By Paul Wilson, Guest Commentator; January 13, 2022
Amtrak has released its audited financial statements for fiscal years 2020 and 2021, the period between October 1, 2019 and September 30, 2021. Highlights include:
Amtrak received an eye-popping $7.7 billion over the two fiscal years from the federal government. That’s the sum of its ordinary annual appropriations, plus COVID relief. $3.7 billion in COVID relief was spread across three emergency spending bills in March 2020, December 2020, and March of 2021. The cash rolled in at a good clip. So where did that all go? The combined loss on the audited financial statements was “only” $3.7 billion for FY 2020 and 2021.
From where I sit, it’s unclear where it went, but here’s where it didn’t go:
1. Keeping sufficient personnel on the payroll to assure reliable operations, and to deal with the inevitable service disruptions due to poor weather, etc.;
2. Keeping sufficient rolling stock on hand, and in good repair, to address the persistent initial terminal delays and enroute failures. And ‒ dare to dream ‒ for make-up consists, spares, etc.;
3. Providing for a sufficient onboard food service that’s available for all passengers;
4. Augmenting Amtrak’s unique product, the private accommodation, during a public health emergency.
And I would have thought that “COVID” relief specifically would be used to make the company more resilient to entirely foreseeable interruptions due to employee illness, quarantines, etc. But no, it hasn’t. Quite the opposite. Amtrak took the money and launched yet another round of aggressive cost-cutting.
From the audited statement of expenses, comparing FY 20 and 21 in the “salaries, wages, and benefits” category, the net result of the furloughs, buyouts, and so forth was $65 million reduction. Train operations due to reduced service: down $60 million. Fuel and utilities: down $27 million.
So, it seems, at first glance, management put the company in the ditch to “save” $149 million (while sitting on $4 billion in federal handouts in excess of its actual losses). $149 million is a paltry 7% of the company’s loss in FY’21. Passenger revenues were off $349 million year-over-year from ’20 to ’21. As usual, revenues drop way faster than expenses.
So, the four-billion-dollar question is: what happened (or will happen) to that $4 billion? Am I missing something?