Amtrak yesterday settled a race-discrimination lawsuit brought by a passenger and agreed to improve the way it handles complaints against its employees.

Without admitting wrongdoing, Amtrak agreed to an undisclosed financial settlement. It also said it would change how it records and documents discrimination complaints. Amtrak agreed to track complaints against employees and to have them investigated by its equal employment office rather than by an employee supervisor, as is the current practice.

Amtrak spokesman Clifford Black said the company was already working to implement nondiscrimination policies before the settlement was reached. "We agree with the policies that were set forth in the settlement and we're already putting them in place. We have zero tolerance for any discriminatory behavior on the part of any Amtrak employee," Black said.

The nation's passenger railroad system also has been hit in recent years by race discrimination lawsuits brought by its employees.

Warren K. Kaplan, an attorney for the Amtrak passenger who was the plaintiff in the case, said Amtrak managers were too busy focusing on the railroad's financial problems to properly manage internal employee issues. "Discrimination was allowed to go unchecked for too long a period of time," he said.

The railroad's financial problems were again in the spotlight yesterday as the Government Accountability Office issued a report that said Amtrak management needed fundamental improvement in many areas including cost control, goods and services purchasing and overall accountability. Amtrak's financial difficulties prompted the GAO review of its management procedures.

"Although Amtrak management has taken steps to instill discipline and control over its operations, the corporation still lacks effective operating practices characteristic of well-run organizations, whether public or private," the report said.

Transportation Secretary Norman Y. Mineta called the report "thoughtful" and "comprehensive" in its judgment of Amtrak's performance. "The Amtrak Board must stop and take a fresh look at how to proceed in the face of this nonpartisan, objective report of systemic failure," Mineta said in a written statement.

In one case, the report said Amtrak understated expenses by omitting $606 million in depreciation and $100 million in employee benefits.

A bipartisan House panel was appointed yesterday to assess the railroad's operations. The group is scheduled to present its findings to the House Committee on Transportation and Infrastructure in February.

Despite its problems, Amtrak won Senate approval yesterday of $1.9 billion in annual subsidies. In June, the House approved $1.18 billion in subsidies. The two houses must now reconcile the difference. President Bush has opposed the subsidies, arguing that Amtrak should be split into separate units and that subsidies should be significantly reduced.

The lawsuit settled yesterday involved a black passenger who charged that a white conductor discriminated against him and his family and humiliated them in front of other passengers on a trip in 2000.

According to the complaint, passenger David Parker of St. Albans, N.Y., his daughter Sueann and her 8-year-old nephew were traveling to New York from Fort Lauderdale, Fla. The train's conductor, Richard Brewer, who is white, prevented the Parkers from bringing their luggage into the passenger compartment and loudly ordered them to check their bags, the complaint said. When the Parkers boarded the train, they found that white passengers had been permitted to bring their luggage on board.

Reached at his home, Brewer said he was the assistant conductor and declined further comment.

Kaplan, Parker's lawyer, said he learned during his investigation of the complaint that Brewer had been the subject of 10 racial discriminatory complaints over 21/2 years. Eight of the complaints were from minority passengers and two were from minority co-workers. One came from a black passenger who alleged that Brewer had referred to him and other blacks on board as a "load of watermelons."

Kaplan said Brewer was never severely disciplined or demoted and that he had retired from the railroad. Black, the Amtrak spokesman, confirmed that Brewer no longer worked for the railroad but declined to elaborate.

Yesterday's settlement followed race-discrimination lawsuits against the railroad brought by employees in recent years.

In 1999, Amtrak agreed to pay $8 million and to make extensive changes in its hiring, promotion, compensation procedures as part of a class-action lawsuit brought by a group of Amtrak's current and former black managers.

Last year, a former Amtrak employee won a $500,000 jury verdict against Amtrak after he sued the company claiming that he was subject to a racially hostile work environment for several years at its Oakland, Calif., train yard.

"Isn't it ironic that in the week we are celebrating the life and legacy of Rosa Parks that we are still fighting discrimination in public transportation?" Kaplan said.