The Alaska Railroad has laid off 127 employees.

Pat Gamble, the railroad's president, sent an e-mail to employees Tuesday. In it, he says 127 funded positions have been laid off.

Gamble adds this does not, by itself, solve the railroad's financial problems.

A message left by The Associated Press with the railroad on Tuesday was not immediately returned.

Officials had earlier estimated a 20 percent cut in its workforce. It has about 700 year-round employees and hires another
100 on a seasonal basis.

The railroad is dealing with declining revenues because of a drop in tourism and reduced production at the Flint Hills petroleum refinery. More than a third of the railroad's revenue comes from transporting products from the North Pole refinery.