WASHINGTON – Sen. John McCain, R-Ariz., proposed legislation on Friday that would break up Amtrak and send the nation's passenger railroad service down the track toward privatization.
"Given Amtrak's extremely precarious financial situation, I strongly believe we must work together to pass legislation this year that will provide for a restructured, revitalized and streamlined rail passenger network," McCain said.
Amtrak is currently the nation's exclusive provider of passenger rail service. Its supporters blame its troubles on chronic under-funding by Congress.
On Feb. 1, Amtrak President George Warrington said that 1 in 18 long-distance routes will be eliminated unless Amtrak receives $1.2 billion in next year's budget, a number far higher than President Bush's proposed $521 million.
A few days later on Feb. 7, the Amtrak Reform Council recommended competition be reintroduced to passenger rail service. The Council was created by Congress in 1997 to monitor Amtrak's financial performance and make recommendations.
The goal of Council was to make Amtrak free of the need for Congressional funds by five years after the Council's creation — this year. Congress is expected to vote later this year on whether Amtrak will be broken up.
McCain's proposed legislation is generally in line with the recommendations of the Amtrak Reform Council. McCain's plan would direct the Federal Railroad Administration to franchise rail routes to companies that meet safety and liability requirements.
In addition, McCain's plan proposes breaking the railroad up into three units: an operations unit, a maintenance unit and a rail reservation unit. Each unit would then be privatized within four years, and an Amtrak Control Board would be created to oversee the process.
House Democrats gave the Amtrak Reform Council's report a cool reception on Thursday, citing concerns with the potential impact of privatization.
Amtrak itself was created in 1970 to alleviate the burden of maintaining a passenger railroad on the freight rail companies. Organized as a for-profit Congressional corporation, it was given a temporary monopoly over interstate passenger rail service and priority over freight companies in moving cars across the rail lines.
Although it was anticipated that Amtrak would eventually become a self-sustaining and even profitable venture, by 1997, it had gone through $22 billion of federal subsidies and capital investments with stagnant ridership.
The Associated Press contributed to this report.