Voltage drop and reduced current flow to the intended loads can also be caused by loose fitting track pins which increase the resistance of the track. When more current is drawn by the locomotive and the gateman, the effect of this increased resistance becomes more noticeable.
If the transformer in use is already sufficient (~72 to 80 Watts), fixing the track connectivity issues would be in order, by adding more track power connections evenly distributed around the layout, wiring the gateman separately, and/or by following these recommendations from Lionel:
