A determination to succeed

THE BALTIMORE SUN

WASHINGTON - David L. Gunn left a comfortable retirement in a brown saltbox home on the coast of Nova Scotia to take the helm of Amtrak a year ago last spring.

Had they asked him to do it five years ago, he would have declined, he says.

"I have a philosophy about this kind of situation, that until the problem is really serious, no one will really deal with it," he says. "It's serious. Actually, it's a little more serious than I thought."

In more than 30 years in the railroad business, the 65-year-old Gunn has built a reputation for parachuting in on troubled rail systems - in New York, Philadelphia and Toronto - to slash costs, bolster infrastructure and set passenger trains right. And he has sought to follow the same prescription at Amtrak that has worked so well for him in the past.

He walked in the door to discover what he describes as a "perverted" accounting system that did not produce regular income statements or balance sheets. He now supplies monthly reports on revenue, riders, budget performance and cash flow.

On arriving, he was startled to find 84 Amtrak vice presidents in place.

"If you wanted to have a meeting, you had to rent Madison Square Garden. It was terrible," he says. He has since eliminated 74 of those positions and about 900 other jobs, too, and streamlined the chain of command.

"I want minimum people between me and the foreman running the air brake shop," he says. "One of the things I set out to do early on, like the day I got here, was to go back to a basic, functional railroad organization."

And he is fond of grasping a worn, misshapen cross section of rail from his desktop and holding it in his fist side by side with a new, symmetrical piece to make the point he believes is most critical.

More than 200 miles of rail are overdue for replacement, he says. When Amtrak should have been replacing 40 miles of track a year, it was replacing only five.

Without more money from Congress for repairs, he predicts a crisis in the next year - a major service disruption, a serious accident, perhaps both.

"We've reached the point where they've got to make some decisions," Gunn concludes during a recent interview in his office at Union Station in Washington.

"They have an enormous problem, and it is not something that can be just wished away."

Unwilling to wait for a green light from politicians, he has already placed orders for $172 million in track, engine parts and other equipment, with the approval of Amtrak's board.

Gunn acknowledges that politicians might accuse him of playing chicken to get his way but says he has little choice.

"They're going to have to stop us," Gunn says. "I will not sit here and have the place collapse physically and have people say, 'Why didn't you do something?'"

When President Bush proposed cutting funds and dismantling Amtrak, Gunn issued a direct challenge: a $1.8 billion plan for next year, well over last year's $1.04 billion in funds.

If he gets no more than the $900 million the House agreed to last week, he says he will be forced to shut down the entire system. That amount would barely pay for operating costs and debt payments, he says.

"I'm not trying to be difficult," Gunn says. "I'm trying to give people the real facts that they better grapple with to make decisions."

Of the potential closing of individual lines, he says that's a political decision he will not make.

A new procedure requires each line to apply individually for its federal subsidy. Department of Transportation officials, not Gunn, will decide which gets what, or anything at all.

But Gunn says cutting the lines would save no money for years, in part because labor protection rules require continued salaries for many employees, in some cases for up to six years. Besides, so many lines have overlapping costs, such as payroll and purchasing, that savings would come only if a large number of lines were cut, obliterating the heart of the national rail system.

So why did he take this job?

"This has been my life. Railroading. As crazy as it sounds, I care about the industry, and I care about its survival," he says.

"It sounds a little egotistical, but I thought maybe I could actually make a difference, you know?"

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