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Summary

As required by Congress, we issued our report on Amtrak's financial performance for 2003 and through the first three quarters of 2004. Amtrak has implemented a strategy of maintaining and rebuilding its existing system. However, unsustainably large operating losses, poor on-time performance, and increasing levels of deferred infrastructure and fleet investment demonstrate that this approach is no longer workable. Amtrak’s management must find ways to reduce its need for operating subsidies and set better priorities for its capital dollars. In the meantime, Amtrak’s Board of Directors should exert its prerogatives and compel management to reduce its reliance on operating subsidies and minimize further deferral of critical capital investment. If these actions are not successful, the Department should impose conditions for awarding Amtrak’s FY 2005 operating and capital grants.