David Randall Peterman Analyst in Transportation Policy
John Frittelli Specialist in Transportation Policy
Amtrak is the nation’s primary provider of intercity passenger
rail service. It was created by Congress in 1970 to preserve some level of
intercity passenger rail service while enabling private rail companies to
exit the money-losing passenger rail business. It is a quasi-governmental
entity, a corporation whose stock is almost entirely owned by the federal
government. It runs a deficit each year. Congressional appropriations
cover about half its total loss, and represent essentially all of its
funding for capital maintenance and improvements.
Amtrak can be divided into three parts. There is its Northeast Corridor (NEC)
service between Washington, DC, and Boston, where Amtrak owns much of the
infrastructure and operates frequent service using its fastest trains.
There is its long-distance service, in which infrequent trains crisscross
the country over tracks owned by freight rail companies. And there is its
statesupported service, in which Amtrak operates shorter-distance trains
under contract with states. Amtrak was last authorized in 2008, in the
Passenger Rail Investment and Improvement Act. That authorization expires
at the end of FY2013.
Since Amtrak’s inception, Congress has been divided on the question of whether
it should even exist. Amtrak is regularly criticized for failing to cover
its costs, and thus requiring federal assistance. The need for federal
financial support is often cited as evidence that passenger rail service
is not financially viable, or that Amtrak should yield to private companies
that would find ways to provide rail service profitably. Yet it is not
clear that a private company could perform the same range of activities
better than Amtrak does. Indeed, Amtrak was created because privatesector railroad
companies in the United States lost money for decades operating intercity passenger
rail service and wished to be relieved of the obligation to do so.
By some measures, Amtrak is performing as well as or better than it ever has in
its 42-year history. For example, it is carrying a record number of
passengers, and its passenger load factor and its operating ratio are at
the upper end of their historic ranges. On the other hand, Amtrak’s plans
do not envision significant decreases in its need for federal funding. Among
the perennial questions that Congress may examine in considering
reauthorizing Amtrak are whether Amtrak should continue to exist, what
range of services it should offer, the appropriate level of federal financial
support for Amtrak, its relations with states and with private rail companies,
and its level of accountability to Congress. .
Date of Report: January 7, 2013
Number of Pages: 33 Order Number: R42889 Price: $29.95
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