This really isn't a unique situation. The non-profit railroad museum boards I have been on and around seem to vary greatly and change over time. Pissing contests like this and financial failures are not unusual.

Remember that many of these boards end up comprising mostly of the members that are active volunteers, and often are also some of the museum "supervisors". Most (but not all) boards do not have a reasonable business plan and corresponding realistic budget that are updated annually or as the situation changes, and track and hold to the budget. These budgets need to contain a 10+% contingency fund which can be used to cover any revenue shortfalls, unexpected expenses or sudden acquisition opportunities. The organization needs to have funded short-term obtainable goals as well as a long term plan.

Typically when it comes to setting and enforcing policy and budget, the boards range from incompetent to indifferent to dramatic. As boards change their focus often does depending upon the stronger member's personal interests. Often there are some borderline potential conflict of interests, but on occasion a board member, officer, supervisor or member will abuse their position for personal gain (financial or sometimes just overbearing) and it throws the organization into a tizzy. Typically the organizations try to avoid confrontation which limits the ability to manage when members fail to follow the board's directions.

Some organizations that have a paid staff and/or "professional" management have done no better. It seems to be a common pattern that without a sustainable business plan the executive director/managers starts to make decisions primarily based on creating income for their paycheck instead of the goals of the organization.

Regardless, any organization that has an outstanding debt that they are selling assets or parts of the collection to resolve is a clear red flag. Most organizations do not have a clear financial statement and don't separate out donations and unearned income from general income when considering their operating expenses. There is little actual understanding of their operating costs and resulting ratio. They also seem to forget that the bylaws should be clear and carefully observed, not to be confused with policy that the board can change at will.

Operating museums have far more issues. Due to general interest and the need to schedule crews, the operating department and its volunteers often ends up having a disproportionate amount of influence with the potential to create the greatest income but also the greatest single expense. Don't forget that a train requires a railroad, and besides volunteers operating the train, you have to sell tickets, make reservations, offer gifts and snacks, just BS with visitors, maintain engines, track, cars and signals. Not to mention there are archives and collection pieces that have to be collected and maintained that will never generate any income. Add to that the necessary administration duties and the thousand other little things (someone has to clean the bathrooms!)

I will agree that being in a fairly isolated area creates challenges for attracting volunteers and visitors, but being in an urban area has its own challenges.

Many organizations do not actively recruit new members to create the next generation of caretakers of our history. Financial issues, lack of direction and squabbling tend to discourage potential and existing members and volunteers which contributes to the downward spiral. It takes strong leadership and a board making tough decisions for the good of the entire organization to be successful. If you don't have a strong and cohesive organization with clear goals, as well as a stable financial situation, there is little chance of obtaining improvement grants which are becoming ever elusive.