Booming business may not be enough to keep Amtrak alive.
The national passenger railroad network needs federal funds just to maintain the status quo but could fall victim to a presidential veto.
Both houses of Congress have passed bills that would provide more at least $1.3 billion in operational subsidies but thats $500 million more than President Bush has stipulated for Amtrak in his budget.
According to Amtrak CEO Alex Kummant, the system could keep operating if the congressional legislation, expected to pass sometime in September, evades a promised veto. But Bush, never a friend of Amtrak, says hell nix any bills that exceed his budget requests.
The future of the rail network and of millions of consumers who count on it seems likely to provoke another confrontation between the White House and Capitol Hill.
The Passenger Rail Investment and Improvement Act, co-sponsored by U.S. Senators Frank Lautenberg (D-NJ) and Trent Lott (R-Mississippi), would target even more money for Amtrak: $3.3 billion for operating subsidies and $4.9 billion for capital improvements, plus $1.4 billion for upgrades of other urban rail systems.
The grants would require states to supply an additional 20 per cent for each federal dollar.
The Lott-Lautenberg measure would keep Amtrak afloat for four more years, through 2012, rather than the year-to-year funding it usually receives.
Unless it gets funds soon, Amtrak will be forced to slash service even though ridership is rising. The rail network has reported 5.4 per cent more riders in 2007 than it had the year before but also said it is not taking in enough money to upgrade aging equipment, including bridges, tunnels, locomotives, and passenger cars.
If forced to slash service, everything outside the busy northeast corridor (Boston-New York-Washington) could be in jeopardy. That would mean elimination of all passenger train service in the west, midwest, and south creating a much heavier demand on an airline industry that is already stretched to the breaking point.
Amtrak predicts it will carry 25 million passengers in 2007, as opposed to 24.3 million last year. With better and more reliable engines, cars, and facilities, ridership could rise even more.
Congress has not okayed a multi-year funding program for Amtrak since 2002, when the Republicans were in control. Now that the Democrats are in control of both houses, that could change although the possibility of a presidential veto could kill any legislation.
The 2008 fiscal budget takes effect on Oct. 1, 2007.
Keep an eye on your inbox, the lastest consumer news is on it's way!