[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]



 
                   GETTING BACK ON TRACK: A REVIEW OF

                   AMTRAK'S STRUCTURAL REORGANIZATION

=======================================================================

                               (112-110)

                                HEARING

                               BEFORE THE

                              COMMITTEE ON

                   TRANSPORTATION AND INFRASTRUCTURE

                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

                           NOVEMBER 28, 2012

                               __________

                       Printed for the use of the
             Committee on Transportation and Infrastructure


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             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                    JOHN L. MICA, Florida, Chairman
DON YOUNG, Alaska                    NICK J. RAHALL II, West Virginia
THOMAS E. PETRI, Wisconsin           PETER A. DeFAZIO, Oregon
HOWARD COBLE, North Carolina         JERRY F. COSTELLO, Illinois
JOHN J. DUNCAN, Jr., Tennessee       ELEANOR HOLMES NORTON, District of 
FRANK A. LoBIONDO, New Jersey            Columbia
GARY G. MILLER, California           JERROLD NADLER, New York
TIMOTHY V. JOHNSON, Illinois         CORRINE BROWN, Florida
SAM GRAVES, Missouri                 BOB FILNER, California
BILL SHUSTER, Pennsylvania           EDDIE BERNICE JOHNSON, Texas
SHELLEY MOORE CAPITO, West Virginia  ELIJAH E. CUMMINGS, Maryland
JEAN SCHMIDT, Ohio                   LEONARD L. BOSWELL, Iowa
CANDICE S. MILLER, Michigan          TIM HOLDEN, Pennsylvania
DUNCAN HUNTER, California            RICK LARSEN, Washington
ANDY HARRIS, Maryland                MICHAEL E. CAPUANO, Massachusetts
ERIC A. ``RICK'' CRAWFORD, Arkansas  TIMOTHY H. BISHOP, New York
JAIME HERRERA BEUTLER, Washington    MICHAEL H. MICHAUD, Maine
RANDY HULTGREN, Illinois             RUSS CARNAHAN, Missouri
LOU BARLETTA, Pennsylvania           GRACE F. NAPOLITANO, California
CHIP CRAVAACK, Minnesota             DANIEL LIPINSKI, Illinois
BLAKE FARENTHOLD, Texas              MAZIE K. HIRONO, Hawaii
LARRY BUCSHON, Indiana               JASON ALTMIRE, Pennsylvania
BILLY LONG, Missouri                 TIMOTHY J. WALZ, Minnesota
BOB GIBBS, Ohio                      HEATH SHULER, North Carolina
PATRICK MEEHAN, Pennsylvania         STEVE COHEN, Tennessee
RICHARD L. HANNA, New York           LAURA RICHARDSON, California
JEFFREY M. LANDRY, Louisiana         ALBIO SIRES, New Jersey
STEVE SOUTHERLAND II, Florida        DONNA F. EDWARDS, Maryland
JEFF DENHAM, California
JAMES LANKFORD, Oklahoma
REID J. RIBBLE, Wisconsin
CHARLES J. ``CHUCK'' FLEISCHMANN, 
    Tennessee
VACANCY
                                CONTENTS

                                                                   Page

Summary of Subject Matter........................................    iv

                               TESTIMONY

Joseph H. Boardman, President and Chief Executive Officer, Amtrak    10
Ted Alves, Inspector General, Amtrak Office of Inspector General.    10
James A. Stem, Jr., National Legislative Director of the 
  Transportation Division, Sheet Metal, Air, Rail, Transportation 
  Union (United Transportation Union)............................    10

          PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS

Hon. Corrine Brown, of Florida...................................    32
Hon. Eddie Bernice Johnson, of Texas.............................    35

               PREPARED STATEMENTS SUBMITTED BY WITNESSES

Joseph H. Boardman...............................................    36
Ted Alves........................................................    94
James A. Stem, Jr................................................   112

                       SUBMISSIONS FOR THE RECORD

Hon. John L. Mica, a Representative in Congress from the State of 
  Florida, reference to a slide entitled, ``Cross-Modal 
  Comparison of Federal Subsidies''..............................     4
Joseph H. Boardman, President and Chief Executive Officer, 
  Amtrak:

    Responses to questions from Republican members of the 
      Committee on Transportation and Infrastructure.............    45
    Responses to questions from Hon. Corrine Brown, a 
      Representative in Congress from the State of Florida.......    64
Ted Alves, Inspector General, Amtrak Office of Inspector General, 
  responses to questions from Republican members of the Committee 
  on Transportation and Infrastructure...........................   108
James A. Stem, Jr., National Legislative Director of the 
  Transportation Division, Sheet Metal, Air, Rail, Transportation 
  Union (United Transportation Union), responses to questions 
  from Hon. Corrine Brown........................................   116


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                         GETTING BACK ON TRACK:


                          A REVIEW OF AMTRAK'S


                       STRUCTURAL REORGANIZATION

                              ----------                              


                      WEDNESDAY, NOVEMBER 28, 2012

                  House of Representatives,
    Committee on Transportation and Infrastructure,
                                            Washington, DC.
    The committee met, pursuant to call, at 10:00 a.m., in room 
2167, Rayburn House Office Building, Hon. John L. Mica 
(Chairman of the committee) presiding.
    Mr. Mica. Good morning. I would like to call this hearing 
of the House Transportation and Infrastructure Committee to 
order. We are pleased to conduct this full committee hearing on 
Amtrak, and the title of today's hearing is ``Getting Back on 
Track: A Review of Amtrak's Structural Reorganization.''
    So welcome. We have one panel of witnesses today, and the 
order of business will be that I will start with an opening 
statement, provide some background, and will yield to Mr. 
Cummings this morning, and other Members who wish to be heard, 
and then we will turn to our witnesses. We will hear from all 
of them, then go to questions. But pleased to welcome, again, 
everyone this morning.
    Now, this is one of a number we have actually held, fourth 
in a series of full committee oversight hearings on Amtrak and 
U.S. passenger rail policy in the United States. We actually 
have two more scheduled. One will be on Thursday, December 6th, 
and that will focus on the high-speed and intercity passenger 
rail grant program, and then we will have the final hearing on 
this important subject, Thursday, the 13th of December, and 
that will be on the Northeast Corridor.
    Ironically, yesterday I was back in New York City actually 
looking at some of the flood and storm damage, and many of the 
transportation infrastructure facilities were adversely 
impacted, a huge amount of damage. I have to say how incredible 
New York City is, how resilient its people are, and how well 
they are coming back. I think they have got about 95 percent of 
their transit operations. Rail was particularly hit. Almost all 
of the East Side Lower Manhattan tunnels flooded, and just 
think of the massive effort put forward to get those trains 
running. They probably move about 20 percent of all the 
passengers in the world in New York City, and a hit like that 
was incredible, but I understand Mayor Bloomberg, who we met 
with yesterday, will be in town today, and we had discussions 
yesterday about FEMA, which our committee oversees, and also 
transportation infrastructure that was hurt. That may be the 
subject of additional scrutiny by the committee.
    But today, again, we are focused on looking particularly at 
Amtrak's structural organization, and I might also recall that 
with the last hearing that we will be doing on the Northeast 
Corridor, our very first hearing was on January 27, 2011, when 
I became chair of the full committee. We did that in Grand 
Central Terminal, where we focused on the future of high-speed 
rail in the Northeast Corridor, and our last hearing on 
December 13th will focus on that same issue and the progress we 
have made since that hearing.
    It is kind of interesting how you come about choosing 
topics for some of these hearings, and I have to reflect a 
moment. A lot of people when they go home, maybe they go to 
bed, maybe they count sheep or read a novel. I like to tuck 
copies of different trade publications at my bedside, and I was 
reading, it had to be after August because this is August 2012, 
Progressive Railroading had a great article which featured--
well, the title is ``At Long Last, A Longer View,'' and it 
focuses primarily on passenger rail service and Amtrak, and I 
thought it was quite interesting, particularly quite 
interesting because it outlined some of the work that Amtrak 
had been doing regarding its reorganization, its structural 
management, and responding to some of the previous studies that 
called for more accountability, more responsibility in the way 
Amtrak is structured, and that led me to say we really need--
the committee really needed to look at where we are in this 
whole process and where we have been.
    For just a minute to tell you where we have been, we have 
had a GAO study in 2005 that asked for Amtrak to develop a 
strategic plan that could clearly link the organization's 
management to overall corporate goals, and Amtrak is a 
corporation. I was intrigued by a comment that Joe Boardman, 
who is the president and CEO, made in this article when he 
pledged in the article, and I take his quote from the article, 
``to run this company more as a business and less as a 
Government entity.'' A quite inspiring goal and something we 
have been trying to achieve from this committee. So he set some 
of the bar. And again, back to 2005 reviews of Amtrak have 
called for improvement again in its organization and management 
strategy.
    In 2010, the IG of Amtrak released another report, and as a 
result of that 2010 report, in November of 2011, Amtrak 
released their 5-year strategic plan with corporate goals and 
new organization structure, you know, targets that they intend 
to use to create more transparency and accountability. And that 
is what we will focus a great deal on today is where they are 
in that process, how they have come along. We will hear from 
the head of Amtrak, Mr. Boardman, we will hear from the 
inspector general, and we will also hear from a representative 
of workers and labor and see how they assess that progress.
    The plan, the strategic plan that is now underway, 
hopefully we will hear to be fully implemented by next year, we 
will get an exact update again from Mr. Boardman and others. 
The plan that was devised takes Amtrak and organizes it into 
six business lines, a vice president or manager of business, 
and we will see how that has come to pass and how that 
reorganization is proceeding, and the purpose of that is to 
establish performance goals that are outlined in the strategic 
plan so that profits and losses can be addressed and also 
accounted for.
    In the past, Amtrak managers have not, unfortunately, been 
held accountable for what has happened in their departments, 
and that is not my evaluation, it is the evaluation of several 
of these studies. Also in the past, there have been Amtrak-
attempted reorganizations without clear goals unfortunately. I 
hope to better understand Amtrak's strategic plans, its 
corporate goals, and specific progress on its reorganization, 
and also learn how it will improve performance, accountability, 
and cost savings.
    I approach this hearing with a very open mind. Amtrak's 
strategic plan is very important. I know it requires a 
transformative approach from what they have done in the past. 
It is not just rearranging the chairs on the deck of the 
Titanic. We want to make certain that there is positive 
progress.
    From a fiscal standpoint, and everybody is focused on the 
fiscal cliff, and sometimes people give me a hard time for 
focusing on Amtrak, but we have this past year, put $1.4 
billion into Amtrak in Government subsidies, almost half a 
billion in operating subsidies and close to a billion on some 
of the capital improvements, and over the years that commitment 
has remained pretty much the same, so we do have a 
responsibility with taxpayer dollars to make certain that this 
operation, which is highly subsidized, and we did do a hearing 
on that, I guess one of the past four hearings we did. Maybe 
they could put that up on the board, is the Cross-Modal 
Comparison of Federal Subsidies. Rode Amtrak yesterday, the 
average cost of my ticket coming back from New York, 
Government-subsidized, the average cost of $46.33.
    [The information follows:]
    [GRAPHIC] [TIFF OMITTED] 76977.009
    
    Fortunately, and I read through the report pretty 
carefully, Amtrak has made some progress in Acela so the loss 
isn't that great for Acela, but this is the average ticket 
subsidy, simply by taking the 29 million passengers or 28 if it 
was last year and dividing it by the underwriting subsidy. 
Other modes of city buses, 10 cents; mass transit, 95 cents; 
aviation, $4.28, and that was highlighted in a hearing that 
we--a previous hearing that we did. So we are trying to bring 
that subsidization for the system down.
    Let me say in closing, I went through the inspector 
general's report last night, and I do want to hear at least the 
report that he is giving, and I am not sure how much of this he 
will address, but seven of the nine board members in PRIIA, we 
had some reorganization of the board of directors, but we now 
have seven of the nine board members on board. I also want to 
know about key personnel. We talked about hiring vice 
presidents and managers over some of these sectors, and that is 
mentioned in the inspector general's report.
    Finally, the comment that the inspector general made that 
the company is clearly in the early stages of implementing many 
of these restructuring initiatives, and he further said that 
recent work shows the sustaining and effectively implementing 
these initiatives has the potential to significantly reduce 
Amtrak's reliance on Federal support, and that is the goal of 
this, it is not just to beat up Amtrak, although sometimes we 
do become very harsh critics when money is lost, or we see lack 
of progress in some areas, but our goal is to reduce the 
Federal reliance on Federal support, and that is one of the 
objectives of this hearing in addition to finding the specifics 
on the progress of their structural organization and 
reorganization.
    I will introduce our witnesses shortly, but let me yield to 
Mr. Cummings, who is serving as ranking member at this point.
    Mr. Cummings. Thank you very much, Mr. Chairman, and it is 
certainly my pleasure to be here. I want to thank you for 
calling this hearing.
    Mr. Chairman, quite often our Federal employees are unseen, 
unnoticed, unappreciated, and unapplauded. In my capacity as 
the ranking member of the Oversight and Government Reform 
Committee, I have heard so much criticism of our Federal 
employees and Government employees in general, and I want to 
take a moment here before I even start to thank Joyce Rose for 
her 25 years of public service on behalf of this committee and 
on behalf of this side of the aisle, and I know all of us feel 
this way.
    [Applause.]
    Mr. Cummings. This is Joyce's, more than likely her last, 
it is her last hearing, and she has always worked fairly with 
all of our Members, and with our staff on this side, she has 
done everything in her power to make sure that not only that 
the Congress is served well, but that the country is served 
well, and so we hate to lose her, but we know, as someone said 
to me, Joyce, and I listened to this in a sermon by T.D. Jakes 
not too long ago, he said his son came to him, his son is a 
singer, and he was about to go off to college, and his son 
said, Daddy, you know, I am not sure this is the thing for me, 
you know. Singers may not make a lot of money, it may not be 
the right thing for me. And his father went up to him, and he 
said, Son, if it is not the thing, it is the thing that will 
lead you to the thing.
    And so this has been, this Transportation Committee has 
been a part of your journey, and we hope that it has been one 
that has been most meaningful, and we really thank God for 
allowing your destiny to lead you to us and for our destiny to 
lead us to you. And so we wish you well in your new endeavors 
as the president, that is quite a--I mean, you went from staff 
person to president--of Operation Lifesaver, which has the 
important mission of educating the public on grade crossing 
safety. May God bless you, and thank you so much for your 
service.
    Mr. Mica. Will the gentleman yield?
    Mr. Cummings. Of course.
    [Applause.]
    Mr. Mica. If the gentleman will yield for just a second.
    Mr. Cummings. Of course, Mr. Chairman.
    Mr. Mica. Again, there is probably no higher tribute than 
to have the other side of the aisle lead with the praise of 
your service to the committee, to the Congress, and to the 
country. Mr. Cummings and I know that you cannot be successful 
in our position without great staff, and certainly you have 
worked long and hard, 12 years for the committee, 25 years in 
Congress, a quarter of a century of commitment to public 
service. I don't think there is anyone that deals with the rail 
or transit issues in the Nation that doesn't know of Joyce Rose 
and her commitment to helping everyone.
    We hadn't passed a passenger rail reauthorization in 11 
years, I was the ranking member, and Joyce worked with myself, 
Mr. Oberstar, and we had great cooperation from both sides of 
the aisle, we passed the legislation called PRIIA, Passenger 
Rail Investment and Improvement Act of 2008, for passenger 
rail, which is right now the guideline we go by in the 
authorization, but if it wasn't for her dedication, commitment, 
and incredible knowledge--I just think of the knowledge that 
will be lost when she leaves her position--we couldn't have 
achieved that.
    So, Joyce, on behalf of the majority side, which we have 
had the privilege to have you working with us, and again, from 
Mr. Cummings and the minority side, we are just eternally 
grateful, and we are paying a little special tribute to you 
today, and thanks again for your service. God bless you.
    Ms. Rose. Thank you.
    Mr. Mica. Mr. Cummings, thank you for yielding.
    Mr. Cummings. So, Mr. Chairman, I thank you for scheduling 
today's hearing. Following the release in 2005 by the GAO of a 
report entitled Amtrak Management Systemic Problems Require 
Actions to Improve Efficiency, Effectiveness, and 
Accountability, that was the name of the report, I was asked by 
then-Ranking Member Oberstar to serve as the lead Democrat on a 
special working group convened by this committee to evaluate 
that report's findings and make recommendations on subsequent 
action.
    Certainly, Amtrak was facing challenges at that time, but 
among other observations, the Democratic Members of the working 
group noted in our view that Amtrak ``faces difficulties in 
implementing long-range strategic plans because of great 
uncertainty regarding its Federal funding each year.''
    During that era, Amtrak faced repeated proposals to cut or 
eliminate the Federal funding provided to it. Obviously, that 
made it difficult for Amtrak's leadership to focus solely on 
operating the company or on developing long-term goals and 
performance benchmarks. We hear a lot in the Congress about 
uncertainty. So subsequently under Chairman Oberstar's 
leadership, Congress enacted the Passenger Rail Investment and 
Improvement Act, and recommitted to the value of the service 
Amtrak provides. This commitment was expanded by President 
Obama and the Congress through the American Recovery and 
Reinvestment Act, which provided funding to begin many of the 
capital projects that had been tabled due to years of 
inadequate Federal funding.
    It is clear that the investments we have made in Amtrak are 
supported by the traveling public. Fiscal year 2012 Amtrak 
achieved the highest ridership levels in its history. That is 
major news. Major. More than 31 million passengers took Amtrak 
in this fiscal year, and the service appears poised to continue 
to grow.
    Against this record of success, and my colleagues on the 
other side of the aisle believe Amtrak needs to get back on 
track, as the title of this hearing suggests, it is only 
because they have once again been doing all they could do to 
try to derail the service. In fact, the Republican Presidential 
platform called explicitly for Amtrak's elimination.
    Fortunately, that misguided platform was resoundingly 
rejected by the American people, who have instead supported the 
President's call to move forward by implementing policies that 
will expand investments in our Nation and support our continued 
economic recovery. The assault on Amtrak needs to end so that 
this company can stay on track and focus on its core mission of 
serving our Nation's mobility needs as safely, securely, and 
efficiently as possible.
    I am very encouraged by the actions Mr. Boardman has taken 
to develop a strategic plan and to introduce an organizational 
structure that supports implementation of that plan and 
increases accountability at all levels of the organization. I 
might note that when the chairman was talking about subsidies, 
Mr. Boardman, I don't think it included Amtrak's commuter rail 
passengers. The actual subsidy is about $5 per passenger.
    I would ask that in your opening statement, you address 
that so we will be clear on what that subsidy is. I don't want 
any confusion about that because I don't want people watching 
this to think that it is something that it is not.
    That said, while we must conduct a thorough oversight over 
Amtrak as the overall entities receiving Federal funding, our 
committee has now held seven hearings at the full and 
subcommittee levels in the 112th Congress on Amtrak, and today, 
we are convening to examine a strategic plan that has not even 
been fully implemented. Appropriate oversight does not require 
micromanagement of all fashions of an entity's operations. 
Thus, while I look forward to the testimony of today's 
witnesses, I hope we will use this hearing to identify ways we 
can support the continued success of Amtrak, enable it to grow 
to meet the increased passenger demands.
    We should also seek ways to support continued 
implementation of the reforms Mr. Boardman has proposed, and 
give him and his leadership team the space they need to fully 
implement their plans rather than require them to return to the 
Hill every few weeks.
    So with that, Mr. Chairman, I yield back and I want to 
thank you for yielding.
    Mr. Mica. Thank the gentleman. Are there others who--anyone 
on this side? Ms. Napolitano?
    Mrs. Napolitano. She was first.
    Mr. Mica. OK, Ms. Richardson.
    Ms. Richardson. First of all, I would like to thank 
Chairman Mica and Ranking Members Brown and Cummings for 
holding this hearing today which focuses on Amtrak's structural 
reorganization. It is noted that Amtrak has a record of 30.2 
million passengers traveling on Amtrak in full year 2011, and 
with that, more than 300 daily trains that connect 46 States, 
including the District of Columbia and Canada, and additionally 
operates intercity trains in partnership with 15 States and 
contracts with 13 commuter rail agencies to provide a variety 
of services.
    At times, this committee has been critical on the way 
Amtrak operates trains across this great country, but if Amtrak 
were truly as bad as some of the hearings have suggested, we 
would have seen headlines like, ``Amtrak Has Record Low 
Ridership.'' In fact, that is completely the opposite. Instead, 
Amtrak's ridership is booming this year, with 11 consecutive 
monthly ridership records. In each month of this current fiscal 
year, Amtrak has posted the highest ridership total ever for 
that particular month, with the final month of September also 
expected to be a new record. In addition, in July was the 
single best ridership month in the history of Amtrak.
    Unfortunately, the recently passed transportation 
reauthorization bill, MAP-21, rail title was noticeably absent 
in its final form despite many of our efforts here on this 
committee. The suggestion before this committee is that no 
Federal funds to Amtrak would be allowed to pursue any legal 
action in court, a 25 percent cut in funding, and even more 
alarming, not having a vision for high-speed rail network.
    These possible legislative actions are detrimental to the 
transportation opportunities for all Americans. The alternative 
to build more roads, buy more cars, and consume more oil should 
not be our only solution. In fact, according to DOT, in 
comparison, in 1958 through 2012 the United States has invested 
$1.4 trillion in our Nation's highways, $538 billion in 
aviation, $266 billion in transit, and yet Amtrak, which was 
created in 1971, has received a small fraction of that funding 
at $41 billion.
    When you consider that and compare it to the oil and gas 
industry, which has received roughly $41 billion in Federal 
subsidies, or more than half of those subsidies have been 
available to the energy sector. We have spent, to bring that 
together, we spent more in 1 year with the oil and gas and 
energy companies in their industry than we have spent in the 
entire life of the program of Amtrak. Clearly there seems to be 
an imbalance, and it is not one that should be continued.
    Regarding the vision of high-speed rail, the Amtrak Acela 
service is one of those alternatives, and though it may only 
achieve the speeds of an average of 83 miles per hour along the 
NEC, surely that is significantly better than the long delays 
and crawling major interstate systems that we have. This 
committee should continue the role, as it always has, to 
facilitate the development of critical infrastructure and the 
continuation of one of America's greatest assets, and that is 
passenger rail.
    I want to thank all of the witnesses before the committee 
today, and I look forward to hearing your testimony about how 
the reorganization of Amtrak can make it an even greater 
service to the American public. With that, I yield back.
    Mr. Mica. Thank the gentlelady. Recognize Ms. Napolitano.
    Mrs. Napolitano. Thank you, Mr. Chairman, and may I 
associate myself with the remarks from Ms. Richardson, but I 
especially want to thank Congresswoman Ranking Member Brown and 
Elijah Cummings for bringing this issue along with you.
    Amtrak is extremely important to California. We have three 
of the top five busiest corridors are in our California area. 
Two of them are supported totally by the State, but Pacific 
Surfliner, 2.8 million, is not. I see that there are some cuts 
coming through, and I am going to be looking at that very 
closely because it has a 2.8 million ridership. All three are 
State-supported services program, and as has been stated, the 
vitality must be supported for the State-supported services 
program. Same advice to the States to work with Amtrak to 
provide passenger rail service that complements the national 
network. It is important to all States, especially California, 
we are a donor State, because it gives more options to 
commuters and many intercity travelers while reducing highway 
congestion and pollution. California has been at the forefront 
of reduction of pollution in cars and several other areas, and 
we continue to look for ways to be able to get people out of 
cars and into public transportation.
    The California Transportation Commission, they are voicing 
their opinion on--I talked to Transportation Secretary Brian 
Kelly, Deputy Secretary Brian Annis, and rail division manager 
Bill Bronte on how they view Amtrak's work with California and 
Caltrans. They are concerned with the changes to the State-
supported services program in section 209 of the Passenger Rail 
Investment and Improvement Act, the PRIIA, because that forces 
the State of California to pay $20 million that are going to be 
taken out of that budget for them, operating losses on that 
Pacific Surfliner. It runs along the border of my area, which 
right now is the Alameda Corridor East that is the train 
transportation that brings in 40 to 50 percent of the Nation's 
goods to the rest of the Nation. We are watching the 
reorganization of Amtrak, making sure it doesn't hinder any 
State partnerships. These are critical because they are the 
ones who will, in the end, work with the local communities to 
ensure that we get more people to utilize it.
    We are pleased that the reorg has created an executive 
level position of general manager. I look forward to meeting 
that individual and working with him. It is a very positive 
step since the States provide 50 percent of the revenues to 
Amtrak. We must have a senior Amtrak level position to work 
with States on their programs, and this is especially 
important, section 209 of PRIIA negatively impacts States, 
especially in California.
    I also wanted to add my 2 cents to Ranking Member Elijah 
Cummings' statement on the employees who run Amtrak. They have 
done a beautiful job. I hope they will continue, and we will 
continue to work with them to ensure that not only do they 
provide good service, but that they also are recognized for the 
work they do for our ridership.
    So with that, I yield back the balance of my time, and I 
thank the chair.
    Mr. Mica. Thank the gentlelady. Ms. Johnson?
    Ms. Johnson of Texas. Thank you very much, Mr. Chairman, 
and Ranking Member. My remarks will be very brief. In October 
2005, GAO issued a report to then-Chairman Young concerning 
Amtrak's lack of a strategic plan, and the report identified 
that without a comprehensive corporate mission, Amtrak's 
business practices were lacking and could not ensure consistent 
and improved corporate performance.
    In August of 2010, the Amtrak Inspector General's Office 
released an evaluation report of Amtrak's strategic planning 
and set forth key elements necessary for an effective strategic 
planning process. The IG's report formed the basis for Amtrak's 
November 2011 strategic plan for fiscal year 2011 to 2015. 
While the reorganization is not yet fully complete, there 
appears to be significant performance and accountability 
improvements, and I look forward to the testimony. It seems to 
me that they are doing exactly as we have desired. Thank you, 
and I yield back.
    Mr. Mica. I thank the gentlelady. Others seek recognition? 
If not, what we will do is turn now to our three witnesses and 
welcome them again. Our first witness, and I will recognize him 
at this time, is the president and CEO of Amtrak, Mr. Joe 
Boardman. Thank you. Welcome, and you are recognized.

TESTIMONY OF JOSEPH H. BOARDMAN, PRESIDENT AND CHIEF EXECUTIVE 
OFFICER, AMTRAK; TED ALVES, INSPECTOR GENERAL, AMTRAK OFFICE OF 
INSPECTOR GENERAL; AND JAMES A. STEM, JR., NATIONAL LEGISLATIVE 
  DIRECTOR OF THE TRANSPORTATION DIVISION, SHEET METAL, AIR, 
    RAIL, TRANSPORTATION UNION (UNITED TRANSPORTATION UNION)

    Mr. Boardman. Thank you, Mr. Chairman, Mr. Cummings, 
Members. I appreciate being here today, and Joyce, I will be on 
your board, so the questions will come from me for the future 
for OLI, but I am glad that you are there. You will bring the 
energy to a very important problem of safety for railroads, and 
I appreciate the work that you have done here.
    Angela Cotey, who is sitting over in the corner, Mr. 
Chairman, who is the one who wrote that article, and I have 
already blamed her for this hearing this morning. She has 
already asked me for another interview, and I understand now no 
good deed goes unpunished in this process.
    What I would like to really start with and talk about this 
morning is that I have been an Amtrak customer as a State 
Commissioner of Transportation, and even before that, and I was 
thinking about this in my own company. I used Amtrak as the 
backbone of what we provided in transportation to the social 
service agencies where we had contracts because part of the 
high cost for social service agencies was to transport, 
especially a long distance. For example, in New York, from the 
central part of the State to Buffalo to the Cancer Center, 
instead of using an ambulance or a very high cost, we would 
transfer people to Amtrak at Utica or Rome or Syracuse in some 
way to get to the Buffalo center. And so Amtrak was, right to 
begin with, the answer to part of the reduction in cost savings 
that the Federal Government is interested in, and the State 
governments are interested in across the country and also 
contributes, then, to Amtrak's revenue as a result of that.
    So as a customer, I am focused on customers, and what is it 
that a customer really needs to ride Amtrak or any other 
service for the future? And so when you look at a 
transformation of a major corporation, which Amtrak is, you 
really had to spend a lot more time in the diagnosis than you 
did in the execution.
    So what you saw for the first year or two was looking at 
Amtrak as an organization first, how do they do their jobs and 
should they be done differently for the future? And what you 
found was in a lot of the past reorganizations a lot of box 
moving in the organizations, but not a lot of understanding of 
what the women and men at Amtrak really accomplished to deliver 
the services that we were really looking for.
    So some things were good and some weren't, but now we have 
some results of what we are doing, and we have made some of 
these changes on an incremental basis as we have gone along. 
For example, we knew that a foundation of this had to be why 
the heck didn't Amtrak have any labor contract agreements for 
over 8 years, and why did we have that kind of a culture at 
Amtrak?
    My perspective was that you needed to bring that group of 
people together in a very different way for the future. So the 
reorganization began almost immediately in terms of 
understanding the strength of this agency was in its men and 
women, the work that they did and how they worked with us or 
with management or not with management, and you needed a way to 
get in there, and the common thread of what a customer wants 
and what an employer wants and what an employee wants is 
safety. And so we went in under the basis of a Safe-2-Safer 
program, which was a different way of looking at safety than 
the railroad industry had looked at generally in the past, and 
the way I have learned about that was from Federal employees. 
Those Federal employees were part of the Federal Railroad 
Administration, and they saw that the level of safety got to a 
certain place and didn't go any lower. We had to change the way 
we were looking at safety. There has been that recognition, 
just in the past year by the freight industry as well. It is 
different than the structure of today, based on awards for 
safety, because what we really need is a behavioral-based 
safety program, which is what Amtrak now has in Safe-2-Safer. 
But it also brought together people to work in collaboration to 
resolve problems. You couldn't resolve problems in Amtrak 
without that kind of collaboration with the women and men that 
did that work.
    Amtrak recorded its ninth ridership record in the last 10 
years, and we have actually reduced our operating subsidy. And 
there is a difference in our view of operating subsidy and 
capital subsidy, because Amtrak, in its first iteration in 
1971, was taking over the money-losing passenger railroad 
system from the private freight industry. It did not include 
the Northeast Corridor then. It only included the long-distance 
trains across this Nation, and Congress contemplated, as did 
the Executive side at that time, that subsidies would be 
needed, although they expected that there would be some way 
that a profit would be made. The freight railroads were 
relieved of a great responsibility, but it wasn't until 1976 
that you really got the Northeast Corridor and you had a 
different structure at that point in time.
    And, Mr. Cummings, to address what you asked early on, when 
you really look at operating assistance, we cover 79 percent of 
our fare box in the company as a whole, but on the Northeast 
Corridor, we cover more than 100 percent of our operating 
costs. We use part of that revenue to go back to subsidize the 
long-distance trains because we know that the long-distance 
trains are an integral part of our network of mobility across 
this country.
    So, in fact, there is not a subsidy to a passenger on the 
Amtrak corridor except when you add capital assistance. I 
understand that the need for capital assistance is so great on 
the Northeast Corridor that that subsidy need will continue for 
a long time. This was recently exposed in the storm Sandy, 
where we lost one of our substations because we didn't make the 
investment, we as a Nation, as a region didn't make the 
investment to make sure that the water didn't come into that 
substation and end the ability for us to have the full level of 
service into the Penn Station in New York City. The tunnel 
flood gates were so old, and were scheduled to be addressed as 
a part of the ARC program and are now scheduled to be done as 
part of the Gateway program. That is a discussion that this 
body needs to have for the future about how do we make those 
investments in infrastructure, and I am hearing that today in 
many areas.
    So, really, a subsidized operating cost is really about the 
long-distance trains, where the business model doesn't work at 
the same level of service that there is along the Northeast 
Corridor, and the need to connect that service.
    But we had to be careful coming in to reorganize Amtrak. 
You had to find out, and whether it was the GAO report or 
whether it was the IG report, we followed the IG structure in 
terms of developing a strategic plan. There is no question 
about that. And I think that Mr. Alves will say that in this 
process, and when we did that, we knew other elements of this 
had to occur as the GAO pointed out in its metrics.
    One of the things that I feel that I brought to this 
process related to most of my career, going into failing bus 
systems and bringing them back, and delivering a different 
structure across the country for passenger transportation. 
While rail is a little bit different, it is still very similar 
in many ways. It is not about the boxes. It is about 
understanding what it is that we have to get done and then 
making sure that we are able to measure, have goals, that they 
are clear, and that we can measure them to see if they are 
successful.
    Broadly, we see that in ridership. Broadly, we see that in 
reducing Federal funds. But our goals need to be much more 
specific so that we can hold ourselves accountable and our 
employees accountable for what needs to be done to improve 
service to the customer because the customer is the major focus 
of what this company needs to be all about. It is not about 
moving trains. It is about moving people, and that is the 
foundation, and the people that you move have to be people that 
feel that they are fairly dealt with within the company.
    So the foundation of what that is about in our 
reorganization is a commitment to the values, the integrity, 
the spirit of service, the desire to improve respect, 
entrepreneurial spirit, humility, knowing that while we have 
heroic acts, we don't have heroes. We need everybody, woman and 
man, to deliver what we are really looking for. It isn't about 
the CEO, it isn't about the union leader. It is about all that 
work in a collaborative fashion. And then we finally need--not 
finally, but perhaps sometimes first of all--forgiveness in the 
process. Because what you are looking for are people making 
decisions, and they have to make them every single day, and 
sometimes they don't make the right one, and they need to be 
forgiven when they have done it in the best way that they can 
and then learn from that for the future, and that is what we 
look for is that learning. I don't have a time clock here in 
front of me, it is not working.
    Mr. Mica. We gave you double so far.
    Mr. Boardman. So I can step back and answer questions for 
the future. We do have a strategic plan. We do have an 
organizational process. It is different than it was in the 
past. It is a matrix organization rather than a siloed 
organization, and it isn't complete. In some ways, as I 
listened to folks, I said it is never going to be completely 
complete because things change.
    For example, I am not so sure right this minute that we 
will hire a general manager of commuter services, because our 
commuter service has gone down. That has been the subject of a 
previous hearing. That may not be the best way to deliver that 
service for the future. We may rethink that, and that is one 
position we have not filled at this time. We have filled the 
general manager for long-distance, we have filled the general 
manager for the Northeast, we have filled the general manager 
for State-supported services, and I will stop, Mr. Chairman.
    Mr. Mica. Thank you.
    We will get back to you on questions. You have covered a 
wide range of what we are interested in hearing about, but we 
will turn now to the inspector general, Mr. Alves. You are 
welcome, and the inspector general of Amtrak, it is good to 
have you here and back again. Thank you.
    Mr. Alves. Thank you, Mr. Chairman. Good morning, Chairman 
Mica, Mr. Cummings, and members of the committee. Thank you for 
the opportunity to discuss how our reports have supported or 
complemented Amtrak's ongoing efforts to operate more 
effectively by focusing on customers and the bottom line. In 
line with the hearing's focus on Amtrak's ongoing 
reorganization, my testimony will center on reports related to 
improving Amtrak's operational and financial performance.
    Before I address those reports, I would like to highlight 
the fact that our work generally supports ongoing Amtrak 
improvement initiatives. Over the last couple of years both the 
board of directors and Amtrak management have been focused on 
improving Amtrak's operational, financial, and customer service 
performance.
    To illustrate, because the board now has seven of the nine 
members authorized by PRIIA, it has been able to reconstitute 
two important board committees, the audit and finance committee 
and the personnel committee. This has helped the board to 
provide stronger oversight of management activities. Similarly, 
Amtrak management has taken key actions, including issuing a 
strategic plan that meets best practice guidelines and provides 
a roadmap to help Amtrak become more focused on customers and 
the bottom line. The reorganization initiative that is the 
focus of today's hearing is directly linked to the strategic 
plan's commitment to organize around lines of business.
    Turning to our reports, generally, Amtrak has taken 
positive action on our recommendations. For example, our August 
2010 report found that although Amtrak had made various 
attempts to develop a strategic plan, none had been successful. 
The need for Amtrak to have a meaningful strategic plan was 
first identified in a 2005 GAO report. We recommended that 
Amtrak develop a strategic plan utilizing a process that 
incorporates best practices for strategic planning. Amtrak 
agreed, and the plan was issued in October 2011.
    Amtrak's board of directors also requested that we review 
Amtrak's risk management processes. Our March 2012 report 
showed that Amtrak did not have a systematic, enterprisewide 
framework for identifying, analyzing, and managing risks. The 
board chairman and the president and CEO responded that once 
they understood the commitment required, they would provide 
guidance to management about Amtrak's plans to implement a risk 
management framework. We have discussed our views on the way 
forward with the board and understand that the board is in the 
process of determining how it will address this issue.
    Starting in 2009, we issued a series of reports on human 
capital management. Our July 2011 report found that only 
limited progress had been made in implementing our prior 
recommendations. In response, Mr. Boardman agreed to make 
improved human capital management a priority. Since then, 
Amtrak hired a new chief human capital officer, and he has 
developed and is implementing an action plan to address our 
recommendations.
    We also issued two reports on Amtrak's food and beverage 
program. In September 2012, we reported that food and beverage 
activities were being carried out by two departments, and their 
activities were not well coordinated. Management agreed to 
consolidate the two, and did so on October 1, 2012.
    Since 1995, we have issued a series of reports identifying 
more than $83 million in overpayments on inaccurate invoices 
from host railroads. Amtrak agreed to improve its invoice 
review process and has done so. In addition, this year Amtrak 
recovered over $20 million of overpayments we had previously 
identified.
    In conclusion, the company is focused on operating more 
like a profit-making business. It is in the early stages of 
implementing many of these improvement initiatives, and we 
believe that sustaining these initiatives over the long term 
and effectively implementing them will be the key to success.
    Mr. Chairman, this concludes my testimony, and I would be 
glad to answer any questions that you or other members of the 
committee may have.
    Mr. Mica. Thank you, and we will hold questions.
    We are going to now recognize Mr. James Stem, and he 
represents the United Transportation Union's workers, and we 
are very pleased to have him back and also look forward to his 
testimony. You are welcome and recognized, Mr. Stem.
    Mr. Stem. Thank you, Mr. Chairman and Ranking Member 
Cummings. We appreciate the opportunity to testify. There are 
about 19,000 Amtrak workers, and I, today, am bringing you 
their message. UTU represents about 3300 career professional 
Amtrak employees. I would also like to revise my remarks by 
adding the fact that I had the personal opportunity to work in 
rail passenger service for a railroad during the 5 years 
preceding the creation of Amtrak. I witnessed firsthand the 
decline of the equipment, the services that were there, the 
attempts by the railroads to get out of that business because 
liability was a major concern, and it was a money-losing 
prospect. I also had the opportunity to work on Amtrak trains 
during the next 10 years following the creation of Amtrak, and 
was embarrassed at the shape of the equipment that Amtrak 
inherited when they first started this process. So Mr. Boardman 
clearly identified this has been a major issue.
    I would like to continue my remarks by pointing out that 
labor doesn't have expertise in business organizations. Our 
members are normally on the other end of that. Our interaction 
with Amtrak has been very positive in the creation of that 
plan. We have had no complaints from the field about Amtrak's 
reorganization, and we support this effort and commend Amtrak 
in modernizing their operations. We also commend Amtrak for 
applying modern technology in managing the resources that 
Amtrak has and their personnel.
    Now that Amtrak is not operating from day to day in a 
survival mode with constant threats to its very existence, we 
are confident this well-planned organization will focus 
Amtrak's assets and workers in areas where the best 
improvements in service will happen.
    Our Amtrak members are a part of the transportation team 
who operate trains, moving passengers to their destinations 
safely and on time. This activity requires simultaneous 
coordination with every aspect of the operation from mechanical 
inspections and repairs to maintenance and repairs to tracks 
and signals, to the positioning and cleaning of the equipment 
and dispatching of intercity and commuter trains to multiple 
destinations in many directions.
    Making changes in one area of operations is not a simple 
issue because it also requires changes in other areas to ensure 
continuity. Eliminating and consolidating layers of management 
responsibility in this organization plan, in our view, is a 
very productive move. We are encouraged that Amtrak made 
reductions in management last year, and their new 
reorganization plan proposes to reassign even more management 
positions. Amtrak should earn the support of Congress for this 
upgrade in their organizational structure. Amtrak operates with 
safety and customer service woven together as top priorities. 
Our operating crews fully understand that safety comes first, 
and on-time performance is the goal. This upgrade of operations 
furthers these priorities and positions Amtrak to meet the 
demand for significant increases in rail passenger service. 
Amtrak operating crews are among the most productive workers in 
this system. Every Amtrak employee should be placed in a 
productive position that supports the needs of customer service 
and the managed growth of our operations. Our members are ready 
and eager to work. Congress asked Amtrak to share a plan on how 
to improve services and reduce the travel times between our 
major population centers. The next generation plan provides a 
roadmap for that improvement and identified the funding 
requirements.
    Amtrak's ridership set a record last year, as Mr. Cummings 
and Mr. Boardman indicated, and with an aging population, 
higher gasoline prices, and the total instability of fuel 
resources, highway and aviation congestion, millions of more 
travelers will choose to ride the train if the service is 
available and dependable.
    Amtrak workers are prepared and well trained to provide 
services to our customers, but for us to succeed, Congress must 
provide Amtrak with consistent and predictable multiyear 
funding for modernization and capacity upgrades. Beyond 
reorganization, what Amtrak really needs is dramatic increases 
in capital investments. Amtrak's next generation plan for the 
Northeast Corridor is outstanding. It will cut the transit time 
in half between Washington and New York as well as between New 
York and Boston. Capital spending to increase speeds and 
upgrade Amtrak's infrastructure is the ticket to transporting 
Americans in a cost-effective and energy efficient manner.
    We in labor are Amtrak's partners. We urge this committee 
to allow Amtrak the latitude to reorganize if they so see the 
need, but more importantly to authorize substantial amounts of 
additional funds for Amtrak's capital needs.
    Amtrak also plays a central role in financing our railroad 
retirement system, which is a self-funded pension that this 
committee in 2000 and 2001 reformed. Changes in the Federal 
treatment of Amtrak, such as significant funding cuts or 
passenger rail privatization, could jeopardize the solvency of 
our railroad retirement system that affects 270,000 career 
railroad employees around the country. Americans want a 
national intercity rail passenger network, and Amtrak is 
uniquely able to fill that need. Highways and commercial 
aviation will not alone meet the Nation's future passenger 
transportation needs.
    The coordination of air and rail passenger services should 
be mandated to free more air slots and provide timely rail 
services for shorter travel distances in 300-mile ranges. A 
modern, efficient, intercity rail passenger system is a 
necessary part of a balanced transportation system. Congress 
should recognize that intercity rail passenger service requires 
public subsidies, just as our airline and bus partners also. 
Many airline executives are on record today supporting the 
coordination of air and rail services to increase the capacity 
of our existing airports.
    I also want to make sure this committee is aware of our 
full support for the expansion of our freight rail capacity as 
well. Amtrak and our freight railroads work together as 
partners. Both have capacity needs that can be mutual goals. We 
support the expansion of Amtrak's services and understand that 
this expansion also must address the capacity needs of our 
freight rail partners. I will be happy to answer any questions.
    Mr. Mica. Well, thank you, and thank you for your 
testimony. We share your commitment to making certain that 
Amtrak employees, particularly those long-serving, are treated 
fairly as we move forward, and also that we meet our 
obligations as far as their commitments, retirement, pension 
benefits and other items. I think we have always advocated 
that. Thank you for your leadership on issues, Mr. Stem.
    Representing labor, I think Mr. Boardman had said that it 
was 8 years that Amtrak did not have a labor agreement in 
place. Is that correct? And I think you will recall at the time 
that I felt that that was uncalled for. But that was the case, 
wasn't it?
    Mr. Boardman. Yes, sir, that was the case.
    Mr. Mica. And I didn't find that case with their brothers 
and sisters, union members in the freight systems, and that is 
why I thought Government-supported service, such as Amtrak, 
should be held to a higher standard, and I think also the 
unions actually had to go to court to get relief. But that is 
not the way to run a railroad or a passenger rail system. So I 
think history in that regard speaks for itself.
    Mr. Boardman, when did you submit the 5-year strategic 
plan?
    Mr. Boardman. It was approved in, I think, October of 2011.
    Mr. Mica. OK. Well, I point out that now I have the 
greatest respect for the opinion of the ranking member. 
Sometimes the other side accuses me of micromanaging. I don't 
consider my role as micromanaging when in 2005 GAO said they 
should have a strategic plan. In 2010 the IG also, Mr. Alves, 
didn't you also say they should have a strategic plan and there 
wasn't one? Is that correct?
    Mr. Alves. Yes.
    Mr. Mica. It was. And then for the record, in 2011, I think 
I became chairman that year, Mr. Boardman did come forward with 
a strategic plan in I have November, you said October, but that 
was correct. So sometimes that role is one of oversight, also 
one of prodding, also one of making sure that what should be in 
place--I come from a business background. If this is a 
corporation which is subsidized heavily by public support, the 
very least they can do is have a business plan, and that plan 
should be flexible.
    Let's take the inspector general's report and look at again 
the implementation of a strategic plan. Let me preface my 
remarks by saying that there is no one who is a stronger 
supporter of passenger rail service in the United States than 
this guy right here. It is cost-effective. I am a fiscal 
conservative. You can move more people for less. As far as the 
environment, energy, it is absolute winner. But we have to do 
it with the least amount of subsidy. And god forbid there 
should be a profit in some of these operations, but we could 
actually I think achieve that if we worked together on it.
    So let's take the report together. First of all, the board 
of directors, in PRIIA we had organizational problems from the 
very top, the board. I was very pleased preceding this hearing, 
and I asked the question before, we went to a nine-member board 
and seven members of the board had been appointed. Two Democrat 
appointees were lacking. Yesterday, I am told, was it yesterday 
the White House submitted these two nominees and I am pleased 
to see that, and I hope the Senate acts with due speed and 
everyone helps get the full complement of the board in place. 
Sometimes it takes a hearing to get action, whether it is 
implementation of a strategic plan or highlighting that the 
board should be filled. And maybe they did that of their own 
volition, but I am very pleased that it was done.
    All right, let's look at the key folks in place, and you 
divide it into six divisions. I am very pleased to hear what 
you said about possibly not going forward with some of the 
commuter activities in the organization plan, at least from 
hiring additional personnel in that area.
    We also find that, talking about ridership, Mr. Boardman, 
the highest percentage of increase in ridership is in State-
supported routes, is that correct?
    Mr. Boardman. Yes.
    Mr. Mica. OK. And next year, according to PRIIA--it is next 
year, isn't it, Joyce--that the States will now have to step up 
to the plate and pay full support. That is correct, Mr. 
Boardman?
    Mr. Boardman. Under section 209, yes.
    Mr. Mica. Yes. Under 209, right. And that actually will 
help your bottom line pretty dramatically. It is about $100 
million a year, some of the calculations in that range, is that 
correct?
    Mr. Boardman. I think, yes, that is within the range. I 
think it might be a little different than that, but yes.
    Mr. Mica. I notice Mr. Joe McHugh sits behind you with a 
smiley face, was quoted in this article to say it is important 
to help States make the case for Amtrak so legislatures will 
invest in that. And that is one reason we want to hold your 
feet to the fire, to make your passenger rail service and the 
cooperative effort with the States attractive, and looking 
forward to working with you. But again we have a change in that 
activity and we will have to see how that evolved.
    The other positions, are they all full, the vice president 
and managers, Mr. Boardman?
    Mr. Boardman. General managers; one of them is a vice 
president, that is the Northeast Corridor infrastructure and 
development, Stephen Gardner.
    Mr. Mica. Yes, and he will be in here I think when we do 
the Northeast Corridor. We want to hear his report.
    Mr. Boardman. I don't know whether I will send him or not.
    Mr. Mica. I would love to have him.
    Mr. Boardman. I understand that, Mr. Chairman.
    Mr. Mica. We will just subpoena him as a last act.
    Mr. Boardman. I have to control everything he says, Mr. 
Chairman. No, I am kidding. And I have to now wipe the smile 
off Joe McHugh's face, is that what I need to do here?
    Mr. Mica. He didn't have a smile.
    Mr. Boardman. OK. But we have moved forward I think in the 
business lines. But the other piece of this, which had I not 
been so long-winded on other parts of what I said earlier, is 
really the matrix part of this. And we have a structure of 
chiefs--chief mechanical officer, chief engineer, chief safety 
officer--and they set the standards and the budgets necessary 
for the business line chiefs to carry out. In that way, you 
have not just a customer focus, but also a bottom line focus, 
and there is the expertise that is there necessary for us to 
make improvements in mechanical maintenance and improvements in 
safety and improvements in all the things that are needed to 
support these general managers to get their jobs done. Some of 
them are filled. Some of them are posted and they will also be 
finished off in this organization.
    Mr. Mica. OK. Again, I look at the areas where we are 
losing money, or you will be losing--you may be losing some 
opportunities in providing some service and State-supported 
service.
    Another area that the inspector general highlighted and has 
been of interest to the committee, we did a hearing on it, is 
the food service, and you have addressed some changes in that 
and improving some of the controls.
    What was the recommendation, Mr. Alves, I can't find it 
here in the report, was it a consolidation of the two 
activities overseeing food service?
    Mr. Alves. Yes, part of the food service was provided or 
overseen in the Transportation Department, which is part of the 
Operations Department. The commissary and food delivery 
function was overseen in the marketing department. And what we 
found was that they weren't coordinating fully.
    Mr. Mica. Has that been implemented, that recommendation, 
Mr. Boardman?
    Mr. Boardman. Yes.
    Mr. Mica. OK. And, you know, again, I am not micromanaging, 
but if you are losing $79 million on food service with a 
captive audience 3 years ago, and that increases to $84.5 
million this past year, you have a problem. Now, yesterday I 
did not order anything on Amtrak so I saved the taxpayers money 
as far as buying--purchasing food. But it is a problem. We want 
in the structural reorganization or organization the 
recommendations if they make sense and they can be effective 
that are recommended by the inspector general implemented. So 
it appears that that is being addressed.
    Finally, let me address again a part of the report. It is 
talking about again Acela and some of the Amtrak services. It 
says, in contrast, availability and reliability remain the same 
or declined slightly for the remainder of Amtrak's equipment. 
Compared with Acela's train set availability, there is an 
improvement of 14 percent. The availability of the rest of 
Amtrak's equipment has stayed roughly the same compared with 
Acela's reliability improvement of 11 percent, and the rest of 
Amtrak's equipment is on average less reliable than before.
    That is a concern. Mr. Boardman----
    Mr. Boardman. Yes, I can address that. We agree that it is 
getting older and therefore it is becoming more unreliable now 
in some ways. We have ordered new electric locomotives on the 
Northeast Corridor to make substantial improvement.
    Reliability-centered maintenance we think is an excellent 
way to go. It is something that has helped us a lot with the 
Acela fleet. That is our premium service and certainly we want 
to maximize its use.
    If we use the same plan with the rest of the company right 
now in the same way, we would probably be talking 600 to 700 
more employees. And so we don't see the balance yet that we 
need to increase the revenues necessary to pay for that, 
compared to where we are right now with the reliability. We 
really looked at that premium service differently because the 
fares were so much higher in that process.
    Mr. Mica. OK. I didn't mention this before, but out of the 
report, just for the record, Amtrak's food and beverage service 
has incurred a direct operating loss of over $526 million in 
the last 6 years. A half a billion is not chump change, and 
just want that in the record.
    Mr. Boardman. I think we had it in the last record, but, 
yes, I understand.
    Mr. Mica. Finally, also as recommended, and this is also 
from the report, the vice president of operations has agreed 
that Amtrak will develop a 5-year plan for reducing its direct 
operating losses.
    Mr. Boardman, can you shed some light on that?
    Mr. Boardman. Well, it goes back to the entire structure of 
what we are trying to do in terms of accountability. And one of 
the issues at Amtrak early on was the lack of accountability 
and lack of even understanding of what a budget was and the 
management of a budget that people had available to them.
    And so a lot of the strategic plan comes out in how are you 
going to measure the metrics and what are your goals. How do 
you get organizational excellence and what are you looking for 
in terms of financial excellence, in terms of maximizing 
revenue, optimizing our operating ratio, doing the normal 
business things that we need to get done, and holding each one 
of those folks accountable to a performance measurement system 
personally in their operation to get that done? So that is 
really the structure that the VP for operations and the whole 
company will begin to really do.
    We saw early on, and I compliment Ted for recommending the 
commissary, but that was something we saw that we needed to 
change quite early. The problem is you have to operate the 
railroad while you are making these changes, so you have to be 
prepared to make the change in a way that makes sense and you 
have to have it tied in together to the rest of the structure. 
So we did that. And I think Ted and I talked about that early 
on, those kinds of things need to happen. We are still doing 
that as we are finding ways to make those improvements.
    Mr. Mica. Thank you. For the record, General, will note 
that Amtrak is now taking all credit cards, at least on the 
Acela train that I was on, which is something you had 
recommended. We hadn't gotten implemented, but Mr. Boardman has 
made progress on that. And also they advise you to get a 
receipt from the cafe too. So you are making good progress.
    Let me yield on that tone to Mr. Cummings.
    Mr. Cummings. Thank you very much, Mr. Chairman.
    To Mr. Boardman, I want you to be real clear, and I know 
you are, but I want to make it real clear that on both sides of 
the aisle we want effectiveness and efficiency. And it does no 
one any good, including the employees, if we are not zeroing in 
on effectiveness and efficiency. And I assume from your 
comments that that is what you have been trying to do.
    But let me just go to this area, and I want you to listen 
to me very carefully, Mr. Inspector General, on this issue, 
because you raised it.
    When you tell me that in a year you were able to recover 
over $20 million in overpayments, I got to tell you that sends 
all kinds of whistles going on in my head. The first question 
is, why do we have the overpayments?
    The second question is, you know, when you are talking 
about strategic plan and organization, there must be somebody 
who is responsible for making those overpayments, in other 
words, somebody in charge. And what have we done to address 
that? How much is still out there? Because I can tell you what 
happens up here is that if somebody has got something against 
you, they will take stuff like that and do some damage, and 
rightfully so. I mean, it is like setting yourself up.
    So help me with this. Talk about these overpayments and 
talk about--I mean, does the strategic plan say we project that 
we may have X amount of overpayments.
    And you are talking about measurements, Mr. Boardman. Does 
the strategic plan then say we will recover X? Because that 
means that somebody has got some money that they are not 
supposed to have, and that is money that we could be using to 
address our issues here. Go ahead.
    Mr. Alves. Thank you. I would like to provide some 
background on this issue. It had been a longstanding issue 
within Amtrak going back to when Amtrak was formed. This unit 
which paid the invoices from host railroads for Amtrak 
operating over their track, there really was no billing review 
process. For years the company relied on the inspector general 
to come in after the fact, years after the fact, and 
reconstruct the payments and identify overpayments.
    I think in 2008 or so we recommended that as a basic 
business process that the company should have to review a bill 
before they pay it. The company agreed and they worked 
aggressively and hard to implement an improved billing review 
process.
    The second issue that we had is that the billing review was 
in the same group that was structuring the agreements with the 
host railroads and we thought that was too close and there 
needed to be a separation of duties. So we also recommended 
that that billing review process be separated from the group 
that is negotiating and working with the host railroads. The 
company agreed to that as well.
    It took a couple of years probably, and these things do 
take time, for the company to put that structure in place, 
develop processes and policies and work guides. But at this 
point the function is in existence and the group is reviewing 
railroad bills as they come in and before they are paid. So we 
think that the problem----
    Mr. Cummings. So are you saying that you think we have 
stopped the hemorrhaging----
    Mr. Alves. Yes.
    Mr. Cummings [continuing]. And now we need to sort of go 
backwards and see what we may have lost. I mean, is that a fair 
statement?
    Mr. Alves. What we are doing is we are finishing up the 
last of our railroad billing review audits. We have covered 
most of the large amounts of money that are out there, and I 
think about the end of the year we will issue the final audit 
reports, and at that point we are going to turn everything over 
to the company. I am not sure that it is cost-effective at this 
point to go back, you know, 5 or 10 years and try and recover 
small amounts of money. So we think that we are covering the 
bulk of the money in our audit reports and the company can move 
forward productively from here.
    Mr. Cummings. Just one quick thing to you, Mr. Boardman. I 
just want you to talk about, you made a big deal, you spent a 
lot of your time talking about safety, and, you know, you talk 
about--and I want to know what you mean by that. You were 
saying that when you went and you tried to do your review you 
figured out that the thing was safety and you kept saying 
safety. What does that mean?
    Mr. Boardman. Well, it means that the system itself, if you 
don't have a safe transportation system, whether it is a bus 
system, aviation system, rail system, you won't have customers, 
because they won't trust the ability to get on the train and be 
safe, that you are not going to have accidents, that you are 
not going to have----
    Mr. Cummings. This is what I want, what you are saying 
right now. This is what I want to hear right now. Come on.
    Mr. Boardman. That you have well-trained employees; that 
they know what to do in an emergency; that we are capable of 
handling our passengers in a very safe, efficient manner.
    Mr. Cummings. And passengers were worried about that, is 
that what you were saying?
    Mr. Boardman. They could be, if we began to have those 
kinds of problems, and there are those areas and pockets where 
that existed, but it was also among employees. So it is not 
just the passenger, it is also the employees.
    Mr. Cummings. Thank you, Mr. Chairman.
    Mr. Hanna. [presiding.] Anyone else have any questions? Go 
ahead, Mr. Bucshon.
    Dr. Bucshon. Thank you.
    Mr. Boardman, I am going to ask a fundamental question. Can 
a passenger rail line in this country be profitable?
    Mr. Boardman. Our Northeast Corridor is profitable, the way 
we operate it, in terms of the operating costs itself.
    Dr. Bucshon. And now as a Nation, across the country, if 
you add on the rest of what Amtrak does across the country, I 
mean, is it possible to be profitable in your view?
    Mr. Boardman. No, not without a policy decision by 
Congress, which is lacking here.
    Dr. Bucshon. What decision would that be?
    Mr. Boardman. Whether the Congress believes whether a basic 
transportation network in this Nation is necessary. They 
decided that in 1971----
    Dr. Bucshon. Right.
    Mr. Boardman [continuing]. And they have decided it several 
other times. But there needs to be a decision, just like there 
is a decision every day that we are going to invest in a 
highway system or an aviation system. For example, you have 
50,000 employees of DOT that are focused on aviation and there 
is only 60,000 people in DOT. So Congress has a lot to decide 
about what it wants in passenger rail across the Nation.
    Dr. Bucshon. So basically, though, passenger rail on its 
own without Government subsidization, it is not possible to be 
profitable.
    Mr. Boardman. Even the curbside buses, which are made a lot 
of today, without the subsidization of being able to pick up on 
the curb and not sustain all the overhead costs, not having to 
pay for the capital and the highways, could not be profitable. 
However, they are now, and fortunately here in Washington we 
have moved them into the terminal.
    So the answer is yes, there is no mode of passenger 
transportation, including aviation, that can be profitable only 
from the fares.
    Dr. Bucshon. Yes, that makes sense to me.
    Mr. Alves, you made a comment that said Amtrak needs to be 
run, and I think this is basically what you said, more like a 
profitable business. I mean, Amtrak was set up 40 years ago to 
be a profitable business, so it has taken us 40 years. What did 
you mean by that, for example, running more like a business and 
less like a Government agency? Are there specific things that 
need to be done? I mean, I know you have got the strategic plan 
and I understand that, but when people always say that, they 
say that all the time, we need to run Government more like a 
business or Government needs to run more like a business. I 
mean, that is a statement that can be made, but it seems like 
there is a lot of smart people that are working on this issue 
and it has taken 40 years and we are still arguing over the 
same points.
    Mr. Alves. It has taken a long time. And Amtrak actually is 
a business. It is not a Government agency and does not, I don't 
think, operate as a Government agency. It operates as a 
business. I think the focus here----
    Dr. Bucshon. In that respect, it does. But it operates like 
a Government, because when we lose money, that doesn't matter.
    Mr. Alves. Amtrak relies on the Government for----
    Dr. Bucshon. That just gets paid off by Congress, right?
    Mr. Alves. Amtrak relies on the Government for its 
existence and survival from the subsidy, both operating and 
capital subsidy. I think what is different now is that there is 
a focus within the company at the leadership levels, the board 
of directors and Joe Boardman, on making the company operate as 
efficiently as it can and focus on the customer.
    This idea of delineating different customers and moving to 
lines of business and developing accountability mechanisms is 
really focused on the bottom line. And I think that is what has 
been significantly missing in the past. The past focus was on 
running the trains. We can run the trains, but can we do it as 
efficiently as we possibly can? I think that the new focus is 
driven by the strategic plan, and it is driven by the whole 
concept of organizing around lines of business and holding 
people accountable for achieving a goal, and that goal is in 
the future going to be much more focused on the bottom line and 
financial performance. That is my sense of what is happening in 
Amtrak.
    Dr. Bucshon. Thank you for that. I guess my sense is that 
from a congressional standpoint that there should be some 
financial pressures on Amtrak from Congress. Otherwise, we 
would never have any of the things that you are all trying to 
do to streamline the operation. I mean, I think the impression 
that we should always open-endedly fund things or increase 
funding to this agency or that agency or subsidize this 
organization or that organization without some degree of 
financial pressure for efficiency, safety and other things, is 
something I think that we need to avoid.
    So obviously Congress wants to make sure you have the 
amount of money that you need to run your organization, but 
also there needs to be some financial pressure on an 
organization to be more efficient, and it sounds like what you 
are doing is just hopefully going to be very successful.
    Thank you. I yield back.
    Mr. Hanna. The gentleman yields back.
    Ms. Norton.
    Ms. Norton. Thank you very much, Mr. Chairman.
    This is a question for Mr. Alves and for Mr. Boardman.
    Mr. Alves, in your inspector general's report, there is a 
troubling section on human capital management in which you have 
found, and I am quoting you now, ``only limited progress'' in 
implementing your recommendations, your human capital 
recommendations. And the most troubling sentence is the one 
that says, ``In addition, Amtrak was increasingly at risk of 
encountering skills shortages as highly experienced long-time 
employees retire.''
    First I want to know where the gaps are when we are talking 
about safety and risk, and then I really have to ask Mr. 
Boardman, what is so difficult about creating training programs 
perhaps for employees that are already at Amtrak so that people 
who are already trained could train to the next level and 
replace those who are retiring.
    I need to know more about the skills shortage risk, how 
serious it is and what can be done about it. And I might say in 
the short term as people experience--as there is some 
downsizing, for example, from the Congress, you may find more 
people retiring. Could I have a response on that?
    Mr. Alves. Yes. What we found was that Amtrak human capital 
management was very focused on transaction type things--making 
the payroll this month, processing the payroll, adjusting 
people's job description--and wasn't really looking at 
strategic issues.
    Human capital practices have evolved over the last 20 
years. Human capital management is now considered a strategic 
issue that drives performance in the company. We issued a 
report, and it didn't get a lot of traction in the company, we 
did a followup, and Mr. Boardman reacted positively and made it 
a priority.
    The idea of losing skilled people is fairly common. It is a 
concern now throughout the country that older employees are 
retiring. You have to have new people coming in. They have to 
be the right people, they have to be trained and developed, and 
they have to be properly rewarded. And there wasn't a strategic 
focus on those issues at Amtrak.
    Since Mr. Boardman made that a priority, Amtrak now has a 
new human capital officer. And one thing that Mr. Boardman 
directed him to do was that within 3 months he wanted a plan to 
address those strategic issues. That plan was delivered. There 
has been a lot of work on it, and we meet periodically and get 
briefed on the progress and I think things are underway to 
correct those deficiencies. And I will let Joe talk to the 
details.
    Mr. Boardman. It is really not all that hard. The problem 
is everything is a priority. It is a priority to resolve union 
issues and have labor contracts. It is a priority to have 
internal controls. It is a priority to replace equipment. We 
didn't have a fleet plan in place until now.
    Ms. Norton. Let me stop you for a second, Mr. Boardman. 
Yours is a labor-centric business.
    Mr. Boardman. Yes, ma'am.
    Ms. Norton. No matter how you look at it. And we are not 
talking necessarily about, surely to some extent, but brand new 
people who would have to be trained. You have got people. There 
is surely a job ladder in your business.
    And my question is very specific, and that is about 
training, as mentioned in the report, training, much of which 
would probably have been done on the job anyway if you are 
dealing with your own employees who want to move up. Why aren't 
there such training programs in place or are such training 
programs planned before you have a wholesale exodus of trained 
employees from Amtrak?
    Mr. Boardman. We are training. We are training now. A lot 
of what you have read is old news, and I think that the 
inspector general was relating to that. We have got a major 
change in how we manage human capital, and we have a regular 
training program that improves operating services. I think a 
lot of the----
    Ms. Norton. Including training people to move into spots 
that will be vacated by retirement?
    Mr. Boardman. Well, they are not all in place yet, and they 
will be.
    Ms. Norton. I just want to know the plan.
    Mr. Boardman. Yes.
    Ms. Norton. So that would be training, much of it for 
people who are already on the job who might move up?
    Mr. Boardman. Some of them will be trained. There will be 
succession plans for folks. We are in the middle of that now. 
That is part of this process. This is very early to have a 
hearing on what we have tried to accomplish in our strategic 
plan that we are moving forward with.
    Ms. Norton. Mr. Boardman, just might I suggest that, and 
especially in light of my next question, because you could see 
retirements the likes of which you haven't planned for.
    Mr. Boardman. One of them could be mine. But I understand.
    Ms. Norton. I certainly didn't mean you.
    Mr. Boardman. Well, I am going to be 65 next month.
    Ms. Norton. Oh, do you have to leave at 65?
    Mr. Boardman. No, I am just saying.
    Ms. Norton. You better start succession planning right 
away.
    But in light of the fact that your business cannot proceed 
without trained people without putting those of us who board 
your trains at risk, as you listed your priorities, I can only 
ask, and we realize we are important, given the fact that you 
already have a very well trained workforce, you do not have the 
kinds of accidents and the like that grab the headlines every 
other day, we would like to keep it that way and even improve 
it. So I am only asking that training, particularly of people 
who are on board, because that is already a trained workforce, 
proceed.
    I do have to ask about your reorganization when you are 
taking your line businesses, and I understand the transparency 
there and I think it is good business practice. But Amtrak 
received about $1.5 billion, roughly speaking, in Federal 
funds, and about half a million of that was even for 
operations.
    Now, the Budget Control Act, or the 2013 budget, I asked 
staff to get me the number, has a $116 million cut in it and it 
could be worse. If we don't go over the cliff, and I have to 
assume we are not insane and that we are not going over the 
cliff, there could be even deeper cuts as we sit and try to 
reconcile the differences among us.
    Does this cut then imperil any of your plans and does your 
strategic plan take into account that you are likely to see 
cuts rather than increases over the next several years?
    Mr. Boardman. Well, yes, it does, in part at least. We are 
making improvements in efficiency by using new technologies. We 
have had an ability to have a voluntary retirement program. We 
have had some RIFs, reduction in force in certain areas in the 
company and tried to place them other places.
    Ms. Norton. I hope those voluntary retirements do not mean 
you shed the very skilled parts of your workforce----
    Mr. Boardman. Most of them, they were all in the 
nonagreement areas, so they were not the labor force agreement 
force. They were all in the management area. There are about 
3,000 employees that are outside the union construct here. So, 
in many ways, it wasn't just moving, for example, the 
commissary over to the operating side of things to make it more 
efficient, it was also looking at what is it that Marketing is 
really doing. They are doing their work the same way now as 
they used to, for example with travel agents, which has changed 
substantially from what it was in the past. Those kinds of 
things we are looking at as well. So, yes, in part the kinds of 
changes that we are making in the strategic plan do help in 
that area.
    Ms. Norton. Mr. Chairman, if you could indulge me for one 
short question here.
    You know, Mr. Boardman, that I have been particularly 
complimentary of your plan, not your strategic plan, your plan 
to bring high-speed rail, to redo Union Station. It is a very 
ambitious, very 21st-century plan. Does the strategic plan take 
into account Amtrak's overhaul of Union Station and of its 
operations in the long run for high-speed rail?
    Mr. Boardman. Well, yes, it does, and the way that it does 
that is in the infrastructure and investment development 
business line that we have been talking about, the one that 
Stephen Gardner is the vice president of. Because what we 
really looked at and asked is, what is one of the most 
important assets in the United States? And that is the 
Northeast Corridor, from Boston to Washington, and Virginia I 
think would like to move it right on to Richmond and south. In 
the structure that we are dealing with, it has real estate 
potential, it has high-speed rail potential.
    It supports 40 million people within 40 miles of that 
corridor, and we need to change how it is done. If you look at 
Union Station today, and I know you know it well, you see many 
vendors that are there providing services with spaces that all 
used to be dedicated to passengers. We need to recreate the 
space for passengers, because they are coming, and this high-
speed rail will be coming. Whether I and my team are talented 
enough to make that happen, someone will make that happen for 
the future, because that is the most efficient way to move 
people in such a dense corridor as the Northeast.
    Ms. Norton. Thank you very much, Mr. Boardman.
    Thank you, Mr. Chairman.
    Mr. Hanna. You are welcome. Thank you.
    Ms. Johnson, would you----
    Ms. Johnson of Texas. I have no questions.
    Mr. Hanna. There is no one on our side. I have a couple of 
questions.
    Incidentally, Mr. Boardman, it is a pleasure to see you.
    Mr. Boardman. Thank you.
    Mr. Hanna. Knowing that you are from Rome and knowing that 
you went to Binghamton University, which I now have the 
pleasure of representing. Thank you.
    Mr. Boardman. Congratulations on your reelection.
    Mr. Hanna. Thank you. It is a mixed bag, but thank you.
    Mr. Alves, you mentioned that in the long-term plan there 
are benchmarks, to paraphrase what you said, which require 
accountability if they are not met. What does that mean in the 
real world?
    Mr. Alves. Well, actually what I was saying is that it is 
not so much that the plan has the benchmarks and 
accountability, it is that this entire process, starting with 
the plan, should lead to that. Amtrak is not there yet. The 
company is not at a place where people are being appropriately 
held accountable to valid metrics.
    Mr. Hanna. What would you imagine that is, though? I mean, 
accountability in the public sector is difficult to require, it 
is difficult to understand, to pin down since there is not a 
profit motive and there are not necessarily stockholders, have 
no vested interest in outcomes, other than doing a good job, 
which I would hope that they all would. What would you imagine 
that looks like?
    Mr. Alves. Well, Amtrak has established, and I think that I 
will take a shot at it, but Joe will be able to answer it much 
more precisely and on target than I can.
    Amtrak has established two key metrics. One is the 
operating ratio, which is how Amtrak's revenue compares to its 
expenses. Amtrak's operating ratio is less than 1 because we 
lose money. And the goal is to bring it up.
    A second incorporates capital into that. So how much 
capital does Amtrak use to generate revenue against its 
expenses? They are like bottom line really excellent goals.
    What has to happen, though, is that the accountability part 
is that everybody has a role to play, and their role is aimed 
at accomplishing Amtrak's strategic goals and contributing to 
those metrics. And they are then measured against how well they 
contribute against that metric. And so there is a much more 
important focus on the bottom line.
    As I said, Amtrak is in the very early stages. And these 
changes are going to take a while to take place.
    Mr. Hanna. In terms of hard accountability, it is difficult 
to attain and difficult to enforce and very difficult to 
define.
    Mr. Alves. It may be difficult, but it needs to be done.
    Mr. Hanna. Exactly. Go ahead, Mr. Boardman.
    Mr. Boardman. I don't think it is so difficult, 
Congressman. I think one of the things that is important here 
is--and I think Ted really talked about it--is the total 
operating expense over the total operating revenue.
    What we are really looking for are these general managers 
to really understand how much revenue is coming in and what 
their cost is, and that they can be held to account for. 
Because we have a history. We know what those numbers are.
    But we also have a performance plan for every specific 
individual, and we are calling it the SMART program. You know, 
you got to have an acronym to really talk about that. And that 
their goals need to be specific, they need to be measurable, 
they need to be achievable, realistic, and then they need to 
have a date on them which provides the time.
    And they won't be perfect. They will be improving as we go 
forward. Each year we have made a lot of improvements in that 
area because humans need that time to really assimilate what it 
is that we really want them to do and what we need to do to 
protect.
    We have had very weak internal controls, I think, as Mr. 
Alves has talked about, and we have had a very weak business 
process. And the reason for that is because for years it has 
been a survival mode, that we survive this year and are we 
going to survive into next year? And that has begun to change 
at Amtrak, I hope. And I just celebrated my fourth anniversary 
2 days ago here at Amtrak. So the changes that are coming about 
I think are very business related.
    Mr. Hanna. So I can tell the public not to send you a bill 
right now because you actually do look at them?
    Mr. Boardman. Yes.
    Mr. Hanna. That is incredible on its face.
    Mr. Boardman. Part of the difficulty here is understanding 
the level and number of transactions along the route of the 
train each day, which is part of what Ted was talking about, is 
whether a train was late at a certain location or not and 
whether there was an incentive paid to a freight railroad as a 
result of that.
    Mr. Hanna. You can understand some of the cynicism----
    Mr. Boardman. Absolutely.
    Mr. Hanna [continuing]. That comes out of this Congress 
over Amtrak when you look at that, especially knowing that 
aviation is subsidized by a little over $4, mass transit is a 
little over 95 cents, intercity bus, which you know a great 
deal about, is a dime, and Amtrak in total, understanding what 
you said earlier, is about a little over $46. That is a 
substantial subsidy. Obviously the four modes of transportation 
are different.
    But I want to ask Mr. Cummings if you have anything.
    Mr. Cummings. Yes, I certainly do. Thank you. I will be 
very brief, though.
    Mr. Boardman, I just want to ask you about Baltimore. Our 
mayor, our train station in Baltimore, I was listening to your 
answer to Ms. Norton, and we want to know what the situation is 
with the Baltimore station. You know, the mayor had appointed 
me to chair a commission here recently to try to address the 
issue of the Baltimore station. I see your staff, they look 
like they are confused.
    Mr. Boardman. Well, let me just address it quickly. What I 
will do is give you a written response because I am not really 
up to speed on that.
    Mr. Cummings. Yes, please do. And that is OK, I am not 
worried about you being up to speed. I just want to make sure 
that it is on the radar, because we are very concerned about 
it. Baltimore is a major city and the train station is one that 
we are not happy about. We want people to feel a sense of 
vitality in our city. We have a mayor who is doing a great job. 
But that train station is very central, as it is in most 
cities. I don't know if you have been through there.
    Mr. Boardman. Absolutely. I go regularly.
    Mr. Cummings. It is not the prettiest picture. So I am just 
curious. I mean, you may have a general statement on that or 
you may have a specific statement.
    Mr. Boardman. Well, I mean, I was looking at the second 
floor there.
    Mr. Cummings. Yes, the second floor.
    Mr. Boardman. They used to have the power director's office 
up on the top floor and the second floor. And we looked at what 
would it a take for us to be potentially using that 
differently.
    So, yes, we are there. We are looking at it. I don't have 
the specifics on what our plans are right this minute, but I 
understand your concern.
    Mr. Cummings. If possible, I would like to set up a meeting 
with your people so that we can at least make sure we are at 
least singing from the same hymn book and the same church on 
the same day.
    Mr. Boardman. Yes, sir.
    Mr. Cummings. So we can get some kind of--you know, I think 
it is just something that concerns us greatly. We just want to 
know where Amtrak is fitting in there and what your plans are, 
OK?
    Mr. Boardman. Yes, sir.
    Mr. Cummings. Thank you.
    Mr. Mica. [presiding.] Thank you. Other Members have 
questions? No other questions.
    Well, let me just as we conclude thank our witnesses. The 
purpose of this hearing and the two that we are planning is 
hopefully to be constructive, to make certain that things move 
forward in a positive fashion as far as Amtrak. Taxpayers have 
a huge amount of interest in this, $1.4 billion, as I said, 
last year, billions of dollars over the 40 years that we have 
subsidized the Amtrak operation.
    Almost all public transportation is subsidized in some 
fashion. May not be able to eliminate that, but we can lessen 
it, as was stated by the goal of actually the Amtrak president, 
Mr. Boardman.
    We are trying to make certain that we have as efficient an 
operation, well organized, with a strategic plan. Others had 
the opportunity to move forward with a strategic plan prior to 
my becoming chairman; it didn't happen. It is now happening 
now, and we want it to be constructed and also executed so that 
we have in place the very best practices, best structure, and 
one that can be flexible to change, to market requirements, to 
customer demands, and to also make certain that our employees 
who serve us and work hard each day for Amtrak are adequately 
rewarded.
    We will, as I said, have two additional hearings, Thursday 
the 6th of December on high-speed and intercity passenger rail 
service grant program. That is the overall high-speed program 
which has been advocated by the administration. And then on 
Thursday the 13th we will conclude the series on passenger rail 
service with an examination of the progress we are making on 
the Northeast Corridor and high-speed rail.
    Yesterday in New York one of the transportation officials 
said that it was a shame that the United States appears to be 
falling further behind in its efforts to build a high-speed 
rail system, particularly in the Northeast Corridor, which has 
the highest concentration of population, the best connections 
in the United States. And we will examine very carefully the 
progress that is being made, the plans that Amtrak has put in 
place to bring the Northeast Corridor into the 21st century of 
world-class high-speed transportation.
    I think the gentlelady from California, Ms. Richardson, 
said that the speed of Acela is 83 miles per hour. Maybe, Mr. 
Boardman, is it 86 miles an hour on average, just for the 
record? Somewhere between 83 and 86. And I think it is in the 
high sixties going from New York to Boston, which just is not 
acceptable.
    So the purpose of the hearings again are not only to deal 
with the consumer, as Mr. Boardman talked about, but also the 
taxpayers. And having been home during the Thanksgiving period 
and to several cities during the Thanksgiving period, I saw 
hundreds, literally thousands of Americans working so hard to 
pay their bills, raise their families, be responsible citizens. 
And they also send a good portion of their labor, sweat and 
tears to Washington and we have to be responsible stewards and 
trustees of their hard-earned dollars. And that is what we 
intend to do until we call the very last hearing to order.
    So, with that, if there are no other questions from members 
of the committee, let me just do a little homework here. I ask 
unanimous consent that the record of today's hearing remain 
open until such time as our witnesses have provided answers to 
any questions that may be submitted to them in writing. We will 
give it 2 weeks with the consent of the other side of the 
aisle. And I ask unanimous consent that the record remain open 
for those 14 days for additional comments and information 
submitted by Members or witnesses that can be included and will 
be included in the record of today's hearing. Without 
objection, so ordered.
    Again, I want to thank our witnesses. We look forward to 
working with you, Mr. Boardman. Thank you for your fine efforts 
today, Mr. Alves, our respected inspector general, Mr. Stem, 
representing our workers. Thank you so much.
    There being no further business before the Transportation 
and Infrastructure Committee, this hearing is adjourned. Thank 
you.
    [Whereupon, at 11:52 a.m., the committee was adjourned.]
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