By Noel T. Braymer

With the retirement of Amtrak President Joe Boardman effective this September, with little advanced notice the Amtrak Board of Directors recently announced its selection of Charles “Wick” Moorman to take over as Amtrak President. So who is Mr. Moorman? He recently retired as the CEO of Norfork Southern Railway after a career there of over 40 years. He was chosen over many other applicants for the job at Amtrak. So, why would he want to be Amtrak’s President? It is doubtful that money was a reason. As a retired CEO of a major company one can assume that he is well off financially. His salary at Amtrak will be $1 a year. But he can earn up to $500,000 bonuses a year based on his performance as Amtrak President

With a long career in railroading, Mr. Moorman is likely interested in the impact Amtrak has on the railroad industry. Often there are tensions between the Class 1 railroads and Amtrak. But because railroad workers are not included in Social Security, rail employees and their railroads instead have payroll taxes that go to the Railroad Retirement Board. Amtrak has many employees in the railroad pension system and also contributes a major share of revenue toward it. If Amtrak were to be greatly diminished or to go away entirely, this would place a much greater burden on paying into the Railroad Retirement Fund on the Class 1 railroads.

At the moment, the railroad’s business is way down. Trade in general is slow all over the world with low demand holding back buying. On top of this the demand for coal shipments by rail is way down and unlikely to rebound. Much the same is true for carrying oil by train, which was booming just a few years ago when oil was over $100 a barrel. Two major areas of conflict between the Class 1’s and Amtrak include the major discounts by law they have to give Amtrak for using their tracks. The other is problems with Amtrak trains often running late or breaking down on the Class 1 railroads. This disrupts traffic on their lines and causes their trains to also be late, costing them money. There is also the question of public relations. The public when they think of railroads, are more likely to think about passenger service, than of freight. This even though freight dominates rail use. There is also widespread interest around the country for additional and new rail passenger service. These are all issues that Mr. Moorman will be facing as Amtrak President.

Amtrak and the Class 1’s will benefit if Mr. Moorman can improve the time keeping and reliability of Amtrak trains. Increasing the payments to the railroads would also improve Amtrak’s relationship with the Class 1’s. But to accomplish these will require besides improved maintenance, more and newer equipment. Expanded and a more reliable Amtrak would improve both the image of Amtrak and of railroads in general. This could also lead to government grants for track improvements which could benefit both passenger and freight rail service. In order to attract more traffic, the railroads will need to improve its infrastructure. This includes many ancient bottlenecks such as exist in Chicago. But the railroads while recently greatly improving their mainlines, are now faced with low traffic and will have trouble paying for improvements until the world economy rebounds.

If Mr. Moorman was looking for a challenge, he certainly will find it at Amtrak. But it will also allow him to deal directly in Washington with the powers that have a major impact on the railroads. A better running and more successful Amtrak can be a good thing for the railroads. This can improve the public image of the railroads. Having oil trains blowing up and catch fire for days at a time is not good for the railroad’s image. If working at Amtrak Mr. Moorman can improve rail service, on time performance, increase revenues while controlling costs and make a case for improving railroad infrastructure nation wide for the benefit of passenger and freight service, then the entire rail industry will benefit. Time will tell if these goals are in the mind of Mr. Moorman and how well he will succeed.