Amtrak

Deteriorated Financial and Operating Conditions Threaten Long-Term Viability Gao ID: T-RCED-95-142 March 23, 1995

Amtrak's financial and operating conditions have deteriorated to the point where its ability to offer nationwide service is seriously threatened. Debt, deferred maintenance, and reduced staffing have helped Amtrak to survive but have also diminished the quality and the reliability of service. In December 1994, Amtrak announced an aggressive plan to reduce expenses by eliminating routes, retiring its oldest cars, cutting staff, and boosting productivity. Yet even if the plan is successful, it will not solve the railroad's long-term problems. GAO believes that continuing the present course--maintaining the same funding level and route system, even with proposed service cuts--is neither feasible nor realistic because Amtrak will continue to deteriorate. GAO discusses the implications of several alternatives, ranging from privatization to limiting service to routes that carry the largest number of passengers in the most cost-effective manner.



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