New search starts for Algoma Central Railway passenger rail operator

From the Sault Star:

A Railmark engine.
A Railmark engine.

Now’s the time for companies that have expressed interest in running passenger rail service between Sault Ste. Marie and Hearst to put their plans in writing for evaluation.

Last Friday, the Algoma Central Railway passenger service stakeholders working group issued a request for proposal for a new operator. The service stopped in mid-July because third-party operator Railmark Canada couldn’t meet a precondition and get a line of credit of $550,000.

The group invited 25 companies in North America to submit their proposals.

Tom Dodds, interim chair, says he was fielding calls and emails from interested business before the RFP was sent out.

The request was also sent to Railway Association of Canada, electronic tendering service MERC, politicians in the Sault and area and a short-line railway operator association in the United States.

“I think we’ve done a pretty broad broadcast,” said Dodds. “I’m pretty confident the industry will know that we’ve sent this out.”

Applications, due Sept. 9, will be evaluated for ideas to increase passenger volume and “the value of the passenger experience,” by offering travel options running a day or more, said Dodds.

“You’d have a combination of increased enthusiasm for using the passenger service because it’s a nicer level of service, as well as different types of experiences that you could undertake on the railway,” he told The Sault Star.

With Canadian National Railway Co., charging a track access fee that “is not insignificant,” the chosen firm “has to see this as way beyond just simply a passenger service,” said Dodds.

“The passenger service and the support provided by the federal government has to be a means to an end,” he said. “You can organize a number of different types of tourism products, or activities or experiences, along the line and get revenue generated. Something like that happens in many other jurisdictions.”

Transport Canada agreed to fund $5.3 million in bridge financing over three years based on Railmark Canada’s business case. Federal support is assured for the new operator. That wasn’t guaranteed when an earlier search that eventually led to Railmark being selected by CN was done.

“We think that’s critical,” said Dodds.

An annual subsidy of $2.2 million from Transport Canada to offer passenger service was cut in 2014, then extended a year to help the working group find another operator after CN stopped running the train. CN wouldn’t operate the passenger line without the subsidy.

The co-chair of Coalition for Algoma Passenger Trains is “very optimistic” a new operator will be found even after Railmark’s short run. The difference, says Linda Savory-Gordon, is firm federal funding.

“That could make the big difference right there,” she said. “People know that if they follow the guidelines of Transport Canada that they will be able to be reimbursed for the eligible expenses. I think that it’s a very good chance that we’ll find a very good operator.”

She, and other working group members, reviewed the RFP last week before it was sent out to interested businesses.

“We’re glad that things are progressing,” said Savory-Gordon. “I’m very pleased that it’s a short turnaround too. Last time was a little longer process.”

A new operator is expected to be in place between October and December.

The Agawa Canyon Tour Train is still run by CN. It’s not affected by the suspension of passenger rail service north of the Sault.