After Amtrak’s ‘best revenue month ever,’ House GOP focuses on railroad’s bonuses

House Republicans held a hearing this week to question the high salaries and bonuses of Amtrak executives. But the rail agency’s top leaders used the opportunity to highlight how quickly its ridership has bounced back after the pandemic.

“Amtrak has accomplished a great deal during [the current fiscal year],” said Stephen Gardner, who has been Amtrak’s CEO since 2020, during the congressional hearing. “Our ridership and revenue are up over 20% and 10% respectively, and May was our best revenue month ever in the history of the company. We’re on track to set a new record ridership this year and will further reduce our operating losses.”

Gardner also told members of the House Transportation and Infrastructure Committee’s subcommittee overseeing railroads that the passenger rail company was making massive infrastructure upgrades, from tunnels on the Northeast corridor to station rehabilitations in Chicago and Philadelphia to new trains for both Acela high-speed rail service and regional routes.

“Amtrak is undergoing a dramatic transformation,” he said. “We are not the company we were a few years ago.”

The glowing update came as two House Republicans introduced bills that sought to bring more scrutiny on Amtrak’s management. The legislation comes as congressional Republicans, including U.S. Sen. Ted Cruz of Texas, have increasingly highlighted controversial aspects of rail service in recent months, as President Joe Biden, a Democrat who has long championed passenger rail, faces reelection this fall.

U.S. Rep. Troy Nehls of Texas, who chairs the Railroads, Pipelines and Hazardous Materials Subcommittee, sponsored a measure to subject Amtrak to the federal Sunshine Act, which would make meetings of its board of directors open to the public.

“Under this law, agency meetings must generally be open to the public. Makes sense,” Nehls told Gardner. “The Supreme Court recognized Amtrak’s federal status and found … that Amtrak was created by the government, is controlled by the government and operates for the government’s benefit. Given Amtrak’s federal status, why has Amtrak continued to violate the Sunshine Act?”

Gardner told him that Amtrak’s lawyers had determined that Amtrak isn’t subject to the Sunshine Law, because it was organized as a corporation. But Gardner said the agency is trying to “engage the public and have more public input with the board meetings.”

Meanwhile, U.S. Rep. Marc Molinaro of New York introduced legislation that would require Amtrak to notify Congress and the public of any executive bonuses it awards. Anthony Soscia, the chair of the Amtrak board, said the agency would provide details of its bonuses this week. Later in the day, The New York Times reported that Amtrak paid 14 executives more than $200,000 in bonuses last year. That adds up to more than $5 million in a year in which the rail service lost $1.7 billion.

At the hearing, U.S. Rep. David Rouzer, a North Carolina Republican, pressed the Amtrak officials on the subject of bonuses.

“I don’t mean this as an antagonistic question whatsoever, so don’t take it that way,” he told Gardner, “but has Amtrak ever turned a profit in a year?”

“No, sir,” Gardner responded.

“I think that’s why the issue of bonuses and executive pay is so touchy, particularly given the dollar amount,” Rouzer said. “So what are the prospects? What’s the timeline where you think we can get to a point where we can turn a profit?”

Gardner told him the company came close to breaking even before the pandemic, before almost all of its business briefly disappeared. The company is hoping that it will break even on its train operations by the end of the decade, he said.

U.S. Rep. Seth Moulton, a Massachusetts Democrat, chafed at the line of questioning. He wondered why Republicans had focused on Amtrak’s lack of profitability but not on the highways or airlines that received federal bailouts. “There’s a huge double standard here, and the fact that Mr. Gardner can even talk about approaching profitability—something we wouldn’t even discuss with our highways—is pretty remarkable and points to the innate efficiency of rail,” Moulton said.

Also at the hearing, Julie White, who oversees rail for the North Carolina Department of Transportation, touted the growing popularity of the state-run passenger rail service there.

“Passenger ridership in North Carolina is at an all-time high, with 2023 state-supported service ridership 38% higher than prepandemic levels of 2019,” she said. “We continue to see an upward trajectory with a 24% volume in the first quarter of 2024 as compared to 2023.”

In fact, she noted, this week North Carolina is running four express trains between Raleigh Union Station and Pinehurst, North Carolina, where the U.S. Open golf championship is taking place. The popularity of those trips, she said, demonstrates “the unmet demand for service to new destinations in our state.”