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House Dem: Amtrak privatization would jeopardy other rail pensions
A key Democratic member of the House Transportation and Infrastructure Committee said Tuesday that House Republicans' plan to privatizing Amtrak rail service could have an unintended consequence: draining the fund for the retirement of rail employees of all stripes.
Amtrak employees make up 10 percent of the national railroad retirement system, Rep. Corrine Brown (D-Fla.) said. Thus, they make up a provide a large percent of the money in the trust funds that pay for those retirements, the Railroad Retirement and Railroad Unemployment Insurance trust funds, she said.
"Last week, Amtrak President and CEO Joe Boardman’s announced that the 'Competition for Intercity Passenger Rail in America Act of 2011,' introduced by Transportation and Infrastructure Committee Chairman John Mica (R-FL) and Railroads, Pipelines and Hazardous Materials Subcommittee Chairman Bill Shuster (R-PA) would 'likely mean the end of Amtrak and the national passenger rail system that Congress authorized nearly 40 years ago,'" Brown said in a statement released Tuesday by her office.
"In light of that announcement, I asked the Railroad Retirement Board to determine the financial impact of a 100 percent decline in Amtrak employment on the Railroad Retirement and Railroad Unemployment Insurance trust funds," she continued. "The Board concluded that the decline in Amtrak employment would result in an immediate loss in tax income that would overshadow any supposed gains from long-term benefit decreases. As a result, the balance in the National Railroad Retirement Investment Trust would plummet from the current $26.246 billion to $9.553 billion by 2026, leaving the freight railroads and its employees to make up the difference."
With that in mind, Brown said the Amtrak privatization plan would "trigger an increase in the taxes paid by other railroad employers and employees." That would "devastate the railroad industry and its employees and jeopardize the entire railroad retirement system," she added.
The proposal would remove Amtrak from control of the federally-designated northeast rail corridor and transfer it to the Department of Transportation. A newly-created Northeast Corridor Executive Committee would oversee bidding process for rail projects in the northeast.
At least one Democrat in the Senate, Sen. Frank Lautenberg (D-N.J.), has vowed to try to stop the proposal from gaining traction there.
