Posts Tagged ‘Iowa Pacific trains’

INDOT Supports Continued Hoosier State Funding

February 7, 2017

An Indiana newspaper reported last week that although Iowa Pacific was playing up the improvements in on-time performance and increasing patronage of its Chicago-Indianapolis Hoosier State, the operation had become a money pit.

IndianaThe Journal & Courier of Lafayette said IP wanted the Indiana Department of Transportation to pay it $900,000 to operate the quad-weekly train through July.

INDOT spokesman Will Wingfield told the paper that IP said if it didn’t get that money it wanted it would cease participating in its partnership with Amtrak to operate the train.

 

For his part, IP President Ed Ellis told the newspaper that he blames the partnership’s failure on the formula INDOT used to pay IP and Amtrak.

That clause, Ellis noted, meant that as the on-time performance of the train improved IP was getting less money.

INDOT rejected IP’s demand for an additional $900,000 for six months of service because it was beyond the means of the state and municipalities that pay for the train.

Funding for the Hoosier State is provided by INDOT, Lafayette, West Lafayette, Tippecanoe County, Crawfordsville and Rensselaer.

Since IP became involved with the Hoosier State in July 2015, it has provided locomotives and passenger cars and been responsible for marketing and on-board service.

Among other steps, IP began offering business class service and had a chef prepare on-board meals. Business class passengers were able to sit in the upper level of a full-length dome car.

Amtrak’s role was to provide the operating crews and handle relationships with the host railroads. That included incentive payments to CSX to handle the train on time.

The Hoosier State, which uses the same route between Chicago and Indianapolis traversed by Amtrak’s tri-weekly Chicago-New York Cardinal, primarily uses tracks of CSX.

Amtrak has said it will take over complete responsibility for the Hoosier State on March 1, including providing rolling stock.

Marc Magliari, an Amtrak spokesman based in Chicago, said the services Amtrak will provide are still being worked out.

However, he said Amtrak hopes to offer Wi-Fi and business class service. One amenity that Amtrak is likely to offer that IP did not is on-board power outlets.

The type of food service, if any, that Amtrak will provide is another unknown at this point. In the years before IP took over the Hoosier State, Amtrak did not offer food service.

Magliari said the train’s schedule will remain the same.

“What we think is important is that we have those amenities,” Tippecanoe County Commissioner Tom Murtaugh said in reference to the services that IP provided. “We think this has led to the increase in ridership.”

As he has said in the past, Ellis told the Journal & Courier that if the Chicago-Indianapolis corridor is to thrive it needs a faster travel time and more trains.

“You have to be able to run multiple frequencies,” Ellis said. “It takes a lot of capital to do that. I was hopeful we would be able to, but here we are: We have the same number of trains going at the same speed.”

Wingfield said INDOT has recommended to Indiana Gov. Eric Holcomb that the state continue for the next two years to fund the Hoosier State at $3 million a year.

Ellis said anything beyond the current level of service will require a higher level of funding from the state.

“I know the folks at INDOT want to solve this, but it’s beyond them,” he said. “It’s up to the legislature and a higher level of commitment to the Hoosier State.”

Indiana Legislators Taking Note of IP Exit as an Operator of the Hoosier State, Future Uncertain

February 4, 2017

Indiana lawmakers aren’t saying just yet if they will continue to support paying for the Chicago-Indianapolis Hoosier State.

iowa-pacificAn Indiana radio station reported that legislators were prepared to continue the funding in the next state budget, but that has been called into question with the exit of Iowa Pacific Holdings as a partner in operating the train.

The Indiana General Assembly provided $6 million in one-time funding in the current state to pay for the quad-weekly Hoosier State.

Senator Brandt Hershman (R-Buck Creek) said he thought the service provided by Iowa Pacific was good.

“It’s comfortable, you don’t have to worry about traffic, you can get work done, you get something to eat, you have Wi-Fi – all those things help the value proposition of the train,” Hershman says.

Another lawmaker, House Ways and Means Chair Tim Brown (R-Crawfordsville), is skeptical that Amtrak can provide that level of service.

“We know that performance under Amtrak wasn’t what we wanted,” Brown said. “We got better performance out of Iowa Pacific and I don’t know if there’s another vendor out there but we’ll just have to have more talk about this.”

The budget for the next fiscal year has yet to be released.

Iowa Pacific and Amtrak have a partnership to operate the Hoosier State with IP providing equipment, marketing and on-board service, and Amtrak providing operating crews and handling relationships with the host railroads.

Amtrak will take full control of the Hoosier State on March 1.

Divorcing Amtrak is Hard to Do

February 3, 2017

The great Hoosier State privatization experiment is about to end. It started in July 2015 when Iowa Pacific Holdings began “operating” the quad-weekly Chicago-Indianapolis train.

amtrak-2I put the word “operating” in quotation marks because in one sense IP did not “operate” the Hoosier State.

It had a partnership with Amtrak. IP provided the equipment and marketing support and was in charge of on-board service.

But the operating crews were Amtrak employees and the nation’s passenger carrier handled the relationships with the host railroads, primarily CSX.

As it turned out, Amtrak has received most of the money paid by INDOT and its partner communities that fund the service.

For awhile, Iowa Pacific received many kudos because of what it wasn’t, which is Amtrak.

Under Amtrak auspices, the Hoosier State was a bare-bone operation that shuttled equipment between Chicago and the Beech Grove Shops in suburban Indianapolis.

By comparison, the IP operation of the Hoosier State was a luxury train, with business class, meals freshly prepared on board and a full-length dome car for those willing to pay extra fare.

IP head Ed Ellis – who once worked at Amtrak – talked about expanding service and the need to cut the travel time.

He said IP would aggressively market the service, seeking to build markets that Amtrak had ignored.

One marketing gambit IP talked about was running a bus between the Crawfordsville station and Bloomington, the home of Indiana University.

IP correctly recognized the college market is a good source of passengers, but apparently the Bloomington shuttle never got on the road.

Iowa Pacific had a lot of people rooting for it to succeed with the Hoosier State, many of whom believe that a private operator can provide better service than Amtrak.

Ellis always knew that increased daily service and faster trains hinged upon the willingness of government entities within Indiana to provide the capital funding needed to upgrade the slow meandering route used by the Hoosier State and Amtrak’s tri-weekly Chicago-New York Cardinal.

If IP could demonstrate that the Hoosier State was a success despite its route limitations, then perhaps Indiana officials would be amendable to funding track work in the same manner that the departments of transportation in neighboring Michigan and Illinois have.

But that has always been a long shot. Indiana has never been as supportive of intercity passenger rail as its neighbors.

Amtrak will take back the Hoosier State in Toto on March 1. Although INDOT said it has a verbal agreement that some of IP’s services will be retained, that is not a sure thing. It is unlikely that the food service will be freshly-prepared meals if there is any food service at all.

It remains to be seen if INDOT will seek an operator other than Amtrak and, for that, matter, how much longer the state and on-line communities are willing to pony up money to underwrite the operating losses.

One key take away from the IP Hoosier State experiment is that divorcing Amtrak is more difficult than it might seem or that some people might wish.

IP Gave Up Hoosier State for Financial Reasons

February 2, 2017

As the Indiana Department of Transportation frames it, the withdrawal of Iowa Pacific from operating the Hoosier State was due to IP making an unreasonable demand.

But as Iowa Pacific CEO Ed Ellis sees it, it was the result of a quirk in the contract that his company had with INDOT to operate the train.

Iowa PacificThat quirk, Ellis said, was that the compensation IP received declined each time the on-time performance of the Chicago-Indianapolis train improved.

Ellis said he sought to renegotiate the contract to guarantee that IP would receive a guaranteed $150,000 a month. But INDOT turned that down.

The situation is complex because Amtrak was also involved in operating the Hoosier State by providing operating crews and handling relationships with the host railroads.

Iowa Pacific provided the rolling stock (including locomotives) and food service employees, and did the marketing and promotion work.

Ellis told WBAA radio station in West Lafayette, Indiana, that INDOT paid Amtrak before it paid Iowa Pacific whenever there was any profit.

INDOT held separate contracts with Amtrak and Iowa Pacific. Amtrak billed the state for fixed operating costs plus “estimated third party costs,” that included maintenance of way charges and “performance incentives” paid to CSX for running the Hoosier State on time.

Iowa Pacific received the difference between what INDOT paid Amtrak and a fixed monthly sum of $254,000, INDOT spokesman Will Wingfield said.

Consequently, Amtrak received $4 million in 2016 while IP got $500,000.

Amtrak received monthly payments of between $288,000 in April to $172,000 in August. IP lost $34,000 in April but earned $82,000 in August.

The costs charged by Amtrak and Iowa Pacific are separate from what those companies earned in coach revenue, food service and business-class fares.

The guarantee that IP sought was more than what the contract specified said Wingfield, who added that it was more than what was reasonable for Iowa Pacific to seek.

Ellis said going into the arrangement to operate the Hoosier State that he didn’t realize how much the payments would favor Amtrak.

“The one thing that I would want to change going forward is to make sure that we put some kind of a floor under what our monthly revenue would be from the contract so that we don’t get into a situation where, at the end, we’re several hundred thousand dollars less than where we thought we would be,” Ellis said.

The Hoosier State began on Oct. 1, 1980, as an Amtrak train. IP took it over in July 2015.

It operated quad-weekly on days that Amtrak’s Chicago-New York Cardinal did not operate between Chicago and Indianapolis.

Amtrak will begin operating the Hoosier State with its own equipment on March 1. Wingfield said Amtrak has verbally committed to trying to add some of the amenities that Iowa Pacific offered, including Wi-Fi service.

INDOT agreed to let Iowa Pacific out of its contract, which was to expire on June 30.

Amtrak to Take Back the Hoosier State

January 31, 2017

Iowa Pacific will cease operating the quad weekly Chicago-Indianapolis Hoosier State at the end of February with Amtrak taking it over on March 1.

Iowa PacificThe Indiana Department of Transportation, which had contracted with IP to operate the train, said the contract was to have run through June 30, but IP demanded more money than the contractual amount.

“They were looking for a minimum monthly subsidy that was outside the budget we had,” said INDOT spokesman Will Wingfield said. “Even under the existing contracts, their needs were beyond what we had budgeted.”

IP has operated the Hoosier State since July 2015, taking over it from Amtrak after INDOT advertised for bidders.

INDOT said it has paid Iowa Pacific Holdings $500,000 to date to provide on-board service, marketing and equipment for the Hoosier State and $3.9 million to Amtrak, which provides crews to operate the train.

IP will receive an additional $300,000 to operate the Hoosier State through the end of February.

“It should be said we signed contracts in good faith with Iowa Pacific that was through the end of June, and then they came to us and said they we’re unable to continue under those contracts,” Wingfield said.

IP President Ed Ellis wrote on Facebook that his company is moving to “a different service model.”

There have been discussions on railfan chat lists that IP might be experiencing financial difficulties after it failed earlier this month to issue paychecks to employees in Saratoga Springs, New York.

Some employees of the IP-operated Texas State Railroad were laid off, but IP said in a statement that those layoffs were seasonal.

Ellis said on his Facebook page that IP was “unable to continue providing passenger train equipment and on-board services under the terms of its existing contract for the Hoosier State.”

IP received high marks for instituting business class, upgrading the food service and offering a dome car on the Hoosier State.

Ellis wrote that these service enhancements improved customer satisfaction, revenue and ridership, but the train suffered from poor on-time performance when it reached its destination hours late, if at all, on some occasions.

Amtrak spokesman Marc Magliari said the Hoosier State will operate with Amtrak equipment starting March 1.

INDOT said it’s seeking to continue on-board wi-fi and business-class seating for the train, which operates between Chicago and Indianapolis on days that the Chicago-New York Cardinal does not operate.

It is unclear, though what the long-term future will be for the Hoosier State, including whether INDOT will again put the operation out for bid.

The Hoosier State is funded by INDOT, Lafayette, West Lafayette, Tippecanoe County, Crawfordsville and Rensselaer.

Rail Rangers to Ride Hoosier State

November 2, 2016

Members of the American Passenger Rail Heritage Foundation will begin riding the Hoosier State on Nov. 27 and providing commentary about the territory served by the Chicago-Indianapolis train.

Iowa PacificThe members are part of the group’s Rail Rangers program and will offer commentary similar that provided on select Amtrak long-distance trains that is provided by the National Park Service.

In a statement, APRH said it has worked with Amtrak and the NPS in providing interpretive services on Amtrak long-distance trains serving Illinois, Iowa and Missouri between 2012 and 2015.

APRHS has also provided commentary aboard private trains in six states.

“We are really excited to partner with both Iowa Pacific and the Indiana Department of Transportation to provide our services for passengers,” said APRHF Rail Rangers Executive Director Robert Tabern. “In addition to some light narration about the towns we pass through, our interpretive guides are going to have free route handout sheets for everyone and maps of Downtown Chicago.”

The Rail Rangers will board the Hoosier State in Lafayette, Indiana, and provide interpretive services until the train arrives in Chicago.

The Hilton Garden Inn and the Campus Inn in West Lafayette are providing lodging for the APRHF members.

Further information is available at www.railrangers.org or www.hoosierrails.org.

Iowa Pacific Holdings President Ed Ellis became interested in working APRHF after experiencing commentary by its members during a June 2016 private rail excursion in Illinois.

As part of an agreement with Iowa Pacific, the APRHF Rail Rangers are releasing a 110-page route guidebook for the Chicago-Indianapolis route titled Riding the Hoosier Rails: A Route Guide From Indianapolis to Chicago.

The book includes information about communities along the Hoosier State route, the Monon and the equipment used by IP. Much of the route uses former Monon rails now owned by CSX.

Tabern said the Rail Rangers program is expected to operate at least twice a month for a trial period through March 26.

Hoosier State Revenue, Patronage Up in Sept.

October 27, 2016

The Chicago-Indianapolis Hoosier State carried 2,428 passengers in September, which was a 46 percent increase over patronage in September 2015.

Iowa PacificThe Indiana Department of Transportation, which helps fund the train, said that September 2016 marked the fifth consecutive month that ridership has grown on a year-over-year basis.

Ticket revenue totaled $82,324 last month, a 64 percent increase from ticket revenue a year ago.

INDOT said the route’s on-time arrivals performance averaged 82 percent in September, down from 86 percent in August.

The replacement of a manual switch with a remote control switch in Crawfordsville, Indiana, is expected to reduce one-way trips by eight to 15 minutes. The switch is located on track owned by CSX.

The quad-weekly Hoosier State is overseen by Iowa Pacific Holdings, which provides marketing, equipment, maintenance and on-board service. Amtrak provides under contract operating crews and works with the host railroads.

Excursion to Use ex-ICRR Tracks in Mississippi

September 22, 2016

An excursion will run in Mississippi on Oct. 23 over the original route of Amtrak’s Chicago-New Orleans Panama Limited and City of New Orleans.

The train will have Iowa Pacific equipment, which has the orange and chocolate brown livery of the former Illinois Central line to be traveled, now operated by the Grenada Railroad.

iowa-pacificThe 96-mile roundtrip excursion will depart at 10 a.m. from Horn Lake en route to Batesville for views of the peak fall foliage season in Mississippi. The trip will last five hours.

Passengers will have the opportunity to purchase an on-board lunch with a bit of Mississippi flavor to it for a separate charge.

The route to be traveled was  once used IC’s City of New Orleans and Panama Limited.

On board employees will be dressed in traditional conductor and waiter uniforms.

The equipment will include two E8A locomotives and five passenger cars, including the Calumet Club once used on the IC’s City of Miami and the Paducah once used on the Panama Limited and City of New Orleans.

The boarding site is at 6780 Center Street East in Horn Lake. For tickets call: 877-334-4783 or visit http://www.grenadarail.com/ride/batesville-express/

 

IP Looking to the Future as it Celebrates First Year of Operating Chicago-Indy Hoosier State

August 29, 2016

Operation of the Chicago-Indianapolis Hoosier State by Iowa Pacific Holdings has reached the end of the first year of a two-year trial and the results are promising and concerning.

Iowa PacificUnder IP oversight, the average on-time performance has been 86 percent, which was better than the OT average of Amtrak trains of between 60 to 65 percent.

Ridership, though, has fallen by 11 percent since IP took over the quad-weekly train from Amtrak on Aug. 2, 2015.

The Hoosier State was racking up financial losses that were on track to reach $2 million for the year.

On the other hand, ticket revenue has increased by 26 percent and during June the Hoosier State even turned a small profit on the strength of increases in patronage and revenue.

IP head Ed Ellis has attributed that turnaround to growth in business class passengers, who pay a premium to receive food and beverage service while riding in a dome car.

The Chicago-Indianapolis route is different in that IP and Amtrak both provide service.

Amtrak’s tri-weekly Chicago-New York Cardinal uses the route and the Hoosier State operates on days that the Cardinal does not.

Ellis told West Lafayette radio station WBAA that the improved timekeeping is a result of establishing personal relationships with Amtrak and every freight rail that hosts the train.

“I think, if nothing else, just that level of daily attention has caused everybody else to pay daily attention to the train and has solved the problem,” Ellis said.

For its part, IP has focused on ensuring that the equipment is ready to go at departure time, thus eliminating late departures that can have a ripple effect.

“ . .  . it’s when trains get out of slot that you get more host-related delays because they need to run freight trains. So leaving on time is important,” Ellis said.

The Hoosier State is not solely an IP train. Amtrak provides under contract the operating employees and does servicing in Chicago and Indianapolis.

IP provides the equipment and handles marketing and promotion although the train is shown on the Amtrak website and Amtrak sells tickets for it.

Funding comes from the Indiana Department of Transportation and five communities along the route of the train.

The Hoosier State costs about $2.7 million annually to operate. Eventually, all of the parties concerned would like to see it become more self-supporting financially. They would also like to see more service on the route.

But Ellis said that will require additional sidings and signal work on the mostly-CSX route that would need to be paid for by the Indiana Department of Transportation.

“I think it’s obvious we need more trains, and the only way to do that is for the state to go to the freight railroads and say, ‘What does it take,’ and for the railroads to give us all a number and for us to decide if we can afford to do that,’ ” Ellis said.

If Ellis had his way, he would create a new route into Chicago and even use a different terminal.

What he has in mind is building a connection in Blue Island between the Metra line from Joliet to the La Salle Street Station and the former Grand Trunk Western mainline that CSX now operates.

Writing on Train Orders.com, Ellis said that and other improvements could cost $500 million and cut the Chicago-Indianapolis running time to 3 hours, 20 minutes.

Ellis would also like to operate three daily roundtrips between the two cities.

He said he wants to trade Chicago terminals because Union Station is crowded but La Salle Street is not.

A new Chicago routing would eliminate running on tracks owned by Amtrak, Norfolk Southern, Union Pacific and the Belt Railway of Chicago. In the process, IP would gain a faster route into Chicago and eliminate a congestion- prone junction with the Indiana Harbor Belt in Dolton.

If the money was available today Ellis figures it would take a year to 18 months to complete the track improvement work. Given the realities of the situation he said it would more likely take until 2020 to get the improvements made and train frequencies increased.

“There is a lot of spade work that has to be done between INDOT, the [Indiana] legislature and CSX on infrastructure improvement,” Ellis wrote on TO.

But he sees progress, noting that revenue in July 2016 was 70 percent over that of the same month in 2015.

“  . . . so the effects of improved service are beginning to take hold.  But there is a long way to go,” he said.

Continued political support for Hoosier State funding appears to be building.

Indiana lawmaker Tim Brown, a Crawfordsville Republican, is chairman of the House Ways and Means Committee, which writes the state’s biennial budget.

He admits to having been skeptical at first about funding intercity rail passenger service, but after riding the Hoosier State he came away with a favorable impression.

“This experience showed me there is a desire, there is interest in continuing it and growing it, and so I’m more convinced now than two years ago that it’s more appropriate to continue funding,” Brown told WBAA.

Brown said that although it is too early to say how much will be allotted for the Hoosier State when the next budget is hammered out in 2017, he expects legislators to approve a line item for passenger rail in the INDOT budget.

IP Marks 1st Anniversary of Operating Hoosier State

August 3, 2016

Iowa Pacific Holdings operation of the Chicago-Indianapolis Hoosier State celebrated its first anniversary this week.

Iowa PacificIP took over the train from Amtrak on Aug. 2, 2015, although Amtrak continues to provide operating employees and handle certain other tasks on IP’s behalf.

During May and June ticket revenue rose 62 percent and 90 percent of the route’s riders indicated in a survey that they were very satisfied with the service.

Since October 2015, on-time performance has averaged 82 percent.

The Hoosier State operates four times a week on days that the Chicago-New York Cardinal does not operate.

The service is funded by the Indiana Department of Transportation and on-line communities.