United Rail Passenger Alliance

		TECHNICAL MEMORANDUM (#95-08)


TO: URPA Executive Committee

FROM: Andrew C. Selden, Vice President-Law and Policy

DATE: April 7, 1995

RE: Amtrak Subsidies

	It can now be demonstrated conclusively that NO FEDERAL 
SUBSIDIES FLOW TO SUPPORT AMTRAK NATIONAL SYSTEM TRAIN OPERATIONS 
outside the Northeast Corridor (NEC).
	Attachment A details all federal grants to Amtrak in the
last five fiscal years. In FY94, these totalled $942.2 million. Of
this amount, the ONLY susidy to train operations was $351 million.
No other federal funds susidized Amtrak train operations in 1994.
	Attachment B is a copy of pg. 26 of Amtrak's 1994 Annual 
Report. It states that in FY94 the NEC incurred an opearting loss of
$260.2 million PLUS "an allocation of corporate overhead costs to
the NEC."
	URPA's analysis of Amtrak's FY94 audited income statement
shows the "unallocated overhead" properly allocable to the NEC to
be $105 million. See Attachment C.
	The NEC's operating loss therefore consumed at least 
74.07% (at $260 million) of the entire federal operating subsidy and
possibly as much as 103.99% (at $365 million). In the latter case,
NO FEDERAL SUBSIDY DOLLARS COULD HAVE GONE TO NON-NEC 
TRAIN OPERATIONS.
	Amtrak, however, also consumed an unknown amount of its own
financial reserves in FY94 over and above the $351 million 
operations subsidy. This suggests that in FY94, non-NEC train
operations probably incurred a relatively small net operating 
deficit, probably on the order of $40 to $60 million net of non-
recurring special charges for deferred casualy liability ($81.6 
million) and retirement fund accruals ($90.6 million). At $60
million, this loss would represent 4.2% of revenues and 10.9% of
non-NEC train operations revenues; in other words, amounts readily
recoverable from improved train reliability, or sales, or NEC
cost abatement.
	No justification can be found in these data for abatement
of train operations in the national system.

                 -----------------------------------

			    ATTACHMENT A

           FEDERAL TRANSPORTATION APPROPRIATIONS HISTORY

PROGRAM		1990	1991	1992	1993	1994	1995
-------------------------------------------------------------
Amtrak:Op       369.1   343.1   331.0   351.0   351.7   392.0
       Cap       83.6   132.0   175.0   190.1   195.0   230.0
Mand Pmt (1)    152.0   150.0   145.0   146.0   137.0   150.0
NEC              24.4   179.0   205.0   204.0   225.0   200.0
Penn Stn          0.0	  0.0	  0.0	  0.0	 10.0	 40.0
Hi Speed (2)	  6.1    10.3    12.0    13.6    23.5    25.0

PASSENGER RAIL
TOTAL-----	635.2	814.4	868.0	904.7	942.2  1037.0

Fed Highway     13560   15088	18112	18430	19938	19864
Fed Aviation	 7141    7937	 8932	 8862	 8645	 8392
Fed Transit	 3048	 3270	 3762	 3800	 4582	 4614

NOTES:
(1) Federal railroad retirement and unemployment costs in excess of
Amtrak's demands on system, therefore not part of true cost of
operating Amtrak system. Paid by the Federal Railroad Adinistration 
directly to the Internal Revenue Service, 1994-94. Included in
Amtrak operations in 1990 and before, and 1995.
(2) Includes some MAGLEV.


                 -----------------------------------

			    ATTACHMENT B

   	      FROM PAGE 26 OF THE AMTRAK ANNUAL REPORT

... As part of Amtrak's restructuring, Amtrak is moving toward
reporting expenses and revenues on a strategic business unit (SBU)
basis. Although the Northeast Corridor (NEC) SBU did not officially
start operations until October, 1994, costs and revenues have been 
assigned to the NEC. 54% of revenue in FY 1994 (or $766.4 million)
and 41.2% of Amtrak's costs (or $1,026.6 million) would have been
the NEC's; these costs do not include the allocation of corporate 
overhead costs to the NEC...


                 -----------------------------------

			    ATTACHMENT C

 			 NORTHEAST CORRIDOR
			   1994 ESTIMATED
		    STATEMENT OF PROFIT & LOSS
			   (In Thousands)

REVENUE
	TRAIN OPS	$423,904
	OTHER		 342,496
			--------
			$766,400			 $766,400

COSTS
		NEC 1990 RATIO	EST. 1994 SHARE
		--------------  ---------------
Train Ops		44%	  $224,575
Maint-ROW		79%	   185,573
Maint-Equip		43%	   184,549
On Board Serv		14%	    25,924
Stations		45%	    65,976
Reserv, Mktg		34%	    63,681
General Support |
Retirement      |-----	54%	   222,388
Taxes, Insurance|
General Admin   |
Depreciation	   	65% (est)  159,301
				----------
				$1,131,967		(1,131,967)
							===========
NET LOSS-------------------------------------------->     (365,567)