Amtrak's board fired the company's president on Wednesday morning, widening a divide between the Bush administration and Congress over the future of the railroad.
The board chairman, David M. Laney, said that the president, David Gunn, helped develop a strategic plan that would have injected more competition into passenger operations, but that Mr. Gunn's "enthusiasm and commitment seems to have drained away."
Amtrak President and CEO David L. Gunn, testifies on Capitol Hill in this April 27, 2005 file photo. Amtrak's board called a meeting for Wednesday, Nov. 9, 2005 and plans to fire Gunn, according to Sen. Charles Schumer, D-N.Y. Gunn has clashed with the Bush administration since assuming the post in 2002. He has said Amtrak can't survive without federal subsidies while the administration has pushed to eliminate them. (AP Photo/Manuel Balce Ceneta, File)
Mr. Laney said Mr. Gunn had failed to move forward on simpler initiatives, like outsourcing maintenance and catering in a way that would cut expenses.
But in a letter to the board dated Nov. 9, Mr. Gunn said, "I can assure you that we have already begun to work on those initiatives that are wholly within our control." In a telephone interview Wednesday he said some changes would require action by Congress.
Mr. Gunn, who is credited with turning around New York City's subway system in the 1980's and came out of retirement three years ago to steer Amtrak successfully during a financial crisis, described the reason for his dismissal as "ideological."
"Obviously, what their goal is - and it's been their goal from the beginning - is to liquidate the company," Mr. Gunn said in the interview.
The Bush administration has proposed putting the railroad tracks of the Boston-to-Washington Northeast Corridor, which are Amtrak's major asset, in the hands of a federal-state consortium, an idea Mr. Gunn has vehemently opposed. The board has voted for now to put the corridor in a separate subsidiary.
Mr. Gunn said he did not oppose injecting some competition into the system if it was done carefully. He pointed out that the administration had discussed bankrupting the railroad, which would mean breaking it up, as a way to reorganize.
"They want at least one transportation mode that is totally free market," Mr. Gunn said.
But highways, airports and ports are all federally subsidized, he said, decrying "all this angst over an operating deficit of 500 million bucks for the whole country, and the bulk of money going into capital or infrastructure."
The action Wednesday was a sharp turnaround for the board. Asked in September about Mr. Gunn's performance, Mr. Laney told a Senate subcommittee, "Mr. Gunn has done, as far as I am concerned, a splendid job."
He said Mr. Gunn had "righted a ship that was listing and about to spill over."
Mr. Gunn is known as a rail-turnaround artist. He was brought in to fix the New York City subway system in the 1980's, and provided leadership in the construction of the subway system in Washington.
Amtrak's supporters in Congress reacted swiftly and bitterly to Mr. Gunn's removal. Democrats sought to contrast what they said were his successes, including cutting expenses, increasing ridership and improving the railroad's physical condition, with the recent failures of the Federal Emergency Management Agency after Hurricane Katrina.
"We have learned recently that there is room for cronies in this administration," said Senator Byron L. Dorgan, Democrat of North Dakota, "and we've learned the cost of cronyism. And now we've learned today there is not room for straight shooters."
Senator Charles E. Schumer, Democrat of New York, questioned the board's legal ability to fire Mr. Gunn. Only one board member, Mr. Laney, has been appointed by the president and confirmed by the Senate, Mr. Schumer pointed out. The secretary of transportation is, by statute, a member, and two other members are recess appointments, whose terms will expire when Congress goes home in a few weeks. There are three vacancies.
"Gunn is more legitimate than the board is," Mr. Schumer said.
He asserted that Mr. Gunn was fired over policy, saying: "The policy difference is that the board wants to kill Amtrak and Gunn wants it to prosper. It's that simple."
The railroad announced Wednesday morning that Mr. Gunn had been "released" from his job, then notified Mr. Gunn. He replied with a memorandum to the board: "For your information, I did not resign. I was removed. It's been fun. Good luck."
Mr. Gunn, 68, was paid $275,000 a year. An Amtrak spokesman, Clifford Black, said he did not know if there was a severance package.
On Sept. 30, the railroad ended the fiscal year with $120 million in cash as operating capital, a strong performance, Mr. Gunn said, especially considering that the Acela express train was out of service for most of the summer because of a brake problem. The Senate just voted 93 to 6 to authorize $11.6 billion for Amtrak over the next six years, although the vote did not actually appropriate any money. That measure, which will probably go to a conference committee to work out differences with a House version, would make the Amtrak president a member of the board.
Both the House and Senate have supported aid packages for the current fiscal year that are far more generous that the White House has proposed.
But the Government Accountability Office said last week that while progress had been made at the railroad, Amtrak needed "fundamental improvements."
Mr. Gunn is widely credited with improving the railroad's management, cutting costs, imposing better financial controls and improving the state of repair of Amtrak's locomotives and passenger cars, which are old, and its tracks, signals and electrical systems, which are truly antique. But while ridership has recently risen to record levels, government auditors predicted that Amtrak's budget deficit would grow sharply in the next few years. The administration has said it is determined to end the perennial subsidies to the railroad, which was created 30 years ago to take over passenger service as the commercial railroads abandoned that business as unprofitable.
Copyright 2005 The New York Times Company