WURR Wrote:
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> 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.

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Sounds like sour grapes from a potential competitor who can't or won't step up to take a risk but wants to take potshots at the successful bidder.

Why don't you put your real name on your posts?