Roth Tries to Rescue Amtrak

As part of the tax package that he will write for the budget agreement, Senate Finance Chairman Roth will attempt to set up a revenue-neutral "reserve fund" to rescue the nearly bankrupt Amtrak, according to aides.

While Amtrak's funding levels were not increased as part of the budget deal, Senate Budget Chairman Domenici Friday told CongressDaily that if Roth can raise the additional revenue specifically for Amtrak, the budget negotiators have agreed to raise the spending caps for the passenger rail line.

A spokesman for House Ways and Means Chairman Archer said that like other specific tax provisions, Archer has not agreed to include such a provision in his tax package.

Roth, who commutes home to Delaware on Amtrak, has been pushing hard in the budget negotiations to rescue the railroad, which is now borrowing to cover operating costs.

A Roth spokeswoman said the goal is to raise $2 billion for the new "Intercity Passenger Rail Reserve Fund" over the next five years to meet Amtrak's needs for $400 million for capital improvements each year. That amount would be in addition to the $50 billion in taxes the Finance and Ways and Means committees are expected to raise, $30 billion of which will come from extending the airline ticket tax, as part of the budget agreement.

Roth has introduced legislation to transfer one-half cent of the 4.3 cents of the gas tax that now goes toward deficit reduction to be used for Amtrak. But doing that would alter the tax revenue relied upon as part of the budget agreement. "We're looking at some different options," the spokeswoman said.

Amtrak President Thomas Downs last month testified that because the railroad is borrowing now just to cover operating costs, "the company cannot survive beyond another 18 or 20 months."

To place Amtrak on the path toward self sufficiency, Downs said the passenger railroad will need a multi-billion dollar infusion of cash for capital improvements. If Amtrak is allowed go bankrupt, Downs said it might actually cost more over the next five years to shut it down than to meet its current capital needs.

That's because Congress, when it created Amtrak, guaranteed most of its workers six years of compensation if the railroad shuts down. Aides said opponents of Amtrak may demand that in return for more capital funding the railroad undergo significant reform, including repeal of the six-year compensation guarantee.