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Amtrak Reorganization Must Not Just Rearrange Deck Chairs on the Titanic


Location: Washington, DC

At a Transportation and Infrastructure Committee hearing today to review Amtrak's ongoing Structural Reorganization, Chairman John L. Mica (R-FL), stressed that Amtrak's plans must significantly reduce the rail service's reliance on taxpayer subsidies by improving performance, accountability, and cost savings. Mica said failing to do so is simply rearranging the deck chairs on the Titanic.

The following is Chairman Mica's statement from today's hearing:

"Today's hearing is the fourth in a series of Full Committee hearings on Amtrak and U.S. passenger rail policy. The last three hearings have strongly focused on concerns with Amtrak's performance in the following areas -- mismanagement in Amtrak's food and beverage service, which resulted in an $833 million loss over 10 years; Amtrak's inability to compete successfully against the private sector for commuter rail operating contracts; and Amtrak's continuing reliance on federal subsidies, at a much higher rate than that for other transportation modes.

"Today's hearing examines what Amtrak is doing to improve its performance through its Structural Reorganization and Five-year Strategic Plan to above all significantly reduce taxpayer subsidies. As Amtrak President & CEO Joe Boardman has previously said, one of Amtrak's goals is "to run this company more as a business and less as a government entity.' In order to meet this objective, Amtrak's plans must address the kinds of problems the Committee has highlighted.

"Over the years, there have been calls from Congress, the Government Accountability Office, and Amtrak's Inspector General for Amtrak to clearly link the organization's management to overall corporate goals, and create more transparency and accountability.

"Amtrak's current reorganization is now underway, and is expected to be fully implemented by the end of next year. The corporation will now be organized into six business lines. Each vice president or manager of a business line is responsible for how well his respective line meets the performance goals outlined in the Strategic Plan, and for the profits and losses of the line.
"In the past, Amtrak managers have not been held accountable for what happened in their departments. Also, there have been past Amtrak reorganizations, but without clear goals.

"Amtrak's Strategic Plan, corporate goals, and reorganization must not just rearrange the deck chairs on the Titanic again. They must lead to improved performance, accountability, and cost savings if they are to help lead to a company that is truly run "more as a business and less as a government entity.'"

Mica noted that two more Full Committee passenger rail hearings are being planned, the first for December 6th on the High-Speed and Intercity Passenger Rail grant program, and the second for December 13th on the Northeast Corridor.

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