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Algoma Central Railway passenger service still in trouble

From Soo Today:

A Railmark engine.
A Railmark engine.

The city of Sault Ste. Marie Ontario has accepted a recommendation to not sign a final agreement with Railmark Canada regarding the operation of the passenger rail service between the city and Hearst.

Railmark has failed to produce a required line of credit.

“One of the preconditions (for the city to sign) was financing in the form of a line of credit (from Railmark), so we cannot at this time recommend we proceed with the signing of the agreement,” said Tom Dodds, Sault Ste. Marie Economic Development Corporation CEO and interim chair of the ACR passenger service stakeholder working group, speaking to council Monday.

“What I’m saying is now we have to look at other options (other operators to run the passenger rail service),” Dodds told council.

Looking at those other options has already started, but doesn’t necessarily rule out Railmark, Dodds told council.

Meanwhile, Railmark Canada President B. Allen Brown said Railmark will continue rolling along from the Sault to Hearst and back at his own expense until he gets that line of credit.

“It (council’s decision) was something I was expecting,” Brown said, speaking to SooToday.

“I’m really disappointed because we’re working very hard, we’re just a little bit away from the finish line (securing the line of credit).”

“I intend to return to Michigan to get the rest of the requested financial information together and finish the process,” said Brown, a U.S. businessman.

“I’m not a quitter,” Brown said.

“We’ve already got the licensing (rail operator certificates and insurance) to do all this.”

Council, in an unanimous recorded vote, accepted the recommendations from Dodds, as interim chair of the stakeholders working group, to not sign the final agreement with Railmark, explore other options in terms of a third party operator for the Sault to Hearst service, and write to both the federal government and CN requesting their continued assistance in keeping the line alive.

CN previously operated the Sault to Hearst passenger rail service with $2.2 million in annual federal funding.

After the federal government announced in 2014 it was ending that subsidy, a group comprised of a wide range of stakeholders was put in place, known as the ACR Passenger Service Stakeholder Working Group.

Two of the stakeholders were the city of Sault Ste. Marie and the Sault Ste. Marie Economic Development Corporation.

After much lobbying, including the efforts of Sault MP Bryan Hayes, it was announced March 31 the federal government (Transport Canada) agreed to provide $5.3 million in funding to Railmark over the next three years to keep the Sault to Hearst passenger rail service running, with the hope the company can turn the service into a self-sustaining, enhanced rail experience for tourists.

Under the new arrangement, the city of Sault Ste. Marie found itself handling the federal financing for Railmark, and members of city council have expressed concerns Railmark may not live up to all the necessary pre-conditions, with the city being left on the hook.

“What we’ve said is ‘it’s a bit of a time out’ and look at all the options…even today there was a meeting with the stakeholders and Railmark to talk about what are the other things we can do so that it’s in everybody’s interest to go ahead and sign the agreement,” Dodds said, speaking to SooToday.

“Our objective is to grow that business…during this period we would expect we’ll have from Mr. Brown the information as to a line of credit in place, so we can come back with something with substance for the passenger service.”

“Where there is certainty is that the government has made a commitment in terms of five million dollars over three years for another third party operator, Dodds said.


M-1 Rail helps get Woodward developments rolling

From The Detroit News:

Construction along Woodward Avenue. (From The Detroit News)
Construction along Woodward Avenue. (From The Detroit News)

Rail may be a year away from ferrying passengers from downtown to Midtown, but housing developments already are popping up along the Woodward Avenue route: an early sign the streetcar service could play a major role in eradicating blight along the 3.3-mile line.

It’s been a hard-fought battle to fund and create the M-1 Rail. While critics predict it will end up a costly mistake, boosters say it will be a game changer that will produce dense, walkable districts.

“We went to Portland, Minneapolis, Denver and San Diego and … we were told light rail was the single dominating economic event that took their cities to the top,” said Dan Gilbert, the billionaire founder of Quicken Loans Inc. and a prime mover in downtown Detroit’s resurgence.

The public transit system will travel on Woodward from Congress Street downtown to West Grand Boulevard just past New Center. Much of that stretch is under major construction in preparation for the streetcars’ debut as early as fall 2016.

Within 10 years, its supporters contend, the M-1 Rail will drive $3 billion in development and 10,000 housing units, filling the yawning gaps of dead buildings and empty lots along Detroit’s most storied street.

“You would really have to go back to the high point of Victorian times to find another era when that stretch of Woodward had plenty of housing,” said Rebecca Binno Savage, a historical preservationist for the Detroit firm Kraemer Design Group.

“Picture the David Whitney mansion: That’s when it peaked as a residential street,” she said.

David Whitney was a lumber baron who lived large and exquisitely in a 22,000-square-foot mansion at 4421 Woodward. His palatial home is now The Whitney restaurant.

Near the 12 stops along M-1’s route, at least 10 housing plans are in the works. Some are still on the drawing board and others will be open by the end of the year. They include:

■A 300-unit complex is intended on the site of the parking lot in front of Comerica Park, home of the Detroit Tigers. That project is being spearheaded by Olympia Development of Michigan, the real estate arm of Ilitch Holdings Inc. The Ilitches, who own the Tigers, also are behind the plan to overhaul 45 blocks north of downtown. The area includes the Red Wings arena being built along Woodward and will have an M-1 Rail stop.

■A 200-unit housing project is slated for an empty lot in Brush Park, developed by the principals of Broder & Sachse Real Estate Services Inc. in Birmingham.

■Also, 250 residential units are part of the huge plans for the former Hudson’s site, which will include 225,000 square feet of mixed-use space and 900 parking spaces. That project is being developed by Gilbert.

The rail project also is drawing investments in smaller buildings, key to erasing the pockets of blight that still plague Woodward.

Plans for the Junction

“M-1 Rail has a lot to do with the investment we are seeing, and the kind of investment we are seeing hasn’t happened in years,” said Richard Rubens, who is with the community group Friends of Milwaukee Junction.

Milwaukee Junction is a neighborhood north of New Center. In the past two years, at least a dozen buildings there have changed ownership. Many of those buildings were empty. Plans for them include both commercial and residential development.

Rubens said construction of M-1 Rail has convinced some investors that Milwaukee Junction will be “the next big neighborhood,” as residents and businesses get priced out of Midtown and downtown.

One of the smaller planned developments is a $2 million conversion of an empty two-story warehouse across the street from the Amtrak station as well as from a future M-1 Rail stop. The warehouse at 207 E. Baltimore, on the corner of Woodward, was bought in the county’s tax foreclosure auction two years ago. Plans are underway to convert it to 12 rental lofts by developers Edward Siegel and James Feagin.

In other parts of Woodward, the anticipation over the public transit line has allowed Joel Landy, a longtime local developer, to convert two long-empty structures into apartment and retail complexes. One of those buildings, at Woodward and Peterboro, has been only a facade for years, Landy said. The other building is near Woodward and the I-94 service drive, he said.

“M-1 is not the only factor, but it is one of the big ones, why banks will finance my projects,” Landy said. Both two-story buildings will each get a $1.1 million overhaul. Both will offer market rate rents for the apartments, ranging from $900 to $1,400 a month, depending on the size of the unit.

Efficiency expected

What convinced Landy to invest now is the way many people talk about M-1 Rail, he said.

“The difference between the bus and M-1 Rail is no one wants to take the bus,” Landy said. “You have no idea how long you will wait for the bus. But people are excited about M-1 Rail; their expectations are completely different. They expect it will be efficient, and you can tell it can attract a wide range of people who plan to use it.”


Algoma Central Railway supporters: Don’t sign that railway deal

From Soo Today:


After more than a year of lobbying to keep passenger service running between the Sault and Hearst, a local working group is now recommending the city not sign a funding agreement with the successful proponent.

In a report to council included in the agenda for the June 22, 2015 regular meeting, Tom Dodds, head of the Economic Development Corp. and interim chair of the passenger rail working group, recommends against signing a funding agreement with Railmark Canada at this time, citing the Wixom, Michigan company’s failure so far to provide proof it has the working capital necessary to proceed.

Dodds recommends “other options” be explored to secure a third-party operator for the Sault-to-Hearst passenger Service and that he and the mayor write a joint letter to the Minister of Transportation and CEO of CN requesting “their continued commitment” to efforts to find a short and long-term solution.

“As of June 16, 2015, the Stakeholder Working Group had received no confirmation that RCL had working capital financing, no confirmation of the equity that RCL would be injecting into the company, no draft term sheet from a working capital financier, nor does the Stakeholder Working Group have any written comments from RCL regarding the draft agreements – despite two prior written formal demands with delivery dates and consequences,” says the report to council.

The federal government announced at the end of March that it would provide a $5.3-million subsidy over two years, on the condition the funds flow to Railmark Canada through the city of Sault Ste. Marie.

A working group report to council earlier this year says CN selected Railmark to run the passenger line from among three competing bids in the fall, after which members of the local working group began pressing the Ministry of Transportation for funding.

This came after what the working group has described as a “thorough analysis of (Railmark’s) bid” prior to final negotiations with CN taking place in January and after “due diligence” being undertaken on CN’s part before it signed a deal with Railmark as a third-party operator in March.

City council has also lent its support to efforts to save the rail line, having sent letters to federal Transportation Minister Lisa Raitt in support of the working group’s earlier recommendations that Railmark be funded as a third-party operator.

It is unclear what happens if the city doesn’t agree to fund Railmark.

MP Bryan Hayes, who has lobbied his Conservative colleagues for funding to keep the line running, told SooToday last week that he expects the funding would still be in place if the city doesn’t sign an agreement with Railmark and that the ball would be back in CN’s court.

CN reiterated this morning that should the city and EDC not complete the agreement with Railmark, it has no plans of continuing to operate the passenger service.

“The company is clear that it is not prepared to operate the Hearst passenger train,” said Mark Hallman, CN’s director of communications and public affairs.

CN will continue to operate the Agawa Canyon Tour Train after plans to have Railmark take over that service did not come to fruition.

CN will not be operating the Snow Train.

Dodds says in the report that Railmark Canada continued, as of Tuesday, with efforts to secure the required working capital and raises the possibility of a lawsuit should the city refuse to continue to negotiate with Railmark.

The report also notes that CN officials have been working with Railmark Canada earlier this week to help the company put a term sheet together for financing.

Dodds has said that if the Railmark deal does not come through, he hopes there would be an opportunity to find an alternative third-party operator.

According to the working group’s report to council, Railmark Canada has been operating the Sault-to-Hearst passenger service throughout May and June three times a week at its own expense – estimated to total more than $200,000 since May 7.

CN employees continue to operate the train under Railmark’s oversight, though Railmark employees are “gradually” taking their place, Hallman said.


More passenger train service may be arriving in Sarnia

From the Sarnia Observer:

Via Rail CEO Yves Desjardins-Siciliano speaks to reporters on Wednesday June 17, 2015 at a luncheon in Sarnia, Ont. Via announced it is working to expand rail service in Sarnia, beginning in 2016 with additional runs to London. (Paul Morden/Sarnia Observer/Postmedia Network)
Via Rail CEO Yves Desjardins-Siciliano speaks to reporters on Wednesday June 17, 2015 at a luncheon in Sarnia, Ont. Via announced it is working to expand rail service in Sarnia, beginning in 2016 with additional runs to London. (Paul Morden/Sarnia Observer/Postmedia Network)

The audience at a Sarnia Golf and Curling Club luncheon hosted by the Sarnia Lambton Chamber of Commerce applauded Wednesday when the head of Via Rail announced plans to add more trains between Sarnia and London.

“You’ve made my day,” Sarnia rail advocate Jim Houston told Via CEO Yves Desjardins-Siciliano after the announcement of the changes expected to begin by 2016.

“I want to see the schedules before I make a real firm comment,” Huston said later, but added, “If we’re going to have four trains a day, for sure, that’s a blessing.”

Local rail advocates, along with Sarnia-Lambton officials, have been lobbying for years to see passenger rail service improved, even as Via cut it back to one train a day to and from Toronto.

Desjardins-Siciliano said Via plans to increase the service in Sarnia to four trains daily, starting in 2016, but he adding it’s not a done deal since it’s subject to the availability of track, something Via will have to work out with freight rail companies.

“We’re meeting with our freight partners to discuss those plans,” Desjardins-Siciliano said.

He said the first run will be from Sarnia to Toronto, with adjustments intended to “shave a bit of time” off the current trip.

The additional trains will be a “commuter run” during the day between Sarnia and London using two-car self-propelled trains.

Via announced earlier it plans to make London a passenger service hub in southwestern Ontario.

During his presentation, Desjardins-Siciliano challenged the community to get behind the changes, spread word about Via’s service and help increase the number of train riders in Sarnia-Lambton.

“The reality is that over the last 30 years, ridership has been declining in and out of Sarnia,” he said.

That led to a reduction in service in 2012 as Via worked to stay within its budget, he said.

Via Rail still has a more than $300-million deficit that has to be covered by Canada’s taxpayers, Desjardins-Siciliano said.

“We have to be very careful how we spend Canadian taxpayers’ money.”

What has changed more recently is that the federal government has provided Via with funding to improve its equipment, plus there has been growing demand for rail service in the country in recent years, he said.

“The market seems to be looking for rail service, like it wasn’t for the last 20 years.”

While ridership has continued to drop in Sarnia, Desjardins-Siciliano said, “some of that is self-inflicted” because of actions by Via.

In challenging the community to support the proposed boost in service, he said, “The community has to recognize its role in changing these statistics.”

Desjardins-Siciliano said it is “too early” to say if Sarnia will see its passenger train station staffed again, something lost in past cutbacks.

“Manning a station today requires significant traffic, because technology takes away a lot of the needs of manned stations,” he said.

“You don’t need a paper ticket. You can just have the ticket on your phone.”

Desjardins-Siciliano said he visited the Sarnia Via station Wednesday and promised the audience he would an official there in the coming weeks to look into the need for repairs to the building.


PTC installation on Wolverine route should be done in late 2016 or early 2017

From The Detroit News:

Amtrak and the state expect to have a speed control safety system along 283 miles of tracks in a year and a half as part of their effort to get faster passenger trips averaging a little more than four hours between Detroit and Chicago.

Michigan Department of Transportation rail chief Tim Hoeffner said the so-called positive train control system, part of more than $400 million in upgrades on the Wolverine Route, will protect against tragedies like the May 12 Philadelphia crash that killed eight people and injured 200.

“The engineer gets a target … when he will have to start lowering the speed,” Hoeffner said. “If you do not do that, the system says ‘we are watching’ and will take action to shut down the train.”

Amtrak installed the system on 100 miles of track it upgraded more than two years ago between Kalamazoo and Porter, Indiana. The state will have it on 135 miles of track between Dearborn and Kalamazoo that are undergoing upgrades to be completed in late 2016 or early 2017, Hoeffner said.

Automated train controls are federally required for higher-speed passenger rail by the end of the year, but hadn’t been installed on the section of track where the Philadelphia derailment occurred. Federal regulators say few rail operators will meet the deadline, according to press reports.

Hoeffner said the Michigan Department of Transportation, Amtrak and the Federal Railroad Administration began collaborating in the 1990s on a positive train control system for the Wolverine Route. The route carries more than 500,000 passengers a year.

Called Intermittent Train Control System, Michigan’s version of the technology first was installed between Kalamazoo and Porter, Indiana. Trains have hit speeds up to 110 miles an hour there since February 2013, Hoeffner said.

Contractors now are installing the system with track upgrades between Dearborn and Kalamazoo. Michigan is using $387 million in federal grants and $37.5 million of its own money to buy and improve the tracks for 110-mile-an-hour train speeds, according to Hoeffner.

“Our intention is to have higher speeds all the way across Michigan,” said Amtrak spokesman Marc Magliari in Chicago. The route has the most miles of 110 mph Amtrak rail outside the Northeastern corridor, Magliari said.

Hoeffner said the train control setup combines modern technology with traditional signal lights spaced at intervals along the track, which have told engineers since the early 1900s to slow, stop or remain at regular speed.

Engineers now also receive the same directions from an on-board display. If they fail to respond, the system can halt the train, after which the engineers need clearance from the railroad’s control center to restart, Hoeffner said.

The goal of MDOT and Amtrak is to run trains safely at higher speeds to lop more than an hour off Detroit-Chicago trips, making them competitive with auto travel, Magliari said.

“A lot of days of the week we’re already faster than driving, considering traffic congestion in Chicago and Detroit,” he said.

But there’s one remaining obstacle to reliably faster service: Passenger trains run at lower speeds and often get stalled — sometimes more than an hour — waiting for traffic to clear from the busy rail corridor between Porter, Indiana and Chicago’s Union Station.

It’s one of the nation’s most congested rail corridors, handling more than 100 trains a day and a key reason Wolverine Route trains often arrive behind schedule, Hoeffner said.

The state is partnering with Indiana and Illinois and the Federal Railroad Administration on an environmental study for a preferred passenger route through the area.

The study, whose completion is due in a few months, is a step toward applying for federal grant money. Hoeffner said the state hopes for federal approval of its study and suggested improvements by spring 2016.

Amtrak also set up a blue ribbon panel in October 2014 to address Chicago rail gridlock that Amtrak President and CEO Joe Boardman said causes unacceptable passenger service interruptions. Four-hour delays are a near-daily occurrence between Chicago and Cleveland, Amtrak said in a statement.