Amtrak Warned of Struggles to Spend ‘Unprecedented’ Funding

The surge in spending to Amtrak from the infrastructure law could hurt the rail company’s ability to manage its current resources, according to a new watchdog report.

Amtrak will need more staff, updated asset management systems, and better fraud detection as it implements billions of dollars from the recent infrastructure law (Public Law 117-58), Amtrak’s Office of the Inspector General found in a report unveiled Monday.

The law increased Amtrak and Federal Railroad Administration funding by about $66 billion, which the OIG called “an unprecedented expansion.” The report warned of “a potential strain on the company’s ability to manage its current operations while concurrently planning and managing a long-term multibillion-dollar infrastructure portfolio.”

Photo: Jon Cherry/Bloomberg

An Amtrak train car at the Memphis Central Station on Feb. 25, 2022.

Many of Amtrak’s systems, such as its incident reporting and workforce scheduling systems, are outdated and don’t offer timely data, OIG found, although it said the company has started to work on upgrades.

Amtrak will need to manage at least $22 billion in capital spending to its national network and Northeast Corridor from the infrastructure law. To stop any fraud and waste, the report said Amtrak will need “robust internal controls” after recent investigations discovered bribery and bid-rigging.

Amtrak CEO Says $75 Billion Growth Plan Relies on State Support

Amtrak has struggled with staffing challenges in recent months. It plans to expand its workforce by as much as 21% this year, including hiring new managers to lead projects funded by the infrastructure law, which the OIG report warned would be challenging.

Many of the railroad company’s employees retired or left during the pandemic. A previous OIG report from December found the company’s human resources department didn’t have adequate staff or managers to recruit and onboard new workers. The company was forced to reduce trips amid staff shortages because of outbreaks.

Amtrak has an ambitious $75 billion growth plan covering the Northeast Corridor as well as other regions. The Biden administration proposed in its fiscal 2023 budget to increase money for rail, including $100 million for the Gateway Program’s Hudson Tunnel Project between New York City and New Jersey. The OIG previously found that Amtrak needs to shore up its workload management to avoid further delays in the that project.

To contact the reporter on this story: Lillianna Byington in Washington at lbyington@bloombergindustry.com

To contact the editors responsible for this story: Sarah Babbage at sbabbage@bgov.com; Adam M. Taylor at ataylor@bgov.com