Amtrak Headed For Financial Collapse

The chairman of the House Transportation Committee said Thursday that Amtrak is headed for financial collapse unless Congress steps in to save it.

“Without decisive action very soon, the country will have no intercity rail service within a few months,” Rep. Bud Shuster, R-Pa., said in announcing plans to name a blue-ribbon panel of experts to come up with ideas for saving Amtrak.

“Amtrak, even under optimistic assumptions, cannot survive the next fiscal year,” he said. “The company is already borrowing to meet payroll costs and even Amtrak’s own business plan will require exhausting all available lines of credit by the middle of fiscal year 1998.”

Financial problems, intensified by a 50 percent cut in federal support over the past two years, have forced Amtrak to eliminate routes and cut back on improvement plans.

Shuster said the panel members, to be named soon, would be asked to come up with ideas and options to address the crisis in inter-city rail services.