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36–682 PDF 2007

AMTRAK’S FISCAL YEAR 2008

STRATEGIC PLAN

(110–51)

HEARING

BEFORE THE

SUBCOMMITTEE ON

RAILROADS, PIPELINES, AND HAZARDOUS 

MATERIALS 

OF THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES

ONE HUNDRED TENTH CONGRESS

FIRST SESSION

JUNE 12, 2007

Printed for the use of the 

Committee on Transportation and Infrastructure

(

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

JAMES L. OBERSTAR, Minnesota, Chairman 

NICK J. RAHALL, II, West Virginia 

PETER A. DEFAZIO, Oregon 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

GENE TAYLOR, Mississippi 

ELIJAH E. CUMMINGS, Maryland 

ELLEN O. TAUSCHER, California 

LEONARD L. BOSWELL, Iowa 

TIM HOLDEN, Pennsylvania 

BRIAN BAIRD, Washington 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

JULIA CARSON, Indiana 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

BRIAN HIGGINS, New York 

RUSS CARNAHAN, Missouri 

JOHN T. SALAZAR, Colorado 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

DORIS O. MATSUI, California 

NICK LAMPSON, Texas 

ZACHARY T. SPACE, Ohio 

MAZIE K. HIRONO, Hawaii 

BRUCE L. BRALEY, Iowa 

JASON ALTMIRE, Pennsylvania 

TIMOTHY J. WALZ, Minnesota 

HEATH SHULER, North Carolina 

MICHAEL A. ACURI, New York 

HARRY E. MITCHELL, Arizona 

CHRISTOPHER P. CARNEY, Pennsylvania 

JOHN J. HALL, New York 

STEVE KAGEN, Wisconsin 

STEVE COHEN, Tennessee 

JERRY MCNERNEY, California 

VACANCY 

JOHN L. MICA, Florida 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

WAYNE T. GILCHREST, Maryland 

VERNON J. EHLERS, Michigan 

STEVEN C. LATOURETTE, Ohio 

RICHARD H. BAKER, Louisiana 

FRANK A. LOBIONDO, New Jersey 

JERRY MORAN, Kansas 

GARY G. MILLER, California 

ROBIN HAYES, North Carolina 

HENRY E. BROWN, JR., South Carolina 

TIMOTHY V. JOHNSON, Illinois 

TODD RUSSELL PLATTS, Pennsylvania 

SAM GRAVES, Missouri 

BILL SHUSTER, Pennsylvania 

JOHN BOOZMAN, Arkansas 

SHELLEY MOORE CAPITO, West Virginia 

JIM GERLACH, Pennsylvania 

MARIO DIAZ-BALART, Florida 

CHARLES W. DENT, Pennsylvania 

TED POE, Texas 

DAVID G. REICHERT, Washington 

CONNIE MACK, Florida 

JOHN R. ‘RANDY’ KUHL, JR., New York 

LYNN A WESTMORELAND, Georgia 

CHARLES W. BOUSTANY, JR., Louisiana 

JEAN SCHMIDT, Ohio 

CANDICE S. MILLER, Michigan 

THELMA D. DRAKE, Virginia 

MARY FALLIN, Oklahoma 

VERN BUCHANAN, Florida 

(II)

SUBCOMMITTEE ON RAILROADS, PIPELINES, AND HAZARDOUS 

MATERIALS 

CORRINE BROWN, Florida Chairwoman 

JERROLD NADLER, New York 

LEONARD L. BOSWELL, Iowa 

JULIA CARSON, Indiana 

GRACE F. NAPOLITANO, California 

NICK LAMPSON, Texas 

ZACHARY T. SPACE, Ohio 

BRUCE L. BRALEY, Iowa 

TIMOTHY J. WALZ, Minnesota 

NICK J. RAHALL II, West Virginia 

PETER A. DEFAZIO, Oregon 

JERRY F. COSTELLO, Illinois 

EDDIE BERNICE JOHNSON, Texas 

ELIJAH E. CUMMINGS, Maryland 

MICHAEL H. MICHAUD, Maine 

DANIEL LIPINSKI, Illinois 

JAMES L. OBERSTAR, Minnesota 

(ex officio) 

BILL SHUSTER, Pennylvania 

THOMAS E. PETRI, Wisconsin 

WAYNE T. GILCHREST, Maryland 

STEVEN C. LATOURETTE, Ohio 

JERRY MORAN, Kansas 

GARY G. MILLER, California 

HENRY E. BROWN, JR., South Carolina 

TIMOTHY V. JOHNSON, Illinois 

TODD RUSSELL PLATTS, Pennsylvania 

SAM GRAVES, Missouri 

JIM GERLACH, Pennsylvania 

MARIO DIAZ-BALART, Florida 

LYNN A. WESTMORELND, Georgia 

JOHN L. MICA, Florida 

(ex officio) 

(III)

(V)

CONTENTS Page

Summary of Subject Matter .................................................................................... vi

TESTIMONY 

Kummant, Alexander, President and Chief Executive Officer, Amtrak ............. 3

Laney, David, Chairman, Amtrak Board of Directors .......................................... 3

PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS 

Brown, Hon. Corrine, of Florida ............................................................................. 31

Costello, Hon. Jerry F., of Illinois .......................................................................... 35

Cummings, Hon. Elijah E., of Maryland ............................................................... 37

Mica, Hon. John L., of Florida ................................................................................ 43

Oberstar, Hon. James L., of Minnesota ................................................................. 47

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Kummant, Alexander .............................................................................................. 51

Laney, David M. ...................................................................................................... 70

SUBMISSIONS FOR THE RECORD 

Kummant, Alexander, President and Chief Executive Officer, Amtrak, response to questions from the Subcommittee ...................................................... 55

Laney, David, Chairman, Amtrak Board of Directors, response to questions 

from the Subcommittee ........................................................................................ 73

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(1)

AMTRAK STRATEGIC INITIATIVES 

Tuesday, June 12, 2007

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

SUBCOMMITTEE ON RAILROADS, PIPELINES, AND HAZARDOUS

MATERIALS, 

Washington, DC. 

The Subcommittee met, pursuant to call, at 2:05 p.m., in Room 

2167, Rayburn House Office Building, Hon. Corrine Brown [chairman of the Subcommittee] Presiding. 

Ms. BROWN OF FLORIDA. Will the Subcommittee on Railroads, 

Pipelines and Hazardous Materials come to order. 

The Subcommittee is meeting today to hear testimony on Amtrak’s Strategic Initiatives. Let me start by expressing my disappointment that the Board has not approved the Amtrak fiscal 

year 2008 strategic plan. I do not understand why Amtrak has not 

followed my newest request to have this plan ready. We were told 

in April that it was going to be approved in May, and we were told 

a few weeks ago that it was going to be approved prior to this hearing. We are now 8 months into the fiscal year 2007. If the Board 

drags this out any longer, there will be no point in approving the 

plan. 

You have to start setting the stage for the initiatives in 2007, 

and we want to see them succeed in 2008. At the rate that we are 

going, we will be in 2008 before we ever see a final plan. 

I did, however, review an earlier draft, and there is good news 

for Amtrak. Amtrak is projected to deliver the best ridership numbers and revenues in history with the projection of 25.3 million 

trips and $1.5 billion in revenues. Ridership in the first quarter of 

2007 increased 7 percent over last year where ticket revenues were 

up 14 percent. Accelerated ridership alone was up 20 percent, and 

with the ever-increasing price of gas, ridership can only increase. 

I do not think there is a doubt that Amtrak has made significant 

improvements in the system over the last several years and has an 

ambitious agenda for future improvement, but Amtrak must also 

address some challenges before it can reach its full potential. It 

must improve its on-time performance on long-distance routes, replace aging rolling stock and infrastructure, improve safety and security, and resolve the longstanding disputes between management 

and labor. 

It is particularly important that Amtrak reach a labor agreement 

that is fair. Most of the Amtrak workforce has gone without a renewable contract for over 7 years. You cannot reach your ambitious 

goal of the company with employees who feel that they have been 

2

treated unfairly. The freights have made significant progress with 

their contracts, and I hope this inspires Amtrak to do the same. 

I look forward to hearing from Mr. Laney and Mr. Kummant 

today about these issues. 

Before I yield to Mr. Shuster, I ask that Members be given 14 

days to revise and extend their remarks and to permit the submission of additional statements and material by Members and witnesses. Without objection, so ordered. 

I yield to Mr. Shuster for his opening statement. 

Mr. SHUSTER. I thank the Chairwoman for yielding and for holding the hearing today. 

It seems that Amtrak has always been a contentious issue since, 

I guess, it was formed in the 1970s. Arguments over funding levels, 

corporate mission, corporate structure, allegations of wasteful 

spending have always been out there, but there is no argument, I 

think, that this Nation needs a safer, faster, more efficient passenger rail system than we have today. 

The Acela, as Mr. Mica likes to point out, only averages 82 miles 

an hour. Wow. The intercity trains cannot even compete with the 

intercity bus service that we have in the country today, so Amtrak 

needs to be better managed, to manage better its resources than 

it has. 

I read through your plan that you put in place. It looks like a 

good plan, but historically as I look back through at Amtrak, it always has a good plan. It just does not seem to work out the way 

it should, and that is imperative that we do that. 

I know that Amtrak has brought in new management. I would 

like to welcome the new President and CEO—not new anymore—

Mr. Kummant, who has been onboard now for several months or 

going on almost a year, I believe it is. 

I also welcome Chairman Laney for being here before us. 

I know you have also brought in a new CFO and a new general 

counsel, so we are looking forward to that management team doing 

good things. 

We still have a long way to go, but it appears that we are hopefully beginning to see some progress even on the long-distance 

trains. The legacy of the 1950s was the interstate highway system, 

and I hope that our legacy in this new century will be a fast, efficient, high-speed rail system. 

It was about several months ago, maybe a year ago now—I think 

it was only several months ago—that we just passed in America 

the population threshold from 200 million to 300 million people, 

and it took 65 years. I was reading a newspaper and saw the projections. We are going to go to 400 million in just 35 years, and 

when you look at the math and look as the population grows across 

America, the density of the population in the corridors that Amtrak 

serves is going to remain dense, and so it is for the future extremely important that we have an efficient passenger rail system. 

It is going to be something that future generations are going to rely 

on. 

So I am looking forward to hearing from you today, and I am 

looking forward to working with you as we try to improve Amtrak 

and improve the transportation system in this country. 

I yield back. 

3

Ms. BROWN OF FLORIDA. Thank you. 

Ms. BROWN OF FLORIDA. I would like to welcome our witnesses 

today at the hearing. Our first witness is David Laney, who is the 

Chairman of Amtrak’s Board of Directors. 

Our second witness is Mr. Alexander Kummant, who is the 

President and Chief Executive Officer of Amtrak. 

Let me remind the witnesses that under our Committee rules, 

they must limit their oral statements to 5 minutes but their entire 

statements will appear in the record. We will also allow the entire 

panel to testify before questions to the witnesses. 

STATEMENTS OF DAVID LANEY, CHAIRMAN, AMTRAK BOARD 

OF DIRECTORS; AND ALEXANDER KUMMANT, PRESIDENT 

AND CHIEF EXECUTIVE OFFICER, AMTRAK 

Ms. BROWN OF FLORIDA. I now recognize Mr. Laney for his testimony. 

Mr. LANEY. Madam Chairwoman, thank you. 

Mr. Shuster, I appreciate your comments. 

I appreciate the——

Ms. BROWN OF FLORIDA. Excuse me. Would you pull that mike—

yes, sir. 

Mr. LANEY. Thank you for the invitation to appear before the 

Subcommittee today. I am glad to be back. I am glad to see you 

again, Madam Chairman. We are very glad that Congress is turning to Amtrak’s reauthorization and hopeful that there will be a 

very constructive outcome. I will make my stated remarks very 

short, and you can use my written statement for reference and for 

questions if you would like. 

As you know, the last time Amtrak had an authorization was 10 

years ago, and I believe it is now in everyone’s interest that Congress has this discussion and, ultimately, adopts a reauthorization 

that provides a clearer direction for Amtrak and its role in shaping 

the future passenger rail in this country. 

It is worth reminding you that the talent and experience housed 

in Amtrak represent virtually all of the passenger rail expertise remaining in this country today. I believe that expertise is worth protecting and worth growing, but I know also that it will not survive 

unless we at Amtrak successfully continue to rebuild Amtrak’s 

credibility with Congress and the administration, with the American public, and in the commercial marketplace in which we operate. 

That is our challenge. And afforded even the bare minimum of 

necessary operating support which we received during the last 

years, we are, I think, very successfully tackling that challenge; not 

as fast as I would like, but faster than I expected. We are nowhere 

near anything resembling what I would consider an end zone. Still, 

the progress is significant and tangible, thanks largely to the remarkable expertise and almost inconceivably steady commitment to 

Amtrak by its workforce. 

There are a number of challenges, Madam Chairwoman, as you 

mentioned, and I will highlight only a few. But one of the principal 

challenges is on-time performance, particularly of our long-distance 

and corridor operations on host or freight railroads. I would add, 

in response to your comment earlier about our tardiness in terms 

4

of the strategic plan, that apparently on-time performance has also 

affected the Board. My apologies. We will have a plan to you shortly, and I am glad you had a chance to see a draft. 

We also have a challenge with respect to our equipment. We 

need to replace a very old, and, some people might say, antiquated 

and deteriorating equipment fleet. We continue to have the challenge of the rationalization of our long-distance routes, and we 

need to rebuild relationships with States, particularly as we focus 

our energies on State corridors for the future. Reauthorization is a 

critical need, and in that reauthorization, we sincerely hope that 

there is a Federal-State match without which there would not be 

a very robust future for passenger rail in the near term. 

You mentioned, Madam Chairwoman, our labor contracts. We 

are very sincerely and very actively trying to move forward, and 

there are at least some indications of positive movement with respect to a resolution on a number of different fronts in that regard. 

Passenger security, on a different note, remains front and center 

for all of us. Those are challenges, but we have a number of remarkable achievements as well. 

We have reduced Federal operating support consistently. Our 

revenue in ridership growth, as you mentioned, Madam Chairwoman, is extraordinary. We have on-time performance levels, really for the first time, in its history of the Acela, approaching 90 percent. And I think we will be targeting 90 percent as a minimum 

going forward. 

With respect to the reduction of Amtrak’s debt, we reduced it by over $500 million over the last 4 years, and with respect to the success and the growth of our State corridors, I will refer only to the 

States of California, Washington, Illinois, Wisconsin, the Keystone 

Corridor in Pennsylvania, and the continued growth on the Northeast Corridor. 

The catalog of these positive results could continue, and there 

are a few more mentioned in my written statement. But let me 

close with a perspective on our employees, on our management 

team, on the working support we have had from the Department 

of Transportation, and now Secretary Peters, the Federal Railroad 

Administration, and Joe Boardman who is the head of that agency. 

All of these, I think, are in excellent shape, and that is at least 

some room for comfort that we will stay the course going forward. 

Finally, I believe you have a very independent, talented and 

proactive Board which continues to make a difference. 

I thank you for the invitation again, Madam Chairman, to be 

here today, and now I would like to answer any questions or to 

defer to our President and Chief Executive Officer, Alex Kummant. 

Ms. BROWN OF FLORIDA. Mr. Kummant. 

Mr. KUMMANT. Thank you, Madam Chairwoman and Congressman Shuster. I will also try to keep my comments brief and not 

cover too much of the same ground. 

Again, it is a pleasure for us to be here and to engage in a very 

important topic here of the overall strategic future for Amtrak. 

First, on performance and key indicators, for another year—as 

has been mentioned in a couple of comments here already—Amtrak 

will set new ridership and revenue records. There are a number of 

contributing factors for this that I think we all understand quite 

5

well: the rising cost of gasoline; we have also added frequencies in 

a number of key States—California, Illinois, Pennsylvania—and 

there is clearly a shift in the ridership in terms of really looking 

for other modes. 

In the Northeast, the challenges of air travel combined with gas 

prices are clearly factors also as to why the Acela ridership has 

grown, as was referenced earlier, at 20 percent year over year. Another key ingredient which was referenced is the very strong, additional on-time performance of the Acela, reaching 88 percent, year 

to date, for this year with a target still of 90 percent. 

This improved on-time performance is a function of our investment in the Northeast Corridor infrastructure as well as sustained 

improvements in day-to-day operating efficiencies. Revenues for the 

year are 11 percent higher than last year for the total system. In 

addition, we continue to improve our safety numbers, and we are 

increasing our focus on passenger security. 

We have not assumed any new debt in 4 years, as Chairman 

Laney mentioned, and at the same time, we have also paid down, 

as was also referenced earlier. So, again, all of our indicators are 

moving in the right direction. 

Going forward, clearly we have challenges. All of this good news, 

again, does not mean that we do not have serious issues to tackle. 

It has become clear to me over the first months here at Amtrak 

that we are really at a crossroads. The company must do everything in its power today to position itself for the future. The decisions we make, the service we provide, the product we deliver 

today, will determine if Amtrak will truly play a key role as a provider of passenger rail service down the road. 

In order to realize the potential, we are developing a strategic 

plan, which we will have to you shortly, that focuses on continued 

companywide cost reduction initiatives that will help reduce Amtrak’s reliance on Federal operating assistance. Increasing revenue 

is also, clearly, a key element of the plan and will hinge on Amtrak’s ability to add frequencies and to improve revenue management. 

Our other key goals and objectives include containing cost 

growth, improving financial transparency, providing a safe environment for employees and passengers alike, improving the management of our human capital, and, finally, conserving natural resources. By increasing revenue and containing costs, it is our intent 

to reduce our dependence on Federal operating support over the 

next 5 years. 

Rail infrastructure continues to be a key issue, as you mentioned, 

of long-distance performance as well. America’s rail infrastructure 

capacity is significantly stretched, particularly in those corridors 

that are most likely candidates for expansion. No matter what else 

is done, we will have to address capacity bottlenecks and shortfalls 

in many parts of our national rail system, most of which is not 

owned by Amtrak. 

Central to our strategy is to position ourselves to expand State 

corridor service where circumstances and resources permit. It is 

where the growth and ridership and revenue will lie in the years 

ahead. If you want to look at models of successful State programs, 

6

again as mentioned before, California, Washington and Illinois are 

great examples. 

Overall, our goal for our reauthorization bill is to solidify Amtrak’s role in providing intercity passenger rail service. That includes a Federal policy for corridor development and for the improvement of our long-distance services so that they better link 

State and regional corridors and become a more relevant transportation alternative. Amtrak’s reauthorization should also help us 

take advantage of opportunities to connect Amtrak’s intercity 

trains with other modes of travel. 

For each of the strategic goals and objectives we are developing, 

we will outline a series of specific actions to be taken. It is clear 

to me that our future hinges on our ability to become more cost efficient and to develop a superior product for our passengers. As I 

have stated, the central part of our strategy is to focus our efforts 

on meeting the needs of States, but while we work with States to 

develop and to expand intercity corridors, we will not forget or 

overlook the importance of the Northeast Corridor. 

The Northeast Corridor is the realization of what a mature corridor should be. As future hearings will address Amtrak’s specific 

capital needs, at that time we will talk more about what we need 

to do and would like to do in the Northeast Corridor. 

Again, in conclusion, it is remarkable that a few years ago, many 

felt Amtrak would continue moving into more and more serious difficulty. That is no longer the case. Reliability, mobility, and environment, these are things that consistently resonate with America’s traveling public, particularly in an era of rising fuel prices, 

highway congestion, and heightened interest in environmental protection. Amtrak continues to be the most promising and welcomed 

alternative. 

Thank you for your time, and I will be happy to answer any 

questions. 

Ms. BROWN OF FLORIDA. Thank you to both of you. 

You know, if you do not have a plan, then in the next 5, 10, or 

15 years, we could end up anywhere. And so that is why the plan 

of having those benchmarks and of having that information is important for us as we develop our budget, as we develop how we can 

assist making sure that the infrastructure is in place. And so I 

would like for you all to explain to us when we get back—it’s June 

12th, 2007, and we have been asking for this since April-May. I 

mean we really started asking for it in January when we took over 

the House of Representatives, when we started a new direction for 

Amtrak. 

So as we leave—we are going to have to adjourn for about 45 

minutes—perhaps that will be the first question that you could answer when we come back. We have three votes, and then we have 

got to take our class picture, so we will be back in about 45 minutes. 

Mr. SHUSTER. You are going to get plenty of time to think about 

it. 

Ms. BROWN OF FLORIDA. Yes. 

Mr. Shuster, do you want to add anything to that? 

We will start off with that. Thank you. 

[Recess.] 

7

Ms. BROWN OF FLORIDA. Okay. We can come back to order. 

I think I had given the first question, so you have had plenty of 

time to tell us what the status is and to explain for us why we have 

not gotten the information we requested and how we are going to 

move forward. 

Mr. LANEY. Let me answer that question, Madam Chairman, if 

I may. 

We have, as you know, a new President and Chief Executive Officer. We have a virtually entirely new management team, senior 

management team. We have three of five Board members who are 

relatively new. And I guess I will assume the responsibility for the 

delay because it has been my job, as best I can, to align what 

amounts to very independent, very involved opinions, all very focused on the future of Amtrak. And we have been at this process 

longer than I would like. I think we are all a little weary of it. And 

we have known, at the same time, that you and your staff have 

been very anxious to have a copy of a final, publishable version of 

this plan. 

As you know and I know, you have a draft, and with that draft 

came a little bit of a cautionary note that the front end, first few 

pages of that, would change fairly dramatically or might change 

fairly dramatically; and in fact, they have changed very dramatically. But the financial piece of that, as well as the strategic targets and actions over the next 18 months and beyond to deliver the 

results that we have focused on, are there very clearly delineated 

in the draft that you have. You should have the final copy, I believe, of the plan no later than midweek next week. And in fact, 

I would be able to deliver one to you today, but there are a couple 

of outstanding issues that are very material that need slightly 

more refinement and resolution. And part and parcel of the challenge is we have Board members who are scattered to the winds 

and who have their own independent lives and livelihoods they 

need to take care of, and it is hard to get everyone at the same 

place at the same time. 

It is no excuse. It has been my decision to slow it down for 

quality’s sake. I would much rather deliver something of higher 

quality than of higher speed, so we will have it to you shortly. My 

regrets. 

Ms. BROWN OF FLORIDA. Well, let me ask one other follow-up 

question here. 

Mr. Kummant has been the Amtrak President and CEO since 

September 2006. How would you rate his performance? 

Mr. LANEY. Well, he probably cringes as I punch my talk button 

and begin the discussion here, but Mr. Kummant has stepped into 

a whirlwind of activity, and has been on a very steep learning 

curve, and has learned and has understood this business, principally I think because of his background and his training, faster 

than I could have imagined. I expected that at the time we hired 

him, and he has done a superb job of assembling a senior management staff, and has in effect taken control of an organization that 

was already moving fairly quickly forward in a direction. He picked 

up on that direction and gave it a little more shape and direction, 

and worked very carefully with the Board to try to deliver what 

8

you are about to see next week. So I give Mr. Kummant a very 

strong ′′A′′ for performance over the last few months. 

Now, that could slip, of course——

Ms. BROWN OF FLORIDA. Of course. 

Mr. LANEY. —but so far so good. 

Ms. BROWN OF FLORIDA. So far, that is good. That is very good 

to hear, too. 

Mr. Shuster. 

Mr. SHUSTER. Thank you. 

I mentioned in my opening statement the importance of some of 

these high-density corridors, the Northeast Corridor I think being 

the number one corridor in the country for your train service. And 

I see you have had some significant improvements there, not only 

in ridership but in improved revenues. 

Have the folks at Amtrak done any recent studies on the price 

tag of what it would cost to make the Northeast Corridor a truly 

high-speed rail corridor where you could have a train getting 

speeds up to 180 miles/200 miles an hour? 

Mr. KUMMANT. Let me answer that in a general case. 

First, what we have looked at is a gradual increase of velocity 

and, really, of the reduction of trip time and of the reduction of 

slow orders. The notion of even taking that corridor to sort of a European high-speed standard is really, frankly, very remote, given 

the commuter traffic on that line as well. And we do run in a 

mixed mode. There are something like 50 freight trains on that 

lane as well. So the notion that it is going to be a true, dedicated 

high-speed line is probably not in the cards for a long time. 

What we are looking at and, in fact, are in the process of launching—we are meeting, in fact tomorrow, with very high-level folks 

from all of the Departments of Transportation, the States, and the 

high-speed corridor—is to really create a capital master plan looking out over the next 10 to 20 years in order to identify what really 

needs to be done on capacity overall. 

So that is: What do we need to do with bridges? What do we need 

to do with tunnels? How do we get through New York City faster? 

How do we get through Baltimore faster? How do we expand slots 

for commuters? How do we increase overall train miles for Amtrak? 

So that work will be going on here very seriously over the next 

year. But as to the notion of pure velocity, I would say it is highly 

unlikely you will see much more than what we see at our peak in 

Connecticut and in Rhode Island of 150 miles an hour. 

Mr. SHUSTER. And unlikely unless we build a dedicated line? 

Mr. KUMMANT. Yes. It would have to be, really, a dramatically 

new structure. And in fact, you would have to decouple the commuter network from our network because it is unlikely that you 

would really mix those two modes. 

Mr. SHUSTER. Would you have to put a 100 percent dedicated rail 

or——

Mr. KUMMANT. Yes. I mean that would be the extreme. I would 

imagine, you know, you might have to put some sort of—and I am 

just making this up, and there are probably people cringing in the 

audience, but I mean you would have to put major bypasses around 

cities in order to do that——

Mr. SHUSTER. Right. 

9

Mr. KUMMANT. —of probably large sections that would be completely new at a very high cost. 

I would say there is a great deal that we think we can do with 

the existing structure, and the real trick here is not so much reaching higher speeds, but it is reducing disruptions. Again, an example 

is we drop down to 20, 25 miles an hour for a pretty long stretch 

through Baltimore. So if you would eliminate that, you would get 

a whole lot more out of that than if I took 150 miles an hour to 

160 miles an hour through some of the wide open stretches. So it 

is really reducing those rail delays that is key. 

Mr. SHUSTER. Do you think you can get the Acela up to the speed 

of 110 miles an hour? 

Mr. KUMMANT. Well, on an average basis, I would have to talk 

to the engineers about that sort of calculation, but we do hit 135 

south of New York, and we do hit 150, again, north of New York, 

and I think we can certainly—south of New York, there are a lot 

of projects. The quality of the catenary, the actual conductive wires 

that run over the track, is something that we will be gradually renewing south of New York, and that is very much a determining 

factor as well on velocity. So there is a lot we can do. 

Mr. SHUSTER. I know the Keystone Corridor has been very successful—Harrisburg to Philadelphia. The average speed is 110; is 

that correct? 

Mr. KUMMANT. Yes, I think we get up to that. And you know, we 

cut—I do not know—something like over a half an hour in travel 

time, and we are up to 85 percent on-time almost. So——

Mr. SHUSTER. It has been very, very successful. 

Are you going to be able to use that as a model or to duplicate 

that in other places in the country? 

Mr. KUMMANT. Yes. I think there are some unique issues there. 

One is that there are very few highway crossings and very few road 

crossings there. It was a very well-engineered railroad to start 

with. It was originally electrified. I think there are a couple of 

other areas around the country we would like to look at, but I 

think one of the more interesting things as well is to look at some 

of the bigger corridors between population centers where, nevertheless, we could cooperate with the freight railroads and perhaps 

with major capital infusion. 

If you look within Florida, Florida certainly has a great population center, opportunities out of Miami. D.C. south to Richmond 

is very congested. There are very big needs. If you look at L.A. 

North to the Bay Area, there would be opportunities there. You 

know, you are talking about significant capital, but you are also 

talking about significant population centers. Detroit to Chicago 

would be an example. There is a 35-mile stretch across Indiana 

that is very difficult to get across, but we actually own almost 100 

miles of track into Michigan where we run almost 100 miles an 

hour, 95 miles an hour. So there is a lot, I think, around the country that could be done. 

Mr. SHUSTER. I have one last question. I see my time has expired. 

Are we going to get another opportunity? 

Ms. BROWN OF FLORIDA. Yes. 

Mr. SHUSTER. Okay. 

10

Just really quickly, how many high-density corridors are there in 

the country? I think I read somewhere there are 17. Does that 

sound right? 

Mr. KUMMANT. Forgive me, I would have to ask. There are designated corridors—I can look over my shoulder here. 

There are 13 designated corridors. 

Mr. SHUSTER. All right. Thank you. 

Mr. KUMMANT. Sure. 

Ms. BROWN OF FLORIDA. The Chairman of the Full Committee 

has joined us, Mr. Oberstar. 

First of all, let me just thank you for conducting the last two 

hearings when I had to be in Florida with family obligations, but 

I know no one missed me because the transportation guru was 

here. And I am just really pleased with the leadership that you 

have provided for our Committee, and we are moving forward. I 

will turn it over to you at this time for any comments and questions that you may have of our panel. 

Mr. OBERSTAR. Thank you, Madam Chair. On the contrary, you 

were very much missed. Your insight and your driving force and 

your commitment to Amtrak and to passenger rail service and to 

the whole issue of freight rail is well-known and greatly appreciated. And we missed you, and we certainly hope your family, your 

mother and grandmother, are doing well. 

Ms. BROWN OF FLORIDA. Yes. 

Mr. OBERSTAR. That is reassuring. That is wonderful. 

Mr. Kummant, you come to us, for once, with some good news 

about Amtrak. It is not a surprise because those of us on the Committee have been following things very closely. And I liked Mr. 

Shuster’s question, but I did not like the answer. 

When are you going to get up to speeds of 185 to 200 miles an 

hour as they do in Europe? It is a good question. The answer is, 

as you said, not for a very long time, maybe not at all. 

I cannot accept that answer, because we can achieve those 

speeds. We can improve. It is a matter of priorities. It is a matter 

of capital investment. It is a matter of the mechanics of the operation of our passenger rail system, and whether this Nation—it is 

not whether Amtrak is willing but whether this Congress, speaking 

for the people of the country, is willing to prioritize and to make 

the investment that we need to make in the capital account to 

make Amtrak the best that it can be, the best that we know it can 

be. 

You cited a moment ago the need for improvement in the catenaries. That is just one of the capital investment needs of Amtrak 

not only in the Northeast Corridor, but it is one of many capital 

investment needs across the country. 

I have to tell you that I am disappointed that 3 months ago I 

asked for a listing of the capital investment needs of Amtrak in a 

meeting that we had in my office, and it took 2-1/2 months to get 

a document. Now, if Amtrak is serious—and you know what your 

needs are; you know what the requirements are; this was not a list 

that I asked for as an endorsement by Amtrak, but as simply a listing of all of the capital account requirements that then we could 

evaluate and prioritize and decide which ones we were going to 

fund first and which ones we could get money through the ApproVerDate 0ct 09 2002 15:44 Feb 14, 2008 Jkt 000000 PO 00000 Frm 00022 Fmt 6633 Sfmt 6633 P:\DOCS\36682 HTRANS1 PsN: JASON
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priations Committee for, those for which we could bring the administration along, but it did not need to go before the Amtrak Management Board to be reviewed. I have to tell you that. I am very, 

very disappointed about that attitude. 

I have said many times how my own experience with passenger 

rail deteriorated over the years. I have seen it unfold before my 

eyes. When I was on my way to graduate studies in Europe in 

1956, I went by train from Minneapolis to the East Coast. The first 

leg was on the Milwaukee 400— 400 miles in 400 minutes. That 

was the premiere passenger service of its time; at least we thought 

so in the Midwest. Now you can hardly get to Chicago by air in 400 

minutes. By the time you drive to the airport, park your car, go 

through security, have a ground stop and an air hold and a weather problem, you cannot even do it by air. But we can do that by 

rail if we ignite the Midwest Rail Initiative, which was one of the 

projects recommended in the study of passenger rail initiatives, 

corridors, in pursuance of the direction and the funding for it in 

ISTEA of 1991. I was the author of that language. 

So of nine of your studies, six were recommended. The Midwest 

Rail Initiative was the primary hope for success. 

Let me ask you and Mr. Laney: What does it take, now going forward, to sort of inspire the Midwest Rail Initiative to get started? 

Mr. KUMMANT. Well, I think—well, what we are working very 

hard at, as I have alluded to in the past, is in pivoting our whole 

organization to face the States. So as we engage with the State 

DOTs and with the States and with the groups of regions, I think 

we really can articulate their particular needs, and, as you said, we 

can come up with very specific capital plans. But we also have to 

do that in conjunction with the freight railroads because, again, 

those are clearly along those rights-of-way, but we continue in 

those dialogues very intently. 

I am very interested, for example, as I have alluded to before, in 

looking at Chicago-Detroit. There is, I think, a large but manageable piece of capital that would get us across Indiana much more 

quickly. And I think all of those dialogues are occurring with a lot 

more intensity as we pivot our whole organization to make that our 

future. We have said very clearly that, going forward, the States 

are our future, and that is really where the ridership is going to 

be. 

Mr. OBERSTAR. There is the Northeast Corridor where you have 

this massive population concentration, where there is a rail infrastructure in place for passenger service, and it can go all the way 

down the East Coast to Florida. 

Then you have the Midwest. Then you have the long line across 

the northern-tiered States to the Pacific Northwest, Seattle. Then 

there is the California connection where, as your figures showed, 

passenger service is growing some 21 percent, and the State of 

California is a willing partner. 

Here in the Midwest, within 300 miles of Chicago, are 17 percent 

of the flights in and out of O’Hare. If we removed 15 percent—

even, say, 10 percent—that would be a reduction of about 100,000 

operations at O’Hare Airport, freeing up short-haul airspace and 

taxiways and landing and parking space. Free that up for long-haul 

12

service, which is far more valuable than 300-mile short-haul service in aviation, and provide that by rail. 

St. Louis lost its nonstop service to London Heathrow when Carl 

Ichan bought TWA, sold it off, sold off that nonstop route to American Airlines. Then, eventually, TWA declined and was absorbed by 

American. They have no nonstop service abroad. 

You could take a high-speed train from St. Louis to Chicago, be 

there in 2 hours, have your bags checked through security, carried 

on a secure railcar, check right into O’Hare and, as a passenger, 

board in a secure environment and get frequent flyer miles for your 

rail travel, fly off to London or wherever else in Europe that passengers typically go from that airport, and continue that service 

Chicago, Milwaukee, Madison, Minneapolis-St. Paul. 

Then you cited the sections going east. That makes so much good 

sense to have an intermodal passenger rail service system. We 

need the Midwest Governors to get on board and to be part of this 

thing. I have a problem in my own State. My own Governor of Minnesota does not see the bigger picture, but I am working on that. 

I would like Amtrak to take some initiative here and to lead the 

way. Stimulate the States. Motivate them to get going. 

Now it has come back to the Northeast Corridor. As Mr. Shuster 

said, we would sure like to see much higher-speed traffic on the 

East Coast. You would have a massive growth in passenger service. 

Ms. Brown has advocated this many, many times throughout hearings we have held over previous years. 

You mentioned that in the Baltimore area, speeds are reduced to 

20, 25 miles an hour. What does it take to upgrade the speeds 

there? 

Mr. KUMMANT. Again, that is the fundamental tunnel issue, and 

that is a multibillion-dollar issue. It is probably about a $2 billion 

issue to build either a new set of tunnels or to entirely refurbish 

those tunnels. 

If I may, sir, I would like to go back and just, again, tip my hat 

to Illinois. You pointed out the tremendous opportunities there. 

Now, we are talking about the conventional speeds, but that is a 

State that has doubled its commitment, its financial commitment, 

and it is pushing very, very hard to even put, you know, multibillion dollars out from a State level. So I think that is a great story, 

and we expect to continue to work very closely with them as well. 

But, again, Baltimore—getting back to Baltimore, again, a multibillion-dollar new tunnel issue is the fundamental——

Mr. OBERSTAR. That needs to be spent for security purposes, a 

good deal of it for safety purposes and the balance for improving 

travel speeds in the corridor. But give us some figures on this. Give 

us some hard numbers and analyses and a suggested 

incrementalization of the investment. We will address the funding 

issues. We will be the advocates for it here on this Committee, but 

we need you to help us with the numbers. You are the ones who 

are ′′in the know′′ on the capital requirements. 

I will withhold further, Madam Chair, at this point. 

Ms. BROWN OF FLORIDA. Thank you, Mr. Chairman. 

Mr. Brown. Did he leave? He stepped out. Okay. 

Mrs. Napolitano. 

Mrs. NAPOLITANO. Thank you, Madam Chair. 

13

I was reading also, with great interest, a portion of our memo 

that gives us information, and it talks about the track conditions 

of the private rail that you use. 

In what condition would you need them to be to be able to provide either faster service or on-time delivery service? Because if 

they are not upgrading their infrastructure, you are suffering. How 

is that affecting you to be able to carry out your mission? 

Mr. KUMMANT. Sure. There is no question it is a significant 

issue. We, for example, have just signed a new 6-year agreement 

with Union Pacific where they have specifically designated a reduction in delay time that is associated with slow orders. So there is 

no doubt, if you look at some of our major routes, slow orders are 

a big issue for us and hurt us on some of our long-distance routes. 

We also have in the summer heat order issues where, when temperatures rise over a certain degree, different railroads have different approaches to slow down their railroad for safety reasons; 

and that, in a sense, is also an infrastructure expenditure issue. 

So, again, it is a difficult dilemma for the freight railroads. They 

are fundamentally geared economically toward supporting freight 

and freight velocity, and they are trying to generate a return on 

capital for their shareholders. Nevertheless, clearly, there is a bit 

of a natural conflict with the type of slow order reduction velocity 

we need to really be effective. So that is a challenge, and we continue to work through that with each of the railroads. 

Mrs. NAPOLITANO. Well, given that, especially on the West Coast, 

you are going to have an increase in traffic that is going to further 

constrain the use of the UP or of the NSF lines, how are you working that out? Are you working with not only the railroads but also 

with the States to be able to find a way to be able to do all of the 

above—upgrade the infrastructure, find a better relationship so 

that you will be able to share more of it? Because they are going 

to be increasing the use of their rail capacity. What will you do 

then? 

Mr. KUMMANT. Well, again, there are no silver bullets there. It 

is day-to-day management. It is bringing the respective organizations closer together. We are spending more time with their dispatch operations to understand how they can dispatch more effectively. Our engineering groups do get together. Again, we have got 

very specifically targeted capital programs to reduce slow orders. 

And going forward, I can certainly envision, as we talk about Federal-State capital grants or matching grants, that those funds can 

go to debottlenecking very specific capacity constraints. And then 

that is an area in which we will have to continue being active, 

going forward, where we just really sit down with the freight railroads and say, you know, ′′Here are a whole series of projects. 

What is the schedule? How do we get through them? How do we 

fund them?′′ it is about capital. It is about reducing constraints. 

At the same time, certainly, every projection one reads over the 

next 15 years is still for dramatic freight volume increase, so there 

is no doubt there is an overall challenge with the capacity of the 

entire freight network. 

Mrs. NAPOLITANO. How are you planning to address it? 

Mr. KUMMANT. Well, again, we do not have a simple solution to 

that other than going through, identifying and prioritizing bottleVerDate 0ct 09 2002 15:44 Feb 14, 2008 Jkt 000000 PO 00000 Frm 00025 Fmt 6633 Sfmt 6633 P:\DOCS\36682 HTRANS1 PsN: JASON
14

necks and working with the freight railroads to put capital into 

those areas. 

At the end of the day, it is an intersection of essentially a private 

company and public policy where—and this is just a personal 

view—we are collectively going to have to find more and more ways 

to get public capital into debottlenecking the overall rail network. 

Mrs. NAPOLITANO. Well, Amtrak got to reach much of the ridership gains in recent years due to collaborative efforts with the 

State governments. 

Can you describe what those partnerships have been? How have 

they been successful? Are you continuing to press forward on 

those? 

Mr. KUMMANT. Sure. 

Great examples, again, have been mentioned here in some of our 

opening comments. California, for example, since 1990 has put 

somewhere between $1.8 billion and $1.9 billion into the railroad 

infrastructure themselves, and those are unmatched dollars. Illinois has done something similar. They also have doubled their support number over the last couple of years. The State of Washington 

has done a very good job in collaborating with BNSF in terms of 

putting something between $300 million and $400 million into 

their rail infrastructure. And if you look at those three States, that 

is where the frequencies are; that is where the real growth has 

been; and that is where the State corridors are doing very well. 

Mrs. NAPOLITANO. So there is a correlation, then, between the 

success for economic development, so to speak, and the ability to 

get your goods delivered on time. 

Mr. KUMMANT. Very much so, yes. 

Mrs. NAPOLITANO. Thank you, Madam Chair. I will wait for the 

next round. 

Ms. BROWN OF FLORIDA. Yes. 

I see that the Ranking Member, my colleague from Florida, has 

joined us. Mr. Mica. 

Mr. MICA. Thank you. 

I am pleased that the Rail Subcommittee is asking for some of 

Amtrak’s strategic reform initiative information. 

I probably share the Chairman of the Full Committee’s interest, 

too, in trying to get in the United States one high-speed rail corridor. I was not here during his questions. I was preoccupied. It 

was my understanding that Mr. Oberstar had requested information on what it would take to get the current Northeast Corridor 

up to a higher speed. 

Is any information being prepared in that regard? 

Mr. KUMMANT. Yes. I mean, we certainly have prepared and 

have submitted quite a bit of information on trip time reductions 

which, in the end, are average velocity improvement. 

Mr. MICA. Right now, our average speed is, what, 84 miles an 

hour? 

Mr. KUMMANT. I understand it is something in that neighborhood. But I do understand his fundamental question or that the 

question at hand was: Will we anytime soon exceed 150 miles an 

hour as a top speed? Given the current overall structure, I said 

that that would be highly unlikely, but we do have a whole series 

of projects that includes continuing trip time reduction. 

15

We are also, in fact tomorrow, launching a capital master planning effort in a collaborative effort with the States along the Northeast Corridor where we will go through and really look at a 20- to 

25-year vision on how do we really grow the entire corridor, what 

is the future of the commuter, where do they need slots, how do 

we increase velocity? 

Mr. MICA. Okay. Commuter versus high speed, you are going to 

look at both? 

Mr. KUMMANT. Yes, sir. Well, we are looking at the corridor in 

totality in terms of——

Mr. MICA. I think you—and again, I was not here, but first of 

all, what is the maximum speed you could get out of the system 

if you put into play all of the improvements that you could out of 

the current trackage that you have? 

Mr. KUMMANT. Well, again, our peak velocity is 150, and I would 

have to go back and look at what an overall average speed trip 

time would be. 

Mr. MICA. I have not seen anything that exceeds like 85, 89 

miles an hour. Is there something that you have? 

Mr. KUMMANT. It is probably not dramatically more than that, 

but we would have to go back and look at that. 

Mr. MICA. And I think you answered his question. 

To get to TGV speeds or true high-speed rail, you would have to 

develop a separate corridor? 

Mr. KUMMANT. Essentially. Or you would have to take major segments of the corridor and develop a dedicated line. 

Mr. MICA. Why not have us put out for bid a contract on the 

Northeast Corridor to put in high-speed service? 

Mr. KUMMANT. Well, again——

Mr. MICA. I mean that is not your decision. That is Congress’ decision. Would you oppose that? 

Mr. KUMMANT. I do not oppose in principle looking at new alternatives, looking at——

Mr. MICA. Actually, it would do quite a bit to free up that corridor for both freight and commuter service. 

Mr. KUMMANT. Well, it is a very broad question. 

Mr. MICA. If I took Acela, your high-speed service, off there and 

we just did commuter and local and freight service, wouldn’t that 

dramatically free up the corridor? 

Mr. KUMMANT. Well, if you look at overall train miles, we are 

still the dominant user in train miles. So certainly it would open 

up a corridor for commuters, but you would essentially lose, you 

know, 10 million riders that we have today. 

Mr. MICA. Ten million riders for what? 

Mr. KUMMANT. For noncommuter service. That is the Amtrak 

and——

Mr. MICA. It is Acela? 

Mr. KUMMANT. It is Acela and our regional product, yes. 

Mr. MICA. Well, again, you have heard of Richard Branson and 

what he did. He bought into the two north-south lines—one going 

up towards Edinburg, the other having 33 million passengers. Your 

total passengers are, what, 26 million for the entire system? 

Mr. KUMMANT. Twenty-five million. 

Mr. MICA. Twentyy-five million for the entire system. 

16

Mr. KUMMANT. Right. 

Mr. MICA. He just took those two corridors—and we had the rail 

folks in— he put 10 billion U.S. dollars and 5 billion pounds into 

it. He put in all new equipment. He increased the ridership from 

33 million to, I think, in the 44-million range, and he paid a dividend for the last 3 years. 

Now, I have asked continually for you all to separate out the 

Northeast Corridor activities and finances. Has that been done yet? 

Mr. KUMMANT. We are in the process of really restructuring our 

whole system. Our whole financial reporting system is——

Mr. MICA. Can you tell what it costs to run the Northeast Corridor? 

Mr. KUMMANT. You can essentially tell what it runs, but we have 

legacy financial systems that we are working through. We have a 

new CFO, a new CIO. It is a very broad effort to really improve 

the financial clarity and transparency that I have committed to. 

Mr. MICA. Do you have the authority to contract out for services? 

Say if we wanted to take the Northeast Corridor, which is the only 

asset you have, you accumulate scattered assets and bid that out, 

both for the development of the corridor and for the operation of 

the corridor, do you have the authority to do that now? 

Mr. KUMMANT. It is really varying opinions on that because there 

is a whole underlying tax structure of the organization. It is not 

entirely clear how easy it is. 

Mr. MICA. It might have to be separated out by law? 

Mr. KUMMANT. That is an under——

Mr. MICA. It could be done. 

Mr. KUMMANT. It is not a piece of work we have worked on over 

the last year. 

Mr. MICA. Finally, I went up to New York City and got a briefing 

on the Madison Square Garden moving Penn Station; and, first, my 

eyes were opened. I never realized that Farley Square, the Farley 

Station, which is the principal rail station when all the mail was 

brought in, I guess, from the ’30s separated in Farley Station, 

which is about a block long. You ought to go up and see it. 

Farley Station is basically vacant property. It is only the Federal 

Government could screw up a potentially productive asset, leave it 

sitting like that. I think they said they had 12 stamp windows 

where they sell stamps. And the final decision on relocating the 

rail, part of the rail service in that location, part of the hang-up 

is getting Amtrak to make decisions. I am sure it is part of a larger 

picture. 

Do you have any idea when you would be prepared to make a 

decision on developing that asset? The plan, as I understand it, is 

to take Madison Square Garden, rebuild it where Farley Station is. 

That would be a new passenger terminal. Then go back, got Madison Square Garden, put a couple towers and additional service that 

would be sort of intermodal and sort of cross-platform transfer. 

When do you think we will be able to move on that? 

Mr. LANEY. That is not our decision. 

Mr. MICA. Who would make the decision? 

Mr. LANEY. The decision—we are part of the decision, and we are 

moving forward quickly, but it is led by some developers in New 

York; also, the State of New York; also, the City of New York. 

17

There is a development authority involved and a number of other 

parties. We are working as cooperatively and constructively and effectively as we can to move it forward, but it is a very complicated 

project, as you know. We would love to see it materialize. I think 

a lot of the oddsmakers put it at less than 50 percent. 

Mr. MICA. Well, there was about $300 million, I think, some seed 

money from Congress. The deal could be put together if everybody 

at the different governmental levels would make the decision, because there is nothing but revenue to be gained out of a project like 

that. It will support itself. I am just a small-town developer, but 

that project will work if we get a pledge from you all to continue 

working, which I am sure you will do. 

I have more questions, but I will reserve the balance of my time. 

Ms. BROWN OF FLORIDA. All right. We want to give him as much 

time as he needs. 

Let’s go to Congressman Cummings, then come back to you. 

Mr. CUMMINGS. Thank you very much, Madam Chairlady. 

Mr. Laney, I have always had concerns over the last several 

years about Amtrak not getting the kind of support that it needs 

to sustain itself. As one who lives in the northeast section along 

that corridor in Baltimore, a lot of my folks depend upon Amtrak; 

and to that end I want to ask you just a few questions. 

First of all, going back, there have been all kinds of proposals 

about the States taking more—putting more money into Amtrak 

services. I mean, is that where the Board is going? 

Mr. LANEY. The short answer is, yes, that is where the Board is 

going. Because, ultimately, we need support from a capital standpoint for growth; and as the Federal operating support diminishes, 

we are going to need some sort of supplemental support from 

States involved. A lot of States, as you heard already, are heavily 

involved on an unmatched basis, but we have been pressing very 

hard for the importance of an addition of a match funding program 

of some sort in the reauthorization. But, yes, sir, the short answer 

is yes. 

Mr. CUMMINGS. With regard to capital funding—I don’t know 

what you may have discussed before I got here, but I apologize to 

keep repeating—Amtrak’s own fiscal year 2008 grant seeks $1.5 

billion, is that right, on Federal funding—in Federal funding, including $760 million in capital funding, is that right? 

Mr. LANEY. Yes, sir. 

Mr. CUMMINGS. The DOT Inspector General has indicated that at 

least $1.4 billion, or roughly double what is requested by Amtrak, 

is required to keep the system from falling further into disrepair. 

Are you familiar with that? 

Mr. KUMMANT. Maybe I can chime in briefly. I believe the DOT 

Inspector General suggested that for a total funding level, including the operating support number, that he felt we would need 1.3 

to 1.4 billion. So I believe the number that we are talking about 

is an all-in number, which actually is fairly consistent with our 

view. 

Mr. CUMMINGS. So what do we need for capital repairs and maintenance. Is that the figure you are saying? 

Mr. KUMMANT. The $700 million really includes all those figures. 

18

Mr. CUMMINGS. Now where are we on this labor agreement? I 

spoke before with the unions, must have been a month ago; and, 

you know, when they told me it has been 7 years, I just wondered 

why is it taking so long to come up with an agreement. 

Mr. KUMMANT. Let me address that, sir, if I may. 

First, I share that. I would love nothing better than to have that 

behind us so we can really get on and run the railroad. 

We are in the middle of actually very serious dialog with three 

different unions. We have one deal that is out for ratification, one 

that is I believe very close to a handshake deal to move forward, 

and another where we have had a high-level discussion and an 

agreement to come in and have a very detailed discussion. 

I think, as you know, the issues we really have on hand, first, 

we have put a very competitive pay package on the table that is 

very similar to what was just ratified with the freight railroads. So 

we are very consistent there. 

There does remain, obviously, a very difficult question of the 

unions asking for a back pay number. That back pay number in 

total would have a $200 million price tag on it. What we have on 

the table is a bonus payment, which is less per person clearly than 

the total back pay but is something that we can fit into our total 

financial profile. So, absent some sort of action entirely outside of 

our financial ability, that $200 million would really be impossible 

for us to deal with. But, at the same time, I do think that there 

is a number of discussions and very serious, honest discussions we 

are having that are moving toward a potential agreement. 

So we do have a bonus payment on the table, we do have wage 

rates that are very competitive with the freight railroads, and we 

are clearly—and I am sure you have heard this. What is very important to us is workplace flexibility issues, and that often becomes 

one of the sticking points in our discussions with the unions. 

Mr. CUMMINGS. I see my time is running out, but let me just ask 

this last question. The differential between—you kept mentioning 

freight, and I appreciate it, but what about the difference between 

Amtrak workers’ pay and, say, transit agencies, other transit agencies? 

Mr. KUMMANT. Some of those gaps have grown; and, honestly, 

that is the result of only having some COLA for 7 years. Sometimes 

you will hear gaps referenced that will be much, much narrower 

after a deal. But there is no doubt that large gaps have opened up 

along many of the trades and many of the types of occupations, and 

that is a big concern, and that is another reason that I very much 

would like to get some deals done. We will never be able to head 

to head completely compete with some of the very high-paid railroads, for example, Long Island Railroad, but we can close that gap 

substantially. 

Mr. CUMMINGS. May I ask one more question, Madam Chair? 

Just one. 

Ms. BROWN OF FLORIDA. Yes, sir. 

Mr. CUMMINGS. Just one. 

I guess one of the things that concerns me is it seems as if we—

the argument that you hear made all the time is we pump a lot 

of money into air, the air industry and others, and then when it 

comes to trains—the other day somebody stole my car, and I took 

19

the train over from Baltimore. And, I tell you, I had a chance to 

really talk to some folks. It was a blessing in disguise. But I said 

to myself, these people get up early—I am talking about I caught 

the train at 6:15—and they work hard. 

I am trying to figure out when you all look at your numbers are 

you all saying we just accept what we are told to accept? Do you 

all come up with the numbers? Does somebody else come up with 

them? 

Because, in other words, I am trying to figure out can we do 

more or are you all in the position as the Board to say, look, this 

is what we need to really do this, and this is what we need to run 

a first rate—and do you ever say, look at what you are doing for 

the airline industry? 

But we have got hard-working Americans getting up at 4:30 

every morning trying to make it and then these employees doing 

the best they can with what they got. Do you ever make any of 

those arguments? 

Mr. KUMMANT. We have got a great workforce. 

Mr. CUMMINGS. I know. That is my point. 

Mr. KUMMANT. I will say this. The Board has moved substantially, and the numbers that we put on the table in March are very, 

very different and I think show a real commitment to trying to get 

there. So I would say we are doing everything we possibly can, and 

I am personally involved, I personally, through the numbers. I see 

the comparisons. So I say it is a very personal issue for me, and 

I am very committed to do what we can, and I think we have got 

some very fair packages on the table. 

Mr. CUMMINGS. Thank you, Madam Chairlady. 

Ms. BROWN OF FLORIDA. Thank you for raising those issues, all 

of the Members. 

Let me say for the past 6 years we have been doing all we can 

just to keep Amtrak afloat when the administration provided zero 

budgeting they recommended. So now that we have a change in 

leadership in the Congress I feel that we are moving forward and 

we are making progress, but it is very important on this one particular area in the area of labor negotiations and agreements that 

we do come to some conclusion because we want to move—I mean 

this Committee—we want to move the industry forward as we 

move freight; and we want to move Amtrak forward, also. 

So as a follow-up question, one that I have heard a lot about, 

back pay. It has been since 2000 when the contract expired, but the 

Amtrak board decision not to give back pay, can you talk to me 

about that? Because it is a major problem. It is like the story of 

the chicken and the pig. They have given all, the Amtrak employees. So where are we with this back pay issue? 

Mr. KUMMANT. It is no doubt a sticky problem; and let me go 

back a little bit, to 2002. David Gunn actually sat with a group of 

union leaders and laid out five principles for labor settlement back 

in 2002. The very first one is the freight railroads had just agreed 

to a deal; and he said, we will match that freight railroad deal or 

be competitive with that deal. Number two, we need workplace 

flexibility; number three, we need health insurance containment; 

number four, no workplace flexibility will result in a furlough of 

20

any employee; and, number five, we will not offer back pay. That 

was back in 2002. 

The intent at that point was for all parties to quickly try to move 

to some sort of resolution. Unfortunately, here we are 7 years later; 

and that one principle has now ballooned into a $200 million issue. 

Again, that alone, if you were to say, hey, let’s just write a check 

for that, we are not capable of doing that within the framework of 

our own financial structure. That is the simple reality of it. We can 

probably meet on a bonus payment something between 30 and 40 

percent of that, and that is the basic structure, the types of offers 

we have on the table today for the back pay issue. 

Ms. BROWN OF FLORIDA. Mr. Laney, can you speak with that, as 

chairman of the Board? Because, I mean, the Board has to, I guess, 

approve whatever recommendation. 

Mr. LANEY. Yes, ma’am, we do. I don’t know that I can add anything to that. 

Ms. BROWN OF FLORIDA. I just want to hear you on the record 

where you stand. 

Mr. LANEY. Well, let me just say that I have been here since 

about the time David Gunn mentioned or laid out to the union 

those principles, and I agreed with him then, and I agree with 

those principles now. 

The ultimate issue from our standpoint is workplace flexibility 

or, as you have heard it called otherwise, work rules. Without some 

additional flexibility in a significant way, there is not much future 

from an economic performance, financial sustenance standpoint for 

Amtrak, as far as I am concerned. 

Back pay is a sticking point, but, as President Kummant has just 

said earlier, I think we are within striking distance of some resolution with our major unions, and I would like to see us go there. It 

would be very helpful for all parties to move forward and move 

past the back pay issue. 

Ms. BROWN OF FLORIDA. Okay. I would like to ask unanimous 

consent that Mr. Baker be allowed to participate in today’s hearing 

and sit in with questions to the witnesses. 

Without objection, so ordered. 

Mr. Baker. 

Mr. BAKER. Thank you, Madam Chair. I appreciate the courtesy 

extended and that of other Members and the witnesses who are 

anxious to get on with the matters at hand. 

Mr. Laney, I want to revisit what I think I heard you express 

a moment ago relative to workplace flexibility. Your response was 

to the point—and I want to make sure that I do not 

mischaracterize—that without appropriate flexibility and workplace environment that the financial future of Amtrak is cloudy at 

best. 

Mr. LANEY. The short answer is, yes, sir. There is so much pressure in the rail industry generally and on ours in particular in 

terms of efficiencies from a financial standpoint, and our biggest 

challenge from a financial standpoint is our labor costs. 

Mr. BAKER. Let me, if I may——

Mr. LANEY. Can I add one thing? 

Mr. BAKER. Certainly. 

21

Mr. LANEY. What we envision over time is, as you have seen and 

heard from all Members, is there are a number of pressures, 

whether it is rising trends in gasoline prices or congestion in air 

and highways and the inability to fund an expansion enough to 

handle the loads of traffic on our highways, there will be rising levels of demand for rail. We have got to be able to address that 

growth and address it from a financial standpoint in terms of efficiencies that we cannot deliver right now without——

Mr. BAKER. I certainly understand. I don’t think we want to be 

in the position of the more service we offer, the more money we 

lose, which gets me to the operational metrics. I have been concerned—and let me acknowledge at the outset I have not been the 

most ardent of Amtrak supporters, but it is not because of the disagreement with the basic purpose of the operation. It has been 

with a frustration over the lack of what I call appropriate financial 

metrics to understand where the pressure points may exist and to 

what extent services may be modified or changed in order to 

achieve what I believe is the intent to provide economical, on-time 

service to people who otherwise would not be served by any other 

provider. 

To that extent, would either of you have—or let me back up. 

Since my last visit to this subject matter over the last 18 months, 

have there been no reporting methodologies, establishment of new 

or different metrics or financials in a better condition to be able to 

report operational bottom line? Do we have a better cost per passenger mile operational assessment? Have we had customer satisfaction surveys to find out what is good, what is bad? What is the 

progress with the Acela line? 

In other words, make me feel good that where we are today is 

not where we were 5 years ago when we were collecting fares on 

cars with cigar boxes and wondering why we couldn’t figure out the 

cash flow. 

Do you have financials that are deliverables, that someone could 

look at and objectively say I know where we are and I know how 

much we are going to lose, and this is why? 

Mr. LANEY. That is a lot of questions, and I am not going to try 

to answer them all. Let me start with answer one. Then I would 

like to give it to our CEO for a little more detail. 

One is, are we today where we were 5 years ago from a financial 

standpoint, from a ridership satisfaction standpoint, from our allover ridership and revenue standpoint? Absolutely not. It is a different operation than it was 5 years ago as far as I am concerned; 

and, more importantly, it continues to head in the direction I think 

you would like to see it head. As I said earlier before you were 

here, it has moved farther than I expected it would move, not as 

fast as I would hope. 

Mr. BAKER. How do you square that with the opening statement 

that, unless we get workplace flexibility, the financial future of 

Amtrak is very bleak? 

Mr. LANEY. I expect we will have workplace flexibility. 

Mr. KUMMANT. Well, let me just make a couple of comments 

about where I think we are really moving the ball and then to your 

fundamental question about structure of the financials. 

22

If you look at the Acela product, for example, and we do plenty 

of customer surveying. Customer satisfaction numbers are up significantly, and the share numbers are up dramatically. We are actually taking share from the airline industry along the Northeast 

Corridor. 

Ridership is up over 20 percent year over year. Overall, Amtrak 

revenue is up 11 percent year over year. We have a very specific 

measure of revenue per available seat mile that is up in almost 

every category. So there are very specific measures that we are 

doing well in. 

Safety tends to be something that within the railroad industry is 

very, very meaningful to rail guys, because it is such a measure of 

how kind of management and front lines work together. Safety is 

improved on a reportable incidentbasis——

Mr. BAKER. Let me get a couple things on the record, because my 

time is about to expire. They extended courtesy the allow me to do 

this. 

For the record purposes, if you can provide the cost per passenger mile—you can pick any two routes you want—between route 

A and B. If you can give me some year over year data, if you can 

show me where the projected operational deficit will be reduced 

over time and for what reasons or factors. 

The other thing I was going to start out asking, but I got diverted, there is an act that was passed in 1993, the Federal Program Performance Review Act, which is subject—a number of governmental agencies are subject to some sort of metric analysis, and 

I can’t see why Amtrak would have been exempt. 

And I know the GSE argument, that you are not really fish or 

fowl. I don’t go there. I think as long as you are getting operational 

subsidies from the government, there is a standard to report to the 

government to disclose why we are in the mess we are in. 

If you can at some point respond—not today—to whether you 

would have a policy objection to being made subject to the Federal 

Program Performance Review Act, and that is simply an ability for 

us as indirect shareholders to be able to get a way in which we can 

look at operations and feel better or worse about where we are 

going. 

I hate that the time has been so limited. I am sure you are enjoying it, but I really, really want to try to work with you. This is not 

about shutting Amtrak down. This is about trying to get us on a 

basis where we can all say we are standing on solid footing. 

I thank the gentlemen and the gentlelady for yielding time. 

Ms. BROWN OF FLORIDA. Yes. Mr. Baker, I want to make a point 

here, because I am glad you came to the Committee, and I am glad 

you asked the questions. 

But on the other half of my concern, you, coming from your area, 

I had a question that I want to ask them on the Sunset Limited, 

when the people from that region have come to my office and have 

discussed that particular route is not financially—one that is financial—but there are other things I want them to consider when they 

develop whatever model, and one of them is homeland security. 

We need to have another way to get those people from that area 

out of harm’s way. Amtrak would be one way, but that is not a 

profitable line. That is a problem. The profitability cannot be the 

23

only factor. Clearly, we need to have a way that—economics is part 

of the plan, but also we need to look at security. 

I have had several meetings with them. I have called Mr. Laney 

about this issue, because I want them to put that train back on and 

run it at a time that—not 2:00 in the morning. But if we had another Katrina, we would already be up in operation and could get 

those people out of harm’s way. But it does not work for them financially. 

So I want them to consider other things other than just finance 

when they consider it. 

Mr. BAKER. Would the gentlelady yield? 

I don’t dispute the Chairlady’s observations at all. There should 

be other considerations in determination of whether a public service is continued. All really I am suggesting is that we have that 

discussion; and if the gentlelady chooses to support the continuation of a route even with the knowledge that it does not necessarily cash flow, that is fine with me, because we subsidize a lot 

of things. 

However, this is a little different. Certified annual financial reports, quarterly operating expenses and revenues, things that any 

other entity, Fannie Mae or Freddie Mac—that is a bad example 

because Fannie is kind of late right now on theirs. But my point 

is at least there is requirements; and all I am suggesting, Madam 

Chair, is if we can come to a standard for reporting and understand the scope of our liabilities, it will help the Congress plan and 

I think encourage Amtrak to make the proper decisions subject 

to——

Ms. BROWN OF FLORIDA. Perhaps we will let them answer that 

question, because they had discussed it earlier. Why don’t we just 

give you a moment to answer. 

Mr. KUMMANT. We produce monthly performance reports that 

are sent to the Hill and are posted on our Web site. Can every financial system be better? Yes, and we certainly are beginning a 

process to put the entire company on an SAP enterprise system 

and again have brought in a new CFO, a new CIO. But there is 

plenty of financial information available, as well as on our route 

level. 

Mr. LANEY. We also have annual independently audited financial 

statements available at any time to you. 

Mr. BAKER. If I may, I am not disputing that there isn’t a financial regime in place, Madam Chair. I am just saying the information we get does not address the concerns that I have raised. I have 

spent considerable time in past sessions in this endeavor, and I am 

confident new leadership now being at the table, that these gentlemen are very capable and sincere of achieving their goals, but the 

fact that we are just now engaging in implementation of SAP is an 

indication we have still got work to accomplish. Not being combative, just we are not where we need to be, and I think that 

should be acknowledged. 

Ms. BROWN OF FLORIDA. Thank you, Mr. Baker. I wasn’t being 

combative, also. I just want you to know that I am pushing them 

because the people in your area have been pushing me. 

We are going to do our last round of questioning and start with 

my colleague from Florida, Mr. Mica. 

24

Mr. MICA. Thank you again. Just a couple of quick questions, if 

I may. 

Over the period I have been on the Committee you have had a 

high of, I think, in the 25,000 number of employees. What is the 

current number? I see a nod there. Then it went down to about 

19,000. Where are you now? 

Mr. KUMMANT. We are about 18,5. A large piece of that was the 

Boston commuter service that dropped out, and the rest has been 

a gradual attrition and management efficiency work. 

Mr. MICA. Okay. So about 18,500. Your operating subsidy, last 

year I think Congress gave you about 1.2 and what was——

Mr. KUMMANT. Excuse me, do you mean the total number or actual operating support number? 

Mr. MICA. Total number. 

Mr. KUMMANT. The number for—I will have to look over my 

shoulder. For 2006, it was the 1.295. 

Mr. MICA. But that wasn’t all operating subsidy, was it? 

Mr. KUMMANT. That included capital and debt service. 

Mr. MICA. What would you say the subsidy was? I have between 

500 and 600 million. 

Mr. KUMMANT. It ended up being about 450 and the debt service——

Mr. MICA. That makes the average subsidization of a ticket 

based on your ridership about $49 for every ticket? 

Mr. KUMMANT. I would have to do the math, dividing that by 25 

million riders. 

Mr. MICA. Well, it is too difficult. I think that is correct. I may 

be wrong. Your debt service was running around 300 million. 

Mr. KUMMANT. A little over 300. 

Mr. MICA. About 300 million. And your capital—backlog maintenance, I am sorry, backlog maintenance at one time that was 4 to 

5 billion. Is that still that high or has it been brought down? 

Mr. KUMMANT. Ongoing capital number has been between 4 and 

600 million. We have put 1.4 billion into the corridor. 

Mr. MICA. Okay, that is capital. What about your maintenance 

backlog for the whole system? 

Mr. KUMMANT. Basically, that essentially, as you pointed out earlier, is our system. So we pretty much have worked off the state 

of good repair types of issues to get to that point. The ongoing 

number to maintain state of good repair in the corridor will be 

about 350 million, and about 70 percent of the equipment has been 

refurbished. 

Mr. MICA. Not annualized but the total maintenance backlog 

would be? 

Mr. KUMMANT. The total maintenance backlog on the rest of the 

system is a freight railroad. 

Mr. MICA. You are not counting that. 

Mr. KUMMANT. No, sir. 

Mr. MICA. But to operate you are going to need 1.2 to 1.3 billion 

budget per year, right? 

Mr. KUMMANT. In the range of 1.2 to 1.5. 

Mr. MICA. In the Lautenberg bill that was about 1.8 billion or 

something like that, that would give you about 4 to 500 million a 

25

year extra, but that is not really going to bring you to a high-speed 

system based on any testimony we have ever had here. 

Mr. KUMMANT. No, sir. Again, we are talking about tens of billions for a radically different system. 

Mr. MICA. Last time we had someone testify it was 16 to 18 billion, as I recall. But that has been years ago, too. I am not sure 

what that would have gotten you. Might have gotten some tunnels 

and bridges and all the other things, but I don’t know if it would 

get you a full high-speed system. Because, as you testified earlier, 

you still have problems running it in the same corridor. It needs 

to be separated, right? 

Mr. KUMMANT. If you are looking for 300 kilometer an hour, 200 

plus mile hour system, you need a radically different system. There 

is no doubt. 

Mr. MICA. All right. One other thing that is in the—there are 

several measures, the environmental meltdown, the global warming. There is a proposal to have commuter rail and other passenger 

rail preempt freight as one of the measures that they are looking. 

Have you at all taken a position on anything like that, passenger 

service? In fact, I think you are still in charge of all passenger service. 

Mr. KUMMANT. Forgive me. Are you referring to the fundamental 

Amtrak right on host railroads? 

Mr. MICA. I think they are looking at beyond that in one of these 

proposals. Maybe you haven’t seen it. 

Mr. KUMMANT. There are preemption discussions on local preemptions in the Northeast Corridor which we would be very concerned about very specific language on that. Because you end up 

have enormous system difficulties if any locality can preempt service on any kind of contiguous piece of the Corridor. 

Mr. MICA. In the Northeast Corridor you wouldn’t favor that. 

Mr. KUMMANT. Because, again, you would probably destroy the 

value of actually having a corridor. It wouldn’t become a corridor. 

It would become a local, fractured piece of locally controlled segments. 

Mr. MICA. But there are some proposals in Congress as part of 

the global warming initiatives and may be coming out of one of the 

Committees to do just that. 

Mr. KUMMANT. I am not intimately familiar with that. 

Mr. MICA. You wouldn’t favor that? 

Mr. KUMMANT. In a general sense, and I may be misspeaking because I don’t know the specific provisions, but if you split up until 

small, locally controlled pieces you will use the effectiveness of 

intercity passenger rail. 

Mr. MICA. Thank you. I appreciate the job you and Mr. Laney 

try to do. Thank you. 

Ms. BROWN OF FLORIDA. Mr. Mica, have you finished? Thank you 

very much. 

I know that you know we spend close to $4 billion a week in Iraq 

for 28 million people. I would like to see what would a couple of 

extra billion dollars do if we put it into the system so we can move 

our citizens and get them to work and back and forth and free up 

some of the money that we put into the airports so that a lot of 

26

our aging population or elderly would love to be on the train as opposed to the plane and all that security the way they have it. 

Mr. MICA. If the gentlelady would yield. I would be happy to sign 

on to any legislation. 

We heard the request here that we need to draw private capital 

into the process. Private capital will flow into the process if they 

are allowed to develop and operate those corridors and you won’t 

have to put—well, you have to put very, very little Federal money 

into it. We may require some Federal backing, maybe some exceptions like we do on some liability for airlines, and we will have 

high-speed corridors, rail passenger corridors throughout the 

United States. 

Ms. BROWN OF FLORIDA. I am excited about that initiative, and 

I take back my time. I am just looking forward for them to come 

forward with the plans so we can figure out how we can assist. 

Mrs. Napolitano. 

Mrs. NAPOLITANO. Thank you, Madam Chair. 

I am sitting here because I am listening to that, and I wish that 

we had all the money to be able to do those high-speed intermobile 

and everything else to move our product to market and our people 

to work. 

One of the questions that comes to mind as you are talking is 

about the pay raises that have not happened since, what, 7, 8 

years. Is it something that happened that management recently is 

going to be giving raises and not staff? Doesn’t that kind of go 

against the wage increases of $1.70 for labor for the last 7, 8 years 

or whatever? 

And then, aside from that, have you lost personnel because of it? 

And then what are you going to do in having to train new employees who have to come and backfill, if you will, to be able on to take 

on those jobs, the time and money spent on that, and then what 

does that do to your accident rate? 

Mr. KUMMANT. All very good questions. 

Let me address there is a program that we had put in play which 

was to address hard-to-fill jobs in the management ranks. Let me 

just put that in perspective. The price tag on this for the company was in the 5 to $6 million range, in contrast to a $200 million back pay issue. The intent 

there was to focus very specifically on jobs that have remained 

open and frontline jobs that we simply haven’t been able to fill in 

areas where our current pay was perhaps 25 percent below local 

markets. 

I would also like to say that no one is well served, either management or labor, by not having jobs filled. I absolutely agree with 

that. 

Now that specific program we are going to take another look at, 

look at specific provisions. We had a geographic component that 

may have been a little too broad. It is actually a very modest program in contrast to some of the large issues relative to labor front, 

and it ended up being something like—I don’t know—2 percent on 

the total salary. But, again, that program we are taking a look at 

and making sure that it is the right thing to do. 

I am not trying to pour the salt in anyone’s wounds. I am trying 

to run an effective organization. That really was the thrust of that. 

27

To your other points, I simply say I agree with your concerns and 

worries. We do have difficulty filling jobs without having labor 

agreements. It does make training more difficult. So far, our safety 

numbers have held up. I agree that not having experienced people 

on the job sometimes can be a safety liability. 

But in the safety realm it is actually interesting, because it can 

cut both ways simply on how the numbers work. This is, believe 

me, not an argument to hire new people, but sometimes new people 

can actually be much more focused on safety than people on the job 

for a long time, not exclusively true, but that is why one can drive 

safety numbers effectively even when one has turnover. 

But there is a training cost, training liability, and that we need 

to fill jobs is absolutely true, and that is a problem. 

Mrs. NAPOLITANO. But isn’t it true that experienced people are 

necessary to be able to prevent accidents? 

Mr. KUMMANT. Yes, I agree completely. I only meant in some 

cases you can have fairly new workforces and see good safety numbers and you kind of wonder how can that be. That is not to say 

experienced workforce and sustaining it is not where it is at. I absolutely agree with that. No question. 

Mrs. NAPOLITANO. Then one other area that is rather interesting 

is that you apparently have 70 percent of your rolling stock has 

been refurbished, but most of it is over 25 years old. When and how 

and what plan have you got to be able to replace, modernize and 

be able to expand to be able to increase your ridership? 

Mr. KUMMANT. You are absolutely again right. That is really the 

centerpiece of where we believe we have to go forward strategically. 

We have to begin a whole new cycle of equipment procurement, 

even this year, even for our high-speed product. 

Mrs. NAPOLITANO. Is that part of what you are presenting to 

Congress at all? Because if it is not being considered, how are we 

going to look at it? 

Mr. KUMMANT. This is part of the document we will be producing 

shortly. But, in all candor, it is something we have talk about at 

almost every hearing in terms of a very significant need for the 

system. 

We would also love to look for some demonstration train sets of 

modern equipment to show what that can do for ridership as well. 

We may be able to do some of that more quickly rather than major 

other procurement. But you are exactly right, and that is a key 

issue to focus on in the coming year. 

Mrs. NAPOLITANO. I hope that Amtrak will move forward on trying to get this imminence of strike avoided. 

Thank you, ma’am. 

Ms. BROWN OF FLORIDA. Thank you. 

Mr. Shuster. 

Mr. SHUSTER. Thank you. 

First, I just want to make a statement. I am very encouraged to 

see in your plan that you are going to use the Customer Service 

Index as one of your metrics as you go forward. I think in any business making sure customers are satisfied is the number one job. So 

I am pleased to see that. 

Also very pleased to see that you are, in your procurement for 

equipment in the future, to purchase DMUs, lower cost to operate 

28

and flexibility; and I am very interested in finding out if you are 

considering using them on the Harrisburg to Pittsburgh. There is 

about 70 to 75,000 boardings in that region. That is what I consider—I am sure you consider—lower volumes. Where are you looking at using them and can you generally comment has there been 

any discussion of the Harrisburg to Pittsburgh? 

Mr. KUMMANT. I am afraid I can’t specifically comment on that, 

but that is exactly the type of service we look at in a development 

in a less dense area. I think along the gulf coast might also be an 

interesting area for DMUs and anyplace where we would like to 

build ridership. I think we are also looking at it in the Northeast. 

Mr. SHUSTER. I just think there are tremendous opportunities to 

build ridership. 

The final question I have deals with the food and beverage department. I know in 2006 the GAO had a study out there that, for 

every $2 in expense, you had brought in $1 of revenue; and in a 

time period from 2002 to 2004 Amtrak lost almost $250 million, basically, selling ham sandwiches and chips. What reforms have you 

instituted and is it possible to get the last quarter profit and loss 

on the food and beverage department, see what you have done? 

Mr. KUMMANT. What I can tell you is this year we will continue improving that number. I think between 16 and $19 million cost 

takeout. 

Let me also make the point, though, that you can go back and 

look at Santa Fe numbers from the 1950s and look at their food 

numbers. There simply is no way you are ever going to make 

money on food on trains. It is essentially part of what every seat 

pays for. 

So I do think we have to look at Amtrak in aggregate; and if you 

look Amtrak’s fare box recovery overall we, in fact, stack up with 

anybody in the world, including the French, including the Germans. Our total fare box recovery of 70 percent is a very good number and is in fact twice what transits run at, and that includes the 

entire food service. 

Now as far as the specific initiative, we do have areconfiguration 

of our dinners into a diner-lounge structure with a simplified 

menu, with a simply food and more flexible service that can be 

scaled up or scaled down depending on the service. That is really 

going to be our vehicle for efficiency and saving in the future, and 

I think we feel very good about that initiative. 

Mr. SHUSTER. In the last quarter, can you give me numbers? 

Mr. KUMMANT. I can give you the annual number, a savings of 

in excess of $16 million this year. 

Mr. SHUSTER. Again, thank you both for being here today. I appreciate your time, and I yield back. 

Ms. BROWN OF FLORIDA. Thank you. 

My last question, I know I had a discussion, but I didn’t get an 

answer, so let me just ask it in the form of a question. What is Amtrak’s plans for the Sunset Limited route and when will those 

plans be finalized? 

I know that you all was in a board meeting when I tried to call 

you, Mr. Chairman, on this issue, because my office had been full 

of people from that region that came and talked with me about it. 

So I would like some discussion on that. 

29

Also, I can just fold in my other question, what is the largest 

challenges facing Amtrak; and, lastly, how can we in Congress assist you? If both of you could address those issues, I would appreciate it. 

Mr. KUMMANT. I would like to start with the Sunset. I do think 

what we would very much like to do, and it is in consultation with 

your office, is to focus on corridors along the same route in order 

to offer services that really work. I would, frankly, like to reduce 

or I should say eliminate the Sunset as this lightning rod for the—

as an avenue of criticism. I think there is better and more effective 

service that we can offer your constituents and constituents along 

the whole gulf coast from Mobile to New Orleans as well as we discussed very specific corridors within Florida. And we also have different approaches on the western route in order to service that 

area and sustain the slot. 

So that is really how we want to move forward. 

The biggest challenges, again, I think we have addressed here 

today, which is, look, I will be the first to say we really want to 

come to a settlement with our whole workforce and our labor force. 

We want to be one team, move forward and really make this thing 

run. 

I do think the equipment procurement piece that we have talked 

about is substantial, and I think there again it is process, and it 

is capital, and there is, obviously, a lot of people committed to that. 

Finally, you have heard about the on-time performance challenges, and that is not an easy one. I think we are moving forward; 

and we do have a plan to continue working with the railroads, 

freight railroads. It is a personal view. But we are going to have 

to continue to find ways to put public capital into the real constraints in the freight network where both freight and passenger 

rail can get some benefit and drive on-time performance. 

Thanks for the time today. 

Mr. LANEY. With respect to the Sunset Limited, Madam Chairman, part of our challenge, as you know and you have heard us 

talk about it, is restructure, rationalization of our resources and investment within the long-distance structure. 

I think you just heard from our President probably what is likely 

to be the ultimate sense of the Board in relatively short order; and 

that is, those resources, that investment is not best served in the 

Sunset Limited. It is best served in focusing it on corridors and, in 

particular, in that part of the country in the concentrated populated area of Florida. 

Our biggest challenges are I think fairly easily identifiable: ontime performance, equipment replacement, the Federal-State 

match and the implications that has for corridor growth, our labor 

contracts. And not in that order. 

Ms. BROWN OF FLORIDA. How can we help? 

Mr. LANEY. The starting point is reauthorization. It is vitally important that we have some form of Federal-State match that is 

enough of an invitation to bring the States to the table to work 

with us for the corridor development. That is, I think, first and 

foremost in terms of what you can do. We will be delighted to help 

in any way we can, but our primary care is to continuing the 

progress that I think we have sustained for a number of years by 

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working with you, with DOT, with the FRA, good partners, with 

the States, and continue the progress and the growth of ridership 

and revenue and the containment of the costs. 

Ms. BROWN OF FLORIDA. Well, we certainly want to work with 

you. My challenge is that it is very important that I understand 

the operations side, that is one side of it, but also we need to know 

long term what kind of investment that is separate from operation. 

But when we look at security, when we look at your stakeholders 

that we have to work with, whether it is bridges and tunnels, what 

we need is to make sure that we have a system 10 years from now 

or 15 years from now that is really moving America where we want 

it to go. When we look at gas prices at $3, $5—$5, people cannot afford 

it. So we realistically need to be together on a team to move this 

country where it needs to go. I think we have the vision and the 

leadership in Congress, and working with you all on the Board, we 

can move forward, but we cannot do it in a vacuum. We need the 

input from you all. 

Mr. LANEY. We fully understand and agree and look forward to 

working with you, Madam Chairman. 

Ms. BROWN OF FLORIDA. Thank you. 

I want to thank the witnesses for their testimony and the Members for their questions. 

Again, the Members of this Subcommittee may have additional 

questions for the witnesses; and we will ask you to respond to 

those in writing. The hearing record will be open for 14 days for 

Members wishing to make additional statements or to ask further 

questions. 

Unless there is further business, the Subcommittee stands adjourned. Thank you all very much. 

[Whereupon, at 4:35 p.m., the Subcommittee was adjourned.]

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