- A new report about the financial expenditures of Amtrak underscore how it’s losing money
- The report comes as Brightline, Florida’s “private” high-speed rail network, launches its Orlando to Miami route.
- The financial realities of operating passenger rail service, be it Amtrak or Brightline, will likely have significant financial implications for taxpayers.
Brightline has officially launched its rail service between Orlando and Miami, just when a new report about Amtrak underscores what a major money pit American passenger rail has proven to be. The two rail services in particular offer contrasting perspectives on how passenger train service can be operated in the U.S.: government-operated Amtrak is certainly different from Florida’s (partly) privately-run Brightline. While the two offer distinct models for transit, both have notable implications for taxpayers, raising questions about the long-term viability of each.
Amtrak, which serves as the national passenger rail network, has never turned a profit since its inception in 1971. While the Acela line, running from Washington, D.C., to Boston, once allegedly turned a modest profit, even that route is now in the red. According to data from Open The Books, the company paid its 19,000 employees an average salary of $121,000 in fiscal year 2022. This information was only unearthed because Amtrak uses an exemption to the Freedom of Information Act to hide the exact figures, claiming that it’s for personal privacy reasons. Additionally, top executives at the company pull in salaries ranging from $504,000 to $780,000. The Daily Caller has a great write-up on the full debacle at the link above.
Government grants continue to keep the rail system running, including billions of dollars earmarked for the service by the Biden administration in the Infrastructure and Jobs Act of 2021. Given that Amtrak is already losing an estimated $1 billion annually, and with the U.S. national debt hitting new highs, the sustainability of this kind of federal support is questionable.
The Amtrak salary and employee data may provide valuable insights for Brightline executives as they try to eke out a profit here in Florida. But though Brightline’s backers claim that the “private” passenger service offers an alternative model, aiming to connect Florida’s major urban centers in a high-speed rail network, the truth is a bit murkier, and Brightline may not be quite as different from Amtrak as they’d like us to think. Although marketed as a privately funded enterprise, it’s essential to note that Brightline has not been entirely self-sufficient. Like Amtrak, it has benefited from government-backed loans and subsidized infrastructure. Moreover, State Sen. Debbie Mayfield, among others, has warned that costs for maintenance at public rail crossings could be passed onto local taxpayers, municipalities, and the state.
Whenever a private corporation needs government handouts to turn a profit, it’s not a good sign, and we should expect Brightline to continue to coming to the state and local governments, hat in hand, as it asks for more infrastructure improvements all aimed at improving the company’s bottom line.
Pricing has been another sticking point for the nascent rail service. With round-trip tickets from Miami to Orlando costing at least $158, Brightline’s service might be prohibitive for average families, especially when compared to driving. Once passengers arrive at their destinations, the lack of robust local transit options adds to the overall expense, negating some of the potential advantages of taking the train in the first place.
While Amtrak and Brightline may appear to represent opposite ends of the public-private spectrum, they share similarities in their reliance on taxpayer money, either directly or indirectly. Amtrak’s government grants and Brightline’s government-backed loans and subsidized infrastructure point to an underlying reality: the challenging economics of passenger rail service in America often necessitate some form of public backing.
On paper, both services have their merits. Amtrak offers a broad network covering vast geographical distances, while Brightline aims to provide a more localized, high-speed alternative. However, the steep costs associated with running these networks and the public money involved raise the stakes for their long-term financial viability.
The critical question for both is how to create a sustainable model that doesn’t burden taxpayers while offering efficient, affordable rail service. As it stands, neither Amtrak and Brightline appear to be on sustainable paths. Both will have to confront difficult decisions in the future—ones that could redefine how Americans perceive and utilize passenger rail systems.