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Amtrak Asks Congress for Supplement to Avoid Bankruptcy Caused by Pandemic

September 10, 2020 by Tom Ramstack
Alexandria, Virginia Amtrak Station. (Photo by Dan McCue)

WASHINGTON — Amtrak made a plea to Congress Wednesday for billions of dollars in supplemental funding to avoid financial collapse as the coronavirus pandemic continues to devastate its ridership.

The number of riders on the national passenger railroad dropped by 97% during the worst of the pandemic in March, April and May, according to Amtrak. It’s now down by 80%.

At the least, Amtrak faces “substantial reductions in all services” and possible bankruptcy without the $4.9 billion the railroad is requesting from Congress, William Flynn, Amtrak’s president, told the House Committee on Transportation and Infrastructure.

Its latest cost-cutting measure is a plan to furlough 2,050 employees on October 1. It also plans to cut more service on its long-distance routes that produce the least revenue, particularly in the Midwest.

“Until our ridership recovers, we must make difficult workforce adjustments,” Flynn said during the congressional hearing.

He warned against long-term damage to the railroad that might result in bridges, tunnels and other critical infrastructure being neglected from a lack of funding.

The only hope for getting customers to return at normal rates is a vaccine against COVID-19, Flynn said.

“We are going to have a very, very challenging 2021,” he said.

Amtrak received just over $1 billion in supplemental funds under the CARES Act coronavirus relief bill Congress approved in March.

Now Congress and the Trump administration are close to finalizing a second pandemic relief bill called the HEROES Act.

The amount of funding for Amtrak under the HEROES Act is still being hammered out by lawmakers. Republicans are demanding a lower supplement than Democrats.

Amtrak ended fiscal 2019 with a loss on operating costs of about $29 million, the lowest in its 49-year history. It was projecting its first profit in 2020.

But then the coronavirus hit.

Union leaders told Congress their members suffered the worst of the consequences.

“Many have contracted the virus,” said Arthur Maratea, president of the Transportation Communications Union. “Some have died.”

He asked lawmakers to approve another Amtrak supplement before the October 1 deadline when furloughs begin.

“Our people have sacrificed,” Maratea said. “Now they’re faced with losing their jobs on October 1.”

Amy Griffin, president of Transport Workers Union of America, said the health and safety of passengers is threatened by more layoffs or furloughs.

“There is currently a lack of coach cleaners as a result of the coronavirus,” Griffin said. They are assigned to disinfect rail cars.

Some Republicans, such as Rep. Scott Perry of Pennsylvania, questioned the accuracy of Amtrak’s figures showing a need for billion-dollar supplements.

He mentioned that taxpayers already have provided Amtrak with more than $100 billion in subsidies in its history.

Democrats, such as Rep. Daniel Lipinski of Illinois, who chairs the Subcommittee on Railroads, Pipelines and Hazardous Materials, appeared more sympathetic.

“I believe Congress needs to act quickly to avoid furloughs and avoid long distance service cuts,” Lipinski said.

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