The U.S.Dept. of Transportation and Amtrak have agreed in principle to an infusion of federal aid that would prevent a shutdown of service in July. In a statement issued the evening of June 26, DOT Secretary Norman Y. Mineta and Amtrak board Chairman John Robert Smith said details were still being made final and no agreement had been signed.

They said the plan includes "immediate financial assistance" from DOT plus a joint Amtrak-Bush administration request for further aid from Congress. An Amtrak spokesman said he couldn't confirm published reports that the assistance would be a $100-million loan.

The proposal also includes other conditions, including improvements in the railroad's "financial discipline and performance."

A supplemental spending bill now in a House-Senate conference may include additional appropriations this year for Amtrak. Senate Appropriations Committee Chairman Robert Byrd (D-W.Va.) has proposed including $205 million in that bill for Amtrak to help the railroad get through its cash crunch. The House version has no funds for Amtrak. Congress is scheduled to begin its week-long July 4 recess after it wraps up its work on June 30.

Amtrak had said its cash position would require it to start shutting down service on July 4 or 5. The shutdown would take several days to complete, and cost about $50 million, says Clifford Black, a spokesman for the railroad.

Black says that Amtrak has been cutting its capital spending, including construction projects and even routine track maintenance. The railroad does have significant infrastructure needs, including an $880-million plan to rectify fire and safety shortcomings in tunnels around New York City, Black says. He also says the catenary system for the electrified stretch from Washington, D.C., to New Rochelle, N.Y., dates from 1935. "We have the desire to replace it, but nowhere near the money--not even the beginning of the money--to do that."

Black adds that capital improvement is an area that new Amtrak President David Gunn would like to address, but says, "Right now, [Gunn is] focusing on keeping the company intact as an entity. As soon as that is reasonably secure, he'll be able to focus on the basics of running a good railroad, which means good track and good mechanical condition."