Amtrak's Accounting

[TWA904]

I don't know if this has been discussed before but I found this report on the RPA website. It was published 15 Aug 2018. Some findings from FY 2017:
Miami was charged with snow removal.
Over $67,000 of Maintenance of Way charges for the Michigan line were charged to the Lake Shore Limited and the Capitol Limited.
Over $3 million of Electric Traction Maintenance of Way(wires, sub-station, etc.) to routes that do not use electrified infrastructure.
Over $10 million in track maintenance cost to State Supported and Long Distance routes but less than $90 thousand to the entire NEC.
At Chicago, the California Zephyr was charged over $1.8 million for moving the train to/from the yard for servicing but the City of New Orleans was charged less than $200,000.

I can't report all the findings of RPA. They believe the Long Distance trains are overcharged by at least $300 million. I wanted to post the entire report but I didn't know if I needed their ok to do so.

The Title is Amtrak's Route Accounting: Fatally Flawed, Misleading & Wrong.

 

[WICT106]

I don't know if this has been discussed before but I found this report on the RPA website. It was published 15 Aug 2018. Some findings from FY 2017:
Miami was charged with snow removal.
Over $67,000 of Maintenance of Way charges for the Michigan line were charged to the Lake Shore Limited and the Capitol Limited.
Over $3 million of Electric Traction Maintenance of Way(wires, sub-station, etc.) to routes that do not use electrified infrastructure.
Over $10 million in track maintenance cost to State Supported and Long Distance routes but less than $90 thousand to the entire NEC.
At Chicago, the California Zephyr was charged over $1.8 million for moving the train to/from the yard for servicing but the City of New Orleans was charged less than $200,000.

I can't report all the findings of RPA. They believe the Long Distance trains are overcharged by at least $300 million. I wanted to post the entire report but I didn't know if I needed their ok to do so.

The Title is Amtrak's Route Accounting: Fatally Flawed, Misleading & Wrong.

The following threads & posts are just a couple of examples:

https://discuss.amtraktrains.com/threads/rpa-blasts-faulty-amtrak-accounting-in-report.73567/

https://discuss.amtraktrains.com/threads/chi-mke-profitable.7361/#post-61553

https://discuss.amtraktrains.com/threads/state-subsidies-to-amtrak.38572/#post-289608

https://discuss.amtraktrains.com/th...e-trains-really-lose-money.48406/#post-372014

 

[jis]

Some of us actually participated in gathering information for that report

 

[Willbridge]

Amtrak follows a hallowed rail tradition of bad accounting. When they (and I for OreDOT) started in 1971 we had the last few years of ICC reports from the railway companies and that provided a cross comparison. That value faded with time, but we were assured that once Amtrak took over the crews and stations and terminal facilities then the phony or unjustified expenses charged by the Class I's and terminal companies would go away. They did and apparently were replaced with phony or unjustified expenses internal to Amtrak.

But wait, there's more! As Alberta Transport 2000 proved in Canadian Transport Commission hearings, VIA Rail had similar problems. The Government of Canada dealt with that problem by changing the rules to make it harder for citizens to ask questions. The only good thing came later. A problem we had partly uncovered was later found to be part of a criminal investigation that punished the president of the railway.

 

[Anderson]

Oh, I got to look at a pretty detailed spreadsheet some years ago (in conjunction with a project to cost out adding a sleeper to 66/67 at state expense). There were an absurd number of cases where incidental charges showed up all over the place (e.g. $5-20 for "First Class" ticket revenue on state-supported trains). Some of them were clearly scattershot allocations of otherwise unaccounted-for costs, but some...well, the term "alchemy" makes sense in context.

 

[jis]

Indeed! 'Alchemy' is a good characterization.

We should remember though that Anderson did not invent this Rube Goldberg accounting system. He is merely guilty of perpetuating it, and to some significant extent FRA (and by extension Congress) requires him to. Ironically, his major guilt is in being conservative and not making any changes in this case.

We should remember that Congress once upon a time passed a law requiring the FRA to come up with an accounting methodology for Amtrak. FRA delegated that work to the Volpe Center, which came up with the basic foundations of the current system, and has been engaged throughout with the FRA and Amtrak in filling in the missing pieces over time. Their mission is etched in the CFR somewhere. It is not even clear which parts Amtrak can unilaterally change when it has not even completed deploying a financial data system that can provide the data necessary for the Volpe Center specified (admittedly bizarre in places) system completely. Not that Amtrak is blame free, since it gets to tag data items as Capital or Expense etc. and allocate amounts to various line items.

The whole handling of the Capital in the Financial Account if anything is an even greater mystery than the bizarre cost allocations in the Cash Account. And all of that flows into the Financial Account which BTW has a GAAP version of it that is audited and certified by one of the big Accounting firms. So this endless moaning about the lack of GAAP accounting from certain folks is just that - moaning. There are even those geniuses among the railfan community who sincerely believe that depreciating an asset generates new cash for buying new assets. So go figure.

 

[JRR]

While there is a lot of discussion, rightly so, about bizarre slight of hand allocation of costs, the allocation of revenue is just as bad, ie - F&B revenue! ( my favorite gripe).