WASHINGTON -- Amtrak says it needs nearly $1.5 billion in supplemental funding from the federal government to maintain "minimum service levels," anticipating ridership will not recover to pre-pandemic levels in fiscal 2021.
In a letter to Congress, Amtrak Chief Executive Officer William Flynn said that the economic fallout from the coronavirus pandemic has become "clearer" and that the company needs a larger subsidy to offset revenue losses, prevent interruptions to capital investments and support Amtrak's state-funded routes.
"It is clear that Amtrak faces daunting challenges in Fiscal Year 2021, which will require us to take action to protect our rail network, our critical capital assets, and the livelihoods of our employees," Flynn said in the letter dated Monday.
"While we work towards a full recovery one day, our current projections tell us that we expect to see ridership drop by approximately 50%, down to just over 16 million riders in FY 2021," Flynn said in the letter.
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Amtrak's funding request for $1.475 billion for the fiscal year that begins in October is in addition to its request for a grant of just over $2 billion. The passenger railroad receives about $2 billion in federal subsidies annually to cover operations in its national and Northeast networks.
Last month, the federal government released more than $1 billion in relief money to Amtrak to keep the railroad running and its front-line workers on the job during the pandemic. The funding, part of a $2 trillion federal bailout package, was an important boost for the carrier, which saw cancellations spike and had to make severe service cuts in recent weeks amid an unprecedented drop in passenger traffic.
Ridership began to plummet in early March, decreasing 95% systemwide. The disruptions set the railroad back after a year of growth on its number of routes and derailed projections that 2020 would yield positive earnings for the first time in the company's 50-year history.
Business on 05/27/2020