Proposed AMTRAK Rail Service Between Philadelphia and Atlantic City

Pursuant to a congressional request, GAO reviewed the National Railroad Passenger Corporation's (AMTRAK) proposed rail service between Philadelphia and Atlantic City to determine whether: (1) plans for the 40-percent nonfederal match were firm and adequate; (2) federal, state, and local tax consequences to a private firm should be counted as part of the federal share; (3) the portions of the rail stations needed for rail service had been correctly identified; (4) a full environmental impact statement is required before federal funds can be released; and (5) the AMTRAK Board of Directors made a reasonable and objective determination of the project's estimated operating revenues.

GAO found that: (1) New Jersey has adopted an alternative plan for providing the 40-percent nonfederal match requirement that will provide funding by the state and the Atlantic County Improvement Authority; (2) the Federal Railroad Administration was preparing an environmental assessment which included the impact of initiating the project; and (3) some of the data AMTRAK used in its economic model of the estimated revenues was inaccurate and unreliable. GAO also found that formal written agreements between the state, the Authority, and AMTRAK had not been executed and submitted to the Department of Transportation so that the Secretary could certify that the nonfederal match requirement had been met.