All This Discussion About Amtrak Accounting?

[haolerider]

I have been having trouble responding the posts of Henry regarding the overhead cost associated with LD trains, but the following pretty much sums up my opionion - for what is worth! Which may be almost as much as all the assumptions and incorrect logic associated with the original discussion.

All of these discussions are just pie in the sky, without access to the real charges that go against the LD trains - or any train for that matter. If you are applying your rates for T&E and OBS,you are not including the expenses related to the crew bases that staff these trains. There are managers and supervisors in each crew base and you need to calculate the total number of T&E and OBS to get the true numbers. You also need to calculate the T&E Operations staff on the ground who support the Engineers and Conductors and deal on a daily basis with the track owners.

There is an entire Marketing Department that also is involved with managing outside sales and several ad agencies, that don't work for free. Costs to operate a company as large as Amtrak can't be discussed without having all the information and making assumptions and forgetting trains does not help your cause.

Even if you come close, what is the point? As "jis" pointed out, these figures have been audited and have been scrutinized by everybody and their brother, since Amtrak is a good target for politicians, non-rail fans and any other nut cases out there. Be satisfied that LD trains do not make money and if Amtrak is charging some expenses to LD trains that should be charged to the NEC, so what? When Amtrak presents their figures to the state partners, there is a clear understanding on both sides as to what is being charged and what is not being charged. All your calculations (based on poor assumptions) are not going to change anything. Believe me, LD trains don't make money, which is why Amtrak was created in the beginning, since the freight railroads did not want to continue to deal with the loss

 

[Ryan]

I've wondered the same thing myself.

I'm hoping against hope that it's all a work up to Henry finally coming out with the backup to his statement that "They could do so much more with very little effort or costs.".

But I'm pretty sure that any concrete proposals won't be forthcoming.

 

[jis]

Well I start getting worried with talk about developing a model. I don't see adequate verifiable basis for the semblance of a model. Of course any model can be built to the nth degree, but unless you can causally and verifiably connect the model to reality, any conclusions reached based on said model is just GIGO. Trust me, I make a professional livelihood of modeling of systems and verification of same and then projecting based on verifiable criteria to figure out what might happen in what-if experiments. If I could get a dime for every piece of nonsense that has been claimed to be true based on dubious models I'd be a millionaire by now.

By the way my focus is more on real time model driven automation, where the requirements for causal connection with reality is even more stringent. If the position of your steering wheel does not accurately reflect the position of the wheel in real time and always, you and everyone else around you will be in deep doo doo.

I agree with Ryan that we will not get a satisfactory answer to the core question of what Amtrak could do with very little cost and effort, working on this current line of reasoning. Best case we will get nothing, worst case we will get are innuendos about how Amtrak does not know what it is doing without any supporting verifiable evidence.

 

[the_traveler]

I agree with all of you. If Henry did not live in Houston, or others unamed in SAS, they would not be talking about the SL losing money or having bad calling times! If they lived in (say) LIN instead, the calling times of the CZ (both ways) are in the middle of the night - and AFAIK have been since Amtrak began! I do not hear too much calling for Amtrak to change the schedule of the CZ to terminate in CHI and EMY just so the residents of LIN do not have to leave in the middle of the night!

Let's leave the finances and scheduling to those who have ALL the facts, not just SOME of the facts!

 

[Anderson]

On the one hand, I'll readily admit that it's a hobby more than anything. On the other hand, at least on my end, I'm trying to sort out the nature of what is to try and determine the nature of what will be. Hence my concentration, as a rule, on the Monthly Performance Reports and so forth.

Put another way, most of my discussion hasn't been trying to argue about the nature of the accounting surrounding LD trains...it's been trying to figure out how Amtrak's cash flow is looking for the coming years to determine whether there's a chance of, say, a piggyback bilevel order or an expanded Viewliner II order. It's also been trying to figure out just how far Amtrak could push fares upwards without losing market share/ridership and things like this.

Yes, it's an odd hobby, but at least understanding these things helps me get a feel for where things are going in the future. Particularly since while Amtrak's short-term projections are alright, their longer-term numbers tend to just be lowball placeholders, I find myself needing to do a bit of play-at-home work to see how things are going.

 

[henryj]

On the one hand, I'll readily admit that it's a hobby more than anything. On the other hand, at least on my end, I'm trying to sort out the nature of what is to try and determine the nature of what will be. Hence my concentration, as a rule, on the Monthly Performance Reports and so forth.

Put another way, most of my discussion hasn't been trying to argue about the nature of the accounting surrounding LD trains...it's been trying to figure out how Amtrak's cash flow is looking for the coming years to determine whether there's a chance of, say, a piggyback bilevel order or an expanded Viewliner II order. It's also been trying to figure out just how far Amtrak could push fares upwards without losing market share/ridership and things like this.

Yes, it's an odd hobby, but at least understanding these things helps me get a feel for where things are going in the future. Particularly since while Amtrak's short-term projections are alright, their longer-term numbers tend to just be lowball placeholders, I find myself needing to do a bit of play-at-home work to see how things are going.

It's a bean counter thing, they wouldn't understand. I can send you my excel spreadsheet if you want it. It has all the costs applied that have been gleened from Amtrak's reports and discussed on here. Sure it's generic across the board but it gives a good insite into which trains do better than others. It worked on the Heartland Flyer. And it shows that the Texas Triangle would be a viable operation. That's all I wanted out of it.

 

[Ryan]

Trying to make predictions about where things will go is one thing, and it makes perfect sense.

Trying to claim that you know better than Amtrak what their costs are based on guesses, assumptions and "what should be" is a whole different kettle of fish, and quite ridiculous.

 

[The Davy Crockett]

Being the son of an accountant, I can tell you that there are some people who love to play with numbers. Speculation is great, but IMHO, there are two types of liars: damn and statistical. Thus I don't take number crunchers too seriously, and they shouldn't take themselves too seriously either! :lol: :lol: :lol:

 

[sportbiker]

Considering how much armchair analysis and speculation board members engage in about all other operations of Amtrak, why do so many here treat henry's financial analysis and speculation as if he's violating some taboo? It's not religion, it's not magical and it's not the Bridge of Eternal Peril. And AFAIK, no animals were harmed by henry in creating his spreadsheet.

 

[henryj]

Considering how much armchair analysis and speculation board members engage in about all other operations of Amtrak, why do so many here treat henry's financial analysis and speculation as if he's violating some taboo? It's not religion, it's not magical and it's not the Bridge of Eternal Peril. And AFAIK, no animals were harmed by henry in creating his spreadsheet.

Thank you for that Sportbiker.

 

[Green Maned Lion]

Years of loud screaming about cost cutting and being a perpetual punching bag has forced Amtrak to cut as many low hanging fruit- and some fairly high hanging fruits, too- in regard to costs. For a US government agency with high unionization- which will never actually change - Amtrak is extremely cost efficient. Cut operating costs? We could spend billions to replace equipment- that would cut some operating costs.

The only thing that Henry said- that I tend to agree with- is that Amtrak uses accounting procedures to unfairly burden the LD trains with expenses, while removing a distinct amount of expenses from other trains, mainly corridors. What I disagree with is that there is "no reason for this". There is excellent reason for this. Before Congress actually demands a full cut of our LD network, they will request the CBO determine how much money it would save to cut the LD trains off the system- and they'd get back a number so embarrassingly low that they'd probably distinctly remember forgetting that they ever suggested the idea. So Amtrak doesn't really need to worry much about it happening.

Meanwhile the numbers encourage state-operating contracts, commuter operating contracts, and expansion of the system where it can be expanded, which if we are lucky may, sooner than we are all sitting here thinking about, mean a corridor system that brings in enough operating revenue to completely offset the operating cost of the rest of the system. Thus Amtrak would, on paper, cease to have an operating loss, shutting up half the people complaining about it. That is the best we can hope for.

 

[Anderson]

GML,

You've hit what I was getting at with my discussion of the PRIIA/Cash Flow thread: It looks to me like the cash flow from the "capital charges" the states are getting hit with might end up being enough to shrink away a substantial share of the LD losses. Once you throw in some more net cash flow from the Acela supplementary cars along with generic increases throughout the system, it might well be enough to make the operating loss situation largely vanish and/or allow a slow flow of car orders to help it go away (note a lot of the trains slamming into capacity limits in coach and in the sleepers for more and more of the year).

 

[The Davy Crockett]

Years of loud screaming about cost cutting and being a perpetual punching bag has forced Amtrak to cut as many low hanging fruit- and some fairly high hanging fruits, too- in regard to costs. For a US government agency with high unionization- which will never actually change - Amtrak is extremely cost efficient. Cut operating costs? We could spend billions to replace equipment- that would cut some operating costs.

The only thing that Henry said- that I tend to agree with- is that Amtrak uses accounting procedures to unfairly burden the LD trains with expenses, while removing a distinct amount of expenses from other trains, mainly corridors. What I disagree with is that there is "no reason for this". There is excellent reason for this. Before Congress actually demands a full cut of our LD network, they will request the CBO determine how much money it would save to cut the LD trains off the system- and they'd get back a number so embarrassingly low that they'd probably distinctly remember forgetting that they ever suggested the idea. So Amtrak doesn't really need to worry much about it happening.

Meanwhile the numbers encourage state-operating contracts, commuter operating contracts, and expansion of the system where it can be expanded, which if we are lucky may, sooner than we are all sitting here thinking about, mean a corridor system that brings in enough operating revenue to completely offset the operating cost of the rest of the system. Thus Amtrak would, on paper, cease to have an operating loss, shutting up half the people complaining about it. That is the best we can hope for.

This makes sense.

 

[jis]

Years of loud screaming about cost cutting and being a perpetual punching bag has forced Amtrak to cut as many low hanging fruit- and some fairly high hanging fruits, too- in regard to costs. For a US government agency with high unionization- which will never actually change - Amtrak is extremely cost efficient. Cut operating costs? We could spend billions to replace equipment- that would cut some operating costs.

The only thing that Henry said- that I tend to agree with- is that Amtrak uses accounting procedures to unfairly burden the LD trains with expenses, while removing a distinct amount of expenses from other trains, mainly corridors. What I disagree with is that there is "no reason for this". There is excellent reason for this. Before Congress actually demands a full cut of our LD network, they will request the CBO determine how much money it would save to cut the LD trains off the system- and they'd get back a number so embarrassingly low that they'd probably distinctly remember forgetting that they ever suggested the idea. So Amtrak doesn't really need to worry much about it happening.

Meanwhile the numbers encourage state-operating contracts, commuter operating contracts, and expansion of the system where it can be expanded, which if we are lucky may, sooner than we are all sitting here thinking about, mean a corridor system that brings in enough operating revenue to completely offset the operating cost of the rest of the system. Thus Amtrak would, on paper, cease to have an operating loss, shutting up half the people complaining about it. That is the best we can hope for.

Very good point!