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Alaska Railroad posts record profit; credit accounting and timing

Posted: Wednesday, April 18, 2001

ANCHORAGE (AP) -- The Alaska Railroad Corporation is reporting a record profit of $16.7 million for the year 2000 -- the most since the state bought the railroad from the federal government in 1985.

Timing and an accounting quirk helped make the numbers that large.

In December of 1999, the railroad suffered a major derailment and jet fuel spill at Gold Creek, north of Talkeetna. It forced a costly cleanup that's still in progress. The railroad also had some winter storm damage and another derailment and fuel spill in October of that year.

Those problems pushed the railroad into the red in 1999, with a loss of $3.8 million.

Last year, though, two federal agencies gave the railroad some grant money to help cover the costs of the Gold Creek derailment and the winter storm damage.

These grants were reimbursement for expenses the railroad booked in 1999. The reimbursements were considered profit once they came in last year.

Without those reimbursements, the railroad's 2000 profit would have been about $6.4 million, a fairly typical showing for the year, railroad officials said.

About two-thirds of the railroad's $104 million in revenue came from hauling petroleum products, gravel and other freight. Freight revenue increased 7 percent over 1999, continuing a decade-long upward trend, the 2000 annual report said.

Passenger traffic generated 13 percent of the railroad's revenue, with 501-thousand passengers served. That's a sharp drop from 1999 ridership of nearly 700,000 passengers, however.

The main reason was suspension of the Whittier shuttle after the new tunnel was opened to vehicle traffic, the railroad said.

Real estate holdings at Anchorage's Ship Creek and elsewhere made up 6 percent of the railroad's revenue, but accounted for 38 percent of its profits, the annual report said.



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