David Gunn Released as Amtrak President
AMTRAK PRESS RELEASE...
November 9, 2005
Railroad Begins Search for Experienced Reform Leader; David Hughes will run Amtrak until Successor is found
WASHINGTON - Amtrak's Board of Directors today released its President, David Gunn, saying that the passenger rail service needed to intensify the pace and broaden the scope of its reforms. Amtrak said that David Hughes, Chief Engineer, has been named Acting President and CEO, and that its board of directors has launched a national search to find the railroad's next leader.
Announcing the Board's decision, Amtrak Chairman David M. Laney said: "David Gunn has helped Amtrak make important operational improvements over the past three years. Amtrak's future now requires a different type of leader who will aggressively tackle the company's financial, management and operational challenges. The need to bring fundamental change to Amtrak is greater and more urgent than ever before. The Board approved a strategic plan in April that provides a blueprint for a stronger and more sustainable Amtrak. Now we need a leader with vision and experience to get the job done."
Gunn came out of retirement in May 2002 to lead Amtrak after a career that included running transit systems in New York and Washington, D.C.
The strategic plan produced by Amtrak's Board and management calls for fundamental change with the goal of delivering better service for passengers and an improving financial performance. The plan calls for competition in U.S. rail passenger service, shared federal-state financial responsibility for passenger rail, as is the case with highways and aviation, and predictable multi-year federal funding.
A report released last week by the Government Accountability Office credited Amtrak's management with some positive changes in recent years, but also was uncharacteristically blunt in concluding that more far-reaching changes were needed along the lines of those proposed by Amtrak's Board.
[Amtrak, 11-9-05]
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NATIONAL ASSOCIATION OF RAILROAD PASSENGERS' LETTER TO MEMBERS...
November 9, 2005
It is with regret that I report that Amtrak's board today released David L. Gunn as President and CEO. A few minutes ago, I sent the following message to our Capitol Hill contacts: "We have a high degree of confidence in David Hughes, who was named Acting President & CEO. Hughes is a former railroad president whose entire career was in the private sector before Gunn brought him to Amtrak as chief engineer. While it is difficult for outsiders to properly judge personnel decisions, we obviously had a high degree of confidence in Mr. Gunn as well, and we will watch very carefully to learn the meaning of the key words in Amtrak's release, since those words mean so many different things to different people: 'reforms' and 'fundamental change'."
Reporters are asking if this is the beginning of the end for Amtrak. It is not, if Amtrak Chairman David Laney can hold true to the goals set forth in his employee advisory today announcing Gunn's release. Citing Amtrak's April strategic plan and budget request, Laney wrote, "The good news in this strategic plan is that we can improve Amtrak, upgrade service in the vital Northeast Corridor, expand rail services in densely populated and increasingly congested corridors across the country, and bring more economic discipline to Amtrak's long distance services."
If "economic discipline" is not code for cutting routes or making trains unattractive, and if Laney can deliver on his stated intentions, passenger rail still has a bright future. A cautionary note is that, when Congress adjourns, as things now stand, there will be only two Amtrak board members-Laney and Secretary Mineta-instead of seven voting members called for in the law.
[National Assn. of Railroad Passengers, 11-9-05, from letter to members by Executive Director Ross Capon]
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STATEMENT BY SENATOR BYRON DORGAN...
Senator Dorgan Reacts to Removal of David Gunn as President of Amtrak
November 9, 2005
(WASHINGTON, D.C.) --- U.S. Senator Byron Dorgan (D-ND) issued the following statement Wednesday in reaction to the decision by the board of directors of Amtrak to fire the rail company's president, David Gunn:
"It was a foolish mistake for the Amtrak board of directors to fire President David Gunn today. This move has nothing to do with performance and everything to do with politics.
"David Gunn has done a great job as president of Amtrak. He has experience. He is qualified. He is nobody's crony.
"The President proposed in his budget to cut all funding for Amtrak. But Congress disagreed, and we have supported full funding. Amtrak is an important part of our transportation system, and we need to have passenger trains running through places like North Dakota.
"David Gunn also understands that America ought to have a national rail system, and one that runs well. This didn't sit well with the White House and the Secretary of Transportation, and so they had the board of directors fire him.
"That was a huge mistake for our country. David Gunn did a first-rate job as head of Amtrak. Shame on those who made this decision."
[U.S. Senator Byron Dorgan, D-ND, 11-9-05]
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STATEMENT BY SENATOR PATTY MURRAY...
Murray Statement on Firing of Amtrak President David Gunn
November 9, 2005
(WASHINGTON, D.C.) - Following a call with Transportation Secretary Norm Mineta in which he informed her of the firing of Amtrak President David Gunn, U.S. Senator Patty Murray (D-Wash), the highest ranking Democrat on the Transportation Appropriations Subcommittee and long-time supporter of Amtrak services, released the following statement.
"Today, the Bush-appointed Amtrak board fired David Gunn because he refused to give in to their short-sighted determination to reduce services. Unlike the politically appointed Board members, none of whom have run a railroad, David Gunn has 41 years of honorable service in the railroad industry. Mr. Gunn inherited a badly mismanaged railroad on the brink of bankruptcy and cleaned up the books, improved service and brought ridership to record levels. This is the type of leadership American travelers deserve.
"David Gunn still had much work to do. But, unfortunately for Mr. Gunn and the nation, his goals for a well-capitalized railroad that serves the whole nation conflicted with the Bush Administration's goals to cut rail service and transfer Amtrak's costs onto our already cash-strapped states. It is my sincere hope that when the Amtrak Board picks a permanent replacement, they will select someone with real railroad management experience, not an Administration crony determined to implement the Bush Administration's reckless agenda."
[U.S. Senator Patty Murray, D-WA, 11-9-05]
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STATEMENT BY NATIONAL ASSOCIATION OF RAILROAD PASSENGERS' PRESIDENT...
NARP President Praises Gunn, Expresses Concern Over Amtrak Governance
November 9, 2005
Washington, D.C. -- The following statement regarding David Gunn,Äôs departure from Amtrak is by George Chilson, President of the National Association of Railroad Passengers:
"David L. Gunn leaves a lasting legacy. In just over three years, he transformed Amtrak in positive ways that will shape its future long after his departure. He inherited an organization on the verge of collapse. He systematically created order from chaos. Faced with myriad problems, he focused on the most important issues and set priorities. He simplified the management structure, dropping vice-president from the titles of many. He created organization charts that identified all authorized positions. He established performance goals and measures. He installed discipline in finance, planning and budgeting - discipline that was essential for effective management but missing when he arrived. He installed transparent and GAAP compliant accounting. His competence and plain spoken honesty brought credibility to a discredited organization. Without David Gunn, it is quite possible that Amtrak - and U.S. intercity passenger rail - would not exist today. David Gunn's leadership has put Amtrak on a solid footing where it can be poised for growth.
"The Amtrak board's decision to replace Mr. Gunn comes at an unfortunate time. Amtrak has overcome significant problems and begun to gain forward momentum. Changing the top leadership jeopardizes that progress. It remains to be seen whether the Board can find a new president who can accelerate Amtrak's transformation into a growing, relevant and cost efficient national passenger rail system.
"There is obvious concern that removal of Mr. Gunn is the first step in an effort to kill the rail passenger business. However, Amtrak Chairman David Laney, in a message to employees today, cited Amtrak's April strategic plan and budget request and wrote: 'The good news in this strategic plan is that we can improve Amtrak, upgrade service in the vital Northeast Corridor, expand rail services in densely populated and increasingly congested corridors across the country, and bring more economic discipline to Amtrak's long distance services.'
"We endorse those goals so long as 'economic discipline' does not mean route cuts, or making the trains unattractive to travelers.
"Attaining Laney's stated goals will require meeting big challenges: the management transition, the fact that the Amtrak Board is about to drop to just two members, and Bush Administration opposition to adequate passenger rail funding in spite of strong support for it on Capitol Hill."
[National Association of Railroad Passengers, 11-9-05]
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ALBANY NEWS-UNION WEBSITE ARTICLE...
Amtrak firing draws critics
By Jennifer A. Dlouhy, November 10, 2005
WASHINGTON -- Amtrak fired David Gunn as its president and CEO on Wednesday, allowing the passenger railroad to hire a new leader who would adopt the Bush administration's plans to split off and privatize part of the troubled system.
The decision comes less than a week after the Government Accountability Office, the investigative arm of Congress, criticized Amtrak's leadership and said the company needed major - and possibly outside - help to get out of the red.
The move ends a rocky relationship between the Bush administration and Gunn, who forcefully fought moves by the White House and some in Congress to strip the company of federal funding and split off part of the rail system.
Some rail advocates, including Sen. Charles E. Schumer (D-N.Y.) reacted angrily to Gunn's dismissal.
Schumer called it "a crushing blow to Amtrak's hopes for success and reform" and praised Gunn as "a brilliant manager who stood up for Amtrak." He said the decision to fire Gunn is a sign the Bush administration wants to "decapitate Amtrak and end Amtrak as we know it."
Sen. Hillary Rodham Clinton (D-N.Y.) called the decision "baffling and questionable."
"David Gunn has fought tirelessly to restrain spending, improve critical infrastructure and keep Amtrak's trains running on time, despite the Bush administration seeking to bankrupt our nation's passenger rail system," she said.
The board of directors that fired Gunn has four members, three of whom were appointed by Bush: Chairman David Laney, Floyd Hall and Enrique Sosa. Transportation Secretary Norman Mineta also has a seat on the panel.
The White House has repeatedly asked Congress to end government subsidies to Amtrak, effectively privatizing the 34-year-old passenger rail system, which is plagued by a sprawling network of mostly unprofitable routes and a debt of more than $3-billion.
The system's only profitable line is the Northeast Corridor from Washington to Boston. Amtrak's board of directors approved a Bush administration plan to split off that line and put it under the control of a federal-state consortium.
Rep. John Sweeney (R-Clifton Park) voiced support for Gunn's ouster and said he hoped the decision would usher in much-needed reforms.
"I am hopeful that new leadership can open the door for Amtrak to work closely with Congress to achieve meaningful reforms that will enable Amtrak to achieve the autonomy and viability desperately needed for a strong national passenger rail system," Sweeney said.
But passenger rail advocates expressed dismay at the firing.
"The Empire State Passengers Association is saddened by the news of David Gunn's firing," said the group's president, Bruce Becker. "We respected his efforts over the past three years, ... and we are concerned about the future of Amtrak with the administration's apparent desire to break up the system."
[Brotherhood of Locomotive Engineers & Trainmen, 11-10-05, from Albany Times-Union website article by Jennifer A. Dlouhy]
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NEW YORK TIMES EDITORIAL...
A disgraceful signal at Amtrak
November 10, 2005
The sudden firing by the Amtrak board of David Gunn, the best president in years of the nation's only passenger railroad, was a body blow to anybody who cares about long-range passenger trains.
Mr. Gunn has done a masterly job in the last three years of holding down costs without dismantling the railroad. That, apparently, was his problem. Mr. Gunn was trying to save Amtrak, but the Bush administration wants to privatize it, bit by bit.
The battle between Mr. Gunn and Amtrak board members - all of them appointed by President Bush - intensified in recent weeks when the board took steps to break off the more profitable Northeast Corridor, putting it into its own division and sharing its control and costs with the states. Senator Frank Lautenberg, Democrat of New Jersey, called it a "fire sale" intended to break up the nation's railroad system.
So last week Senator Lautenberg and Senator Trent Lott, Republican of Mississippi, managed to get a 93-to-6 vote to authorize $11.6-billion for passenger rail service in the next six years - as close to an all-out endorsement of Amtrak as you can get.
But while senators were trying to help Amtrak move forward, its board took a step backward. It complained yesterday that Mr. Gunn - who has greatly increased ridership, improved management and upgraded equipment - was moving too slowly. After his firing, Mr. Gunn said, "Obviously what their goal is, and it's been their goal from the beginning, is to liquidate the company."
For Amtrak's 25 million passengers, this should be a call to arms. Amtrak should be a public transportation trust. It will never be self-sufficient, nor show a conventional profit, any more than the airline industry can fly without federal help. The Bush administration long ago threatened to disassemble Amtrak. Yesterday it began at the executive suite.
[Editorial on New York Times website, 11-10-05]
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WASHINGTON POST WEBSITE ARTICLE...
Amtrak fires president days after bad report
By Keith L. Alexander, November 10, 2005
WASHINGTON -- Amtrak's board fired its president yesterday, nearly a week after a government investigation found repeated management problems with the rail service.
David L. Gunn's firing comes after a three-year tenure marred by clashes with the Bush administration over the direction of the financially beleaguered national rail service.
Amtrak Chairman David M. Laney praised Gunn's tenure but said that the railroad needed immediate changes and that Gunn resisted those changes. He said no particular event triggered the unanimous decision by the four-person board.
"It was more of the things that David was not seeing done or resisting from being done that led us to conclude that he's not the right guy at the helm as we try to move forward," Laney said.
David Hughes, Amtrak's chief engineer, was named acting president and chief executive until a permanent replacement is found.
Amtrak's management has come under heightened criticism recently. Last week, the Government Accountability Office issued a report that said Amtrak needed fundamental improvement in many areas, including cost control, goods and services purchasing, and overall accountability.
In response to the GAO report, Transportation Secretary Norman Y. Mineta on Monday criticized Amtrak's operations and promised stricter oversight of the railroad's finances. He said he hoped the report would be a "turning point" that spurred the railroad to "clean up its act."
Gunn said he was surprised by the board's decision but suspected his job might be in jeopardy after hearing Mineta's comments. "It sounded like they were then trying to set up an excuse," he said.
Gunn said he believed he was fired because he opposed the board's plan to split off the Northeast Corridor into a separate subsidiary, a move that had been endorsed by the Bush administration. The Amtrak board's four voting members were all appointed by President Bush.
The plan was authorized by the board on Sept.22, but the vote was not disclosed. When the plan was first reported last month, Laney said that separating the Northeast Corridor would allow Amtrak to better manage the high maintenance costs of the 456-mile line between Washington and Boston.
Amtrak has never turned a profit in its 34 years, and it has $3.5-billion in long-term debt. Its chronic financial problems have prompted calls for drastic measures.
The Bush administration has suggested ending Amtrak subsidies and turning passenger rail into regional services operated by the states with federal grants. The White House budget proposal for fiscal 2006 did not include any Amtrak funding.
Congress granted Amtrak about $1.2-billion in the past fiscal year. Last week, the Senate approved $1.4-billion in annual funding for 2006; in June, the House approved $1.17-billion. The two houses must now reconcile the difference.
This summer, Gunn described the administration's plan as being designed by "policy wonks and politicians." He said yesterday that the administration intends to dismantle the railroad. "They have a very different vision for the place. Zero funding, bankruptcy and break it up. My efforts were not being helpful in what they were trying to accomplish," he said.
Laney denied Gunn's assertions. "Nobody on the board envisions any of those three scenarios," he said.
Known as a blunt but skilled manager, Gunn, 68, came out of retirement after a long career in passenger rail to lead Amtrak in 2002. He had declined an invitation in 1994 to serve as Amtrak's president.
From 1991 through early 1994, he served as general manager of Washington's Metro system. He won praise from passengers for cleaning up Metro's bus and rail system by repairing and replacing aging cars and buses.
But Gunn did not enjoy the political aspects of the job and upset some members of the Metro board by making operating decisions without consulting them.
Sen. Charles E. Schumer (D-N.Y.) defended Gunn and called the firing "a crushing blow to Amtrak's hopes for success and reform."
In addition to the GAO report, Amtrak has faced other problems recently. In April, it was forced to shut down its popular high-speed Acela Express line for nearly three months after it discovered hairline cracks in 300 of 1,440 brake disks.
Amtrak has also been the subject of several recent race-discrimination lawsuits filed by employees and passengers. It settled one of those suits last week for an undisclosed sum and agreed to track complaints better.
Gunn, who maintains dual residence in Northern Virginia and Nova Scotia, said he had no plans other than to go hiking in the mountains of Virginia. "I don't have to get another job. I was doing this because I believe in the company."
[Washington Post website article by Keith L. Alexander, 11-10-05]
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PROGRESSIVE RAILROADING WEBSITE ARTICLE...
Amtrak supporters voice opinions on Gunn's termination
November 10, 2005
During the past month, Amtrak has remained in the headlines. The national passenger railroad attracted coverage for its plan to create a Northeast Corridor subsidiary, the Senate's approval of a $1.45-billion fiscal-year 2006 Amtrak appropriation and reform bill, and the Government Accountability Office's report criticizing Amtrak's business practices. Now, Amtrak has grabbed its biggest headline by firing President and Chief Executive Officer David Gunn.
Yesterday, the board terminated Gunn - who came out of retirement in May 2002 to take Amtrak's reins - to install a new leader board members believe can "intensify the pace and broaden the scope of reforms."
The news outraged many Amtrak supporters, who voiced concerns that the board fired Gunn to carry out the Bush Administration's Amtrak reform proposals - which Gunn and the administration have clashed on, and critics say would destroy the railroad. A number of Amtrak observers also are questioning the legitimacy of the board action since the seven-member body currently has four members and only one - chairman David Laney - has been confirmed by the Senate.
"[The] decision to fire David Gunn is wrong, ill-advised and further proof that the Bush Administration doesn't want Amtrak to succeed," said Sen. Tom Carper (D-Del.) in a prepared statement. Carper noted that just last week, the Senate adopted the Passenger Rail Investment and Improvement Act of 2005, showing they support "meaningful and thoughtful Amtrak reform."
"It's unfortunate that the administration, through the board, would rather play games with Amtrak's management than engage Congress on how to make Amtrak stronger," he said.
The National Association of Railroad Passengers (NARP) also believes the firing came at a bad time. "Amtrak has overcome significant problems and begun to gain forward momentum. Changing the top leadership jeopardizes that progress," said NARP President George Chilson, adding that the association is concerned that Gunn's termination "is the first step in an effort to kill the rail passenger business."
Rep. Jerrold Nadler (D-N.Y.) agrees. "The Amtrak board of directors has become a front for the Bush Administration and Amtrak opponents," he said. "The firing of David Gunn is another backdoor attempt to dismantle the railroad."
To Friends of the Earth, there is no compelling reason for the termination. "The decision to fire David Gunn begs the question of whose interest the board is serving the riders or the Bush administration's?" said Transportation Policy Coordinator Colin Peppard. "With Amtrak finally making real progress with needed reforms, it makes no sense to fire an experienced, qualified leader with a track record of success. As we have seen recently, a willingness to act as the president's yes-man is often more important than real qualifications or experience."
Meanwhile, Midwest High Speed Rail Association Executive Director Rick Harnish believes it will be difficult to find a replacement for Gunn given the administration's intercity passenger-rail policies - or lack thereof. "Americans should not allow the administration's excessive focus on Amtrak management to obscure its own long-standing failure to develop a sound federal transportation policy," he said. "Fussing with the organizational chart is just a distraction. Absent meaningful mobility policy, the funding and leadership to support it, Amtrak will continue to endure the futile exercise of periodic management turnovers."
While Amtrak supporters protested Gunn's termination, U.S. Department of Transportation officials said they support the firing and will back Amtrak as it works to improve service, upgrade infrastructure and establish new fiscal accountability measures. "I am confident in the board's judgment and its belief that different leadership is needed to address the serious challenges facing the company," said U.S. Transportation Secretary Norman Mineta.
[ProgressiveRailroading.com, 11-10-05]
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GANNETT NEWS SERVICE ARTICLE...
Amtrak head's firing may lead to closure of long lines
By Ledyard King, November 10, 2005
WASHINGTON -- The firing of Amtrak President David Gunn on Wednesday could make it easier to eliminate cross-country train lines and turn over the deteriorating Northeast corridor between Washington and Boston to private hands.
Gunn resisted Bush administration calls to privatize its track in the Northeast and eliminate long-distance lines that serve rural America but don't pay for themselves. Those steps might not be any easier to achieve now that the company's governing board, made up of Bush appointees, has gotten rid of Gunn.
Sen. Trent Lott (R-MS) called Gunn's dismissal "a step backward" for the nation's passenger rail system. Lott was the prime author of a measure the Senate passed overwhelmingly last week authorizing more than $11-billion over the next six years to reduce Amtrak's debt, fix its tracks and keep it operating.
Amtrak has two lines running through Mississippi. The City of New Orleans goes from Chicago to New Orleans, and the Crescent runs from New Orleans to Washington D.C. The Sunset Limited ran along the Gulf Coast, but Hurricane Katrina damaged rail lines halting service in the area.
Some members of Congress said they'll be even more reluctant to endorse White House calls for change in rail service.
"The board's decision today provides a degree of uncertainty that does no one any good: the people who ride Amtrak, the people who work there and for us in Congress who want to reform (it)," said Sen. Tom Carper (D-Del.) a former Amtrak board member. "His departure is not going to convince anyone in the Senate that selling off the Northeast corridor is a good idea."
Federal taxpayers have contributed about $29-billion to Amtrak since it was created in 1971. Its trains operate in 46 states and carry more than 25 million passengers a year.
Amtrak Chairman David M. Laney announced Wednesday that David Hughes, the railroad's chief engineer, would run the quasi-public company while the board conducts a national search for a replacement.
Laney said Amtrak needed "a different type of leader who will aggressively tackle the company's financial, management and operational challenges" than Gunn, who had headed transit systems in New York City, Toronto and Washington.
Gunn's firing comes less than a week after a report by the Government Accountability Office criticized Amtrak's financial management. The report accused the company of approving contracts that mushroomed far above their initial amount, spending $2 for every $1 in revenue from food and beverage service, and giving top executives bonuses without spelling out why they had earned them.
But the GAO also gave some praise to Gunn, who has boosted ridership, cut Amtrak's workforce and discontinued some of Amtrak's money-losing pursuits since he was appointed in 2003. He also earned bipartisan praise from Capitol Hill.
Gunn had said - and lawmakers such as Lott and Carper agreed - the federal government has an obligation to provide a national rail network, even though some cross-country lines cost more than $100 per passenger in federal subsidies.
Gunn's departure means it will be easier to confine rail service to California, the Northeast and regions where passenger traffic is highest, lamented rail advocate Jim RePass, president of the National Corridors Initiative Inc. "The administration has decided to accelerate the end of long-distance service because that's the fundamental goal," he said.
Tom Till, who headed the now-disbanded Amtrak Reform Council, which Congress set up to suggest ways of improving passenger rail, said it's too early to tell what this latest step means for the future of passenger rail. But he said new leadership would be more willing to consider much-needed reforms that could lead to the private management of the Northeast corridor between Washington and Boston.
"I give a tremendous amount of credit to the board," said Till, now in Seattle as a senior fellow at the Discovery Institute. "They need a lot more cleaned up operation."
[Brotherhood of Locomotive Engineers & Trainmen, 11-10-05, from Gannett News Service article by Ledyard King]
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MINOT DAILY NEWS EDITORIAL...
Will Gunn's firing derail Amtrak?
November 10, 2005
MINOT, N.D. -- Amtrak president David Gunn has consistently disagreed with the Bush administration's assessment that federal subsidies for the troubled rail service should be eliminated.
So it wasn't exactly shocking when Gunn was fired Wednesday by Amtrak's board of directors. He had held the post since 2002.
Amtrak's Empire Builder train runs through North Dakota, and includes stops in Minot, Rugby, Stanley and other towns in our region.
The Bush administration has called for an end to the subsidies that have kept the rail service alive for years. Amtrak has never made money in its 34-year history, and had an operating loss of $550-million for its fiscal year that ended Sept.30. The railroad also has a debt of more than $3.5-billion.
While acknowledging that the rail service isn't a money-maker, supporters of Amtrak argue that the rail service is necessary in states like North Dakota, where public transportation is vital in rural areas. Gunn was a huge asset to the supporters of keeping federal subsidies flowing to Amtrak.
It remains to be seen what Gunn's dismissal will mean to the future of Amtrak. Most likely, it means there may not be much of a future at all, especially if Gunn is replaced by someone more willing to let the Bush administration have its way. Let's hope that doesn't happen.
[Minot Daily News editorial, 11-10-05]
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ROANOKE TIMES EDITORIAL...
An ideological detour for Amtrak
November 11, 2005
ROANOKE, Va. -- Amtrak's board of directors fired the company's president Wednesday, striking an ideological blow for the Bush administration that could prove fatal to the passenger railroad.
The impact would be immediate in cities along Amtrak routes. But repercussions also would be felt in communities, like Roanoke and others in Southwest Virginia, that lack passenger rail service but yearn for its return, and want it to link up to a national rail system.
Yet Amtrak's failure seems to be what the White House has had in mind all along.
If so, it took a major step in that direction by ousting David Gunn, known as a railroad-turnaround artist as the head of transit systems in New York City, Washington, D.C., and Toronto. Gunn came out of retirement in 2002 to take the controls at Amtrak when it was in financial crisis.
In September, The New York Times reports, Amtrak Chairman David Laney said on Capitol Hill that Gunn had "righted a ship that was listing and about to spill over." Righted it, but did not pull it far enough to the right.
The administration holds the view that passenger trains, alone among all modes of U.S. transportation, should operate in a free market. It wants to break up Amtrak into regional rail services operated by the states with federal grants. It proposes to turn over Amtrak's major asset, the tracks in the heavily traveled Northeast corridor between Boston and Washington, to a federal-state consortium.
Gunn adamantly disagreed, complaining the plan was designed by "policy wonks and politicians" who want to dismantle the railroad. The administration's vision, he claims, is "zero funding, bankruptcy and break it up."
Chairman Laney denied that those are administration objectives. But President Bush included no Amtrak funding in his 2006 budget proposal. And if he achieved his goal of eliminating federal subsidies, passenger rail service likely would survive only along the busiest routes.
Gunn was fired just days after the Government Accountability Office criticized Amtrak's management.
But if the railroad has far to go, criticism must be viewed in light of how far back it started and how far it has come. Gunn cut costs, improved financial controls and repaired Amtrak's rolling stock and antiquated tracks.
America is strangling on roads. It needs a nationwide passenger rail system, and it will have to pay for it.
[Roanoke Times editorial, 11-11-05]
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ALBANY TIMES-UNION EDITORIAL...
Derailing Mr. Gunn
November 11, 2005
ALBANY, N.Y. -- The sudden ousting of Amtrak President David Gunn comes as yet another reminder of how determined the Bush administration is to dismantle the national passenger railroad. Congress needs to prevent that from happening, for the good of the Northeast, which depends heavily on rail commuter traffic, and the nation, which needs a national rail network as never before. Rail travel helps reduce highway travel and the air pollution that accompanies it. It also helps reduce the nation's dependence on foreign oil - a dependence that is now costing Americans more money than ever as gasoline prices remain high.
Until recently, it seemed as if Mr. Gunn was the right man for turning Amtrak around. Just last September, he had been getting good marks from Amtrak's board president, David Laney, who told a Senate subcommittee that Mr. Gunn was doing a "splendid job." The numbers backed up that glowing assessment. Amtrak had $120-million in operating cash at the end of its fiscal year, Sept. 30, despite losing millions of dollars in revenue after brake problems forced the railroad to cancel its high-speed Acela service for the summer.
But then the board voted to carve out Amtrak's profitable Northeast corridor - from Boston to New York City to Washington - and place it under the control of a subsidiary. That was in keeping with the Bush administration objective of breaking up the railroad, and Mr. Laney, a Bush appointee, is obviously aiding in that effort.
Not Mr. Gunn, who saw the board's vote for what it was and objected. On Wednesday, he repeated his views in an interview with The New York Times: "Obviously, what their goal is -- and it's been their goal from the beginning - is to liquidate the company."
Sen. Charles Schumer, D-N.Y., puts it more starkly: "The policy difference is that the board wants to kill Amtrak and Gunn wants it to prosper. It's that simple."
There's no question that Amtrak couldn't survive without federal subsidies, but that is no reason for the White House to try to shrink budget deficits and pay for the costly war in Iraq on the backs of rail travelers. Fortunately, the Senate has recognized Amtrak's value by approving $11.6-billion for the railroad over the next six years, under an authorization bill sponsored by Sen. Frank Lautenberg, D-N.J., and Sen. Trent Lott, R-Miss. Earlier this year, the House approved $1.2-billion for Amtrak for the 2006 fiscal year.
While a conference committee will have to reconcile the two measures, Congress must send a strong message to the White House that while Mr. Gunn might be gone, Amtrak won't be next.
[Albany Times-Union editorial, 11-11-05]
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ALL ABOARD OHIO PRESS RELEASE...
Amtrak president's firing threatens Ohio's trains, plans for future
November 11, 2005
COLUMBUS, Ohio -- All Aboard Ohio, a nonprofit association, is calling for the immediate reinstatement of Amtrak President David Gunn, and for the resignation of U.S. Transportation Secretary Norman Mineta. All Aboard Ohio considers Gunn's firing earlier this week as a direct threat to Ohio's passenger trains, and to the future of the proposed Ohio Hub System. Gunn was fired by Amtrak's board of directors who were appointed by President Bush at the behest of Mineta.
"This was a power play, plain and simple, between Gunn, who was striving for a more stable Amtrak, and Mineta, who said he wants to bankrupt Amtrak, leading to its disbanding," said Bill Hutchison, president of All Aboard Ohio.
Hutchison noted this act of desperation by Mineta came only days after the U.S. Senate overwhelmingly passed Amtrak reform legislation 93-6. In addition to structurally reforming Amtrak and requiring it to compete with other railroads to operate publicly funded trains, the legislation would also permit an increase in capital funding to modernize Amtrak's trains, tracks and stations while reducing its debt burden and lowering its annual operating subsidy by 40 percent. Also, Congress recently turned down Mineta's request to eliminate dining- and sleeping-car services on trains essentially reducing them to steel-wheeled buses that would have eroded ridership.
"Mineta clearly saw he was losing ground in his efforts to dismantle Amtrak," Hutchison said. "Bush and Mineta's delusional desire to sell pieces of Amtrak to private enterprise, which cannot compete with the tens of billions in federal funds given each year to air and highway modes, reveals their double-standard that only passenger trains should live or die in a 'transportation free-market' which does not exist."
Further, he asked if Amtrak's future was so important to the Bush Administration, why did Mineta go on a nationwide tour to bash Amtrak rather than attend a single Amtrak board meeting even though he is on the board to seek reforms? Why didn't Mineta instead seek public hearings to learn what Americans want from their rail system? Why is the Bush administration continuing to leave vacant three Amtrak board seats for so long? Why are two of the four board members "recess appointments" and whose terms expire at year's end?
At 10 a.m. Nov. 15, U.S. Representative Steve LaTourette (R-Concord, OH), chair of the House Subcommittee on Railroads, will hold a hearing on Gunn's firing. Also, LaTourette is sponsoring House Bill 1631 to provide $60 billion for passenger and freight rail development projects nationwide. This bill would allow American travelers and freight to travel as quickly and inexpensively as our competitors in Europe and the Orient.
"We support Rep. LaTourette's inquiry, as well as his legislation," Hutchison concluded. "A world-class rail system will allow this nation to better compete, but only if its first-class executives aren't thrown off the train after finally getting it on the right track."
[All Aboard Ohio press release, 11-11-05]
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NEW YORK TIMES WEBSITE ARTICLE...
House explores actions of Amtrak board
By Matthew L. Wald, November 11, 2005
The vote by the Amtrak board of directors to fire the railroad's president, David L. Gunn, has created intense interest in Congress in the board itself, which some legal experts say has been operating for years using untested legal principles. The concerns come as the board faces new questions about its future.
For the second time in recent history, it may soon lack a quorum. Only four of the board's seven seats are filled, and some directors who have served recently may not have been properly appointed under a 1997 law meant to reform the railroad, said Representative Steven C. LaTourette, Republican of Ohio, chairman of the railroad subcommittee of the House Transportation and Infrastructure Committee.
In addition, one of the railroad's shareholders believes that changes the board is making in Amtrak's structure cannot be completed without consultation with the holders of common stock.
Mr. LaTourette said that at a meeting two weeks ago, David M. Laney, the chairman of the Amtrak board, provided a written response to questions about the board's composition. "But I have more questions after reading it," Mr. LaTourette said. If the board is not properly constituted, he said, it cannot conduct business.
"You don't want to have, compounding its well-documented financial difficulties, Amtrak entering into contracts and agreements illegally," he said. "That would be disturbing." Mr. LaTourette has scheduled a hearing for Tuesday [Nov.15] on the governance issues and on Mr. Gunn's dismissal. Of the four current board members, only Mr. Laney was confirmed by the Senate for the job. Two of the appointees, Enrique Sosa and Floyd Hall, were recess appointments put in place by President Bush under Article 2 of the Constitution, which allows the president to name people to fill vacancies that occur when Congress is out of session.
Such appointees serve only until the end of the Congressional session, meaning that Mr. Sosa's and Mr. Hall's terms will end when the current session of Congress ends in a few weeks.
A deeper problem may be that Amtrak's enabling legislation specifies that it is not a government agency, and the legality of recess appointments to Amtrak has not been tested in court, legal experts say.
Mr. Hall and Mr. Sosa declined interview requests made through Amtrak. All four board members are Bush loyalists, but they are not popular with Amtrak supporters in Congress. Senator Frank R. Lautenberg, Democrat of New Jersey, said on Wednesday that before Mr. Sosa was appointed to the board, he said he had never ridden an Amtrak train.
The fourth member of the board, by statute, is the secretary of transportation. Norman Y. Mineta, the current secretary, has designated Jeffrey A. Rosen, the general counsel of the Transportation Department, to serve as his representative on the board.
Mr. Laney said in an interview that he had no indication of whether the White House would appoint more directors.
The railroad has plans to operate without a quorum by appointing an executive committee to exercise the authority of a quorum between meetings. Such committees are allowed under the District of Columbia's corporation law. But the idea that the committee can act on behalf of a quorum when there is no quorum has not been tested in court, legal authorities say.
"It appears what they're saying is, once they have four, the four can appoint two, and the two can do all the stuff that four could," Mr. LaTourette said. "I'm not so sure that's right."
Jeffrey D. Bauman, a professor at the Georgetown University Law Center, said the idea of operating a corporate entity without a quorum had not been tested in court because the circumstances were so unusual. A more frequent legal dispute involves the opposite case, with more people claiming to be directors than there are seats.
"When there are vacancies, they get filled," Professor Bauman said of most corporations. "It's pretty clear that this kind of a situation would never arise in a real corporation." Mr. LaTourette said that a 1997 law intended to wean Amtrak off federal subsidies might have required the replacement of the board in 2003. If Amtrak was still taking subsidies at that point, the law required that a new board, appointed by the president, would take over.
Another issue is the board's legal ability to deal with the Northeast Corridor tracks linking Boston, New York and Washington. The Bush administration has called for stripping the corridor from Amtrak and turning it over to a federal-state consortium. The plan's prospects are uncertain, partly because the states have shown no interest.
But the Amtrak board, while it opposes the transfer at this point, voted in September to have the railroad's executives prepare to create a separate subsidiary to own and operate the corridor.
Mr. Laney said that the District of Columbia's corporation law forbids a board to sell "all or substantially all" of a corporation's assets without shareholder approval. A shareholder, he said, might argue that the corridor was substantially all of Amtrak's assets.
Amtrak issued common stock when it was established, to compensate the railroads that gave Amtrak equipment to run its passenger service. More than half of the common stock is owned by a Cincinnati company, American Financial Group, whose chairman and chief executive officer is Carl H. Lindner III, who is also an owner of the Cincinnati Reds. Mr. Lindner is a major donor to Republican causes.
A lawyer for Mr. Lindner said that he had not taken a position on the Northeast Corridor. But the second-largest Amtrak shareholder, the Burlington Northern Santa Fe Railway, has.
"As a longstanding shareholder of Amtrak," said Richard Russack, a spokesman for the railroad, "we would hope that the board would give us the opportunity to review their actions. We do have the right, as a common-stock shareholder, to vote on whatever action they're going to take."
[Brotherhood of Locomotive Engineers & Trainmen, 11-11-05, from New York Times website article by Matthew L. Wald]
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ASBURY PARK PRESS EDITORIAL...
Fight Amtrak derailment
November 15, 2005
The firing of Amtrak President David Gunn, a strong advocate of a national rail network, is bad news for the 185,000 New Jersey commuters who ride NJ Transit trains along Amtrak tracks. It removes a vocal opponent of the Bush administration's plans to split off the Northeast Corridor to federal-state management, with the states sharing in maintaining the heavily traveled lines that Amtrak would continue to operate.
It is an arrangement New Jersey cannot afford. With its Transportation Trust Fund nearly depleted, the state is struggling to keep NJ Transit afloat. It doesn't have any extra money to take on partial maintenance of Amtrak lines and equipment.
Keeping Amtrak alive would keep NJ Transit alive. Shutting down the commuter rail line would force its riders onto the roads, further taxing the state's highways, bridges and air quality - and drivers' patience. Businesses also depend on the Amtrak lines to get their products to market.
The Gunn dismissal last week is being played out in Washington amid fears by rail advocates that President Bush wants to eliminate federal subsidies to Amtrak and privatize the nation's rail system. But ending the federal aid does not have support in Congress. The House has approved nearly $1.2-billion for Amtrak this budget year. The Senate earlier this month authorized more than $11-billion over the next six years to reduce Amtrak's debt.
Amtrak's managers must monitor its performance and oversee its finances to help stem its operating losses, as recommended by the General Accountability Office. But the national rail system that serves 25 million passengers a year must be saved. New Jersey's congressional delegation must join the fight. It can't allow its colleagues or the Bush administration to forget that Amtrak is an essential element in the engine that drives the state's economy.
[Asbury Park Press, 11-15-05]
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ASSOCIATED PRESS ARTICLE...
Supporters want Amtrak chief reinstated
November 15, 2005
WASHINGTON -- Amtrak supporters in Congress on Nov.15 questioned whether the railroad's board had the authority to fire David Gunn as president last week and said he should be reinstated.
"I hope the board will reinstate Mr. Gunn until all the legal issues are resolved," said Sen. Charles Schumer, D-N.Y., who testified before the House railroad subcommittee. "There is no legal consensus that the board had the power to fire Mr. Gunn."
Amtrak Chairman David Laney defended both Gunn's firing and the board's right to do so, saying Gunn had refused to "go in several new directions" with the railroad.
Gunn said his firing came as a surprise but that he had known the board was unhappy with him, mostly because of his opposition to splitting off the Northeast Corridor from Amtrak. He said he was fired because he was "merely an obstacle to destroying Amtrak." In September, the board voted to explore breaking off the Northeast Corridor and allow a private consortium to run it. Gunn said he opposed the plan because it would separate operations and maintenance functions, a move he called "bad railroading."
Laney said there were many reasons Gunn was fired, including his resistance to revamping Amtrak's food and beverage service and revenue producing measures.
The nearly five-hour hearing was contentious at times, with only Rep.John Mica, R-Fla., voicing support for Wednesday's decision to fire Gunn.
Gunn said he learned he would be fired when he found a private public relations firm handling matters in Amtrak's public affairs office: "That indicated to me that something was afoot."
Laney told the subcommittee the board hired the public relations firm - whose name he did not recall - to handle media questions about Gunn.
Several lawmakers questioned whether the board had a quorum when it fired Gunn. The seven-member board has three vacancies. Lawmakers said they believed the board had to have five members to have a quorum.
Transportation Department general counsel Jeffrey Rosen said Amtrak's board did have a quorum.
But Schumer still questioned the action.
"There are serious, legal and procedural questions concerning the composition of the current board," Schumer said. "It's my belief that the board did not have the legal grounds to remove David Gunn."
[Brotherhood of Locomotive Engineers & Trainmen, 11-15-05, from Associated Press report]
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INTERNATIONAL HERALD TRIBUNE WEBSITE ARTICLE BY DON PHILLIPS...
Railroading Amtrak's president
November 16, 2005
PARIS -- Nowhere in the world do the railroaders who supervise and run freight trains and those who operate passenger trains truly get along well. Throughout the world, one group dominates operations, and the other gets the crumbs. One group is nervous about losing dominance, and the other lusts for it.
In Europe, the passenger train is the king of the hill. Even the European Union is having difficulty getting European railroads to accept an EU policy pushing transfer of freight from road to rail.
In the United States, it's the opposite. Freight is king. Outside the Washington-New York-Boston corridor, freight is actually more than king. Passenger trains out in the heartland of America survive only because freight railroads do not want the bad publicity that would come with the death of the passenger train. Freight railroads therefore have a policy of containment for passengers. If they could get away with it, the freight railroads would crush the passenger train tomorrow. Or so it seemed.
But a funny thing has happened. David Gunn, the president of Amtrak, was fired last week by a new Amtrak board of directors, all conservative Republican businessmen despite a requirement that there be a mix of Republicans and Democrats on the board. Not a single member of the board, recently appointed by President George W. Bush, had any railroad experience.
Oddly, Gunn was on his way to see the board chairman, David Laney, when he was fired. He came to see Laney with good news, but he never got to deliver it: Amtrak was doing better than ever; ridership was up, and the deficit was declining.
Gunn actively opposed some of the policies being pushed by the board and by Transportation Secretary Norman Mineta, the only Democrat in Bush's cabinet. Gunn was particularly opposed to splitting operation of the Washington-Boston corridor from the rest of Amtrak. Although Gunn is one of the most professional and effective presidents Amtrak has ever had, he is not a politician. He speaks his mind. His working life has been spent on railroads and transit systems. He is credited, among things, with cleaning up the crime-and graffiti-ridden New York subway system.
Gunn's dismissal sparked an uproar in Congress. Hearings were held this week, and Republicans and Democrats alike deplored the move.
To the surprise of many, the dominant freight railroads also weighed in - on the side of Gunn, a fellow professional.
Technically, there are several major shareholders in Amtrak, including the large freight railroads that once operated passenger trains. They have long since written the stock down to zero and all but forgotten about it. But suddenly they were using it for leverage.
"As a longstanding shareholder of Amtrak," said Richard Russack, a vice president for the Burlington Northern Santa Fe, the second-largest U.S. railroad, "we would hope that the board would give us the opportunity to review their actions. We do have the right, as a common-stock shareholder, to vote on whatever action they're going to take."
In other words, who wants amateurs operating on their railroad?
There is no telling how this dispute will turn out. But clearly Mineta and the Amtrak board have made powerful enemies in Congress and among the freight railroads. Consumer groups have come down on them. State governments are weighing in. Even the railroad unions, who squabbled constantly with Gunn, have blasted the Amtrak board and the Bush administration.
And even Mineta found himself being called names. The Democrat who once advocated tax increases for road construction was already under fire from many who felt he had become ineffective. Larry Kaufman, an influential columnist who has been a part of railroading for decades, including a stint as a railroad vice president, has called for Mineta's resignation.
"With Norman Mineta's depth of experience and knowledge, he should be transportation's principal advocate - to the country and inside the government," Kaufman wrote in Argus Rail Business, a specialist magazine, last month.
Perhaps Mineta has accomplished one thing: solid support for Amtrak everywhere but the White House.
[Brotherhood of Locomotive Engineers & Trainmen, 11-16-05, from International Herald Tribune website article by Don Phillips]
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GOVEXEC.COM ARTICLE...
Amtrak chairman defends dismissal of David Gunn
November 17, 2005
WASHINGTON -- Amtrak's board of directors 'had no choice' but to fire the president of the government-subsidized passenger railroad, Chairman David Laney told lawmakers Nov.15.
Laney defended David Gunn's Nov.9 dismissal in a hearing before the House Transportation and Infrastructure Railroads Subcommittee. He said Gunn was accountable to no one and that keeping him as chief executive officer would head Amtrak down a track to financial ruin.
"Amtrak's financial performance has not improved in the last three years," Laney wrote in prepared testimony. He added that Gunn was "at best, an unwilling bystander" in the board's effort to reform the company, which consumes about $2-billion in federal and state subsidies each year.
One of those reforms was the directors' Sept.22 decision to create a wholly owned subsidiary to take charge of infrastructure along the busy Northeast Corridor between Washington and Boston. It is one of only two profitable Amtrak routes, but carries a $4-billion backlog of needed repairs.
In his prepared testimony, Gunn denied resisting strategic reforms initiated in April. "Those reforms were supported by management," he wrote, adding that "we were on track to implement the reforms that were within our control."
However, Gunn did resist the subsidiary decision, which he said came as a surprise in late August and ultimately resulted in his termination.
Gunn said that over his three-and-a-half-year tenure, Amtrak addressed material weaknesses in its financial reporting system, stabilized its operating losses, improved its capital improvement program's productivity, increased ridership to record levels and cut more than 5,000 employees.
Laney acknowledged that Gunn helped Amtrak achieve much-needed financial stability, but noted that the company still loses about $500-million a year. He said Amtrak's business needs "substantial reengineering" that Gunn was neither suited nor eager to oversee.
[Brotherhood of Locomotive Engineers & Trainmen, 11-17-05, from GovExec.com article by Beth Dickey]
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BOSTON GLOBE WEBSITE COLUMN...
Why Amtrak should backtrack
By Michael S. Dukakis and John Robert Smith, November 18, 2005
BOSTON -- If the Hurricane Katrina fiasco has taught us anything, it is that there is no substitute for competence at the top of important federal agencies. Yet last week a new Amtrak board that has three vacant seats and only one member that has been confirmed by the U.S. Senate removed a man who was almost universally seen as the best president in Amtrak's 32-year-old history.
As the chairman and vice chairman of the Amtrak board in 2002, we recruited David Gunn to run Amtrak because we believed - as did the rest of a bipartisan board that endorsed him unanimously - that he is the kind of straight-shooting, hands-on rail executive needed to correct the long, slow slide in performance and credibility that Amtrak, for many reasons, was enduring.
Gunn is a graduate of the Harvard Business School and has vast rail experience. His performance justifies the confidence we placed in him. Since he took over at Amtrak, head count and management bureaucracy have been sharply reduced, operational efficiency has been improved, and more locomotives and cars have been overhauled at a record pace. As important, Gunn won back the respect of Congress. The proof of that came just days ago, when the Senate voted, 93-6, to support the Lott-Lautenberg bill authorizing $11.4-billion, over six years, for major infrastructure repair and a long-delayed start of work on other corridors across the country.
Amtrak has been seeking capital funds, but has been denied them, for almost all of its 32-year existence. Gunn was the first president in Amtrak history to show Congress why the railroad must have major investment support - as do the nation's highways and airline systems - to serve the public successfully.
By any fair measure, Gunn was a brilliant and successful president. For the first time in decades, Amtrak's management and Congress were moving forward with a clear vision for its future. To replace him in order to gamble on an ill-conceived attempt to mimic the catastrophe of British Rail privatization of more than a decade ago - and make no mistake, that is what the administration is bent on doing - is to take a step backward, not forward, on the creation of a healthy national rail transportation system.
It is not just the Northeast Corridor that needs Amtrak. It is people who live in the towns and cities across America who increasingly have no other transportation alternative - whose airports have been closed or whose bus service has been discontinued. It is millions of motorists stuck in traffic jams on the nation's highways or air passengers stuck in airports when fully a third of flights are for 350 miles or less - an ideal distance for intercity rail corridors - because outside of the Northeast Corridor, we have utterly failed to provide them with the kind of rail service that connects cities in Europe and Japan quickly, comfortably, and efficiently.
We need Amtrak as part of a transportation system that serves all Americans, not just those who can afford to fly or drive. Gunn was building such a system.
The current Amtrak board has a choice. It can stick to its decision and destroy the enormous progress that the company has made under his leadership which they called 'splendid' and 'brilliant' just months ago. Or they can do the right and responsible thing and reinstate him as the chief executive officer of the nation's rail passenger system.
We know what they ought to do. Let's hope they have the wisdom and the good sense to do it.
[Michael S. Dukakis was vice chairman of Amtrak's board. A teacher at Northeastern University and former governor of Massachusetts, he was the Democratic nominee for president in 1988. John Robert Smith served on Amtrak's board from 1997 to 2002, ending as chairman. He is the Republican mayor of Meridian, Miss.]
[Boston Globe website, 11-18-05]
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