Rail Runner a Fiscal Challenge (NM-Looking for ways to save Richardson's Railroad)

The Albuquerque Journal ^ | July 3, 2011 | Larry Abraham, Vice-Chair, Rio Metro Regional Transit District board

[CedarDave]

As vice chairman of the Rio Metro Regional Transit District board, and the member who made the motion to end weekend service, I feel a certain responsibility to bring to light the facts we are facing. ... the bottom line is that all the citizens of New Mexico are carrying the $1.3 billion financial burden of the Rail Runner.

... the train is serving approximately 2,250 individuals per weekday.

The Rail Runner is facing a $1.2 million deficit in fiscal 2012, which begins July 1 of this year.

We faced a similar financial crisis in late 2009. Gov. Richardson directed stimulus money toward the weekend operations.

This only prolonged the inevitable. We are now facing the real question of the sustainability of the Rail Runner operations.

It is $1.2 million of the Congestion Mitigation Air Quality funds that expire this year. Even more important, the balance of those funds will go away in 2013 creating an additional $5.4 million deficit in fiscal 2013.

The state has spent a half billion dollars on the Rail Runner. Under ... Governor Richardson’s program, the state issued highway revenue bonds to pay for the Rail Runner. This means that with principal and interest the state is obligated for nearly $850 million over the next 16 years to pay for the Rail Runner, ... whether we run the Rail Runner or not.

... the budget for the Rail Runner is approximately $23 million a year, with fare box revenue being $3.2 million or 13.5 percent of the total operating budget.

Putting this in even bleaker perspective over the span of 20 years, the true cost of the Rail Runner is close to $1.3 billion, with revenues of only $60 million.

[CedarDave]

It's refreshing to have a public servant put forth the truth of financing of the Rail Runner. As far back as 2006 or even earlier, word was out as to what Richardson was doing with highway funds and how he bamboozled the Democratically controlled legislature to fund the railroad, first with the purchase of the BNSF line then less than $200 million in funds to get the first segment up and operating. The second segment involved the biggest capital construction project in state history -- building a line from the Rio Grande valley up the lava cliffs to the plateau where Santa Fe is located. Construction costs were said to total just under $500 million dollars. Now, the true cost of the project ($1.3 billion) comes into the light and the state taxpayers are on the hook for $850 million whether it runs or not.

The first several years of operation were buoyed by air quality mitigation and stimulus funds. Both have/are ending requiring creative ways (including increasing fare - duh!) to save the service, if it is worth saving. Irrespective of the fate of the train, as he said, the state is still on the hook for $850 million.

Abraham hopes (as do many SF businesses) that creative ways can be used to make it a tourist attraction in addition to a commuter train. This involves getting ABQ/SF residents and visitors to use it on off hours and on weekends, provided such service can reduce the bottom line and increase farebox recovery to cover much more of the operating cost.

If not, sell off the engines and cars, mothball the line, and reinstate running buses to and from Santa Fe for a cost to taxpayers of $800,000 per year.

[CedarDave]

...the true cost of the project ($1.3 billion) comes into the light ...

NM list PING! Click on the flag to go to the Free Republic New Mexico message page.

(The NM list is available on my FR homepage for anyone to use. Let me know if you wish to be added or removed from the list. For ABQ Journal articles requiring a subscription, scroll down to the bottom of the page to view the article for free after watching a short video commercial.)

[EQAndyBuzz]

“The Rail Runner is facing a $1.2 million deficit in fiscal 2012, which begins July 1 of this year.”

Just raise prices and tax everyone in the state

That will fix the problem /sarc

[okie01]

I recall several conversations between us here on FreeRepublic which predicted that such an end to the RailRunner boondoggle was inevitable.

Now, it should be apparent to all.

The most cost-effective solution for the people of New Mexico is to shut the operation down. Tomorrow. If not sooner. It was never going to work. And, by damn, they've proven it.

There is no point in adding ever-growing operational deficits to the capital costs already incurred.

I make the cost to each NM household at around $2,000. What do you propose to do for the ex-Gov in return?

[org.whodat]

Willie Green is down at amtrak buying tickets to get out there and help them out.

[NonValueAdded]

I wonder how the 2,250 ridership compares to the projections used to push the project. Also it is interesting to now learn the federal money was "congestion mitigation." Just how much congestion was there along the route?

I grew up with commuter rail. In metropolitan Boston it made a lot of sense. There certainly are cases for it. But thank heavens that our Florida Governor avoided the same sort of boondoggle as outlined in this article. That route was not a commuter route and we had obvious pie in the sky ridership estimates.

[festusbanjo]

...and they wonder why Rick Scott in Florida said “no thanks” to a “free train” running from Tampa to Orlando. Like most government ventures, if it was a good idea to begin with, a private enterprise would have done it long ago.

[CedarDave]

Article posted earlier today with additional history:

Fiscal Train Wreck (NM-Richardson's Railroad Runs deeply into the Red)

[CedarDave]

I recall several conversations between us here on FreeRepublic which predicted that such an end to the RailRunner boondoggle was inevitable.

Click on the keyword Richardson's Railroad for all the articles posted on FR.

[wjcsux]

I can’t think of an entire section of I-25 that anyone would consider congested. The way King Bill was selling it you would have thought it was I-95 going through D.C. This whole thing was a pork-barrel project from the get-go.

[CedarDave]

I wonder how the 2,250 ridership compares to the projections used to push the project.

Several years ago one estimate was an average of 4,500 passenger-trips daily between Santa Fe and Belen. I don't know whether that is 2,250 passengers traveling round trip each day or 4,500 individual riders. I suspect its the former. Gotta be cheaper to buy fuel for each rider to drive that route.

[CedarDave]

I can’t think of an entire section of I-25 that anyone would consider congested.

The section from ABQ to US 550 in Bernalillo is congested. Richardson diverted funds for reconstruction (including expanding the original interstate roadway of 2 lanes to 3 lanes each way) to the Rail Runner in 2003 or 2004. Finally rebuilding is underway. I drove through there on Friday p.m. heading north to SF. Backup through the construction zone was 20 minutes even with two-lanes each way being maintained.

[NonValueAdded]

I can’t think of an entire section of I-25 that anyone would consider congested. The way King Bill was selling it you would have thought it was I-95 going through D.C. This whole thing was a pork-barrel project from the get-go.

Hmmmm ... misuse of a Federal grant? misappropriation? If there was no congestion mitigated, someone is guilty of a crime.

[hinckley buzzard]

Trains like this are demonstrably useless as transportation. The only way they can be useful is to focus on tourism. Wine-tasting get-away-weekend trains to Santa Fe would appeal to the artsy-fartsy types who keep that poor beleaguered pueblo alive.

If they were smart enough they would extend it to Denver, through some spectacular country. I took the train from Denver to Raton many years ago (The Texas Zephyr) and it was as beautiful a ride through the mountains as there is anywhere. As for routine transportation, though, this is obviously the predicted bust.

[Lurker]

I suppose that raising fares to actually cover the operating costs is completely out of the question.

[MamaB]

For years my late husband and I had talked about taking the train through the NW Nat’l Parks but he developed cancer and died before we could do it. He made our daughter promise that she would go with me when the time was right. Well, the next year, out of the blue I got to thinking about that. I talked to my daughter, grandson, and granddaughter separately if they wanted to go on this trip of get the money after I was gone. Each told me to go on the trip. In July, 2007, we went on that trip. We flew to Seattle about a week early so she could show me the city and for the kids to see their dad who lives out there. We toured an animal reserve in the state of WA, went through the tunnel through the mtns, Idaho, Glacier Nat’l Park, Yellowstone and ended up in Jackson at the Lodge there. We had a blast and made enough memories to last our lifetimes. We are so thankful we went because the company went out of the business the next year. We hate to think what we would have missed if we had waited. It sure was a whole lot different than here in Alabama!

[dirtboy]

I suppose that raising fares to actually cover the operating costs is completely out of the question.

I rode this from Santa Fe to Alb last month to get to the Alb airpor. Seven dollars one way. From the sound of things, it would take 35-40 dollars to cover operating costs. At that point, it would still compete with driving for a one-way trip to the airport, where there is a round-trip component for the driver dropping , but not for a round-trip commute.

Rail transit just doesn't work in low-density cities and regions. But try telling that to the liberal morons who push it.

From what I can see, transit based around Santa Fe is almost entirely a fringe benefit to government workers in Santa Fe who live in outlying areas - heck, you can take a shuttle bus from Las Vegas NM to Santa Fe for three dollars. 65 miles.

[Mr. Lucky]

If he really wanted to get there, wouldn't he be buying Greyhound tickets?

[org.whodat]

I think Willie Green owns a bicycle , he only goes to places that are down hill.