Ventura County Star

Transportation commission plans to terminate Fillmore & Western Railway lease

By Mike Harris


Originally published 10:46 a.m., May 16, 2013

Updated 05:32 p.m., May 16, 2013

The Ventura County Transportation Commission intends to terminate a lease on Dec. 1 that allows the Fillmore & Western Railway, a private tourist attraction, to use the Santa Paula Branch Line.

But the commission is prepared to negotiate a new lease if it can examine the railway’s financial records, VCTC Executive Director Darren Kettle wrote in a letter this week to Fillmore & Western President Dave Wilkinson.

The commission requested the records in mid-April, but Fillmore & Western had not provided them as of Thursday.

Wilkinson said Thursday that the company’s attorney feels the commission’s request is overly-broad and asks for too many records. Still, he said, the railway will turn over some of the documents beginning in a day or two.

In a letter to transportation commissioners this week, Wilkinson complained that VCTC and Kettle are conducting a “witch hunt” against the railway.

“It is my opinion that all the mismanagement of the Santa Paula Branch Line over the past several years by VCTC is all being blamed on Fillmore & Western,” he wrote.

Kettle said he was left off Wilkinson’s mailing list and declined to comment on the “witch hunt” accusation.

Wilkinson remains hopeful the railway and commission can reach a new agreement to keep the trains running.

“We’re in negotiations and if Mr. Kettle wants to make it a newspaper deal, that’s fine,” he said. “But this is a private corporation and I think everything will turn out fine. We’re going to work as hard as we can to make it work out.”

Without a lease, Fillmore & Western might not be able to stay in business, he conceded.

“That would be the last alternative,” he said. “That’s about all I have to say about it right now.”

Owned by the commission since 1995, the approximately 30-mile rail corridor that extends from Ventura to the Los Angeles County line east of Piru has lost several millions dollars over the past decade.

At its meeting last Friday, the commission vowed to stop the financial bleeding, with some commissioners questioning the wisdom of subsidizing the for-profit Fillmore & Western Railway to the tune of about $600,000 a year in an era of shrinking public transit dollars.

“Commission members expressed a series of concerns that they would like to see addressed,” Kettle wrote in his letter to Wilkinson. “High among those concerns is, at a minimum, the need to make every effort to bring the line to a cost neutral status, and preferably ‘profitable,’ as soon as reasonably possible.”

Even so, Kettle wrote, the commission wants to keep doing business with Fillmore & Western.

“As a number of the public who spoke during the commission meeting stressed, there is public benefit derived from having rail service available on the line,” Kettle wrote.

After the public portion of the meeting last week, commissioners went into closed session with Kettle. On Thursday, Kettle declined to say what he was directed to do, saying it would breach confidentiality.

When pressed about reporting actions to the public, Kettle said: “There are various conditions that relate to lease negotiations that don’t require an announcement. When it comes to negotiations or leases, I couldn’t come out and announce what my negotiating parameters were, since that would obviously ruin my leverage. That’s my understanding from the attorneys.”

Fillmore & Western representatives and supporters told the commission last week that tourism and the economy throughout the Heritage Valley would take a significant hit if the railway went out of business. The railway’s vintage trains, a popular tourist attraction, annually draws about 50,000 to 70,000 visitors, according to Kathleen McCreary, the railway’s director of sales and marketing. Those tourists patronize local businesses, providing cash-strapped Fillmore with much-needed sales tax dollars.

The railway also has been used in Hollywood productions, such as the 2011 film “Water for Elephants” and TV shows like “Glee.”

Fillmore & Western pays the commission 5 percent of fees it charges producers, which Kettle said comes out to about $7,000 a year. The railway also pays the commission monthly rent of $769.

Over the past 11 years, the commission has earned about $3.5 million from the rail corridor, primarily from agriculture leases alongside it, but has spent about $7.2 million during that span, including maintenance costs, Kettle said.

The commission entered into its lease with for-profit Fillmore & Western in 2001. Though the agreement predates Kettle’s tenure as executive director, he said Thursday that “the sense was, I believe, that there was an amount the commission should pay to help Fillmore & Western maintain the railroad tracks in some sort of operable condition.”