Sec. Slater Attacks Amtrak Study Claims

<B>Sec. Slater Attacks Amtrak Study Claims</B>

By Barbara Cook

U.S. Department of Transportation secretary Rodney Slater issued a sharp rebuke to the Amtrak Reform Council for its recent report that he claimed "mischaracterized" Amtrak's congressional mandate to achieve operating self-sufficiency by the end of fiscal year 2002.

Further, Slater said, the report "was issued without adequate time for review, discussion of its findings or of Amtrak's concerns in a public meeting."

The council, an 11-member independent oversight body established in 1997 by Congress to monitor the rail line's financial and operating progress, published its first annual report at the end of January and claimed Amtrak had made little progress in establishing a niche in U.S. passenger transportation. If it determines Amtrak can't survive without continued federal operating subsidies after 2002, the council must formulate a plan to restructure the rail network.

The council's main complaint was that Amtrak is not counting some major expenses as liabilities in its financial statements, a factor that allows the rail company to claim greater gains. Further, the report disputed Amtrak's claims of passenger traffic improvement. Finally, the report said Amtrak's financial statements only appear to have improved because the rail line is benefiting from payments from commuter agencies and other activities rather than passenger service.

Amtrak was concerned that the negative thrust of the Amtrak Reform Council report could harm its chances to raise funds in private capital markets. "Ridership is up 10 percent over the past three years, and last year alone commercial revenues exceeded the business plan by 16 percent," Amtrak stated. "Recently, Moody's upgraded Amtrak's credit rating and said it expects Amtrak to be operationally self-sufficient by 2003. Standard & Poor's also issued a favorable report."

Slater agreed: "I am confident that Amtrak will reach operating self-sufficiency as required by law and thrive.