Saturday, June 27, 2009

This Week in Amtrak

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This Week at Amtrak; June 27, 2009

A weekly digest of events, opinions, and forecasts from

United Rail Passenger Alliance, Inc.

America’s foremost passenger rail policy institute

1526 University Boulevard, West, PMB 203 • Jacksonville, Florida 32217-2006 USA

Telephone 904-636-7739, Electronic Mail •

Volume 6, Number 19

Founded over three decades ago in 1976, URPA is a nationally known policy institute which focuses on solutions and plans for passenger rail systems in North America. Headquartered in Jacksonville, Florida, URPA has professional associates in Minnesota, California, Arizona, New Mexico, the District of Columbia, Texas, New York, and other cities. For more detailed information, along with a variety of position papers and other documents, visit the URPA web site at

URPA is not a membership organization, and does not accept funding from any outside sources.

1) Things are getting interesting regarding the sudden departure by retirement of Amtrak’s well-respected Inspector General, Fred Weiderhold.

No one seems to know where this is going, but, fortunately for Amtrak and the American taxpayers, Senator Chuck Grassley of Iowa has taken a strong interest in this situation.

It’s important to note throughout Amtrak’s decades-long corporate life, Amtrak has often been remiss in following normal rules and procedures and courtesies (Not to mention settled law.) in Washington.

Back in the late 1980s, this was the identical case with VIA Rail Canada, run by our cousins in the cold north. Since the Canadian federal government is a parliamentary system of government, things can happen more quickly and dramatically there versus what happens in the United States. The bottom line for VIA at the end of the 1980s was the government of Prime Minister Brian Mulroney felts it was constantly being submarined by the board of directors and management of VIA, and, in a meeting of just a handful of members of the Prime Minister’s cabinet, suddenly, half of VIA Rail Canada disappeared due to a tremendous slash in VIA’s government funding.

That one cut cost the original Canadian on Canadian Pacific Railway lines to be gone, and the lesser route of the Super Continental on Canadian National Railroad lines to become the premier train of the system (With the “Canadian” moniker.), but to this day only operating a tepid tri-weekly service between Toronto, Ontario and Vancouver, British Columbia via Edmonton and Jasper, Alberta. Also soon gone was the Atlantic, which operated between Montreal, Quebec and Halifax, Nova Scotia via St. John, New Brunswick.

The tourist service VIA Rail Rocky Mountaineer survived, but was transferred to private ownership where it has flourished and grown by being freed of the oppression of government ownership.

Several other routes, such as service to Sudbury, Ontario, also disappeared.

Amtrak for decades has played – like VIA Rail Canada – fast and loose with federal law, mostly often obeying federal statutes and mandates when convenient and otherwise doing as it pleased, often ignoring propriety.

Understand, it really didn’t matter who was on the Amtrak Board of Directors at the time or who was running the White House at the time, these games have continued unabated for decades.

Perhaps, a century from now, when a true and deep history of Amtrak is compiled and written by a neutral historian, there will be an understanding of why so many directors of Amtrak chose to either look the other way or did what they did for the sake of expediency.

Maybe, some of what was done was done to get around the vagaries of attempting to run a business in a cesspool like Washington.

But, for whatever reasons things have happened in the past, it looks like a day is dawning when business as usual at Amtrak may have to be radically changed. We saw the many great efforts of departed Chairman of the Board David Laney to put Amtrak on a more transparent and businesslike track. We saw a reduced board after his departure struggle to get through the wrong hiring of Alex Kummant and his subsequent merciful departure. And, we now see a continuing reduced board with buckets of free federal money and lots of extraneous infrastructure projects going on, but without a clear vision of what Amtrak will be later this year or next year.

Here’s hoping Senator Grassley will continue to work to bring the light what is really going on at Amtrak.

Amtrak Interim President and CEO Joseph Boardman, a creature of government and not accustomed to working within or for private sector boundaries needs to take the lead with Senator Grassley and reveal what his management team is doing to solve any problems being identified as holding Amtrak back from greatness.

2) This is a press release, published in full, from Senator Grassley’s office. Keep in mind this is a press release from a politician, not a news story.

[Begin quote]

For Immediate Release

June 25, 2009

Grassley asks Amtrak to respond to report describing interference with IG work

WASHINGTON --- Senator Chuck Grassley has asked Amtrak about the circumstances of the Inspector General's unexpected retirement seven days ago and invited Amtrak to provide information about the interference by Amtrak in the work of the Inspector General described in a report prepared at the request of the retired watchdog.

Grassley said the report indicates that Amtrak's policies and procedures have systematically violated the letter and spirit of the Inspector General Act.

"As I continue my investigation into whether the independence of the Inspector General was undermined by Amtrak officials, I want to make sure I have any and all information Amtrak wants to provide," Grassley said. "The allegations are serious, including third parties being told to first send documents under subpoena by the Inspector General to Amtrak for review, and the Inspector General being chastised for communicating directly with congressional appropriations and authorizing committees,"

Grassley asked the Office of the Inspector General last week for a copy of the report, which was prepared by the law firm of Willkie Farr & Gallagher. Grassley said his office had been in communication with former Inspector General Fred Weiderhold about the issues before Weiderhold's retirement on June 18, 2009.

Also this month, Grassley has been investigating the President's decision to fire the AmeriCorps Inspector General, after the Inspector General issued two reports of mismanagement and abusive spending by AmeriCorps grantees. Grassley also has asked the International Trade Commission to account for its termination of its Inspector General who had been repeatedly hired for six-month increments and been given outstanding performance reviews. In both cases, Grassley said the administration failed to comply with a law enacted last year requiring Congress to be notified 30 days in advance of the dismissal of an Inspector General and given the reasons for the firing. Then-Senator Barack Obama co-sponsored the legislation along with Grassley.

"Inspectors general are watchdogs over the federal bureaucracy, and the Inspector General Reform Act of 2008 is supposed to better safeguard their independence so they can do their jobs for taxpayers and program stakeholders," Grassley said. "The President has said he wants more accountable government, and keeping good watchdogs on the job is fundamental to that goal. Inspectors general need to be strengthened, not undermined."

Last week, Grassley asked the Treasury Secretary to put an end to documented resistance from the Treasury Department to requests for information from the Special Inspector General for the Troubled Assets Relief Program. Senator Grassley was an advocate for creating a Special IG for TARP to try to hold the program accountable and co-sponsored legislation to strengthen the ability of the Special IG to conduct oversight after the TARP program changed its original mission. Earlier this year, Senator Grassley also battled the White House after it tried to subject requests of the Special IG to the red tape of the Paperwork Reduction Act. Grassley subsequently introduced legislation to exempt the Special IG from the Paperwork Reduction Act.

Grassley has long worked to empower inspectors general to conduct effective oversight of the federal bureaucracy and he has held inspectors general themselves accountable for meeting the requirements of the jobs.

The text of Grassley's letter to Amtrak is below, along with his letter of last week to the Amtrak Office of the Inspector General, which sought a copy of the report. The attachment to today's letter, including the "Report on Matters Impairing the Effectiveness and Independence of the Office of Inspector General," are posted here.

June 25, 2009

The Honorable Thomas C. Carper

Chairman of the Board


National Railroad Passenger Corporation

10 G Street, NE

Washington, DC 20525

The Honorable Lorraine A. Green

Interim Inspector General


Office of Inspector General

National Railroad Passenger Corporation

10 G Street, NE

Washington, DC 20525

Dear Chairman Carper and Interim Inspector General Green:

Thank you for your response dated June 23, 2009. My staff is currently in the process of reviewing information from various sources concerning the Amtrak Office of Inspector General (OIG). I am interested in the facts regarding former Inspector General Fred Weiderhold's (IG) retirement. Interestingly, he retired on the same date that the law firm of Willkie Farr & Gallagher, LLP completed a "Report on Matters Impairing the Effectiveness and Independence of the Office of Inspector General" ("Report"). I understand that there was a meeting with Mr. Weiderhold and the Board of Directors on that same date as well, and that his decision to retire was made during that meeting. Accordingly, please:

1) provide a description of the circumstances surrounding former IG Weiderhold's unexpected retirement, specifically the relationship between the timing of his retirement and the Report;

2) produce any and all internal as well as personal materials relating to: (a) the former IG's departure; and (b) the Report; and

3) produce any and all materials cited in footnote 7 of the Report.

For definitions related to this request and all future requests, please refer to Attachment 1.

The Report prepared by Willkie Farr & Gallagher, LLP and Attachment 2 suggests a long-term and unrelenting interference with the activities and operation of the OIG. The Report seems to indicate that Amtrak's policies and procedures have systematically violated the letter and the spirit of the Inspector General Act, as amended. However, in order to ensure that Amtrak has an opportunity to respond, please identify any factual representations with which you disagree, or about which you wish to provide additional information. Please be sure to provide documentation in support of your position(s).

I also want to thank you both for offering to "maintain an open line of communication" with my office, and look forward to my staff receiving a briefing from you. In addition, I would appreciate your making the following individuals immediately available for interviews:

1) D. Hamilton Peterson, Deputy Counsel to the Inspector General;

2) Edward Puccerella, Director of Congressional & External Affairs;

3) Colin C. Carriere, Counsel to the Inspector General; and

4) E. Bret Coulson, Deputy Inspector General.

It was also reported to my staff that some OIG staff members may be fearful of retaliation if they were to discuss the matters set forth in this letter with anyone, including Congress. As you may be aware, 18 U.S.C. § 1505 prohibits obstruction of Congressional inquiries. Denying or interfering with employees' rights to furnish information to Congress in any way will be considered an obstruction of our inquiry. Amtrak and Amtrak OIG employees should be free from fear of retaliation or reprisal, and authorized to freely answer questions from Congress without representatives from Amtrak present, if they so desire. Accordingly, I would appreciate your advising the OIG and all full-time, part-time and contractor employees at Amtrak of the fact that they are free to contact Congress without advising Amtrak management or their respective supervisors.

Thank you again for your continued cooperation and assistance in this matter. As you know, in cooperating with the Committee's review, no documents, records, data or information related to these matters shall be destroyed, modified, removed or otherwise made inaccessible to the Committee.


Charles E. Grassley

Ranking Member


June 18, 2009

E. Bret Coulson

Deputy Inspector General Management & Policy

Office of Inspector General


National Railroad Passenger Corporation

10 G Street, NE

Washington, DC 20525

Dear Mr. Coulson:

As a senior member of the United States Senate and as the Ranking Member of the Senate Committee on Finance (Committee), it is my duty under the Constitution to ensure that Inspectors General, which were created by Congress, are permitted to operate without political pressure or interference from their respective agencies. Inspectors General were designed for the express purpose of combating waste, fraud, and abuse and to be independent watchdogs ensuring that federal agencies were held accountable for their actions. I understand that Inspector General Fred Weiderhold, Jr. has retired today.

Based on contacts that my staff had with Mr. Weiderhold on two recent occasions (April 2, 2009 and June 4, 2009), I understand that the OIG has suffered from repeated and continuous interference from the agency. After the most recent discussion, it was agreed that the OIG would provide, among other things, a White Paper and specific examples of agency interference with OIG audits and/or investigations. To date, the OIG has not yet provided any documents. As you know, any interference such as that was described in these previous discussions is a direct violation of the Inspector General Act of 1978.

In light of Mr. Weiderhold's unexpected retirement, please provide the previously requested documentation immediately. I am deeply troubled that these aforementioned meetings with my staff and discussions of the OIG's independence concerns predicated this personnel action with IG Weiderhold. Furthermore, I am even more concerned that there is a lack of accountability, based on the OIG's reported lack of independence, for the $1.3 billion in stimulus funds that Amtrak has received from American taxpayers.

Due to these recent events, I specifically request all materials at the IG's office be preserved immediately.

In addition to providing the requested documentation, please provide an immediate briefing to my staff on the level of proper oversight the OIG has over of the $1.3 billion dollars of American taxpayer money, and what role the previously discussed independence issues with the agency played in the elimination of former IG Weiderhold.

Thank you in advance for your assistance and I would appreciate a response to this inquiry by June 19, 2009.


Charles E. Grassley

Ranking Member of the

Committee on Finance

cc: The Honorable Thomas C. Carper



National Railroad Passenger Corporation

Joseph H. Boardman

President and Chief Executive Officer


National Railroad Passenger Corporation

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United Rail Passenger Alliance, Inc.

1526 University Boulevard, West, PMB 203

Jacksonville, Florida 32217-2006 USA

Telephone 904-636-7739

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