Similar to your local Post Office, Amtrak is a government agency that was created to serve the needs of Americans. Though they charge you for their services, they are heavily subsidized by government funds, because intercity passenger trains are considered an essential service.
In this article, we’ll explore the structure and leadership of Amtrak, America’s only cross-country passenger rail service.
The National Railroad Passenger Corporation: an independent government agency to get you from A to B
National Railroad Passenger Corporation: that’s Amtrak’s official business name. It’s what’s known as an independent government agency, a term that means Amtrak is outside of the direct control of the executive branch of government.
Amtrak is part of the executive branch, but it makes its own rules and isn’t directly controlled by cabinet members or the office of the president. The FCC, NASA, and EPA are three more examples of the roughly 3 dozen independent federal agencies.
To be clear, Amtrak is influenced by the office of the President; it isn’t a completely separate entity, nor is it a private business that contracts with the government. Instead, Amtrak is in a sort of special middle ground between being a private and public entity. The government owns it, but the government doesn’t involve itself with running things most of the time.
Who’s in charge of Amtrak?
Pete Buttigieg, in 2022, is President Joe Biden’s Transportation Secretary. That makes him the person most closely connecting the federal government and the day-to-day operations of Amtrak. However, that doesn’t mean he – or his boss – is in charge. Amtrak’s CEO, as of 2022, is Stephen Gardner.
As CEO, Mr. Gardner is the top dog in US passenger rail service. He makes the major decisions, guides the company’s operations, and answers to the federal government.
Mr. Gardner had served as Amtrak’s president since 2020, a tenure defined by the pandemic era, full of travel restrictions and frustrating experiences. He worked for various regional railroad companies and commuter rail agencies before joining Amtrak in 2009.
What does this mean for you as a current or future Amtrak customer? Very little – but that’s the way it should be. Where the influences of Amtrak executives matters is in the future – what exactly is Amtrak planning to do with all that money that’s going to come pouring in?
Time will tell, but Amtrak’s been pretty clear about its 2035 plan; hopefully, Mr. Gardner is the right person for the job, because the 2035 plan is pretty exciting. For one thing, my current home base of Columbus, Ohio, might finally get its own station!
Does my tax money pay for Amtrak trains to run?
Yes, your tax dollars (a tiny portion of them, at least) winds up keeping Amtrak trains on the tracks. Amtrak makes a significant portion of its money from ticket sales, but the company could not exist without the help of federal/state subsidies and billions of dollars in grants.
Amtrak typically sees between 1 and 2 billion dollars of federal money come its way each year. That’s roughly equivalent to a few thousandths of the federal government’s budget. If we took a super simple view of our tax bills, we could say that most Americans spend a couple bucks each year to subsidize Amtrak. Obviously, taxes are way more complicated than that, but it’s helpful to think about.
64% of Amtrak’s money comes directly from ticket sales. The rest comes from a combination of other things, most especially subsidies and grants, though investments and other business activities account for significant revenue as well.
Interestingly enough, more than 75% of ticket revenue comes from Amtrak’s Northeast Corridor. You’d think the sky-high cost of roomettes and other expensive Amtrak trips would be more meaningful, but the Acela rules all, I guess!
Are the people who work for Amtrak federal employees?
Although Amtrak functions independently of the federal government, its employees are federal employees. That means they get access to all the benefits of government jobs – including those precious pensions us private sector folks are jealous of.
While public sector employment isn’t as cushy or lucrative as pop culture makes it seem, it is generally a good thing that Amtrak employees are public employees. According to Indeed and ZipRecruiter, two popular salary information aggregators, Amtrak train attendants make roughly $53,000 a year. That’s not much to brag about, but it’s a good bit more than nothing, especially if one is lucky enough to be in a low cost of living area.
It’s a lot better than similar jobs in the private sector, too. For instance, a flight attendant for United Airlines only makes about $45,000, though they can earn a lot more with 5-10 years of experience and job-hopping.
What does being served by federal employees mean for you? Again, very little, other than that you might be a little jealous of their healthcare plan!