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Assets do not just

acknowledge the role sunk costs will play in

be used to provide future service;

· Variable-value assets: Equipment that

the disposition of Amtrak assets.

disappear in liq-

will be put to different uses; and

uidation; market

· Low-value assets: Equipment appropri-

Inventory of Assets

forces cause a

ate to only a narrow market niche.

reallocation of

In every line of business the fair market value

Table 1 illustrates possible transfer or disposi-

resources and

tion of Amtrak rolling stock.64 For much of

of assets is represented by the price at which an

assets to their

asset would change hands between a willing

Amtrak's rolling stock, it is likely that creditors

and able buyer and a willing and able seller, act-

with liens on such assets would seek to foreclose

most remunera-

ing at arm's length in an open and unrestricted

on them outside bankruptcy after obtaining

tive possible use.

market. The extent of the market for Amtrak

relief from the automatic stay on creditor actions

assets will become more fully understood when

that goes into effect when a bankruptcy case is

filed.65 In the case of low-value assets, Amtrak

a franchise system is established and potential

franchisees determine which Amtrak assets are

may have paid off the debt incurred to finance

needed for future train operations. Until then,

their purchase, in which case liquidation under

any attempt to assign values to Amtrak assets is

the auspices of a bankruptcy court may be both

hypothetical.

necessary and desirable as the most efficient

In any event, assets do not just disappear in

means of disposing of such assets.

liquidation; market forces cause a reallocation

Real Estate and Facilities

of resources and assets to their most remuner-

Rail Lines. As of September 1997, the value

ative possible use. For example, when Pan

American Airlines, at one time one of the

of one of Amtrak's largest assets, real proper-

country's premiere carriers, declared bank-

ty on the Northeast Corridor, was about $4.3

billion.66 However, the market value of this

ruptcy, its aircraft were not dumped into the

ocean, its terminal gates dynamited, and its

property is untested and may be affected by

routes abandoned. Rather, other airlines,

the easements commuter and freight rail-

chiefly Delta, purchased most assets and hired

roads possess to provide service on the

many former Pan Am workers to fly and main-

Northeast Corridor. Updating the assessed

tain the planes and assets it had purchased.

value is a relevant exercise if this infrastruc-

A byproduct of liquidating Amtrak is that

ture is to be offered for sale to private com-

by selling assets the government can get a

panies. On the other hand, valuation

"refund" (although of admittedly undeter-

attempts may be an academic exercise if the

mined proportions) for assets purchased

line is to be transferred at no cost to a newly

with federal capital subsidies, but clearly that

created regional public authority. The only

is not the main intent of liquidating Amtrak.

other significant piece of right-of-way owned

The following is a representative sample of

by Amtrak is a stretch of track on the Detroit-

Amtrak assets and transfer or disposition

Chicago line. Everywhere else in the nation

opportunities.

Amtrak pays fees to operate over the tracks of

the private freight railroads.

Rolling Stock

Railroad Passenger Stations. Ownership of

It is conceivable that private-sector inter-

train stations and parking garages is quite

ests planning to become franchise operators

varied. In the Northeast Corridor, Amtrak

and others who use rail passenger equipment

owns the larger stations. Many others all

will place Amtrak rolling-stock assets (loco-

along the line from Massachusetts to

motives, passenger cars, freight cars) in three

Maryland are owned by commuter authori-

categories:

ties or other public agencies. Elsewhere in the

nation, Amtrak owns stations whose values

· High-value assets: Those most likely to

range from significant (with Chicago Union

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