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Amtrak Chairman David Laney and President and CEO David L. Gunn today [April 21] announced a series of bold and comprehensive strategic reform initiatives the railroad is undertaking as corporate actions and pursuing in legislation to revitalize U.S. passenger rail service. Additionally, the railroad will seek $1.82 billion in federal funding to support critical FY 06 capital investment programs and to support national operations.

The initiatives seek to transform the funding and development of passenger rail service, and introduce competition, efficiency and cost-savings. These are dynamic measures to strengthen passenger rail service at a time when
our nation needs it most, said Laney. Together, they advance four fundamental objectives:

Development of passenger rail corridors utilizing a federal/state matching approach common to all other modes (generally 80/20). States, not Amtrak, would lead the development of the corridors, a number of which have already
been federally designated, and Amtrak may, among others, competitively bid to provide the service.

Return of the Northeast Corridor infrastructure to a state-of-good-repair and operational reliability, with phased-in financial responsibility for
capital and operating costs assumed on a proportionate basis by all users, including Amtrak, freight and commuter railroads. Establishment of
phased-in financial performance thresholds for Amtrak's existing 15 long-distance trains and any future similar proposed service. Amtrak is
initiating a series of actions to improve the financial performance of these trains. Services falling below the thresholds could be continued through support by states or other authorities, reconfigured or eliminated.

Creation of markets for competition, private commercial participation and industrial reforms in various rail functions. This includes competition
among operators, including Amtrak, for new corridor routes.

Business as Usual Cannot Continue¡¨

Despite the record number of passengers being served by the railroad today, Amtrak cannot continue business as usual, nor can the snail pace of passenger rail development continue to lag behind the growing need in high-demand regions of the country,¡¨ said Laney. These initiatives will
both continue fundamental reform at Amtrak and help spur a rational and much-needed growth of the passenger rail network. It is Amtrak¡¦s belief
that the leadership of such development is the role of states and the federal government, not Amtrak. Instead, Amtrak must in the long run transform itself to a competitive provider of passenger rail services, with the recognition that in the near term it will remain the steward of the national passenger rail system as it is today.

Amtrak Reforms

In 2002, Amtrak eliminated its unwieldy business-unit structure and began a
series of other reforms: reduction of management layers, zero-based budgeting, strict GAAP accounting and other cost controls, including the
reduction and elimination of several routes. Amtrak also returned its focus to the railroad's core business of passenger service and asset rebuilding. More than 5,000 positions were eliminated and the growth in operating costs
was brought under control.

Building on these efforts, Amtrak will for FY 06 align financial accounting, planning and management accountability along five business
lines to facilitate future decision-making. The five business lines are:

Amtrak-owned infrastructure management (principally the Northeast Corridor (NEC)); NEC operations; state corridor operations; national long-distance operations and ancillary businesses. These lines are not a return to the business unit structure and do not separate NEC operations and capital project management. Amtrak has reviewed various proposals to separate the
management of NEC operations and infrastructure, but concluded that complexities and risks of separation outweigh the benefits, and therefore that such a separation is not advisable at this time. With an ultimate goal of a vibrant passenger rail system with multiple service options and a competitive supply industry, Amtrak will undertake a wide range of reforms, including the clarification of individual business activity costs,
increased outsourcing, and the initial facilitation of competition for selected routes and functions.

Public Sector and Legislative Reforms

While internal reforms at Amtrak will help provide a foundation for a competitive and efficient national passenger rail system, strong federal
and state leadership is essential if passenger rail is to meet the demand for service. Among the legislative changes called for to accomplish the
reform objectives are:

Establishment of a federal/state capital match program for passenger rail development, comparable to other modes of transportation. This long-proven federal transportation funding mechanism through which the U.S. Department
of Transportation annually provides more than $40 billion for highway and transit projects.

Designation of a federal agency to oversee the transition to a competitive passenger rail environment, including the distribution of federal funding, selected assets and rights of access. Revisions allowing the transition to a method by which all users of the NEC fund their proportionate share of its costs.

Ultimately, extension of Amtrak access rights on freight railroads to qualified competitors for state-managed services. Targeted revisions to
allow labor agreements to terminate at the conclusion of the term of their agreement.

Federal Funding for Fiscal Year 2006

As Amtrak will undertake the internal reforms addressed earlier and pursue public sector and legislative reforms, little reduction in the need for
federal support will be realized in FY 06. In fact, funding for operations, critical assets such as the Northeast Corridor and other needs are
essential to the success of the reform initiatives Amtrak has outlined. Consequently, Amtrak is seeking federal funding in FY 06 of $1.82 billion.
This request includes $787 million for capital infrastructure projects, $560 million to support train operations, $278 million for service on
existing debt, $175 million in working capital and $20 million for transition costs associated with the reforms previously outlined.

Current federal Amtrak funding (FY 05) is $1.2 billion. However, Amtrak cautioned that an appropriation at this level would be insufficient in FY 06 to sustain operations and the backlog of capital projects the railroad is working to erase. Amtrak's Board and management want to emphasize that Amtrak cannot continue to operate at the current funding level of $1.2 billion in FY06. Amtrak Hearing Scheduled for April 21

Today , April 21, 2005 Amtrak Chairman Laney along with President and CEO David Gunn are testifying at an Amtrak oversight hearing before the Senate Subcommittee on Surface Transportation and Merchant Marine.

The publication, Amtrak Strategic Reform Initiatives, is available at the Amtrak Web Site.

Go to www.amtrak.com in the Government Affairs section.
                    * * *
  The hearing seems to have gone well for Amtrak. News reports said that the majority of the committee were sympathetic to Amtrak and critical of the Administration's budget proposal. 
  Amtrak had earlier announced that the Acela Express trains will be out of service until summer. (Amtrak will publish a new interim NEC timetable as of May 1.) Board Chairman David Laney pointed to the Acela problem as one facet of Amtrak's current needs, saying it would cause Amtrak to run out of money by the end of the fiscal year without increased funding. 
  Subcommittee chair Trent Lott said he was "extremely stunned" by the White House's zero-budget request. 
  Only two Senators spoke critically of Amtrak: Republicans Ted Stevens of AK and John Sununu of NH.
  Three funding plans were introduced. Besides Amtrak's request and the Bush proposal, the DOT Inspector General Ken Mead said Amtrak needed $1.4 billion at least, or $2 billion to put Amtrak in a better position.