Amtrak blames the red ink on rising compensation costs for union workers and increased costs for fuel, materials and other expenses. Amtrak is making money on its heavily traveled Northeast Corridor between Boston and Washington, serving mostly commuters, executives said. But money-losing, long-distance routes are a drag on the bottom line, Amtrak says.
Amtrak officials project an operating loss of $506 million in the fiscal year ending Sept. 30, up from a loss of $419.9 million last year. Officials have projected a loss of $616 million next year.
Obviously, Amtrak has learned over the years how to play The Washington Game; gone are the days when Roger Lewis let loose with his (in a 1972 response to a 'what would you do with a billion dollars, sir"?) "that would be more funds than we could sensibly commit". Boardman, who before he ever became Amtrak CEO was rated on his "mastery of the game". is not about to say "it doesn't matter what the LD's cost; they simply are our meal ticket to feed at the Federal trough".
Posted by George Harris (Member # 2077) on :
Uhh: Mr. Norman, you should know as much as anyone what you can do with selective accounting. Remember the term, "Fully Allocated Costs?" Are we sure that the NEC is having costs honestly applied? I am not. The whole thrust of Amtrak from the get-go has seemed to be make the NEC look good and the long distance trains look bad.
Posted by Gilbert B Norman (Member # 1541) on :
Mr. Harris, of course I hear you.
So long as there are costs arising from the existence of a business enterprise that will only be avoided if the enterprise is discontinued in its entirety, there will be the issue of fair and reasonable allocation of those fixed costs. Since Amtrak accounting simply by the constraints placed upon it under RPSA '70, namely a government agency required to report the results of its operations as if it were a private sector business enterprise, is "opaque', there is wide "wiggle room' in the allocation of its inherently "bloated' fixed costs. Accordingly, I cannot deny the possibility of a misleading allocation of such.
But no one informed of railroad industry affairs, away from "pols" looking to blow some wind, expects the Long Distance system to be sporting Adios drumheads anytime soon. The industry is simply Kubler-Ross Phase V, Acceptance, about such and for that matter, in my capacity as likely the most anti-LD active member around here, so am I.
Posted by irishchieftain (Member # 1473) on :
quote:Originally posted by George Harris: Uhh: Mr. Norman, you should know as much as anyone what you can do with selective accounting. Remember the term, "Fully Allocated Costs?" Are we sure that the NEC is having costs honestly applied? I am not. The whole thrust of Amtrak from the get-go has seemed to be make the NEC look good and the long distance trains look bad.
With "fully allocated costs" to any other transportation mode, the only one that looks good is rail freight, as much as the regulation out of DC has slowed that mode down.
It seems that all Boardman knows how to do is to repaint a handful of diesel locomotives in "heritage" colors. Other than that, the horse-trading continues...