By J. Bruce Richardson, Corridor Rail Development Corporation; September 10, 2021
In the 1960s, United States Senate Republican Minority Leader Everett Dirksen of Illinois famously said (when a billion dollars really meant something) “A billion here, a billion there, and pretty soon you’re talking about real money.”
Many of us of a certain age remember when a million dollars was considered real money. Children wondered what it would be like to be a millionaire. Today, it’s pretty common to be a millionaire. Consider that half a century ago, Amtrak’s first annual total free federal subsidy was $140,000,000. Today, Amtrak claims some single long distance/inter-regional routes lose twice more than that annually.
As a culture, we have zoomed past thinking “billions” of dollars are an amazing amount of money, now we allegedly talk rationally in terms of trillions of dollars. Amtrak is still mostly thinking in terms of billions of dollars.
Amtrak happily jumped on the federal government pandemic funding gravy train (no pun intended) when it came to handing out trillions of dollars to keep the economy going.
The usual tactics were tried: If you don’t give us the money we want, the world will come to an end. They got the money.
Here’s a brief review of Amtrak’s pandemic-gotten gains; all numbers are based on Amtrak public reports:
Fiscal Year 2020, which began October 1, 2019
• $2 billion in annual funding; $700,000,000 for the Northeast Corridor, $1,300,000,000 for the National Network
• $1.018 billion in COVID-19 Relief Emergency Funding; $492,000,000 for the Northeast Corridor, $526,000,000 for the National Network
Total Fiscal Year 2020 Federal Funding: $3,018,000,000
Fiscal Year 2021, which began October 1, 2020
• $2 billion in annual funding; $700,000,000 for the Northeast Corridor, $1,300,000,000 for the National Network
• $2,700,000,000 in COVID-19 Relief Emergency Funding; $1,625,000,000 for the Northeast Corridor, $1,075,000,000 for the National Network
• $1,690,000,000 in additional COVID-19 Relief Emergency Funding; $969,388,160 for the Northeast Corridor, $728,611,840 for the National Network
Total Fiscal Year 2021 Federal Funding: $6,390,000,000
Easy free federal funding comparison:
• Fiscal Year 2019, Pre-Pandemic, Annual Subsidy: $1,941,600,000
• Fiscal Year 2020, Annual and Pandemic Subsidy: $3,018,000,000
• Fiscal Year 2021, Annual and Pandemic Subsidy: $6,390,000,000
Ticket and other annual income comparison:
• Fiscal Year 2019, Pre-Pandemic: $3,503,515,000
• Fiscal Year 2020, Pandemic: $2,430,701,000
• Fiscal Year 2021, Year To Date, July 2021 (most recent available report) Pandemic: $1,476,300,000
Let’s review:
• Fiscal Year 2019, Pre-Pandemic, Amtrak received an Annual Subsidy of $1,941,600,000 and had non-subsidy income of $3,503,515,000 for a total of $5,445,115,000
• Fiscal Year 2020, Pandemic, Amtrak received an Annual Subsidy and COVID Relief Funding of $3,018,000,000 and had non-subsidy income of $2,430,701,000 for a total of $5,448,701,000
• Fiscal Year 2021, Pandemic (as of end of July), Amtrak received an Annual Subsidy and COVID Relief Funding of $6,390,000,000 and had non-subsidy income of $1,476,300,000 for a total of $7,866,300,000
Let’s talk ridership and load factors:
• Fiscal Year 2019, Pre-Pandemic
Northeast Corridor, 12,525,600; Load Factor 59%
State Supported Routes, 15,440,700; Load Factor 41%
Long Distance/Inter-Regional Routes, 4,554,800; Load Factor 58%
Total Ridership, 32,521,200
Total Load Factor Average, 52%
• Fiscal Year 2020, Pandemic
Northeast Corridor, 6,147,400; Load Factor 43%
State Supported Routes, 8,004,500; Load Factor 29%
Long Distance/Inter-Regional Routes, 2,689,500; Load Factor 40%
Total Ridership, 16,841,400
Total Load Factor Average, 37%
• Fiscal Year 2021, Pandemic, Partial Year through July
Northeast Corridor Ridership, 3,084,000; Load Factor 33%
State Supported Routes Ridership, 4,047,000; Load Factor 23%
Long Distance/Inter-Regional Routes Ridership, 1,696,000; Load Factor 45%
Total Ridership, 8,827,000
Total Load Factor Average, 33%
In Andrew Selden’s article on this platform, “Sabotage!? Why Are Southwest Chief And Other Train Consists Designed For Failure?” Mr. Selden points out how long distance trains, particularly the western long distance/inter-regional trains are being operated this year with what appears to be intentionally short consists and turning passengers away because of sold-out conditions. While the numbers reported only show through the end of July, most summer trains were in sold-out mode.
On October 1, 2020, the first day of Amtrak’s Fiscal Year 2021, all daily long distance/inter-regional trains with the exception of Auto Train were reduced to tri-weekly service, with one Florida Service train maintaining four day a week service. On average, Amtrak was operating these trains at a level of 43% of their previous daily service. They all returned to daily service in late May and early June of 2021.
Consists were parked, onboard services and train and engine crew employees were laid off. On the Northeast Corridor service in 2020 was curtailed dramatically as well as on state supported routes.
While revenues from the sale of tickets and accommodations plummeted, expenses were drastically lower, as well.
This begs the question, even considering the costs of making stations and work areas “pandemic ready” with various germ barriers and revised systems, if Amtrak had total income (tickets/subsidies) of $5,445,115,000 for FY 2019 and nearly the same amount of $5,448,701,000 for FY 2020, why is there such a much higher total of (so far, as of July) $7,866,300,000?
That’s a difference of $2,421,185,000 between FY 2019 and FY 2021 as of the end of July. FY 2019 was advertised by Amtrak as their best performing financial year in the modern Amtrak era. A lot of equipment has been parked, we know over 1,200 employees were furloughed due to the train frequency reductions, and one of Amtrak’s largest expenses – train miles – were reduced by 49% from FY 2019 levels to FY 2021, as of July.
In the grand scheme of things, minor expenses such as upgrading car interiors and seats and new soft goods in sleeping cars are in the lower millions of dollars, not billions.
One of the questions raised about Mr. Selden’s article was available OBS and T&E staffing to be called back from furlough. Some noted a number of furloughed employees chose to be former Amtrak employees rather than return to their furloughed jobs once they were needed again.
Any competent human resources department should be able to provide an accurate account of former employees choosing retirement benefits and others who handed in their notice of leaving employment. Rather than a question of not enough employees available to call back to work, the real question is at what level of employment were management decisions made to call back employees to only staff the shorter consists instead of the former consists at a fuller length?
If it was a matter of staffing by region or crew bases then there would be no consistency nationwide of only operating two coaches per consist, especially with the initial social distancing seating.
Again, Amtrak has an additional $2,421,185,000 of cash to use. With that type of cash – and no reason to believe with the current party in charge in Washington that more federal subsidy won’t be available as requested – why isn’t the system fully back up and running? Americans are hungering to travel, even at Amtrak’s outrageously high sleeping car fares. It’s not a question of “maybe” there is more demand than space available, it’s a question of why isn’t there enough equipment being operated to meet demand?
During the pandemic era there have been no major derailments to lessen the equipment supply. Even with a trimmed down mechanical/maintenance workforce, no equipment should have to go without mandated cleaning and testing.
In fairness, we know no one at Amtrak’s senior executive level is getting rich from their salaries; Amtrak management salaries continue to lag behind other railroads. There is no reason to believe any one or group of inside individuals is benefiting from all of the availability of free federal monies. And, we also know, for the middle and lower management levels and rank and file employees the same holds true, but Amtrak salaries for OBS and T&E employees are still higher than most similar level non-railroad salaries.
The bottom line is, what is this $2.4 billion in extra money going to? And, with this sea of cash, why are long distance/inter-regional consists shorter than they were in FY 2019? Inquiring minds want to know.