capital grant request would be spent on the Northeast Corridor and how much would be spent elsewhere in the Amtrak system.