Iowa Pacific subsidiary Santa Cruz & Monterey Bay Railway has offered freight and seasonal excursion trains on 32-miles of tracks owned by the Santa Cruz County Regional Transportation Commission since 2012.
Iowa Pacific officials told the Sentinel that disappointing performance and a dispute about whether Iowa Pacific or the Santa Cruz County Regional Transportation Commission should pay for damage to the tracks caused by last year’s winter storms.
“Even though we see long-term potential in Santa Cruz, it requires long-term investment of a magnitude which is not justified,” Kevin Busath, vice president of strategic planning, told the newspaper. “We have five years left on contract; no way we can get that back within that time.”
The Santa Cruz County Regional Transportation Commission noted that Iowa Pacific still owes the commission $60,000 related to unpaid fees on last year’s Polar Express and on storing rail cars in Watsonville.
“I don’t know that they will pay it back,” Santa Cruz County Regional Transportation Commission Deputy Director Luis Mendez said. “We are one of a line of entities trying to get payment from Iowa Pacific.”
Mendez said that the Santa Cruz County Regional Transportation Commission is seeking new operators and will provide a public report by Jan. 18, 2018.
The Santa Cruz & Monterey Bay is among a growing list of properties with which Iowa Pacific has cut ties due to contract disputes. In January, Iowa Pacific announced it could not fulfill the contract to operate the Hoosier State train between Indianapolis and Chicago. A month later, the company cut ties with the Piedmont & Northern in North Carolina, and in March was ousted as the operator of the Texas State Railroad.
Iowa Pacific did not respond to Trains News Wire’s request for comment.
Trying to make a buck in the railroad passenger business appears to be a rather tricky endeavor these days. Perhaps more so using marginal freight lines and old passenger equipment. I don’t see a lot of others trying to do it. The ones that are appear to be mostly non-profit. I applaud the Iowa Pacific attempt (the Ed Ellis dream) to make it succeed as a business. Perhaps they can still find a viable business model that can make it work under the right circumstances.
Too bad. Unfortunately i see another bike trail in the future.
Another shining star railroad company that has burnt out. They overextended expectation of big bucks but in just about every case did not read or get “fixed” the fine print in the contracts.
Here’s an article from August 2013:
Rails of debt: Parent company of local train operator struggles
http://www.montereyherald.com/article/ZZ/20130803/NEWS/130807647
Excerpts:
(1) “To be perfectly blunt, we’ve been slow paying vendors in the Santa Cruz area and all across the country,” said Kevin Busath, Iowa Pacific’s vice president of strategic planning. “We’re working our way out of this. Within two or three months we should be current with everybody.”
(2) “The list of people that are owed money would probably fill several pages of your newspaper,” said one local debtor, who asked not to be identified.
No one can say they didn’t see this coming.
Correction to my last. The plan to get more rail to Salinas involves extending the Capitol Corridor (Sacramento-San Jose) southward from San Jose to Salinas:
http://www.tamcmonterey.org/programs/rail/salinas-rail-extension/
It is actually “in work!”
The former SP Monterey Branch from Castroville to Monterey is currently not in use (needs lots of work) and is owned by Monterey County though entity “TAMC.”
http://www.tamcmonterey.org/programs/rail/monterey-branch-line/
The last I heard, a busway was being discussed for the Monterey branch.
I emailed Iowa Pacific and suggested running shuttles back and forth from Santa Cruz and Monterey might work. The response was underwhelming. There are plans to extend rail to Salinas from Gilroy soon.
This is disappointing. I used to regard Ed Ellis as a great thinker and innovator, but the real world results just aren’t there. Too bad.
Another Ed Ellis failure !!!
Ed Ellis sure has beautiful dreams. He can assemble a gorgeous streamliner and talk a great talk about tourist and intercity passenger train revivals. But there’s never enough revenue to sustain his dreams.
This sh…t happens when a money makin operation gets a contract, This is never an issue in Amtrak operated systems because they don’t care about making money, we all know Amtrak don’t care about that.However Iowa Pacific is a for profit company, this isn’t a surprise, Really?!?!?
Maybe Ed should start hiring local people that know the area to run these operations…the missing piece for the Santa Cruz operation is being able to run down to Monterey.
Seems like there is always some dispute.