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A Message from the Amtrak Reform Council

Welcome to the Amtrak Reform Council Website

Final Restructuring Plan

For information regarding the Council's Finding resolution on November 9th and results of the Council's meetings on December 14th and January 11th, please click on the Heading "Press Room."

Our website has been designed to educate the public regarding:

Background Information
In 1970, the National Railroad Passenger Corporation (Amtrak) was created by Congress to relieve the freight railroads of the burden of money-losing passenger operations and to preserve rail passenger service over a national system of Congressionally-designated routes. Amtrak was created as a for-profit government corporation that was granted the right of access to the tracks owned by the freight railroads at incremental cost and with operating priority over freight trains. Amtrak was also granted a monopoly to provide intercity rail transportation over its route system and was to receive federal subsidies for the first few years, but then it was expected to make a profit.

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Washington, DC 20590

Phone: (202) 366-0591

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In 1997, after 26 years and approximately $22 billion in federal operating subsidies and capital investments, and an overall trend of stagnant ridership, Congress debated the viability of continuing to fund Amtrak, knowing that without federal funds, Amtrak would cease operations. The Senate reached a compromise by passing by unanimous consent the Amtrak Reform and Accountability Act of 1997 (which became law on December 2, 1997). This Act (P.L. 105-134) provided that Amtrak (a) would no longer be a government corporation or hold a rail passenger monopoly; (b) would be allowed to add new routes and close money-losing routes; (c) would receive approximately $2.2 billion in Taxpayer Relief Act funds; and (d) would have to achieve operational self-sufficiency (i.e., no longer receive federal operating grants) five years after the enactment of the Act.

The Act also created the Amtrak Reform Council, an independent bipartisan federal commission of eleven (11) members whose statutory mandate was to: (a) make recommendations to Amtrak to help it reach operational self-sufficiency; (b) report annually to Congress on Amtrak’s performance in several areas; (c) if the Council were to find that Amtrak would be unable to achieve its goal of operational self-sufficiency by December 2, 2002, then submit to Congress a plan for a rationalized and restructured national rail passenger system; and (d) if such a finding were made by the Council, Amtrak would submit a plan for Amtrak’s liquidation to the Congress.

Brief History of the Amtrak Reform Council

The Amtrak Reform Council (Council) has eleven Council members (six appointed by Republicans, four appointed by Democrats, and the Secretary of Transportation). There are six staff members.

Highlights of the Council's history are summarized below.

The Amtrak Reform and Accountability Act becomes public law (P. L. 105-134)

MAY 1998
The Council met for the first time with nine Council members appointed, and elected Governor Christie Todd Whitman as Chairman. The Council discussed its FY1998 budget of $50,000.

Chairman Whitman submitted a FY1999 budget request to the Congress for $1.9 million in order to hire consultants to study the issue of Amtrak. The Congress approved a budget of $450,000 for FY1999 and had a restriction on hiring consultants. Shortly afterwards, Chairman Whitman resigned from the Council.

The Council met, and voted to appoint several Council members to a recruitment committee to hire of a staff director and legal counsel to help the Council prepare its mandated reports to Congress.

MARCH 1999
Gilbert E. Carmichael, a former Federal Railroad Administrator, as the newly elected Chairman of the Amtrak Reform Council approved the hiring of Thomas A. Till, former Deputy Federal Railroad Administrator, as Executive Director. The Council approved the Executive Director's request for the authority to hire the rest of the Amtrak Reform Council staff, and his work plan to hold Outreach Hearings throughout the country, inviting states to provide their views about intercity rail passenger service.

APRIL 1999 - NOVEMBER 1999
The Council held five hearings: (1) in Philadelphia, PA, for the Northeast Corridor that runs between Washington, D.C. and Boston, MA; (2) in Charlotte, NC, for the emerging Southeast Corridor from Virginia to Florida; (3) in Seattle, WA, for the Pacific Northwest Corridor from Oregon to British Columbia; (4) in Chicago, IL, for the Midwest Regional Rail Initiative states; and (5) in Dallas, TX for the South/Southwestern regions of the United States.

Council Budget for FY2000
In August, Council approved a FY2000 budget request of $1.4 million to be submitted to Congress. In October, the Congress approved a budget for FY2000 for $750,000 and lifted the restriction on hiring consultants.

The Council sent its first letter of recommendations for improvement to Amtrak. The letter suggested that Amtrak consider taking a number of actions, including: 1) separating the financial statements of the NEC infrastructure from those of Amtrak's nationwide train operations; 2) providing separate financial statements for Amtrak's Mail & Express business; 3) substantially reducing corporate overhead; 4) instituting a program of continuing annual cost reductions; and 5) developing contingency plans for corrective action in the event Amtrak does not achieve the operating and financial goals contained in its Strategic Business Plan.

The Council released its First Annual Report to Congress, which discussed the broad range of functions Amtrak performs, from train operator to infrastructure owner to real estate developer. The Council expressed the view that this extensive set of functions kept Amtrak from focusing effectively on its core business of intercity rail passenger service. The report also set forth the financial criteria the Council proposed to use to determine if Amtrak achieves the statutory goal of operational self-sufficiency by December 2, 2002.

At a Hearing of the Senate Surface Transportation Subcommittee, Committee on Commerce, Science and Transportation, the Subcommittee instructed the Council to follow Amtrak's interpretation of the test for operational self-sufficiency. The Council indicated that it would follow the test criteria of Amtrak and the Subcommittee.

MARCH 2000 - NOVEMBER 2000
In 2000, the Council held three additional hearings: (1) in Denver, CO, for the Mountain States; (2) in Sacramento, CA, for the state of California; and (3) in Burlington, VT for the New England States. In addition, the state of Florida testified before the Council at a meeting in Washington, D.C. The Council also held meetings in Washington and New York, New York.

The Council also released a Summary of Principal Provisions of Laws Pertaining to Amtrak, and prepared a staff working paper on issues relating to Amtrak's ownership of the rail infrastructure on the Northeast Corridor between Washington, D.C., and Boston, MA.

Council Budget for FY2001
In FY2001, the Council requested a budget of $1.3 million and the Congress approved a budget of $750,000.

The Council released its Second Annual Report to Congress that: 1) described the fundamental structural flaws of Amtrak as an institution; 2) outlined a new business model for Amtrak to correct the flaws; 3) offered a spectrum of five options for restructuring Amtrak, and 4) discussed possible funding options for investments that support intercity rail passenger service.

JUNE 2001
Council hearing in Newark, NJ that focused mainly on the Council's proposal to "appropriately separate" the Northeast Corridor infrastructure from Amtrak's national train operations. The states, Amtrak, commuter train operators, and the freight railroads, all of which share the use of the Northeast Corridor, were invited to testify.

JULY 2001
The Council sent a second letter of recommendations for improvement to Amtrak stating that Amtrak should consider: 1) changing its organization to implement a separation of infrastructure responsibility from train operating responsibility, including separate financial statements, and 2) revisiting the recommendations of the Council's November 1999 letter, most of which Amtrak had not implemented.

Council Hearing set for Los Angeles on September 20th was cancelled due to the events of September 11, 2001.

The Council, at a business meeting in Atlanta, discussed the issue of whether the Council should make a Finding whether Amtrak would be operationally self-sufficient by December 2002. After a lengthy discussion, the Council agreed to have the staff prepare a Finding resolution.

The Council votes to approve, by a 6-5 vote, a Finding that Amtrak will not be operationally self-sufficient by December 2, 2002. The finding was based on the interpretation of operational self-sufficiency requirement as defined by Amtrak. This started a 90-day deadline for the Council to submit an action plan to Congress for the restructuring and rationalization of the national intercity rail passenger system. During that same time period, Amtrak was to prepare a plan for liquidation.

The Council met and discussed nine options for restructuring Amtrak. The Council staff was directed to reduce the options to three options.

Amtrak's liquidation plan
An amendment, introduced by Senator Biden, to the Defense Appropriations Act of 2002 (P.L. 107-117) prohibited Amtrak from using federal funds to prepare a liquidation plan. The amendment was adopted and signed into law by the President.

Council Budget for FY2002
The Council requested a budget appropriation of $1.3 million (including a request for funding for first 3 months of FY2003), and submitted the budget to Congress in March 2001. In December 2002, Congress approved a budget for the Council of $225,000.

The Council met to discuss three restructuring options. Mr. Wendell Cox, Council member introduced a fourth option for the Council's consideration. The Council discussed all of the options, and the Council adopted Option III with several amendments, by a vote of eight in favor, one against and two Council members abstaining.

On February 7, 2002, the Council released to Congress its Action Plan for the Restructuring and Rationalization of the National Intercity Rail Passenger System. The Council, in a vote of nine Council members in favor, one against, and one abstaining (Secretary of Transportation), adopted the Action Plan.

Thank you for visiting our Website. The Council is looking forward to working with Amtrak, its employees, the Administration, Congress and all other interested parties to achieve our common goal of improving intercity rail passenger service in the United States.


Last updated April 30, 2002           Privacy Statement

The ARC is an independent federal commission established under the Amtrak Reform and Accountability Act of 1997 (P.L. 105-134).