Northeast Rail Corridor: Information on Users, Funding Sources, and
Expenditures (Letter Report, 06/27/96, GAO/RCED-96-144).

Pursuant to a congressional request, GAO provided information on the use
of the Northeast Corridor by Amtrak and other commuter and freight
railroads, focusing on: (1) sources of funding for the corridor's
expenditures; and (2) annual funding required to operate and maintain
the corridor's infrastructure.

GAO noted that: (1) the Northeast Corridor is used daily by 100 Amtrak
trains, 1,100 commuter trains, and a few freight trains; (2) about 91
percent of the trains using the corridor are commuter trains; (3) Amtrak
and commuter and freight railroads provide the bulk of the funding
needed for operating and maintaining the corridor; (4) from 1988 through
1993, commuter railroads provided an average of $105.3 million in
revenues and operating subsidies for the corridor's operation and
maintenance expenditures and Amtrak funded approximately 42 percent of
the corridor's average annual capital expenditures; (5) Amtrak and other
users spent an average of $497 million annually on the corridor's
operation, maintenance, and capital improvements; (6) an additional $2.7
billion will be needed over the next 15 years to upgrade the corridor's
infrastructure; (7) Amtrak and non-Amtrak funding varies widely on
various segments of the corridor; and (8) Amtrak needs to improve the
quality of its service to protect its revenue.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-96-144
     TITLE:  Northeast Rail Corridor: Information on Users, Funding 
             Sources, and Expenditures
      DATE:  06/27/96
   SUBJECT:  Railroad transportation operations
             Mass transit funding
             Federal aid for transportation
             Railroad regulation
             Mass transit operations
             Railroad industry
             Railroad research
             Budget receipts
             Maintenance costs
IDENTIFIER:  Amtrak Northeast Corridor
             Amtrak Northeast Corridor Improvement Project
             New Haven (CT)
             New Rochelle (NY)
             Boston (MA)
             Washington (DC)
             
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Cover
================================================================ COVER


Report to the Chairman, Subcommittee on Surface Transportation and
Merchant Marine, Committee on Commerce, Science, and Transportation,
U.S.  Senate

June 1996

NORTHEAST RAIL CORRIDOR -
INFORMATION ON USERS, FUNDING
SOURCES, AND EXPENDITURES

GAO/RCED-96-144

Information on Northeast Rail Corridor

(343875)


Abbreviations
=============================================================== ABBREV

  GAO - General Accounting Office
  LIRR - Long Island Rail Road
  MARC - Maryland Rail Commuter Service
  MBTA - Massachusetts Bay Transportation Authority
  MTA - Metropolitan Transportation Authority of New York
  MNCR - Metro-North Commuter Railroad
  NECIP - Northeast Corridor Improvement Program
  NJT - New Jersey Transit
  SEPTA - Southeastern Pennsylvania Transportation Authority
  SLE - Shore Line East
  VRE - Virginia Railway Express

Letter
=============================================================== LETTER


B-262227

June 27, 1996

The Honorable Trent Lott
Chairman
Subcommittee on Surface Transportation
 and Merchant Marine
Committee on Commerce, Science,
 and Transportation
United States Senate

Dear Mr.  Chairman: 

The Northeast Corridor--the 460-mile railroad track and facilities
between Washington, D.C., and Boston, Massachusetts--serves over 100
million passengers per year and is critical to the transportation
infrastructure for eight states and the District of Columbia.  Most
of the corridor is owned by the National Railroad Passenger
Corporation (Amtrak).  Amtrak, eight commuter railroads, and three
freight railroads use the corridor on a daily basis.\1 From 1988
through 1993, Amtrak and other users spent a total of $3 billion (in
1995 dollars) to operate, maintain, and upgrade the corridor's
infrastructure.\2 These funds were used to maintain tracks, signal
systems, electric traction structures and facilities, and stations;
dispatch trains; and make capital improvements for commuter and
high-speed operations.  Despite these expenditures, the corridor's
infrastructure has deteriorated, and Amtrak estimates that about $2.7
billion is now needed to bring the corridor up to a state of good
repair.  Amtrak defines a state of good repair as a condition where
only routine maintenance is required. 

This report responds to your request for data on the users of the
Northeast Corridor and the funding needed for its operations and
maintenance.  Specifically, as requested, we describe (1) the
relative use of the corridor by Amtrak and the commuter and freight
railroads, (2) the sources of funding for expenditures on the
corridor, and (3) the annual funding required to operate and maintain
the corridor's infrastructure in a state of good repair and continue
capital improvements at their historical rate.  This report does not
include fuel and crew expenditures or the purchase or maintenance of
rolling stock, since these expenditures do not pertain directly to
operating and maintaining the corridor's infrastructure. 
Additionally, this report should not be used to determine whether the
corridor's users are contributing their fair share of expenditures,
since (1) we have included expenditures for infrastructure and
facilities that benefit only commuter railroads and only Amtrak as
well as expenditures for jointly used infrastructure and facilities
and (2) we use very broad measures of the corridor's utilization that
are not appropriate as the sole basis for allocating costs.  Appendix
III provides you with a detailed discussion of our scope and
methodology. 


--------------------
\1 For this report, we define the Northeast Corridor as the main-line
track and facilities between Washington, D.C., and Boston, Mass.  We
do not include data on (1) expenditures for the corridor's spurs
(e.g., Philadelphia-Harrisburg, Pa.); (2) operations of the
Springfield Terminal Railway Company, a freight railroad that
operates on a corridor spur; or (3) the Port Authority Trans Hudson
Corporation, a commuter railroad that operates on the corridor only
over one bridge. 

\2 Unless otherwise specified, all dollar amounts are in 1995
dollars. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

The Northeast Corridor is used daily by about 100 Amtrak trains,
1,100 commuter trains, and a few freight trains.  The relative use of
the corridor by Amtrak and other railroads varies significantly
depending on the measurement factor used.  For example, the commuter
railroads accounted for about 41 percent of the train-miles (the
product of the number of trains times the number of miles traveled)
operated on the corridor in 1993 compared with about 56 percent for
Amtrak.  Three freight railroads accounted for about 3 percent of the
total train-miles operated in 1993.  Tallying the number of trains,
in contrast, produces a different picture.  According to Amtrak,
about 91 percent of the trains using the corridor each day are
commuter trains, while only about 9 percent are Amtrak trains. 

From 1988 through 1993 (the most recent year for which Amtrak had
data readily available), Amtrak and commuter and freight railroads
funded expenditures for operating and maintaining the corridor and
for capital improvements.  Nearly half of the expenditures for the
corridor's operations and maintenance (e.g., train dispatching and
repairs to track and signal systems) came directly from Amtrak's
revenues and operating subsidies.  The remainder came from non-Amtrak
sources, including commuter railroads' revenues and operating
subsidies and freight railroads' revenues.  Amtrak's capital
subsidies, which vary from year to year on the basis of congressional
appropriations, funded about 42 percent of the average annual capital
expenditures on the corridor.  Capital expenditures include those for
major infrastructure projects, such as bridge replacements and
station improvements.  Capital grants from the Federal Transit
Administration and state and local sources funded the balance of
capital expenditures. 

From 1988 through 1993, the percentage of funding from Amtrak and
non-Amtrak sources on specific segments of the corridor varied
widely.  For example, between Wilmington, Delaware, and Trenton, New
Jersey, non-Amtrak sources funded about 32 percent of the average
annual expenditures for operations and maintenance.  In contrast, on
the non-Amtrak-owned segment between New Rochelle, New York, and New
Haven, Connecticut, non-Amtrak sources funded about 96 percent of the
total expenditures.  Similar variations in capital funding occur on
specific segments. 

From 1988 through 1993, Amtrak and other users spent an average of
about $497 million annually on the corridor's operations,
maintenance, and capital improvements.  Notwithstanding this
expenditure, Amtrak states that the corridor was not maintained in a
state of good repair.  Amtrak estimates that an additional
expenditure of $2.7 billion, or $180 million annually, will be needed
over the next 15 years to bring the corridor's infrastructure to a
state of good repair.  Therefore, over the next 15 years, the
corridor's total annual required expenditure from Amtrak and other
users to operate and maintain the corridor's infrastructure in a
state of good repair, while continuing capital improvement programs
at their 1988-93 historical rate, is about $677 million.  According
to Amtrak, the deterioration of the infrastructure has caused a
decline in the quality of service--primarily in the form of train
delays.  Amtrak believes that if the quality of service continues to
decline, Amtrak and commuter railroads could lose revenues as their
passengers shift to other transportation modes, such as private
automobiles or airlines. 


   BACKGROUND
------------------------------------------------------------ Letter :2

In 1970, the Congress passed the Rail Passenger Service Act,\3 which
created Amtrak to operate and revitalize intercity passenger rail
service.  Amtrak acquired ownership of most of the right-of-way along
the Northeast Corridor from the bankrupt Penn Central Transportation
Company through the Regional Rail Reorganization Act of 1973 and the
Railroad Revitalization and Regulatory Reform Act of 1976.  Amtrak
did not acquire ownership of the 56-mile section between New
Rochelle, New York, and New Haven, Connecticut.  New York's
Metropolitan Transportation Authority owns the New York portion of
this segment, while the Connecticut Department of Transportation owns
the Connecticut portion.  Also, Amtrak did not obtain ownership of
the 38-mile section within Massachusetts.  This segment is owned by
the Massachusetts Bay Transportation Authority. 

As figure 1 shows, Amtrak shares most of the main line's right-of-way
(the route between Washington, D.C., and Boston, Mass., excluding
spur lines) with commuter railroads.  On three segments--namely,
between Perryville, Maryland, and Wilmington, Delaware; between
Sunnyside Yard (N.Y.) and New Rochelle, New York; and between Old
Saybrook, Connecticut, and Providence, Rhode Island--Amtrak did not
share the track with commuter railroads from 1988 through 1993.\4
Although not shown in figure 1, the Virginia Railway Express uses
Union Station in Washington, D.C., as the terminus of its commuter
operations from Fredericksburg and Manassas, Virginia.  Also not
shown in figure 1 are the three freight railroads that operate on the
corridor.  Appendix I provides you with background information on the
commuter and freight railroads that operate on the Northeast Corridor
main line. 

   Figure 1:  Ownership of and
   Operations on the Northeast
   Corridor

   (See figure in printed
   edition.)

Amtrak's operations Mileage on the corridor

Amtrak operates trains from
Washington, D.C., to Boston, Mass.  460

Commuter railroads' operations

Maryland Rail Commuter Service (MARC) 77
Southeastern Pennsylvania Transportation
Authority (SEPTA) 58
New Jersey Transit (NJT) 58
Long Island Rail Road (LIRR) 4
Metro-North Commuter Railroad (MNCR) 56
Shore Line East (SLE) 33
Massachusetts Bay Transportation
Authority (MBTA) 44

Amtrak owns and maintains about 365 miles of the corridor's main
line.  On these sections, Amtrak provides dispatching services for
all trains and maintains and upgrades the track, bridges, signals,
fencing, and electric traction system (between Washington, D.C., and
New Rochelle, N.Y.) that make up the right-of-way.  The Metropolitan
Transportation Authority of New York and the Connecticut Department
of Transportation, through the Metro-North Commuter Railroad, provide
for these services on their respective portions of the corridor
between New Rochelle, New York, and New Haven, Connecticut.  On the
Massachusetts segment, Amtrak provides maintenance and dispatching
services for all trains under contract with the Massachusetts Bay
Transportation Authority. 

Commuter and freight railroads that operate over the Amtrak-owned
portion of the corridor pay access fees to Amtrak for the use of its
tracks.  Between New Rochelle, New York, and New Haven, Connecticut,
Amtrak pays access fees to Metro-North for the use of its tracks, and
Amtrak allocates some capital subsidies to support major projects on
this segment.  Between Providence, Rhode Island, and Boston,
Massachusetts, access fees are incorporated into the contract between
Amtrak and the Massachusetts Bay Transportation Authority.  The
Consolidated Rail Corporation (Conrail), a freight railroad, pays
access fees to the Massachusetts Bay Transportation Authority for its
operations on the corridor in Massachusetts.\5


--------------------
\3 P.L.  91-518, 84 Stat.  1327 (1970). 

\4 The Shore Line East Commuter Railroad extended its service to New
London, Conn., in February 1996.  Prior to 1993, its service extended
only to Old Saybrook. 

\5 Conrail pays access fees to Metro-North only when Conrail's
operations between New Rochelle, N.Y., and New Haven, Conn., exceed a
certain threshold.  According to Conrail, this threshold was not
exceeded from 1988 through 1993. 


   THE NORTHEAST CORRIDOR IS A KEY
   TRANSPORTATION ASSET USED BY
   DAILY COMMUTERS AND INTERCITY
   TRAVELERS
------------------------------------------------------------ Letter :3

The Northeast Corridor is used not only by Amtrak's intercity trains,
but also by commuter trains that carry commuters to and from work
each day.  Commuter railroads account for about 91 percent of the
passenger train movements on the corridor.  Commuter railroads also
carry far more passengers annually than Amtrak does.  For example,
Metro-North carried 26 million passengers in 1994 on its 56-mile
segment between New Rochelle, New York, and New Haven, Connecticut. 
Similarly, in 1995, New Jersey Transit carried over 19 million
passengers on the 58-mile segment between Trenton, New Jersey, and
New York City.  In contrast, Amtrak's annual ridership over the
entire length of the corridor averages about 11 million. 

Train-miles--the product of the number of trains times the number of
miles traveled--is another measure of the corridor's utilization.\6
Amtrak operates fewer trains than the commuter railroads do, but its
trains generally travel farther.  Conversely, commuter railroads
operate many trains over limited distances on the corridor.  Figure 2
shows the percentage of train-miles that Amtrak, commuter railroads,
and freight railroads operated on the corridor in 1993. 

   Figure 2:  Percentage of
   Amtrak's, Commuter Railroads',
   and Freight Railroads'
   Train-Miles Traveled on the
   Northeast Corridor, 1993

   (See figure in printed
   edition.)

Although the percentage of train-miles operated by freight railroads
on the corridor is relatively small, Amtrak officials stressed that
because freight trains are typically longer and heavier than
passenger trains, they cause a larger share of wear and tear on the
infrastructure. 

Along various segments of the corridor, the percentage of train-miles
operated by commuter railroads differs, as figure 3 shows.  Because
we did not collect the amount of freight railroads' train-miles on a
segment-by-segment basis, figure 3 shows only the commuter railroads'
percentage of total passenger train-miles (i.e., the total of
Amtrak's and commuter railroads' train-miles) operated on the
corridor. 

   Figure 3:  Commuter Railroads'
   Percentage of Total Passenger
   Train-Miles Traveled on the
   Northeast Corridor, 1993

   (See figure in printed
   edition.)

The shaded bars in figure 3 reveal that some of the heaviest use by
commuter railroads on the corridor is in the vicinity of New York
City.  New Jersey Transit and the Long Island Rail Road use the
corridor's main line to directly access Penn Station in New York
City.  Although the Long Island Rail Road uses the corridor for only
4 miles--mostly in the East River tunnels--the railroad operates the
highest percentage of total commuter train-miles on any segment of
the corridor.  Metro-North also serves New York City, operating
trains between New Haven, Connecticut, and New Rochelle, New York, on
the corridor's main line.  Metro-North uses its own right-of-way from
New Rochelle to New York City's Grand Central Terminal.  Appendix II
shows commuter and freight railroads' train-miles for each year, from
1988 through 1993. 


--------------------
\6 Many more specific criteria, such as train-hours, gross tons (for
freight operations), and car-miles, may be more appropriate for other
purposes, such as allocating shared-use costs. 


   ABOUT HALF OF THE NORTHEAST
   CORRIDOR'S FUNDING FOR
   OPERATIONS AND MAINTENANCE
   COMES THROUGH NON-AMTRAK
   SOURCES
------------------------------------------------------------ Letter :4

As figure 4 shows, non-Amtrak sources provided, in total, about
$126.3 million (52 percent) annually for operations on and
maintenance of the corridor.  From 1988 through 1993, commuter
railroads used an annual average of $105.3 million in revenues and
operating subsidies to pay for operating and maintenance expenditures
on the corridor.\7 Commuter railroads operating on Amtrak-owned
segments used these funds for the operation and maintenance of
stations and for access fees to Amtrak.  Freight railroads also paid
Amtrak and the Massachusetts Bay Transportation Authority an average
annual total of $21 million in access fees.  Amtrak used commuter and
freight railroads' access fee revenues to help fund its operating and
maintenance expenditures.  On segments not owned by Amtrak, commuter
railroads or their parent agencies used revenues and operating
subsidies to pay for the major portion of infrastructure operations
and maintenance. 

   Figure 4:  Expenditures and
   Sources of Funding for
   Operations and Maintenance
   Expenditures on the Northeast
   Corridor, Based on Averages for
   1988-93

   (See figure in printed
   edition.)

Legend

oper.  = operating

rev.  = revenue

RR = railroad

From 1988 through 1993, Amtrak provided, in total, for about $117.7
million (48 percent) of the Northeast Corridor's average annual
expenditures for operations and maintenance.\8 Amtrak pays for
operating and maintenance expenditures on the portions of the
corridor that it owns and pays access fees to Metro-North for the
segment between New Rochelle, New York, and New Haven, Connecticut. 
From 1988 through 1993, Metro-North provided for an annual average of
$57.3 million in operations and maintenance expenditures on this
segment on behalf of the Metropolitan Transportation Authority of New
York and the Connecticut Department of Transportation, the owners of
the right-of-way.  Together, Amtrak and Metro-North funded 72 percent
of the total average annual expenditures for operations on and
maintenance of the corridor.  On the segment owned by the
Massachusetts Bay Transportation Authority, Amtrak performs
operations and maintenance under its commuter operator contract. 

Figure 5 shows the funding sources for capital projects on the
corridor, on the basis of average expenditures from 1988 through
1993.  Amtrak provided for about 42 percent of the average annual
capital expenditure during this time period, using funds from its
Northeast Corridor Improvement Program (NECIP) and general capital
subsidies.\9 From 1988 through 1993, Amtrak spent an average of $76.2
million of NECIP funds and $28.9 million of general capital funds on
the corridor annually.  Capital expenditures were for major upgrades
and the maintenance of track, stations, signal systems, and
high-speed rail improvements. 

Figure 5 includes Amtrak's and commuter railroads' expenditures that
are directed at achieving each entity's specific objectives.  For
example, figure 5 includes Amtrak's expenditures to support
high-speed inter-city service, as well as commuter railroads'
expenditures for their stations and parking facilities.  The degree
to which Amtrak and the commuter railroads receive mutual benefits
from these expenditures varies. 

   Figure 5:  Expenditures and
   Sources of Funding for Capital
   Expenditures on the Northeast
   Corridor, Based on Averages for
   1988-93

   (See figure in printed
   edition.)

Amtrak officials stressed that their annual capital spending is
constrained by the level of capital subsidies appropriated by the
Congress.  From 1985 through 1990, the Congress appropriated very few
funds for NECIP, which affected Amtrak's average annual capital
expenditures from 1988 through 1993.  In contrast, commuter railroads
benefited from an annual average of $93.1 million from state and
local sources, as well as $54.5 million that was provided by the
Federal Transit Administration for capital projects.  State and local
funding comprised over 63 percent of the average annual non-Amtrak
capital funding from 1988 through 1993. 


--------------------
\7 Includes federal and state operating subsidies. 

\8 This total does not include expenditures for capital improvements
or for train operations, such as the purchase and maintenance of
rolling stock and the provision of train crews or fuel.  The total
includes operational expenditures for train dispatching, the
operations and maintenance of stations, and the maintenance of the
tracks, signals, and electrification system. 

\9 P.L.  94-210, 90 Stat.  31, 119 (1976), created NECIP. 


      THE PROPORTION OF AMTRAK AND
      NON-AMTRAK FUNDING VARIES
      WIDELY ON VARIOUS SEGMENTS
      OF THE CORRIDOR
---------------------------------------------------------- Letter :4.1

As figure 6 shows, the relative portion of average annual
expenditures for the corridor's operations and maintenance from 1988
through 1993 funded by Amtrak and non-Amtrak sources varied
substantially from segment to segment.\10

The Southeastern Pennsylvania Transportation Authority received an
annual average of $630,045 from 1988 through 1993 from the Delaware
Transit Corporation, an agency of the Delaware Department of
Transportation, to support commuter services between Marcus Hook and
Philadelphia, Pennsylvania.  These expenditures are included in
figure 6 in the non-Amtrak totals for the Wilmington-to-Trenton
segment. 

Between New Rochelle, New York, and New Haven, Connecticut, where
Amtrak does not own the right-of-way, Amtrak-funded expenditures are
only a small portion of the total.  Metro-North's revenues and
operating subsidies provided for the non-Amtrak expenditures.  Major
components of these expenditures include train dispatching;
maintenance of the tracks, and signal and electrification systems;
and station operations and maintenance.  Amtrak's expenditures on
this segment are mostly the access fees that Amtrak pays to
Metro-North for use of its tracks. 

   Figure 6:  Expenditures and
   Sources of Funding for
   Operations and Maintenance
   Expenditures on Segments of the
   Northeast Corridor, Based on
   Averages for 1988-93

   (See figure in printed
   edition.)

Capital expenditures also varied substantially from segment to
segment, as figure 7 shows.\11 Between New York City's Penn Station
and Sunnyside Yard, in Queens, New York, the Long Island Rail Road
invested relatively large sums of capital.  State and local sources
provided for most of this funding from 1988 through 1991 and about
half of the funding in 1992 and 1993.  According to a Long Island
Rail Road official, the expenditures include those for improvements
to Penn Station and for a lump-sum payment to Amtrak for a 99-year
lease to use the station. 

   Figure 7:  Expenditures and
   Sources of Capital Expenditures
   on Segments of the Northeast
   Corridor, Based on Averages for
   1988-93

   (See figure in printed
   edition.)

Between New Rochelle and New Haven, the Metropolitan Transportation
Authority of New York and Connecticut Department of Transportation
used Federal Transit Administration funding as well as state and
local funding sources for capital projects.  The Connecticut
Department of Transportation's expenditures paid for major projects
such as the replacement of crossties, improvements to station
platforms and maintenance-of-way facilities, and the replacement of
the Peck drawbridge and approaches in Bridgeport, Connecticut. 

The Virginia Railway Express uses Union Station in Washington, D.C.,
and stores its commuter trains during the day at Amtrak's Ivy City
Yard, just north of Union Station.  The railway pays access fees to
Amtrak for the use of Union Station and the Ivy City Yard and has
spent some capital funds, primarily on projects at the Ivy City Yard. 
These expenditures are included in the Washington-to-Perryville
segment of figures 6 and 7.  Not included in figure 7 is $1.3 million
that the Rhode Island Department of Transportation spent in 1992 and
1993 on station improvements and switching systems. 


--------------------
\10 We allocated Conrail's access fee payments according to the
route-miles over which it operates between Washington, D.C., and New
York City.  These access fees are included in the non-Amtrak-funded
bars for the segments between Washington, D.C., and New York City. 

\11 The non-Amtrak expenditures on the Wilmington-to-Trenton segment
do not include a $0.5 million Delaware Transit Corporation
expenditure in 1990 for the Claymont, Del., station. 


   ADDITIONAL ANNUAL EXPENDITURES
   MAY BE REQUIRED TO MAINTAIN A
   STATE OF GOOD REPAIR AND
   CONTINUE IMPROVEMENTS
------------------------------------------------------------ Letter :5

Information provided by Amtrak and other corridor users indicates
that about $677 million will be needed annually over the next 15
years to operate and maintain the infrastructure of the corridor,
return it to a state of good repair, and continue existing
improvement programs.  Because past expenditures did not keep pace
with repair needs, a backlog of repairs exists, and service
interruptions and delays are increasing.  Amtrak believes that
continued deterioration could result in reduced ridership and the
loss of the associated revenue. 


      TOTAL EXPENDITURE
      REQUIREMENT DEPENDS ON
      CONTINUATION OF IMPROVEMENT
      PROGRAMS
---------------------------------------------------------- Letter :5.1

Amtrak estimates that about $180 million in additional expenditures,
or an additional 36 percent over actual 1988-93 average annual
spending levels, will be needed each year for 15 years to return the
corridor to a state of good repair while continuing to make capital
improvements.\12 Adding the $180 million to the $497 million average
annual expenditure for operations, maintenance, and capital
improvements from 1988 through 1993 brings the total to $677 million
annually for the next 15 years.\13

However, future expenditure requirements depend on improvement plans. 
A portion of the $497 million in average annual expenditures for
operations, maintenance, and capital was used for high-speed and
capacity improvements.  If the rate of improvement spending continues
as it did from 1988 through 1993, then $677 million, adjusted for
future inflation, may be a good approximation of annual expenditure
requirements.  Expenditures for upgrades could decrease after speed
and trip-time goals have been achieved.  In such a case, the required
annual expenditures in the future could be less than $677 million. 

Amtrak and other users of the corridor plan to continue improving the
corridor for the next several years.  Amtrak plans to spend about $1
billion over the next several years on high-speed rail service on the
corridor.  Most of this will be focused on establishing high-speed
service between New York City and Boston, Massachusetts.  The
Maryland Rail Commuter Service plans over $110 million in capital
improvements at its stations and parking facilities on the corridor. 
New Jersey Transit has spent $322.5 million since 1993 on its
Secaucus Transfer project, and the agency's proposed capital program
includes more than $250 million over the next several years for a
variety of capital projects to improve stations and connections
between its off-corridor routes and the corridor.  The Rhode Island
Department of Transportation plans to spend over $140 million by 2001
mostly to build a third track to facilitate freight railroad
movements within the state. 


--------------------
\12 Amtrak's $180 million state-of-good-repair estimate does not
include the segment over which Metro-North operates between New
Rochelle, N.Y., and New Haven, Conn.  According to Metro-North and
Long Island Rail Road officials, no significant state-of-good-repair
backlogs exist on the Metro-North segment of the corridor or on the
segment over which the Long Island Railroad operates, except for
safety upgrades needed in the East River tunnels. 

\13 Amtrak's estimate includes the cost of safety upgrades in
stations and tunnels ($500 million); replacement of electrification
between Washington, D.C., and New Rochelle, N.Y.  ($600 million); and
repairs needed on the segment in Massachusetts ($55 million), which
the Massachusetts Bay Transportation Authority owns and Amtrak
maintains under contract.  The estimated cost of upgrading tunnels
and replacing electrification has recently been increased to $600
million and $700 million, respectively. 


      THE CORRIDOR'S
      INFRASTRUCTURE NEEDS REPAIR
---------------------------------------------------------- Letter :5.2

Amtrak has received about $3.4 billion (in nominal dollars) in NECIP
capital grants since 1976 specifically for improvements to the
corridor.  However, in accordance with NECIP's goals, Amtrak focused
most of these funds on improving the infrastructure for high-speed
rail rather than giving a high priority to other capital needs. 
Additionally, from 1985 through 1990, the Congress provided Amtrak
with very little NECIP funding. 

Consequently, the infrastructure has aged and now needs major
renovation.  For example, Amtrak officials have stated that the
1930s-era electrification system between Washington, D.C., and New
Rochelle, New York, is badly deteriorated and needs replacing at a
cost of nearly $700 million.  The loss of power at an electrical
substation not only halts trains but restoring power by transferring
the load to other equipment not affected by the failure results in
overloads and accelerated equipment failure rates.  Also, track
switches are prone to failure, delaying all trains on the corridor
until repairs are completed. 


      DETERIORATED INFRASTRUCTURE
      HAS CAUSED DELAYS
---------------------------------------------------------- Letter :5.3

Figure 8 shows the number of Amtrak train delays on the Northeast
Corridor from 1990 through 1994 caused by infrastructure problems,
such as signaling, broken track, and routine maintenance activities. 
Since 1990, Amtrak has encountered at least 7,000 such delays on the
corridor each year.  In 1994, the number of delays increased sharply. 
While a 1-year increase does not indicate a trend, Amtrak believes
that delays will continue to increase if the corridor's repair needs
are not addressed.  Continued Amtrak and commuter service delays and
interruptions could affect federal, state, and local transportation
funding in the northeast region and result in a shift of Amtrak and
commuter railroad riders toward other modes of transportation. 

   Figure 8:  Number of
   Infrastructure-Related Delays
   for Amtrak Trains on the
   Northeast Corridor, 1990-94

   (See figure in printed
   edition.)


      AMTRAK DEVELOPED A STRATEGIC
      PLAN TO ADDRESS CUTS IN
      FEDERAL FUNDING
---------------------------------------------------------- Letter :5.4

The Congress has made substantial cuts in the federal operating
subsidy for commuter railroads and has pressed Amtrak to develop a
plan to end its dependence on operating subsidies.  In response,
Amtrak's Board of Directors passed a resolution to develop a business
strategy to eliminate or significantly reduce the federal operating
subsidy by 2002.  Shortly, we will report on Amtrak's progress in
implementing this plan.\14 A key component of Amtrak's long-term plan
to operate free of federal operating subsidies is the anticipated
increase in revenues resulting from high-speed improvements on the
Northeast Corridor.  Reduced revenues could jeopardize this plan.  A
second key component of Amtrak's plan is having a continuing source
of capital funds. 


--------------------
\14 Amtrak's Strategic Business Plan:  Progress to Date
(GAO/RCED-96-187). 


   SCOPE AND METHODOLOGY
------------------------------------------------------------ Letter :6

To conduct our work, we visited officials at Amtrak's headquarters in
Washington, D.C., and its Northeast Corridor Strategic Business Unit
in Philadelphia, Pennsylvania; the Federal Railroad Administration in
Washington, D.C.; and the eight commuter railroads and the state and
local agencies responsible for their operations.  At these locations,
we also obtained and reviewed pertinent documents and discussed
activities relating to all aspects of operations on and funding for
the corridor's main line from Washington, D.C., to Boston,
Massachusetts.  We obtained similar information from the three
freight railroads that operate on the Northeast Corridor's main line. 
We conducted our review from June 1995 through June 1996 in
accordance with generally accepted government auditing standards. 


   AGENCY COMMENTS AND OUR
   EVALUATION
------------------------------------------------------------ Letter :7

We provided the Department of Transportation, Amtrak, and the 11
other users of the corridor with a draft of our report for their
review and comment.  We discussed this report with officials at the
Department of Transportation, Amtrak, and Conrail and with a member
of the Northern Virginia Transportation Commission who serves on a
board that oversees Virginia Railway Express' operations.  The
Metropolitan Transportation Authority of New York, New Jersey
Transit, and the Massachusetts Bay Transportation Authority provided
us with written comments which are included along with our response
in appendixes IV, V, and VI.  The Massachusetts Bay Transportation
Authority took no exception with our report.  The Southeastern
Pennsylvania Transportation Authority did not provide us with written
comments in time to be included in this report.  The other four users
did not provide us with comments. 

A Senior Transportation Economist at the Department of
Transportation, the Executive Director of New Jersey Transit, and the
Director of Policy and Planning at the Metropolitan Transportation
Authority of New York all commented that our report should present
side-by-side comparisons of each railroad's usage and expenditures
and address whether users of the corridor were contributing their
fair share.  We did not present such a comparison because the issue
of equitable cost sharing is outside the scope of this report. 
However, we clarified the scope of our work by adding a statement to
this effect at the beginning of the report. 

Officials at the Metropolitan Transportation Authority of New York
and Amtrak commented that our draft should more accurately describe
Amtrak's $180 million annual need to achieve a state of good repair. 
We clarified that Amtrak's state-of-good-repair estimate does not
include the segment between New Rochelle and New Haven and that no
state-of-good-repair backlogs exist on this segment.  On the basis of
Amtrak's comments, we clarified the text to reflect that the $180
million is the additional annual expenditure that will be needed over
the next 15 years to achieve a state of good repair. 

The Controller of the Northern Virginia Transportation Commission
commented that Virginia Railway Express' capital expenditures on the
corridor were mostly for projects at Amtrak's Ivy City Yard.  We
clarified this point in the text of our report. 

Officials at the Metropolitan Transportation Authority of New York
and Conrail commented that our draft did not accurately state to whom
Conrail pays access fees.  We clarified circumstances under which
Conrail would pay access fees to Metro-North and stated that Conrail
pays access fees to the Metropolitan Bay Transportation Authority for
use of the corridor's track in the state of Massachusetts.  In
addition, users of the corridor provided us with additional
clarifying comments, which we incorporated throughout this report
where appropriate. 


---------------------------------------------------------- Letter :7.1

We are sending copies of this report to congressional committees and
subcommittees interested in rail transportation matters; the
Secretary of Transportation; the Administrator, Federal Railroad
Administration; the Administrator, Federal Transit Administration;
the President of Amtrak; the Director, Office of Management and
Budget; and other interested parties.  We will make copies available
to others on request. 

Please call me at (202) 512-2834 if you or your staff have any
questions.  Major contributors to this report are listed in appendix
VII. 

Sincerely yours,

John H.  Anderson, Jr.
Director, Transportation and
 Telecommunications Issues


INFORMATION ON COMMUTER AND
FREIGHT RAILROADS THAT OPERATE ON
THE NORTHEAST CORRIDOR
=========================================================== Appendix I


   VIRGINIA RAILWAY EXPRESS
--------------------------------------------------------- Appendix I:1

The Virginia Railway Express (VRE) initiated service in June 1992
under agreements with Amtrak, Norfolk Southern Railway, CSX
Transportation, and Consolidated Rail Corporation (Conrail).  VRE's
two routes--the Manassas line and the Fredericksburg line--join in
Alexandria, Virginia, to provide commuters with service to Union
Station in Washington, D.C.  VRE's routes cover 84 route-miles.  The
major stations served by VRE include Alexandria, Woodbridge,
Fredericksburg, and Manassas in Virginia, and Washington, D.C.'s
Union Station.  In 1995, VRE carried 1.85 million passengers. 


   MARYLAND RAIL COMMUTER SERVICE
--------------------------------------------------------- Appendix I:2

The Maryland Rail Commuter Service (MARC) descends from the former
Baltimore & Ohio Railroad and the former Pennsylvania Railroad.  In
1974, the Maryland Department of Transportation began subsidizing the
Baltimore & Ohio's unprofitable passenger service.  When Amtrak took
over passenger service from Conrail, the Maryland Department of
Transportation signed a new agreement to have Amtrak provide service
for commuters along the Northeast Corridor between Washington, D.C.,
and Baltimore. 

Today, what is called MARC train service includes the Penn line,
operated by Amtrak, and the Camden and Brunswick lines, operated by
CSX Transportation.  The system serves Washington, D.C., and
Baltimore, Maryland, and continues as far north as Perryville,
Maryland, and as far west as Martinsburg, West Virginia.  In fiscal
year 1994, 5.05 million riders traveled over MARC's 187-mile route
system, of which 77 miles are on the Northeast Corridor. 


   SOUTHEASTERN PENNSYLVANIA
   TRANSPORTATION AUTHORITY
--------------------------------------------------------- Appendix I:3

In 1983, the Southeastern Pennsylvania Transportation Authority's
(SEPTA) railroad division took over the operation of commuter rail
lines formerly operated by the Reading and Pennsylvania Railroads. 
SEPTA is an intermodal transit authority with responsibility for
running local transportation, including commuter rail, and a variety
of other urban and suburban transit systems.  According to SEPTA, the
authority is an instrumentality of the Commonwealth of Pennsylvania
created by the state legislature, and oversight responsibility rests
with the Pennsylvania Department of Transportation.  SEPTA's board is
appointed by various state and county authorities including the
governor, the majority and minority parties in the state senate and
state house of representatives, and the five counties served by
SEPTA. 

SEPTA's Regional Rail Division operates seven commuter rail routes
arranged in a radial configuration with central Philadelphia at the
locus.  Since 1983, SEPTA has expanded commuter rail service westward
along the Amtrak-owned Harrisburg line.  The regional rail system
operates 243 route-miles serving 152 stations in five counties.  Two
of SEPTA's routes, totaling 58 route-miles, lie on the Northeast
Corridor's main line and provide riders with service from Wilmington,
Delaware, to Trenton, New Jersey.  In 1995, SEPTA's ridership was
25.2 million. 


   NEW JERSEY TRANSIT CORPORATION
--------------------------------------------------------- Appendix I:4

The New Jersey Transit Corporation (NJT) commuter rail system
descends from some of the country's oldest railroads, including the
former Central Railroad of New Jersey; the former Pennsylvania
Railroad; the former Erie Railroad; the Delaware, Lackawanna &
Western Railroad; the former Lehigh Valley Railroad; and the
Pennsylvania-Reading Seashore lines.  The portion of NJT on the
Northeast Corridor began as part of the extensive Pennsylvania
Railroad System.  NJT is a component unit of the state of New Jersey. 

NJT operates 12 commuter rail lines covering 427 route-miles, 58 of
which lie on the Northeast Corridor between Trenton, New Jersey, and
New York City's Penn Station.  The system serves 14 of New Jersey's
21 counties and includes New York City and Newark, Atlantic City, and
Trenton in New Jersey.  In 1995, NJT carried 45.4 million riders. 


   LONG ISLAND RAIL ROAD
--------------------------------------------------------- Appendix I:5

The Long Island Rail Road (LIRR), which was incorporated in 1834, is
the oldest U.S.  railroad still operating under its original name. 
In 1980, LIRR's Certificate of Incorporation was amended to convert
it to a subsidiary public benefit corporation, and in 1982 LIRR
embarked on a capital program to add new cars, improve switching and
storage of rail cars, and extend electric service. 

Today, LIRR is a subsidiary of the Metropolitan Transportation
Authority (MTA) of New York.  The railroad links New York City with
134 stations in Nassau and Suffolk Counties on Long Island.  Although
the system comprises 11 branches and 117 route-miles, only 4
route-miles lie on the Northeast Corridor.  This segment passes
through the East River tunnels, providing riders with access to New
York's Penn Station.  LIRR shares Penn Station with Amtrak and New
Jersey Transit.  In 1994, LIRR's ridership was 73.2 million. 


   METRO-NORTH COMMUTER RAILROAD
--------------------------------------------------------- Appendix I:6

The routes of the present-day Metro-North Commuter Railroad date from
1831 with the incorporation of the former New York and Harlem
Railroad and the former Hudson River Railroad, which was incorporated
in 1847.  When the Congress decided that Conrail would no longer have
to provide service for passengers, New York created Metro-North on
January 1, 1983, to assume operation of the metropolitan commuter
rail service. 

Metro-North operates as a subsidiary of MTA.  New York and
Connecticut share oversight and financing responsibilities for the
New Haven line pursuant to a 1985 contract.  Connecticut administers
its share of Metro-North's activities through its Department of
Transportation.  New York administers its share through MTA, a public
authority with a statutory mission to provide the public with transit
services in the New York City region. 

Metro-North's total system encompasses 338 route-miles.  The
railroad's New Haven line operates on the Northeast Corridor's main
line for 56 miles between New Rochelle, New York, and New Haven,
Connecticut.  At New Rochelle, the New Haven line diverts from the
corridor and continues to New York's Grand Central Terminal.  In
Connecticut, three branch lines--from Waterbury, Danbury, and New
Canaan--feed into the New Haven line.  In New York, Metro-North also
runs along the Hudson and Harlem lines east of the Hudson River and
the Port Jervis and Pascack lines west of the Hudson.  In 1994,
Metro-North's ridership was 61.9 million. 


   SHORE LINE EAST COMMUTER
   SERVICE
--------------------------------------------------------- Appendix I:7

The Connecticut Department of Transportation began the Shore line
East Commuter Service (SLE) on May 29, 1990.  SLE operates solely as
a commuter rail service, restricting operation to peak weekday hours. 
The Connecticut Department of Transportation administers and funds
SLE and contracts with Amtrak for the daily operation of that
service. 

From 1990 through 1996, SLE operated 33 miles of commuter service
between New Haven and Old Saybrook, Connecticut, making five
intermediate stops.  In February 1996, SLE extended its operations to
New London, Connecticut, bringing its total route-miles to about 50,
all of which are on the Northeast Corridor.  In 1994, ridership was
282,687. 


   MASSACHUSETTS BAY
   TRANSPORTATION AUTHORITY
--------------------------------------------------------- Appendix I:8

In 1947, the state legislature created the Metropolitan Transit
Authority, which was renamed the Massachusetts Bay Transportation
Authority (MBTA) in 1964.  MBTA is an independent state authority. 
The chairman of its board is the state's Secretary of Transportation. 
MBTA's commuter rail provides access to Boston for most of eastern
Massachusetts via 11 separate lines.  The system covers 226
route-miles, of which 44 lie on the Northeast Corridor between
Providence, Rhode Island, and Boston, Massachusetts.  MBTA's 1993
commuter-rail ridership was 21.6 million. 


   CONRAIL
--------------------------------------------------------- Appendix I:9

Conrail began operations in April 1976 as a federal government-owned
corporation, although its origins go back to the earliest days of
railroading in North America.  The oldest segment of what became
Conrail was the Granite Railway Co., built in 1826 to carry granite
blocks for the Bunker Hill Monument in Massachusetts.  By the early
1970s, scores of railroads in the Northeast and Midwest had been
acquired or merged into six different lines, and all were bankrupt. 
The federal government, recognizing the national economic importance
of the six railroads, responded by creating Conrail and appropriating
the funds needed to rebuild tracks, locomotives, and freight cars. 

In 1981, Conrail no longer required federal investment and finished
the year with its first profit.  In 1987, the federal government sold
its ownership interest in Conrail through what at the time was the
largest initial public stock offering in the nation's history.  In
1996, Conrail operated a railroad route network of about 11,000 miles
with a fleet of about 2,100 locomotives and nearly 53,000 freight
cars. 


   PROVIDENCE AND WORCESTER
   RAILROAD COMPANY
-------------------------------------------------------- Appendix I:10

The Providence and Worcester Railroad Company is an interstate
freight carrier conducting railroad operations in Connecticut, Rhode
Island, and Massachusetts.  The railroad interchanges freight traffic
with Conrail at Worcester, Massachusetts, and at New Haven,
Connecticut; with the Springfield Terminal Railway Company (formerly
the Boston and Maine Railroad) at Gardner, Massachusetts; and with
the New England Central Railroad (formerly the Central Vermont
Railway) at New London, Connecticut.  In 1994, the railroad handled
28,404 carloads of freight and 45,405 containers. 

The Providence and Worcester Railroad operates over 470 miles of
track, approximately 170 miles of which it owns.  On the Northeast
Corridor, the railroad operates between Providence, Rhode Island, and
South Norwalk, Connecticut. 


   DELAWARE & HUDSON RAILWAY
   COMPANY, INC. 
-------------------------------------------------------- Appendix I:11

In 1991, the Delaware and Hudson Corporation was renamed the Delaware
and Hudson Railway Company, Inc., when it was purchased by Canadian
Pacific Rail Systems and integrated into one of the largest
transportation organizations in North America.  The railroad operates
over 1,500 miles of track--600 miles of owned track and 900 miles of
trackage rights over other railroads' tracks.  On the Northeast
Corridor, the railroad operates between Landover and Perryville,
Maryland.  In 1995, the railroad carried 7.3 billion ton-miles of
freight. 


COMMUTER AND FREIGHT RAILROADS'
TRAIN-MILES OPERATED ON THE
NORTHEAST CORRIDOR, 1988-93
========================================================== Appendix II

                                (Train-miles in thousands)

                         1988        1989        1990        1991        1992        1993
------  ----------  ----------  ----------  ----------  ----------  ----------  ----------
Commuter railroads
-----------------------------------------------------------------------------------------
MARC                      139         252         361         456         560         556
SEPTA                     953         979       1,000         976       1,128         972
NJT                     1,693       1,684       1,679       1,650       1,693       1,691
Long Island Rail          777         777         777         777         777         777
 Road
Metro-North             1,708       1,841       1,807       1,851       1,902       1,916
 Commuter
 Railroad
SLE                       N/A         N/A          66         215         175         235
MBTA                      495         578         602         599         608         665

Freight railroads
-----------------------------------------------------------------------------------------
Conrail                   830         620         476         424         408         368
Delaware & Hudson         N/A         N/A         N/A         N/A         N/A          34
 Railway Company,
 Inc.
Providence &               16          12          15          22          24          33
 Worcester
 Railroad
-----------------------------------------------------------------------------------------
Legend

N/A = not applicable


SCOPE AND METHODOLOGY
========================================================= Appendix III

For purposes of this report, we limited our review to the main line
of the Northeast Corridor, which lies between Washington, D.C., and
Boston, Massachusetts.  We held discussions with and obtained data on
expenditures and train-miles operated on the corridor from officials
of Amtrak, VRE, MARC, the Delaware Transit Corporation, SEPTA, NJT,
LIRR, the Metropolitan Transportation Authority of New York,
Metro-North Commuter Railroad, the Connecticut Department of
Transportation, SLE, the Rhode Island Department of Transportation,
MBTA, the Delaware and Hudson Railway, Conrail, and the Providence
and Worcester Railroad. 

We did not obtain data on expenditures from railroads that operate
only on the Northeast Corridor's spurs--the tracks between
Philadelphia and Harrisburg, Pennsylvania; 11 miles of the track on
the line between New York City and Albany, New York; and the track
between New Haven, Connecticut, and Springfield, Massachusetts--all
of which are owned by Amtrak.  We collected data only on the
expenditures that go toward making the corridor available as a
transportation facility for the trains operated by Amtrak and by
commuter and freight railroads.  We did not collect data on
expenditures for train operations, such as fuel and crews' salary and
purchases and maintenance of rolling stock. 

To determine the relative usage of the corridor and the sources of
funding among Amtrak and commuter and freight railroads, we requested
train-mile, expenditure, and funding source data for 1988 through
1993.  We chose this time period because (1) it provided several
years of data for us to incorporate yearly funding variations and (2)
a substantial portion of Amtrak's expenditure data was readily
available only through 1993.  To determine the sources of funding for
the expenditures, we requested that Amtrak and each corridor user
include the sources of funding in their data on expenditures. 

To determine the annual expenditures required to operate, upgrade,
and maintain the Northeast Corridor's infrastructure in a state of
good repair, we collected data on expenditures from Amtrak and each
user of the corridor for 1988 through 1993.  We also asked Amtrak and
the other right-of-way owners to estimate the amount of additional
expenditures that are needed to bring the corridor to a state of good
repair.  The data in this report present an order-of-magnitude
estimate of the annual expenditure required to operate the Northeast
Corridor's infrastructure in a state of good repair, rather than an
exact accounting.  Each railroad provided us with data based on its
own fiscal year, some of which begin in June, October, and January. 
Officials at some railroads told us that they could not provide us
with the data that we requested in a format that conformed to a
different fiscal year.  Table III.1 shows each railroad's fiscal
year. 



                              Table III.1
                
                 Span of Fiscal Year Used by Railroads
                   Operating on the Main line of the
                 Northeast Corridor, 1988 Through 1993

Railroad                            Fiscal year
----------------------------------  ----------------------------------
Amtrak                              October-September

Conrail                             January-December

Delaware & Hudson Railway Company,  January-December
Inc.

LIRR                                January-December

MARC                                July-June

MBTA                                July-June

Metro-North Commuter Railroad       January-December

NJT                                 July-June

Providence & Worcester Railroad     January-December

SEPTA                               July-June

SLE                                 July-June

VRE                                 July-June

----------------------------------------------------------------------
In a number of cases, data were not available to allow for exact
computations of expenditures and funding sources.  In such instances,
Amtrak and the commuter agencies developed estimates as follows: 

  -- Amtrak could not readily break out the exact amount of general
     capital and some NECIP funds that it spent on specific segments
     of the corridor.  Therefore, Amtrak allocated these expenditures
     evenly over the route-miles of the corridor that it owns. 
     Because the corridor is not in a state of good repair and a
     repair backlog exists, actual expenditures could understate the
     true requirement to operate and maintain the corridor in a state
     of good repair.  Therefore, we used Amtrak's estimate of the
     expenditures required over the next 15 years to bring the
     corridor to a state of good repair.  We added this estimate to
     the actual average annual expenditure of all users of the
     corridor to arrive at the total annual expenditure to operate
     and maintain the corridor in a state of good repair while
     continuing capital improvements at their historical rate. 

  -- Amtrak and at least one commuter railroad commingle their
     revenues with operating subsidies before allocating these funds
     to various expenditures.  Therefore, we have combined these
     funding sources in this report. 

  -- When NJT implemented a major upgrade of its automated financial
     system in 1993, data on expenditures for prior years were
     combined into totals for major projects.  Agency officials
     allocated expenditures to specific fiscal years on the basis of
     their best recollection of each project's spending. 

  -- LIRR could not readily determine the exact amount that it spent
     for operations on and maintenance of its 4-mile segment of the
     corridor.  The railroad arrived at its expenditures by prorating
     its systemwide expenditures over the 4-mile segment of the
     corridor over which it operates. 

We attempted to portray the amount actually expended in each fiscal
year.  However, some railroads use an accrual basis for recording
operating and maintenance costs, while others do not.  Therefore, the
expenditures for operations and maintenance shown in figure 4 contain
some accrued expenses from the period after 1993 and exclude some
1988 expenditures.  Because the beginning and ending accrued expenses
may offset one another, the net effect could be minimal.  Although
Amtrak officials were unable to quantify the impact of including
accrued expenses in our data, a senior Amtrak official stated that
the impact of accruals could be insignificant. 

We reviewed Amtrak's procedures to retrieve and compile the
expenditure data used in this report.  We also reviewed the
procedures that each commuter railroad used to develop data on
expenditures.  However, we did not audit the data provided by Amtrak
or the commuter and freight railroads.  Each entity had the
opportunity to review a draft of this report and provide us with
comments. 




(See figure in printed edition.)Appendix IV
COMMENTS FROM THE METROPOLITAN
TRANSPORTATION AUTHORITY
========================================================= Appendix III



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


The following are GAO's comments on the Metropolitan Transportation
Authority's letter dated June 4, 1996. 


   GAO'S COMMENTS
------------------------------------------------------- Appendix III:1

1.  The issue of equity is outside the scope of this report. 

2(a).  Because equity of each railroad's contribution is outside the
scope of this report, we did not list each railroad's specific
contribution.  We stated Metro-North's expenditures for operations
and maintenance because of the corridor's 12 users (Amtrak, eight
commuter railroads, and three freight railroads); the combined
Metro-North and Amtrak expenditures provided for 72 percent of the
total expenditures for operations and maintenance. 

2(b).  We did not attempt to determine which portion of improvements
was for maintaining the basic railroad and which was for upgrades. 
We have clearly stated that the expenditures include those for
upgrades as well as for regular maintenance. 

2(c).  Amtrak told us that a major portion of its data, which were
organized by corridor segment, was available only through 1993.  We
requested expenditure data for a 6-year period prior to 1993 to
account for variations in annual spending on the corridor. 

2(d).  We did not independently verify the number of trains operating
on the corridor.  We attributed this statement, which was made by the
Corporation's President in testimony before the Congress, to Amtrak. 

3(a).  Our objective was to determine the funding required to operate
the corridor in a state of good repair.  Past expenditures did not
keep pace with repair needs.  Therefore, we added Amtrak's
state-of-good-repair estimate to the average annual expenditure of
all corridor users from 1988 through 1993.  In response to this
comment and a similar comment by Amtrak officials, we clarified the
basis of Amtrak's state-of-good-repair estimate. 

In a meeting at the offices of the Metropolitan Transportation
Authority of New York on January 18, 1996, attended by
representatives of the Authority, Metro-North, and LIRR, we asked
whether Metro-North or LIRR had any unmet state-of-good-repair needs. 
Officials responded that, with the exception of tunnel upgrades,
there were no unmet needs.  We have clarified this point in the text
of our report. 

3(b).  We have included a statement that Amtrak's state of good
repair estimate includes the estimated cost of electrification
replacement between Washington, D.C., and New Rochelle, New York, and
the needed tunnel upgrades. 

4(a).  We have modified figure 1 and the accompanying note to more
clearly show Amtrak's and commuter railroads' operations and
associated mileage. 

4(b).  We have corrected the reference to Conrail's access fee
payments. 

4(c).  The point of the paragraph is to show that commuter railroads
carry far more passengers on the corridor than does Amtrak.  The
discussion shows that two commuter railroads--NJT and
Metro-North--each carry more passengers over their respective
segments than Amtrak carries over the entire corridor. 

4(d).  We did not collect data on train-hours, car-miles, or other
data needed to allocate costs for a joint-use facility such as the
Northeast Corridor because the issue of equity of expenditures versus
usage is beyond our scope. 

4(e).  We have deleted this sentence from the report. 

4(f).  The text on page 12 of the draft accompanied figure 4, both of
which deal with contributions for the entire corridor.  The text on
page 16 of the draft accompanied figure 6, both of which deal with
contributions on a segment-by-segment basis. 

4(g).  The names of the Metropolitan Transportation Authority and
LIRR have been corrected throughout the report. 

The Authority's letter included a Metro-North memorandum that
provided us with separate comments as an attachment.  Many of the
comments in that memorandum mirrored those in the Metropolitan
Transportation Authority's letter or addressed points of
clarification that we have considered and incorporated in the text as
appropriate. 




(See figure in printed edition.)Appendix V
COMMENTS FROM NEW JERSEY TRANSIT
========================================================= Appendix III



(See figure in printed edition.)


The following are GAO's comments on New Jersey Transit's letter dated
June 4, 1996. 


   GAO'S COMMENTS
------------------------------------------------------- Appendix III:2

1.  While the number of trains may not directly affect costs, the
number of trains does affect the corridor's capacity.  Since cost
allocation is not the focus of this report, we believe the number of
trains presents a broad picture of the corridor's utilization. 

2.  Any comparison of usage versus expenditures is outside the scope
of this report. 

3.  After obtaining further clarification from NJT, we included the
1994-96 expenditures for the Secaucus Transfer project in our report. 

4.  We updated the ridership figure as suggested. 




(See figure in printed edition.)Appendix VI
COMMENTS FROM THE MASSACHUSETTS
BAY TRANSPORTATION AUTHORITY
========================================================= Appendix III


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================= Appendix VII

RESOURCES, COMMUNITY, AND ECONOMIC
DEVELOPMENT DIVISION, WASHINGTON,
D.C. 

Stephen M.  Cleary
Sharon E.  Dyer
Edmond E.  Menoche
Phyllis F.  Scheinberg
Ron E.  Wood

BOSTON REGIONAL OFFICE

Nancy S.  Barry
Ellen M.  Bradley

NEW YORK REGIONAL OFFICE\1

William T.  Cronin
Karlton P.  Davis
Susan K.  Hoffman


--------------------
\1 These staff performed the initial work for this report prior to
the closing of the New York Regional Office in November, 1995. 


*** End of document. ***