Office of Management and Budget Click to print this document

October 21, 1997
(House Rules)

H.R. 2247 - Amtrak Reform and Privatization Act of 1997
(Shuster (R) Pennsylvania)

The Administration strongly opposes House passage of H.R. 2247 unless it is amended to delete objectionable provisions that would:
  • Repeal important statutory, economic, and collective bargaining rights of Amtrak employees. Further progress can be made within the existing labor-management relations structure.

  • Override State liability laws by imposing arbitrary caps on damages arising from passenger rail accidents or by imposing exceptionally strict standards for punitive damages. Amtrak has successfully renegotiated most of its operating agreements with freight railroads within the current State law systems.

  • Delay the deadline by which certain Amtrak facilities must comply with the Americans with Disabilities Act.

  • Replace Amtrak's current board of Directors with a new Board. The current Board has proved capable of directing Amtrak during this time when difficult issues must be addressed. (The Administration supports (1) removing existing restrictions on the President's authority to appoint future members of Amtrak's Board and (2) requiring that such appointees be confirmed by the Senate.)

  • Subordinate the Federal interest as a creditor in the event of a default. This and other proposed changes in the Section 511 Railroad Loan Guarantee program are not appropriate. Instead, the Administration urges enactment of its alternative financing and credit proposals set forth in its "National Economic Crossroads Transportation Efficiency Act of 1997" (NEXTEA). These proposals empower States to make choices that best suit their transportation needs, including public rail freight, and are preferable to the Section 511 program which provides benefits directly to private freight railroads.

  • Eliminate the Secretary of Transportation's liquidation preference and voting rights on the Amtrak preferred stock held by the Secretary, require the United States to relinquish all rights held in connection with any note obtained or mortgage made on Amtrak property, and eliminate Amtrak's status as a mixed ownership Government corporation fully subject to the Government Corporation Control Act. Given the substantial Federal investment and public policy interest in Amtrak, any privatization effort will necessarily require a great deal of careful analysis. Until that analysis is done, the proposed elimination of Federal financial and other involvement with Amtrak is premature.
Finally, H.R. 2247 should be amended to provide for substantial involvement of the Executive Branch, including the Treasury Department, in the development and implementation of any Amtrak privatization plans.

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