How Much for a Burger?
You have to give House Transportation Committee Chairman John Mica, R-Fla., kudos for creativity. A longtime foe of Amtrak, Mica attacked on the caloric front as Congress was adjourning for its August recess. He accused Amtrak of losing $833 million in a food service that is subsidized by taxpayers. To drive home his point, he publicly bought (and ate) a $1 hamburger and $1 soda at a Washington D.C. McDonald's. Why, he queried, does a similar meal cost $9.50 on Amtrak? And why, he pressed further, is Amtrak still losing money on the transaction? The cost to the rail service, apparently, is $16.50.
Amtrak President Joseph Boardman acknowledged in a hearing before Mica's committee that Amtrak's food service only recovered 59 percent of its cost last year. (Amtrak's goal is to recoup 70 percent of the costs by 2015.) But Boardman also pointed out that food and beverage services only accounted for 8 percent of Amtrak's total expenses for the year, and more than half was covered by the revenues from sales. "This is a very small portion of a very large business," he said.
It's hard to see where Mica is going with this line of argument, except to annoy Amtrak partisans. He isn't asking Amtrak to get rid of its food service, which Boardman said would cost more than it would save. For Mica, it is part of a larger beef, so to speak. He has pressed to privatize the federally subsidized rail service for years, but his attempts thus far have been unsuccessful. Elected officials representing the Northeast Corridor tend to balk at the suggestion, worrying that the private sector won't pony up the money and rail service will suffer. Still, whether you love Amtrak or hate Amtrak, the rail service still operates at a loss.
Where is this Amtrak conversation going? Has Mica introduced any new arguments with his burger stunt? Is there any chance Amtrak's subsidized status will actually change in the next year? Who is paying attention to this dispute, and are they persuadable? Does it make sense to single out the food service for criticism?
August 15, 2012 12:09 PM
Better Performance Metrics Needed
By Mark Aesch
Chief Executive Officer, TransPro
This topic will serve great value if it is a catalyst for a broader and much overdue public discussion about how the performance and effectiveness of government transportation agencies can be measured and improved.
Regardless of one’s ideology or political party we should all be able to agree that transportation agencies should operate at the high standards of performance. We should be able to transparently monitor actual performance against pre-established goals. Such management is common in the private sector. Unfortunately, most public transportation agencies do not have a set of weighted metrics to determine how well they are doing, let alone ones that set annual goals and invite transparency to compare their performance with agencies of similar size and mission. In 2011, I appeared before the House Transportation Committee that Rep. Mica chairs to discuss and advocate for competitive benchmarking and evaluation. The recently passed federal transportation act, in fact, obligates transit agencies to report on their performance. Transportation agencies must...
This topic will serve great value if it is a catalyst for a broader and much overdue public discussion about how the performance and effectiveness of government transportation agencies can be measured and improved.
Regardless of one’s ideology or political party we should all be able to agree that transportation agencies should operate at the high standards of performance. We should be able to transparently monitor actual performance against pre-established goals. Such management is common in the private sector. Unfortunately, most public transportation agencies do not have a set of weighted metrics to determine how well they are doing, let alone ones that set annual goals and invite transparency to compare their performance with agencies of similar size and mission. In 2011, I appeared before the House Transportation Committee that Rep. Mica chairs to discuss and advocate for competitive benchmarking and evaluation. The recently passed federal transportation act, in fact, obligates transit agencies to report on their performance. Transportation agencies must cut unnecessary costs, operate more efficiently, and raise revenue by having more and better customer services and amenities. Transforming the operation of many public sector agencies will not be easy and it will not happen overnight, but it must be done. The taxpayer is demanding to be treated like a shareholder – with transparency in reporting, and real results. The journey begins with annual goal setting, quarterly performance evaluation and leaders with the courage to manage based on information.Read More