Poor management

Losing $80 million a year on Amtrak's food service is close enough to a profit for government work.

A recent headline out of Washington, D.C., demonstrates why the federal government drives taxpayers crazy.

"Amtrak losing millions each year on food sales," the headline states.

The story concerned a congressional hearing into Amtrak's permanent problem of losing big money on the sale of food and beverages, mostly on its long-distance routes.

How much money? Brace yourself.

Amtrak is currently losing about $80 million a year on food and beverage sales. It's lost $834 million on food and beverage sales since 2002.

Amtrak is under an order from Congress that dates back to 1981 to operate its food-service operations at a profit. But it has never done so in the 31 years since.

That reflects poorly not only on Amtrak, which obviously has no idea how to run a railroad, but on Congress as well.

What's ironic is that the prices Amtrak charges are not low. A can of Pepsi costs $2 and a hamburger, $9.50. But that can of Pepsi costs Amtrak $3.40 and the hamburger, $16.

Problems surrounding Amtrak food sales have been attributed to high labor costs, cash thefts and inventory mismanagement. The biggest problem is that Amtrak managers don't really care.

A 2005 General Accounting Office report scorched Amtrak for poor management of its money-losing food service. That prompted Amtrak managers to state that they were aware of the problems and making progress in solving them. Seven years later, not much has changed.

Some kind of food and beverage service needs to be available for train travelers, particularly on the long routes that make up 87 percent of the deficit in food operations.

Why not install vending machines? Or how about contracting with a private food-service company that could run profitably with a captive audience on board?

It's hard to believe that Amtrak officials cannot implement more effective oversight to eliminate the theft of money and food. But, after 31 years of failure, it's pretty apparent that Amtrak cannot change, because no one wants to change and there's no penalty for not changing.

Sections (2):Editorials, Opinion
Categories (2):Editorials, Opinions

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