ASHINGTON, June 19 — The Bush administration will propose on Thursday to end Amtrak's monopoly on intercity passenger rail service, government officials said today.
They said the plan calls for states to help decide what service will be offered, and to help pay for it. One goal of the new policy, they said, is to introduce competition to determine whether Amtrak or other entities will operate trains.
The transportation secretary, Norman Y. Mineta, is scheduled to describe the policy on Thursday at a breakfast meeting of the Chamber of Commerce of the United States.
The plan is also expected to call for stripping Amtrak of its major capital asset, the Northeast Corridor tracks running from Washington through New York to Boston, which would be taken over by a partnership of the federal government and the states. The corridor needs billions of dollars in capital improvements and is heavily used by transit agencies in the states through which it passes, as well as by Amtrak.
The recommendations follow in part the report of the Amtrak Reform Council established five years ago by Congress to study ways to restructure the railroad, which has run deeper and deeper in the red. The report called for allowing other companies to bid on the right to run trains. The competition could be structured to include a certain level of subsidy, from the federal government or the states.
Amtrak was formed by Congress in 1971, as railroads got out of the passenger business and concentrated on the more viable freight business. The legislation creating Amtrak gave it a monopoly on operating passenger trains, and other passenger trains currently operate with its permission and cooperation.
The Bush proposal, which has been awaited for months by Amtrak and its advocates, would move government involvement in long-distance passenger rail service toward the model used in mass transit, one Congressional aide suggested. Washington would give some money to the states, which would determine how much they wanted to add and what level of service they wanted.
But a Senate aide said he had been told that the administration would require the states to pick up all operating losses on long-distance trains, or the trains would be canceled.
One element of the administration proposal that is not clear to Amtrak or Congressional aides is whether the plan will address the short-term cash crunch the railroad faces.
Amtrak officials say they are having trouble securing a $200 million line of bank credit they say they need by the end of this month to keep operating. As described by government and other officials, Amtrak is caught in a bind, with commercial banks unwilling to extend credit until auditors say that Amtrak is a going concern, and the accountants holding off because of uncertainty about the availability of credit.
David Gunn, the new president of Amtrak, said recently that without a new line of credit, the railroad would have to cease operations this summer.
In testimony prepared for a hearing on Thursday by the Senate subcommittee on transportation appropriations, Mr. Gunn said: "The company had lost credibility on many fronts and its management structure was ineffectual. The company made bad decisions while pursuing an impossible goal of self-sufficiency. Despite these problems, Amtrak and the service it provides are well worth saving. How it has conducted its business over the last few years is something that must be changed immediately if we are to survive."
In an effort to continue operating, Amtrak has been seeking a supplemental appropriation of $200 million to tide it over until the end of the fiscal year, Sept. 30, Congressional aides say. A proposal to give it $50 million to repair cars damaged in derailments is also moving through both houses of Congress.
In another effort to find money for the short term, Amtrak has applied for a loan guarantee from the federal government under a program intended for small freight railroads.
What the railroad will get next year is likewise uncertain. In the Senate, 52 members have signed a letter calling for a $1.2 billion appropriation, but there is no consensus in the House about how much money Amtrak should receive. The administration's budget proposal, released in February, listed $521 million but described that as "a place-holder" until a real number was developed.
The administrator of the Federal Railroad Administration, Allan Rutter, may be questioned about that on Thursday in testimony before the Senate subcommittee.