My comments in reply to various above:

The track was originally part of Union Pacific's Joseph branch. This part of the line was sold to Idaho Northern and Pacific in the early 1990s, along with several branches in Idaho. Not long after, Boise Cascade imploded and closed most of their mills on the branches, including one at Joseph. The line was approved for adandonment between Elgin and Joseph. IN&P still operates the line between La Grande and Elgin (where there is still an active Boise stud and plywood mill) under a lease from UP.

Literally as the scrappers were pulling the first spikes, Union and Wallowa counties stepped in and formed a rail authority under state law to purchase the in 2003 line using a combination of state and federal grants and loans. The loan was paid off last year using revenue from the storage cars. The Wallowa Union Railroad Authority has members appointed from each county (local politicians and business members), and one from the state (ODOT). Before rail operations could resume, the last mill in Joseph closed. The last remaining mill in Wallowa closed at the beginning of the recession, leaving no viable freight traffic. The WURR board does not wish to salvage the line except as a last resort since their primary purpose is to retain the rail infastructure to allow future industrial development that requires rail service and would provide needed jobs. The largest employers in Wallowa County are now government and the hospital.

As part of the economic development related to the railroad, the Eagle Cap Excursion Trains have been operated by WURR with assistance from the Friends of the Joseph Branch, a local non-profit organization. The Friends have refurbished some of the passenger cars and provide volunteers on the train (including some train crews the last few years), and use gift sales to support their activities. Over the years, the Eagle Cap Train has used a variety of operating schemes and been based out of Joseph, Wallowa, Minam and Elgin. It does not appear that the excursion trains have only been able to pay at best its own operating costs, and the loss of freight traffic means that excusrion operations must now pay all of track engine and overhead expenses. Ridership has been fairly light with somewhere around 2500 passengers being their highest year, though recently was far less since the trains have been limited to running every other Saturday during the tourist season to limit losses. At times in the past, just the advertising, ticketing and catering costs have exceeded half the ticket revenue.

There have been offers in recent years for private companies to operate the trains at their own financial risk, but these efforts have been rejected due to concerns about using public property for profit, which would require that property taxes be paid on the railroad, adding $50k to expenses. Frontier Rail did manage to operate some trains at their own financial risk and loss for a while before being unable to reach a formal agreement. The Friends group has not supported the concept of an operator unless the Friends retained primary control of the excursion train, though the Friends group is not financially respponsbile for any loss. The WURR board has asked for bids for oeprators at least three times. Frontier was successful the first round, only one bid was recieved and rejected the second time, and Sierra Nevada and Pacific was chosen by the board last September.

Originally the Friends were to have had complete responsibility for the excursion train operations with WURR only responsible for providing an engine and train crew. Due to various issues, WURR has retained primary and financial responsibility though the Freinds have had substantial influence oon the schedule, advertising and fares. The Friends have never submitted a proposal to run the railroad themselves but have been quick to exert their influence over any potential operating proposal. In September the Friends threatened the board to withdraw their support and volunteers because neither bidder had consulted them before submitting their proposal.

For any potential bidder/operator, the following requirements have been listed:

1. The railroad authority cannot lose money, and is not offering any subsidy.
2. There is an expectation that freight service must be offered, though there is no viable demand. One customer wants a few tankcars of dust control agent in the spring.
3. The Friends' wishes must be considered and their participation allowed.
4. WURR handles all funds to avoid the property tax issue. I'm not sure how this was resolved for Sierra Nevada and Pacific - maybe they are a non-profit and are exempt - or all funds are handled by WURR?

The realities that have to be considered for any potential operator are:

1. No viable freight traffic in the foreseeable future.
2. The historical ridership of the excursion train has been too low to pay expenses even before the full amount of overhead and maintenance expenses are considered.
3. The majority of the ridership has been seniors from the region, not typical of most scuccesful operations.
4. There are no shop facilities an important requirement for a steam locomotive.
5. A steam locomotive will double or triple operating costs due to repairs and fuel.
6. The area is fairly isolated, 20-70 miles off I-84. Joseph does seem to have a decent amount of tourist traffic.
7. Some of the track is in an isolated canyon with the attendent issues (slides), while the upper end of the line in the valley is far less scenic or parallels the highway.
8. Track speeds are 10-15 mph, making the trips fairly time consuming.
9. There is competition in the region with other rail oeprations closer to population centers. The Boise area has the Thunder Mountain Train which seems to be successful with an impressive schedule, and does has money behind it (same family that owns IN&P). Visitors from Portland have to drive right by the Mt. Hood Railroad, which has Iowa Pacific behind it. Those interested in steam have the option of the Oregon Coast Scenic (As close to Portland as the Mt. Hood) or the Sumpter Valley which has been in operation for 30+ years 90 miles from Elgin and about just as far off I-84 and much closer to Boise.
10. Any operator has to meet the WURR's requirements (no losses, WURR handling the funds, substantial liability insurance requirements); and somehow appease the Friends desire to be in control to retain the needed and valued assistance of their volunteers.
11. This is a common carrier railroad under full FRA rules - and the board tends to try to accomodate any request by other public agencies that may add additional requirements.
12. The WURR acts somewhat as a de facto economic development project so it does come with many political considerations that don't always make the railroad's needs the first priority.

In my OPINION, the WURR line has potential as a tourist operation, BUT will require the freedom to make some hard business decisions, requires the investment of time and money (remembering this is only a lease or contract subject to cancellation with 90 days notice), and has stumbled for several years already. It cannot support operating all 63 miles of line, or the added expense of a steam locomotive.

I am guessing that the addition of a steam locomotive will provide an added draw for a couple seasons, but the added revenue will still not cover costs. Under the best circumstanes, success and survival of this oepration is not assured and is a long shot - before even considering the history, reputation and financial ability of the new operator.

If/when Sierra Nevada & Pacific fails - will the board be forced to mothball/salvage the railroad or look again for womeone to operate a failed tourist operation under such challenging conditions?

Yes - I do have limtied inside information (it is a public agency and nothing here is confidential information) and a potential conflict of interest. This ranting is nothing but my opinion.