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Amtrak Says Railroad’s Subsidies Dwarfed by Highway Bailout

Sept. 20 (Bloomberg) -- The head of Amtrak defended U.S. support of the railroad’s operations, saying highways have received more emergency help from U.S. taxpayers in the past four years than Amtrak has gotten in its 41-year history.

“In the past four years, the federal government has appropriated $53.3 billion from the general fund of the Treasury to bail out the highway trust fund,” Amtrak Chief Executive Officer Joseph Boardman said in testimony at a congressional hearing today. “That’s almost 30 percent more than the total federal expenditure on Amtrak since 1971.”

Boardman appeared today at a House Transportation and Infrastructure Committee hearing where Chairman John Mica, a Florida Republican, said taxpayers have provided Amtrak subsidies of $50.97 per ticket sold for the past five years.

Amtrak says it covers 85 percent of its operating costs from ticket revenue. Taxpayers cover its capital and debt costs. The Washington-based railroad, which has never made an annual profit, received about $1.4 billion in taxpayer aid for this year.

Amtrak has defended its taxpayer support “since our creation,” said Steve Kulm, a spokesman.

Mica, who has had three hearings to examine Amtrak’s operations and promised more, said the railroad got $375.10 in U.S. subsidies for each passenger on the Sunset Limited line between New Orleans and Los Angeles in the 2011 fiscal year.

Air, Limo

It would have cost $50 a passenger less to transport Sunset Limited customers by airline and airport limousine instead, Mica said. He also compared Amtrak fares and taxpayer support with long-haul bus service.

Amtrak and its supporters pointed to its responsibility to maintain its tracks and right of way, something bus operators don’t have.

Representative Bill Shuster, a Pennsylvania Republican who may be the House transport panel’s next chairman, said taxpayer subsidies for Amtrak are inevitable, and that the committee and railroad need to look at how to best use them.

“If we’re going to use taxpayer dollars, which we probably always will have to, we have to make sure we’re good stewards,” he said.

To contact the reporter on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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