NCPA - National Center for Policy Analysis

Moving Closer to Amtrak Privatization

February 7, 2002

The arguments of those who believe Amtrak should be broken up, sold off to private bidders and introduced to competition should get a significant boost when the Amtrak Reform Council submits its report to Congress today.

  • The council is expected to recommend that the national passenger-rail be split into three entities and opened to competition while continuing to receive federal-government funding in some cases.
  • The council wants to see funding for operations structured on an incentive basis -- such as a percentage of revenue -- to encourage improvements that would draw more passengers.
  • Amtrak would be separated into a small government agency that raises funds and administers the passenger-rail program, a train operating company and another company that controls the infrastructure assets.
  • After a transition period, the agency could identify routes and services that might be franchised to private or other operators.

The report is also expected to say that in the future, federal operating subsidies should be limited to long-distance national trains, while states bear the cost of operating subsidies for corridor operations -- including new high-speed services.

Source: Daniel Machalaba, "Amtrak Oversight Group Is Set to Endorse Breakup, Competition," Wall Street Journal, February 7, 2002.


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