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AMTRAK, LONG-DISTANCE TRAINS, AND CONGRESSIONAL FUNDING

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The data in the B-1 Table, which is found at the Federal Railroad Administration web site, is at least six years old. That is ancient history in the world of cost accounting.  Without access to Amtrak's books, assumptions, estimates, and conclusions about its current cost structure are speculative. For example, if we don't know how Amtrak allocates or assigns costs for the long distance trains operating in the NEC, it is impossible to know how much of that cost, if any, would go away if the long distance trains were discontinued. If anyone has a verifiable source for the costs assigned to the long distance trains in the NEC, I would like to learn about it. Most of the costs, especially the fixed costs, associated with the NEC don't fall on the long distance trains. Most of the long distance train mileage occurs outside of the NEC. Even the long distance trains that run in the NEC probably get little of the allocated costs. And they surely don't fall on the Empire Builder.  The NEC wears a high percentage of Amtrak's fixed costs. Amtrak's financials make this clear. Its because Amtrak owns most of the NEC track, etc. If the long distance trains were discontinued, little if any of the costs associated with the NEC would go away. Nor would the costs associated with the State Supported and Other Short Corridor Trains. That's not the issue.   The key question is how much of the direct and allocated costs driven by the long distance trains would go away if these trains were discontinued?  Amtrak probably could come up with a good number through boots on the ground accountants, as per my previous post. It would take a lot of digging, but it could be done.  Been there; done that in another environment.   As per my post, the direct labor costs associated with the long distance trains could be determined relatively easily, and they would go away in time.  What are these labor costs?  Which ones are direct; which ones are allocated? Again, without access to Amtrak's books, there is no way to tell. Models based on 1968 or 2007 data are not timely. Some of the shared management and supervisory labor costs could also go away, although not on a one to one basis as per the direct labor cost. What is the percentage of shared labor costs attributable to the long distance trains?  Again, to reinforce a point, without access to Amtrak's books, it is not possible to know.   The depreciation expense associated with the long distance equipment would go away if the equipment was retired and either scrapped or sold. How much of Amtrak's depreciation is worn by the long distance trains? Without access to Amtrak's property records, we cannot know.   Maintenance is a mixed cost. To the extent it is driven by an activity, i.e. a car runs so many miles and has to come in for maintenance, the maintenance performed on the car is a variable cost. Most of it is avoidable if the car is retired and sold. On the other hand, the costs associated with the maintenance facility, including the management and supervisory costs, behave like fixed costs.   If Amtrak discontinued all the long distance trains, it would not need the Haleigh, Florida, maintenance facility, as an example, and it could be sold. Or it could be used to provide contract maintenance to another carrier. Thus, what appears to be a fixed cost becomes a variable or avoidable cost if management decides to close and/or sell the facility.  Without access to Amtrak's books, including the work orders, the maintenance costs associated with the long distance trains is not knowable.   An accounting team could go through every one of Amtrak's costs, as shown on its books, and come up with a reasonable estimate of the avoidable costs associated with the long distance trains. The costs that I referenced above are just a few examples. The trick, however, would be to get Amtrak's management team to make the hard decisions to shed the direct costs and move aggressively to slim down the shared mixed and fixed costs.
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