Virginia & Truckee Reconstruction Project Analysis

2007: Nevada State Railroad Museum's Steam Locomotive #8 Has a "Bad Hair Day"

2010-02-28T12:05:00.001-08:00

Here's a video I dug up off the cutting room floor from late 2007 and early 2008 when I produced Living Steam (www.livingsteam.com). Living Steam has been available on DVD and is now available on Blu-Ray.

Blogger Update, Details on #18, NEW SITES

2010-02-28T11:25:00.000-08:00

No. 45 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

** I have been posting a lot of new videos at http://www.youtube.com/virginiatruckee

CURRENTLY CONSIDERING STATUS OF THIS BLOG

Per this post on Blogger Buzz, changes in the way Google handles Blogger are making me rethink how I post updates on the internet. I host this blog on my site, renorailfans.com. Google Blogger uses FTP to post my updates to my site directly. Google has decided to abandon this method, so one way or another I have to change the way this blog is posted. I have until March 26 to change, so this is sort of on hold until I make a decision.

FACEBOOK

I have been experimenting with a Facebook page under the name Virginia Truckee. I am a relatively old man in the world of social networking (age 42) and I have resisted social networking for a few reasons. First, I am the kind of guy who likes to pick up the phone, or use that dinosaur known as e-mail. Second, I know people like twitter, but I have resisted using something that starts with the work TWIT. I have been using computers for 31 years now, so it may not be logical but some of these new "technologies" like twitter look a little silly to me.

However, as I have been actively posting new videos at my virginiatruckee Youtube account, I noticed I was getting a lot more subscriptions and friend requests. In looking at ways to promote the Youtube account, I noticed a feature called Autoshare that automatically posts Youtube activity to Facebook (or myspace) -- so I created the Facebook page. I am looking at whether Facebook can replace this blog, or what type of blog I will move to.

NEW SITES AND LIVING STEAM GOES BLU-RAY

VIRGINIAANDTRUCKEERAILWAY.COM -- For those who haven't seen it yet, I have created a site months ago to present information on the reconstruction project. At virginiaandtruckeerailway.com you can see a timeline of the reconstruction project's budget, which has grown from $10 million to over $70 million.

ARTOFTRAINS.COM -- A long time ago I hosted a site called Art of Travelling. In the last year I began hosting a site, Art of Trains. It's just in the beginning, and it's a place for me to showcase my favorite photos. Later today I will also be posting an image of a great painting now on display at the deYoung museum in San Francisco. It shows a scene at old Sacramento with people boarding a Central Pacific train.

LIVINGSTEAM.COM -- Just an update, I am now selling the Blu-Ray version of Living Steam on amazon.com.

DETAILS ON STATUS OF MCCLOUD #18

OK, here's some actual content about the Virginia and Truckee Railroad. In January Tom Gray of the (real) Virginia and Truckee Railroad gave the Nevada Commission for the Reconstruction of the Virginia and Truckee Railway an update on the status of #18. For those who forget, McCloud #18 was moved "back" to Nevada as detailed in this post from last year.

To follow a conversation on this topic, please see this page from the virginiaandtruckee1976 Yahoo Group. Here is the inital post:

I took down some rough notes on Tom Gray's presentation at the last Commission
meeting about the status of McCloud #18.

If something doesn't make sense, let me know and I'll try to clarify it. It's
funny (funny strange, not funny haha), while the Commission basically gave the
#18 to Sierra for free, they are charging the V&TRR $24,000. In a state of
confusion, at a CCCVB meeting, Stephen Lincoln referred to the "$35K from the
Grays," but methinks he was mistaken.

You can watch this presentation on acctv.org--

NOTES:

GRAY REPORT

Needs new front wheels on tender
fronts 31, backs 33, bolsters leaning
thought boiler cracked, just scale
rear truck pretty severe, needs a lot of work
running gear pretty worn out slaps pretty hard
main crank pin bad, big job
some bushings and con rod need to be replaced

Tom total about $75K "just to grab a number"

"haven't started to spend the real money yet, planning to hire a couple people"

millard, any update estimate on cost?

Gray, front running gear <10K, rear 15-20K tender 15K

millard neighborhood 50-60K

allen 50K from foundation, dedicated to locomotive, use that on #18 repairs

moving on to lease

millard mentions arbitration, history with 8

tyson says the previous caretakers (Sierra) just didn't lubricate some parts of
the locomotive

66:26

current condition, what it takes to get it running, have authorized 15K, will
get NNRF to pay for 18 repairs outside the commission process

during a discussion of what is maint vs. what is repair, Tyson says, "I've seen
these engines actually heal themselves." When your car is making a bad noise,
and the noise goes away, it has not healed itself, it has gotten worse.
Whatever, Tyson.

Storey County Wants Their Money Back and Then Some More!

2009-12-18T17:09:00.000-08:00

No. 44 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

STOREY COUNTY WANTS THEIR TAX MONEY BACK, AND MORE!

12/18/09

Wouldn't it be nice if we could decide we don't like paying taxes, and then ask the IRS for our money back? RIGHT!

But Storey County is asking something similar. Years and years ago, Storey County became the only involved county where the voters approved a sales tax increase to fund the Virginia and Truckee Reconstruction project run by the Nevada Commission for the Reconstruction of the Virginia and Truckee Railroad.

Of course back then the construction costs were estimated at $10 million, and the total project including buying out the private V&T Railroad, buying equipment and building facilities was only $20 million. Today the construction costs alone are over $70 million.

Perhaps Storey County doesn't feel they're getting their dollars worth, perhaps they have wised up and realized that local taxes are supposed to be spent in the local tax area. Here are two juicy agenda items from the snow-canceled V&T Reconstruction Commission meeting in December, 2009:

15. DISCUSSION AND POSSIBLE ACTION on a request from Storey County for $250,000 to match their $250,000 for the purchase of the old freight depot in Virginia City.

16. DISCUSSION AND POSSIBLE ACTION on a request from Storey County to give all of the tax collected from the date of action from the commission back to Storey County

Perhaps at the higher altitude, the politicians brains work better than in low-lying Carson City! IT'S ABOUT TIME!

Carson City Wants Their Money Back!

2009-12-18T16:44:00.000-08:00

No. 43 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

CARSON CITY CAN'T AFFORD V&T BOND PAYMENTS, ASKS FOR MONEY BACK FROM COMMISSION

12/18/09

Check out this article from the Nevada Appeal...

"Sales tax revenues dedicated to paying off bonds for the V&T Railway are expected to fall short by $300,000 this fiscal year.

"But Carson City Finance Director Nick Providenti said it's not this year's bond payments he is concerned about. The Carson City Convention & Visitor's Bureau has agreed to put up $100,000 and the V&T commission has about $200,000 in cash built up during the years when sales tax revenues came in higher than needed."

Well, don't say ex-Commissioner Mayor Marv didn't warn us! He said over a year ago this could happen, but assured us the Nevada Commission to Reconstruct the Virginia and Truckee Railroad could afford to cover the bond payments.

Depending on how you account for it, whose money is going to cover these bond payments? There's three ways to look at it.

1) Assuming all funds put into the project are segregated, then you could make a case that Carson City will simply be getting some of their original money back.

2) Assuming last in -- first out accounting, the $2 million in federal stimulus money is being used to pay Carson City to cover local bond payments. Well, stimulus was intended to bail out monetary malfeasance on the part of spend-happy local governments. I have to ask, why does everyone get so mad when banks were loaned TARP money and then pay it back with interest, but no one cares when profligate local governments get bailed out and don't have to pay it back.

3) Assuming all the funds are mixed together in a big melting pot, you have a combination of 1 and 2.

Just a year ago, when Mayor Marv made his comments, I contacted Carson City's Finance Department and asked them about this. I was sent a spreadsheet showing the "conservative" accounting used so that the taxes would always cover the bond payments.

Oops! This is not unique to Carson City, local governments all over the country spend much more than they can pay for. These types of situations will be "sprouting like weeds." Time to sell munis!

McCain - Coburn: V&T Wasteful Stimulus Spending, LVRJ Article

2009-12-09T10:39:00.000-08:00

No. 42 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

SENATORS COBURN AND MCCAIN SINGLE OUT V&T RECONSTRUCTION AS WASTEFUL STIMULUS SPENDING

12/09/2009

On Tuesday, December 8, Senators Tom Coburn and John McCain issued a press release and a report on wasteful stimulus spending projects.

The Press Release -- Senators Coburn and McCain Release New Oversight Report on Economic Stimulus Projects

The Report -- Stimulus Checkup
A closer look at 100 projects funded by the American Recovery and Reinvestment Act.

In addition, the Las Vegas Review Journal printed an article later on December 8 saying that "conservative" Nevada Governor Jim Gibbons disagreed with McCain and Coburn, parroting the "V&T party line" that the project would create jobs and stimulate the local economy.

Las Vegas Review Journal Article -- Governor disputes criticism of stimulus money for Virginia & Truckee Railroad

My next blog post will be an extended discussion of the stimulative effects of the Virginia and Truckee Railway Reconstruction Project.

Dorr: "They Told Me Not To Include Land Costs"

2009-11-27T22:42:00.000-08:00

No. 41 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

KEN DORR SAYS HE WAS TOLD TO LOWBALL ORIGINAL V&T RECONSTRUCTION ESTIMATES

11/27/09 warning may contain satire and/or cynicism, read at your own risk

FOR IMMEDIATE RELEASE

(EASTGATE SIDING, NV)-- Following the strange turn of events to a perfect day summarized in the previous release (#40), I decided to let Project Engineer Ken Dorr know about the uncivil behavior of his underling, Gary "The Strongman" Luce. That story was already covered in #40.

Once we returned to the Dump Road station, I asked Ken if I could speak to him for just 30 seconds. He and I stepped off the locomotive and I said something like this: "Look, Ken, I know some of you Commission people dislike me, and some of you hate me, but there was no excuse for what Gary just did." I told him about Gary blocking my video shot and hitting my camera.

Ken was having none of it and quickly switched subjects. To summarize, he proceeded to tell me that I had better things to do with my time than criticize the Commission. His top suggestion was that I should raise money for the Commission.

I will ramble on about this further down in this post, but let me get right to the most interesting point. Ken and I began debating the continually unrealistic and low budget estimates for the Virginia and Truckee Railway Reconstruction project long-bungled by the Nevada Commmission for the Nevada Commission for the Reconstruction of the Virginia and Truckee Railway. He brought up the original estimate of $20 million, which has now soared to over $70 million. You can see a rough timeline of these estimates and supporting docs at virginiaandtruckeerailway.com.

When Ken mentioned the $20 million estimate, I pointed out that this estimate was really $10 million. I mentioned that at the time in 1995 then-and-now Commissioner Ron Allen had said that half ($10 million of the $20 million) was for equipment, and the other half was for construction. Ken shrugged that off, saying no one now knows what Ron Allen said back then. I pointed out that it was entered in the record by the Nevada Legislature.

THEY TOLD ME THE LAND WAS FREE!!!

Let me say quickly that at this point Ken was mad at me. People will often lower their guard when they're mad and say what's really on their mind. You know how when a girlfriend gets mad at you and says something mean, then later says, "I didn't mean it?" You can be sure she meant it, and you can be sure Ken Dorr was being honest.

In that unguarded moment, Ken became defensive and said that when he made the $20 million estimate, he was told not to include land costs. He listed a number of assumptions that turned out to be wrong, including the assumption that the land for the entire project would be donated!!!

I asked him, "who told you to do that?" Ken replied that he didn't remember. I asked if it was then-Commissioner and Chairman Greg Smith, and he said "maybe."

As covered more thoroughly in post #39 and the excerpt below ...

Reconstruction -- Then and Now, A Story of Unmet Expectations

many statements made to the Nevada Legislature at the start of the project turned out to be false or were later ignored. My favorite is the claim that no money will be spent until all the money is raised. Another one is the claim that $7 million would come from a professional fund-raiser, and $10 million would come from a phantom private foundation that never materialized.

Beyond that, Ken and I spent nearly 20 minutes where he would tell me to join the Rotary, start a club to raise money for his project, and quit being negative by criticizing the Commission.

I would counter that government criticism and watchdogging is a necessary function of a free republic, and that if all the "negative" criticism of government went away, government would likely be more out of control that it already it.

So when someone criticizes you, do it using the Dorr Method, saying, "they made me do it!"

EXCERPT FROM LINKED NEVADA LEGISLATIVE HEARING TESTIMONY:

Mr. Allard asked if it was intended to delay construction until
the entire $20 million was raised.  Mr. Smith responded
affirmatively and added that none of the money 
will be spent until the entire amount necessary
to finish the project is raised.

Mr. Close asked what the assets of the V & T would total
once the project is completed.  Mr. Smith responded the railroad
cars would each cost from $250,000 to $300,000.  The engines
could cost from $750,000 to nearly $1 million.  Ron Allen,
President of the Virginia and Truckee Historic
Railroad Society, estimated the physical assets
would be at least half of the total project price. 
He noted the estimate would have to include right-of-way,
physical assets and the goodwill of an ongoing business.

If you read this far, take a look at the contradiction in these statements from Dorr and Allen. Dorr says he was told not to include right-of-way (land) costs. Allen says these costs must be included in the estimates. Too bad Dorr won that one or we would have had an honest budget from the start.

History is Made on the V&T Despite Strongarm Tactics

2009-11-27T20:33:00.000-08:00

No. 40 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

A RUN-IN WITH THE POWERS THAT BE: GARY "THE SHERIFF" LUCE, GEOLOGIST

11/27/09

FOR IMMEDIATE RELEASE (warning, contains satire and/or cynicism, read at your own risk)

(EUREKA MILL, NV) -- Today's historic first passenger run on the first part of Phase 3 of Nevada's Virginia and Truckee Railway Reconstruction Project was marred only by some amazing antics by Gary "Vinnie" Luce, Project Geologist and forceful frontman.

PERFECT DAY ENDS WITH A THUD

Jim Lohse, a well known critic of the Nevada Commission for the Reconstruction of the Virginia and Truckee Railway, was aboard the first passenger train to run past Eastgate Siding onto the new tracks heading to Eureka in the Carson River Canyon.

Lohse is producing The Unauthorized Biography of the Virginia and Truckee Railways. He relates a bizarre incident that marred the end of an otherwise perfect day. For the last two years has shot video of the Virginia and Truckee Railroad as well as the government run reconstruction of the Virginia and Truckee Railway.

"I got to Virginia City at 6am and the whole day I got these fantastic shots, stuff that was really icing on the cake of my video collection."

Relating a sudden turn of events, Lohse claims that his last day of shooting before heading into production ended with a thud. Lohse says that project geologist Gary "The Snapper" Luce didn't like him taking video of the train and hit his camera after blocking his shot and intimidating him.

OPPORTUNITY FOR HISTORIC RIDE

"I was already on the train all day, and I planned to go home at 1pm," Lohse recounted. "I found out that at the end of the day the train would run down the new tracks, marking a historic moment." Lohse says he boarded the train at Eastgate Siding and rode with Project Engineer Ken Dorr in the cab of the Virginia and Truckee Railroad's #29. Although Lohse has been a fierce critic of what he sees as "bad governance and straight-up dishonesty" by the government commission, he was surprised that Ken Dorr did not object to his presence in the cab.

"It was really a nice end to the day, here I am in the cab with a person I have accused of a crime and he is high-minded enough to be civil to me. I always felt Ken was one of the good people who can endure political battles and still meet for a beer at the end of the day. Some people take criticism much more personally. We were being friendly and Ken was even explaining highlights of the trip as we went along. I was thankful and told him so."

UNAUTHORIZED VIDEO TAKES LUCE BY SURPRISE

It had just started drizzling a cold rain. The experience took an abrupt u-turn when Lohse got off the locomotive to film the train's movements at the end of the track, at Eureka Siding, near the historic location of the Eureka Mill. Lohse recalls the strange turn of events: "I was making video of Ken Dorr operating the switches. Then I moved up the tracks past the passenger cars to get another angle. Despite Ken's implicit permission for my activities, I was filming when suddenly someone walked in front of my camera and blocked my shot."

Lohse claims that it was Gary "The Hand" Luce. Luce was mad because he recently discovered video posted on YouTube showing video made aboard a ballast train in 2008. Gary was confronting Lohse about this, while Lohse says he demurred. "He had me on a technicality, I posted it, I know the video was a surprise to him, but he was assuming I was the person who filmed it. I wasn't supposed to be on those trains, it was against the construction site rules. For the sake of argument, if I was on that train, it must have been with permission of the engineer, right?"

MAYBE THE WEATHER HAD SOMETHING TO DO WITH IT

Lohse says he assured Luce that no one in charge knew of the effort to capture video on the construction train. "All of a sudden, here we are in a dark river canyon known for criminal activity, and I've got this low-level project employee confronting me about something I posted on YouTube. He knows he's blocking my shot, he accuses me of trespassing, he said some other threatening things."

Things turned worse when Gary "The Hammer Luce" became physical. "Here this thug is simply abusing me verbally, that's OK, I can take that. Then, without warning, he reaches up and hit my camera! It's a good thing I wasn't looking through the viewfinder or I would have got a black eye!"

Lohse says he picked up the camera, walked away and continued filming unmolEsted. Gary "The Body" Luce made no further contact with Lohse, and Lohse reboarded the locomotive for the trip back to the Carson City station.

You might think it would end there, but it didn't. At the end of the trip, Lohse advised Project Engineer Ken Dorr of the incident. Lohse was surprised when Ken engaged in a long argument about wide-ranging subject. "It was quite a shock -- often it's not until people get mad that they really start to tell the truth. Ken let a couple historical facts slip that he never would have told me, except in anger."

TO BE CONTINUED IN POST #41, "THEY TOLD ME TO IGNORE LAND COSTS IN MY ESTIMATES, WE THOUGHT LAND WAS FREE"

Reconstruction -- Then and Now, A Story of Unmet Expectations

2009-11-23T09:36:00.001-08:00

No. 39 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

VIRGINIA AND TRUCKEE RECONSTRUCTION COSTS/PLANS -- THEN AND NOW

Let's compare claims made in 1995 to today's reality. Way back in 1995 there was a hearing in the Nevada Legislature. A groups of local politicians from Carson City were asking the state to provide a loan of $5 million to help reconstruct the Virginia and Truckee Railway from Carson City to Gold Hill. They also planned to buy out the existing private Virginia and Truckee Railroad, owned by the Gray family. The Gray's have now run their operation without government funding for over 30 years.

Let's take a look at what claims were made back in 1995 vs. today's reality:

SUMMARY OF CLAIMS MADE IN 1995

-- Total costs, soup to nuts, will be $20 million
-- $10 million of this is for equipment
-- Contradictory claim also made that operator provides equipment
-- The railroad's revenues will pay for the project in the long run
-- The V&T Reconstruction project is similar to Colorado's Durango & Silverton RR.
-- Private fund-raiser says he can raise $7 million
-- Private foundation ready to donate up to $10 million
-- State loan would be repaid at $1 per ride, based on $15 ticket price

INITIAL CONSTRUCTION ESTIMATES WERE $10 MILLION

1995 Claim: Total costs would be $20 million. Long-time commissioner Ron Allen said half those costs would be cars and locomotives, making the initial construction estimates $10 million:

Mr. Smith responded the railroad cars would each
cost from $250,000 to $300,000.  The engines
could cost from $750,000 to nearly $1 million.
Ron Allen, President of the Virginia and Truckee
Historic Railroad Society, estimated the physical
assets would be at least half of the total project
price.  He noted the estimate would have to
include right-of-way, physical assets and the goodwill of
an ongoing business.

This was apparently contradicted earlier in the hearing with this statement:

Chairman Marvel asked if the Commission had already
purchased the necessary rolling stock.  Mr. Dini
responded the operation of the V & T would be leased
to private enterprise.

Now, in this Nevada Appeal article, the estimate is over $70 just for construction. They have already raised and spent $40 million, and say $30 million more is needed.

In addition, different camps among the V&T Reconstruction Commissioners differ on who should own the rolling stock. Mayor Marv and Bob Hadfield, long involved in this project, had often claimed that Sierra Railroad would be the operator (covered in another section) and that Sierra would bring $3 million of assets to the project. At the same time, the Ron Allen-John Tyson camp has long lobbied for the Commission to purchase their own trainset. So far the Commission has spent over $500,000 on equipment. Some of this equipment has been abandoned before it's even used.

THE RAILROAD WILL ULTIMATELY SUPPORT ITSELF

In 1995, Greg Smith, Chairman of the Tri-county Railroad Commission, said:

the railroad could break even the first year of operation
and would make money by the second or third year of operation

This is funny, for years (right up through the 2006 Sierra Railroad "business plan") the public line was that the railroad would either "support itself" or "pay for itself."

The idea that revenues would pay for construction has long been abandoned, but now even the idea that revenue would support operations has been abandoned. See the Nevada Appeal article from November 2 and my previous blog post detailing Chairman Millard's claim that "running that train ... will never be profitable."

THE V&T IS COMPARABLE TO THE DURANGO & SILVERTON

Back in 1995 the claim was made that:

The Durango & Silverton Railroad in Colorado is comparable
to the Virginia and Truckee.

Now, this claim is still often made. In this case the message has not changed -- it's just been wrong all along. The Durango and Silverton is quite different from Virginia and Truckee Reconstruction in many ways, including:

-- The D&S right of way was never lost, and did not need to be repurchased
-- The Colorado Rockies are much greener and more beautiful than the proposed V&T route, which includes wrecking yards, a race track, industrial buildings and brothels in Mound House, and the existing and abandoned mining/milling areas of American flat.
-- The Durango and Silverton is over 40 miles one-way and follows a forested river route
-- Silverton is much more cohesive as a tourist destination

A PRIVATE FUND-RAISER WILL RAISE UP TO 70% OF CONSTRUCTION COSTS

In the 1995 hearing Chairman Greg Smith claimed:

Carl Dubois, a nationally recognized fundraiser,
has estimated that approximately $7 million could
be raised through the private sector.

Now, it is clear that this never happened. It's common for Commissioners to claim that private funds can no longer be used because federal funds are involved. This claim has always been invalid, because in 1995 the plan was to use $2 million of federal ISTEA funds.

A PRIVATE FOUNDATION WILL PAY UP TO 100% ($10 MILLION) OF COSTS

In 1995, Chairman Smith tesitifed:

Mr. Smith indicated a private foundation has
expressed the intention to provide up to $10 million

Now, it's not even clear who this foundation was. Although the Northern Nevada Railway Foundation is currently the recipient of more Commission funds than they have donated back, it seems in 1995 the "private foundation" was Ron Allen's secret society, the Virginia and Truckee Historic Railroad Society. This group has never donated a dime to the project, let along $10 million.

In progress, more to come.

Recovery.gov -- Counting Obama stimulus jobs with ABC News

2009-11-16T19:56:00.000-08:00

No. 38 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles NOVEMBER UPDATE ON THE VIRGINIA AND TRUCKEE RAILWAY PROJECT

ABC News runs story on stimulus spending in places that don't exist

or....

What does .72 of a person look like?

See the ABC News video about bogus reports by the federal government of where stimulus money was spent. This is interesting, but only slightly relevant. I just bring it up to show that recovery.gov does not always present their data and facts in an honest, straightforward way.

I will leave it to people smarter than me to address the big questions. For months the stimulus grant to the Virginia and Truckee Reconstruction project was nowhere to be found on recovery.gov. It finally showed up, and what do you know? 10.72 jobs were "saved or created." Now, I am also an economist, and the idea of a "saved job" is really a joke because it can't be measured. Leaving that aside...

This post is about the claim that 10.72 jobs were created on the Virginia and Truckee Reconstruction project in Phase 3A. You know they aren't reporting straightfoward nubmers. If they really created lasting full time jobs, the number would be an integer!

First a little background is in order.

Phase 3A of the project run by the Nevada Commission for the Reconstruction of the Virginia and Truckee Railway is the stretch of track from the end of Highland Road down into the canyon a couple miles.

For a complete project map see this link on renorailfans.com, and here's a more specific map of the area where the stimulus dollars are being spent. On this map (look at where Phase 2C ends) it's the Phase 3 tracks heading south (to the left on the second map) that go into the canyon which were funded by stimulus dollars.

Now, go to recovery.gov. As of November 16, 2009, there is a section in the middle of the page that says: DATA, DATA AND MORE DATA! Take a deep breath, realize you are entering a propaganda zone, and look below the headings that say BY RECIPIENT and BY REGION.

Click on Grants, for Agency choose Department of Transporation, and of course choose Nevada for state. You will get a map. Click on one of the dots east of Carson City and you get a pop-up window with data about the $2,033,899 the project got from the Feds. When you click on View All Data, you see the (inaccurate) project description saying: "V&T Railroad from Eureka Mill to West Side of Frehner Pit."

Let's look at some facts:

1) $2,033,899 divided by 10.72 means we the taxpayers spent about $180,000 to create "jobs."

2) The project only lasted a few months, in the real world we call that temp work, not a career.

3) The rail subcontractor, H&H Trackbuilders, uses mostly California based employees when spend the bulk of their pay in California on rent, family, etc.

4) Since I personally know these guys, I know for a fact that they send some money back to Mexico. I don't have a problem with that, just realize that your stimulus money was awarded to create 10+ temp positions in Nevada so the money could flow out of state and out of the country.

5) Of course these guys didn't get paid $180K for a couple months work, realize that when "stimulus" money is spent on job creation, the lion's share of the money pays for materials and equipment needed to build infrastructure. The worker gets the short end of the stick. This is NOT FDR having people dig holes and fill them in just to make work.

6) The section of track from Eastgate Siding (aka Dump Road) north over Highway 50 up to the west side of Frehner Pit (aka Road and Highway Builders) was part of Phase 2C and was not paid for by this grant. (Road and Highway Builders is another story.)

7) What does that extra .72 of a worker look like?

IT'S RAILWAY, NOT RAILROAD!

Finally, let me point out that the recovery.gov website makes the same mistake that Ty Cobb Sr. made today. They make the same mistake that the Nevada Legislature made. None of this money goes to the Virginia and Truckee Railroad! That's a private company in Virginia City.

The money goes to the people who are trying to steal that name away, the Nevada Commission for the Reconstruction of the Virginia and Truckee Railway. For more history on how they confuse people about the distinction between the private company and the public effort, read the post about the lawsuit pending between the private company and the government entity. It's toward the end of the post.

And if you ever figure out what .72 of a person looks like, please email me at jim@virginiaandtruckeerailway.com.

Even Ty Cobb Sr. is Confused

2009-11-16T17:14:00.000-08:00

No. 37 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles NOVEMBER UPDATE ON THE VIRGINIA AND TRUCKEE RAILWAY PROJECT

When is a railroad not a railway? When it's in Virginia City, that's when! Ty Cobb Sr. doesn't appear to know the difference.

Today, November 16, 2009, Ty Cobb Sr. was being interviewed by Bill Manders. I'm going to say right here that I don't listen to Manders often, but I happened to turn the radio on to switch to 99.1 and there he was interviewing Cobb.

Now, in the previous half hour Cobb was speaking in favor of building Yucca Mountain, saying that even (so-called) conservatives like Governor Jim Gibbons were against it. He and Manders were staking out a locally unpopular pro-Yucca position, so you'd think you were talking to two real right-wingers, right?

I decided to do one of my rare radio show call-ins. Usually I save my ammo to call a more high-profile host occasionally, like my call the Rush Limbaugh earlier this year. In this case, here's Ty Cobb Sr., former national security advisor to President Ronald Reagan, and he's on the local radio station where I can call him.

Since the V&T Railway Reconstruction folks just admitted their budget would go over $70 million, I wanted to know what he thought.

It was interesting. First, it's very easy to get on KOH, as long as you make your point quickly. If the call screener picks up and you ramble, he'll say no and hang up on you.

So I asked Mr. Cobb a question like this: "I wanted to know what you think of the railroad reconstruction project, not the private company but the government commission, now that they have admitted their budget will go over $70 million."

Manders jumped in and facetiously suggested that we should just all pay our taxes and shut up. Once he was done having his fun, I interjected, "Their initial budget was $10 million."

Ty Cobb senior then surprised me, sort of. I am getting used to conservatives setting aside their principles (they're called Republicans) and gobbling up public money "because if we don't someone else will."

Cobb said the project was near and dear to his heart because HIS FAMILY HAD GIVEN LAND TO THE RAILROAD. I realize it's a simple slip of the tongue, but he gave his land to the GOVERNMENT, NOT THE VIRGINIA AND TRUCKEE RAILROAD.

So for anyone reading this, realize that the Virginia and Truckee RAILROAD is a private entity that has never taken a dime of government money. The Virginia and Truckee Railway is the government commission whose budget has grown seven-fold.

It's also funny, you know about the V&T Lives license plates? The Northern Nevada Railway Foundation claims credit for these, and that's a different story. What's relevant is that the money from the license plates goes directly to the Nevada Commission to Reconstruct the Virginia and Truckee Railway.

Now, getting tongue in cheek myself, not only is the government reconstruction project stealing a name from the private Virginia and Truckee Railroad, they are actually stealing the license plate revenue. If you look at the specific license plate law (also copied at the end of this post), it says the revenue goes to the ... you guessed it ... Virginia and Truckee RAILROAD!!! The Gray's have never seen a dime of this money ;>)

I guess if the Nevada Revised Statutes and the entire Nevada Legislature is confused about the names, it's OK for Ty Cobb Sr. to be confused.

That's all for now,
Jim

PS THE NEVADA REVISED STATUTES ON THE LICENSE PLATES ARE SUPPOSED TO GO TO THE PRIVATE RAILROAD, at least the way the law is written. We all know where it's supposed to go...

NRS 482.37945 Support of reconstruction, maintenance, improvement and promotion of Virginia & Truckee Railroad.

1. Except as otherwise provided in this subsection, the Department, in cooperation with the Northern Nevada Railway Foundation or its successor, shall design, prepare and issue license plates for the support of the reconstruction, maintenance, improvement and promotion of the Virginia & Truckee Railroad using any colors that the Department deems appropriate. The design of the license plates must include a depiction of a locomotive of the Virginia & Truckee Railroad and the phrase “The Virginia & Truckee Lives.” The Department shall not design, prepare or issue the license plates unless it receives at least 250 applications for the issuance of those plates.

2. If the Department receives at least 250 applications for the issuance of license plates for the support of the reconstruction, maintenance, improvement and promotion of the Virginia & Truckee Railroad, the Department shall issue those plates for a passenger car or light commercial vehicle upon application by a person who is entitled to license plates pursuant to NRS 482.265 and who otherwise complies with the requirements for registration and licensing pursuant to this chapter. A person may request that personalized prestige license plates issued pursuant to NRS 482.3667 be combined with license plates for the support of the reconstruction, maintenance, improvement and promotion of the Virginia & Truckee Railroad if that person pays the fees for the personalized prestige license plates in addition to the fees for the license plates for the support of the reconstruction, maintenance, improvement and promotion of the Virginia & Truckee Railroad pursuant to subsections 3 and 4.

3. The fee for license plates for the support of the reconstruction, maintenance, improvement and promotion of the Virginia & Truckee Railroad is $35, in addition to all other applicable registration and license fees and governmental services taxes. The license plates are renewable upon the payment of $10.

4. In addition to all other applicable registration and license fees and governmental services taxes and the fee prescribed in subsection 3, a person who requests a set of license plates for the support of the reconstruction, maintenance, improvement and promotion of the Virginia & Truckee Railroad must pay for the initial issuance of the plates an additional fee of $25 and for each renewal of the plates an additional fee of $20, to be distributed pursuant to subsection 5.

5. The Department shall transmit the fees collected pursuant to subsection 4 to the treasurer with whom the Nevada Commission for the Reconstruction of the V & T Railway of Carson City and Douglas, Lyon, Storey and Washoe Counties has entered into an agreement as required by subsection 2 of section 8 of chapter 566, Statutes of Nevada 1993, for deposit in the fund created pursuant to that section. The fees transmitted pursuant to this subsection must be used only for the reconstruction, maintenance, improvement and promotion of the Virginia & Truckee Railroad.

6. If, during a registration year, the holder of license plates issued pursuant to the provisions of this section disposes of the vehicle to which the plates are affixed, the holder shall:

(a) Retain the plates and affix them to another vehicle that meets the requirements of this section if the holder pays the fee for the transfer of the registration and any registration fee or governmental services tax due pursuant to NRS 482.399; or

(b) Within 30 days after removing the plates from the vehicle, return them to the Department.

(Added to NRS by 2001, 583; A 2003, 6, 499)

November Update on Virginia Truckee Railway Project

2009-11-04T12:30:00.000-08:00

No. 36 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

NOVEMBER UPDATE ON THE VIRGINIA AND TRUCKEE RAILWAY PROJECT

Here's a letter to the editor I just submitted.

(ADDED LATER: They printed it on November 7, 2009. See the full post for a link by clicking Read More)

Otherwise I have not been paying a lot of attention. The Commission has really dug their heels in by ignoring public records requests, some up to eleven months. The CCCVB still has not disclosed the costs of the August 14 VIP party, rumored to have gone significantly over budget. Brandeis said sunlight is the best disinfectant, but the V&T Railway powers that be are hiding in the shadows.

The letter was prompted by an article posted twice on the NevadaAppeal.com website, leading to two different sets of comments.

Later article on November 4:
V&T commissioner floats idea of raising room tax in Carson City

Earlier article on November 2:
V&T Commission: We need sustainable income

You know the feature on the cartoon pages where they show you two cartoons and say, "find the difference?" You could play that game with the two articles above. Couple this double posting of the same info with the Computer Vet's comments about the Appeal's RSS feeds and you will see they are having trouble with their website.

Here's the letter:

As printed in the November 7, 2009 edition of the Nevada Appeal

LETTER TO EDITOR

Congratulations to the V&T Railroad, the private company who made this year's runs possible. By working hard and spending smart, Tom Gray is a superstar. He gets most of the credit.

The government commissions involved are more suspect. By spending other peoples money, they've never had a motive to reduce costs and operate efficiently. Despite claims that the high ticket prices were a fundraiser, each full train still lost money. NO money went back to the Commission to help pay for future development.

Now, after a VIP party of unknown cost and a money-losing season, the V&T Commission is going hat in hand to counties they have ignored for years. The enabling law has always required proportional benefit estimates, yet the Commission has never followed that law. They could have forced counties to pay up all along, but instead they wait until governments are truly broke to say, "we need sustainable income."

Meanwhile the gift shop concession, normally a profit center for tourist railroads, is being run by the Northern Nevada Railway Foundation. These lobbyists in fund-raisers clothing have never made a net contribution to the V&T Commission, yet are selling their wares in a gift shop paid for by the V&T Commission.

Now, despite losing a vote last year 61-38, they are patting themselves on the back for a money-losing season. What's the difference between a politician and a drunken sailor? The sailor spends his own money.

Thanks, Carson City, for making this money pit possible! Keep it up!

END OF LETTER

McCloud #18 Returned Damaged

2009-08-05T09:51:00.000-07:00

No. 35 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

COMMISSION OWNED MCCLOUD #18 RETURNED DAMAGED BY SIERRA RAILROAD

The McCloud #18 steam locomotive, purchased by the Nevada Commission for the Reconstruction of the Virginia and Truckee Railway, was leased to Sierra Railroad for the last couple years. Because the value of the lease was (artificially valued) under $9000 per year it was not subject to competitive bidding under Nevada Law.

As noted in a Nevada Appeal article, the McCloud 18 was returned a week ago. It came back damaged. Here are photos of the damage.

These details came out at the August meeting of the Nevada Commission for the Reconstruction of the Virginia and Truckee Railway. Meeting notes are available on the Gold Hill Historical Society website, goldhillnv.org. See item 14 for details.

The virginiaandtruckee1976 Yahoo Group saw this interesting comment posted:

---- BEGIN COMMENT FROM YAHOO GROUP MEMBER

The reason for these stringent requirements on boiler inspections is based on over a century of experience dealing with the consequences of not maintaining a close watch on high pressure steam vessels. The tourist railroad industry has a remarkable record for safely operating high pressure steam equipment. This is due in large part to the stringent requirements that MUST be observed.

For Sierra Railroad to be negligent to the level of failure to fill out and submit a required annual report as a minimum level of non-performance for a piece of equipment entrusted to their care is inexcuseable (misfeasance). For there to be deterioration of the running gear in the level that is being dealt with here is bordering on the criminal for equipment entrusted to their care (breach of fiduciary duty).

As somebody attempting to obtain a multi-year operating contract with a guaranteed profit formula for the operator this failure to maintain #18 should be a red flag warning to all other parties involved.

Sierra Railroad has demonstrated that they can not be trusted in the future to adequately maintain any equipment entrusted to their care.

Lets say for example they were to be awarded a 2 year operating contract. Based on their performance to date what condition do you think equipment would be in at the end of the 2 year contract period?
------ END COMMENT

My comment is about Chairman Dwight Millard saying that it's not time to affix blame, it's time to fix the locomotive. Imagine that you rent a car and return it damaged. You tell the rental car company that it's not time to play the blame game, that the owner should fix the damage. I don't think you'd get very far.

The lease contract between Sierra and the government Commission called for Sierra to keep the locomotive in good shape.

Millard's Bomb-Drop: Running That Train Will Never Be Profitable

2009-07-19T13:10:00.000-07:00

No. 34 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

At the July 13, 2009 meeting of the Carson City Convention and Visitor's Politburo, Dwight Millard dropped a bomb. You can see the meeting at the ACCTV.org website, his comment was made at 56:20.

CCCVP member Molly Walt was asking why the contract being offered to the CCCVP by the Nevada Commission to Reconstruct the Virginia and Truckee Railroad was only being offered for 2009. She was getting a little greedy, wondering if the CCCVP was able to clear a profit on 2009 operations would they get the right of first refusal on a 2010 contract. She was concerned that when private companies see that the railroad experts of the CCCVP can make money at it, they greedy private companies would try to get their hands on the profits. This sort of thinking is not surprising from a public schoolteacher.

Dwight Millard answered, "Running that train from here to there will never be profitable for anybody, no matter what you do. You can't charge enough."

He went on to say that tired old line I have heard from so many in Carson City, that's it's worth running a loss-making railroad because it will bring economic development to Carson City.

LET'S MAKE SURE THIS BENEFITS CARSON CITY OVER OTHER COUNTIES

Well I'm going to wrap it up here. I'm running out of time to waste on watching these jokers. Kevin Ray explains that it was never the intention to make money running trains. He admits that much of the benefit is going to accrue to Washoe County with its superior hotels, casinos and other attractions.

He finally lets the cat out of the bag, he figures that if Carson City does the marketing they can steer people to stay in Carson City hotels. Questionable.

Thanks for following, I'm probably done at this point.

Doing the Math on CCCVP Operating Costs for V&T Trains

2009-07-19T11:30:00.000-07:00

No. 33 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

The costs and revenues are moving targets, even in one meeting there were several contradictory numbers put out.

NEWSFLASH: Originally I heard Dwight Millard to say that it would cost the Carson City Convention and Visitor's Polit-Bureau $4000 per weekend to "rent the bus" from the Virginia and Truckee Railroad. I wondered how in the heck the real V&T could make money or even break even, once costs of fuel, employees and wear and tear were factored in. I also thought the train capacity was to be 120, now I hear Millard saying 140. Updated figures are below...

NEWSFLASH PART II: Watching the CCCVP meeting of July 13, later in the meeting Candy Duncan said that the CCCVP was planning on spending $30,000 marketing 24 railroad trips, and only expected to pull in $20,000 in ticket revenues. Numbers are again updated below to reflect these costs, and a new section is added to analyze "the soft bigotry of low expectations."

NEWSFLASH III: I was assuming 24 trains and mapping out numbers assuming they could fill all these trains. Now I hear there will only be Saturday trains after Railfest weekend. So there are only 13 trains this season. Read more for all the conjecture...

NEWSFLASH IV: I just heard Candy Duncan say they are spending $30,000 to market the train, PLUS $20,000 for the VIP reception on Friday August 14, 20009. But when they voted on the marketing budget it was $35,000, plus the $20K for booze.

So the bottom line appears to be the CCCVP will pay $6992 per train, assuming full trains. If they ran at 50% capacity, you'd have $2968 less revenue per train, meaning they'd be paying $9960 per train. With the Commission offsetting $25,000 of these costs at $1923 per train, the CCCVP will be left with a bill for $8037 per train. The total season cost is $104481 at 50% capacity and $77168 at 100% capacity.

LOSE NEARLY $10,000 PER TRAIN THEY PAY TO RUN!!!!

So the ticket prices for the 2009 extended Virginia and Truckee Railroad runs, being done for the Carson City Convention and Visitor's Politburo are:

$48 Adult (round trip)
$36 Child (RT)
$40 senior/veteran

Let's assume that they can sell 140 seats per train. Let's fallaciously assume that every train runs full, and there's 13 trains over twelve weeks.

Let's further assume that for every 140 person trip, 10% are seniors, 50% are adults and 40% are kids.

14 seniors x $40 = $560
56 kids x $36 = $2016
70 adults x $48 = $3360

TOTAL PER TRAIN $5936
SEASON TOTAL $77168

(BUT They are only projecting $20,000 in ticket revenue, so they only plan to run at 26% capacity??????)

Expenses: $4000 per train to the Grays Virginia and Truckee Railroad
$2692 per train for marketing
$300 per train for other expenses (tickets, unknown, etc.)

TOTAL $6992 per train
SEASON TOTAL $90896

I wish them luck. Luck is also what they are getting from the Nevada Commission to Reconstruct the Virginia and Truckee Railway. The Commission has provided a $25,000 subsidy to the CCCVP. I expect the commission will also be paying the costs associated with readying a temporary depot site for the CCCVP. If all the costs were truly accounted for, they would be losing even more money.

But it doesn't matter if they make money or not -- don't forget, this is all about gov't subsidy, not operational profits. They have no incentive to account for all costs and market the event effectively months ahead of time. They will get YOU to pay for it.

And this is all moot, my numbers must be wrong. Respected businessman (real estate developer sitting on unsold houses) and CCCVP Chairman (and V&T Commission Chairman) Dwight Millard said:

"Running that train from here to there will never be profitable for anybody, no matter what you do. You can't charge enough."

See the full post here.

Millard to CCCVB: An Introduction to How a Railroad is Run!

2009-07-19T10:28:00.000-07:00

No. 32 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

Notes of the Carson City Convention and Visitor's Politbureau meeting of July 13, 2009

As I have said in other posts, the overloaded nine-member Nevada Commission for the Reconstruction of the Virginia and Truckee Railway has too many members to make operations decisions. This is the story, according to Kevin Ray at the June meeting of the Carson City Convention and Visitors Politburo. Accordingly, the NCRVTRWY has handed off operational responsibility to the CCCVP.

So if nine cooks spoil the soup, will five ignorant cooks do better? At the July CCCVP meeting, Millard kicked off a discussion by saying "this is your introduction to how a railroad is run."

Excuse me for laughing. Somehow the CCCVP is being given operational responsibility for the $40 million project, and they are getting "an introduction to how a railroad is run." This is your government at work, the same people who will bring you health care, energy taxes, and a possible "Nevada net profits tax" that is remniscient of the Depression era policies that just made things worse.

JUST KIDDING, HEADS IN THE BEDS, ASSES IN THE SEATS

Millard then said, "I'm just kidding." The problem is, he's not kidding. The CCCVP, as a body, is questionably proficient at "putting heads in the beds," quoting boardmember Stephen Lincoln. I would note that Stephen Lincoln is also an expert at riding trains and flipping off people he doesn't like. This actually happened as I was making video of a VIP train last year. Hi Stephen!

Back to the point. Millard's characterization is correct, the CCCVP is getting a crash course in railroad operations. They could also use a crash-course in publicity. As of July 19, less than 30 days away from their subsidized event, they have yet to list it on their own website on the events calendar. They also haven't listed it on the Nevada Appeal events calendar. They have not issued a press release.

I guess since the V&T Reconstruction Commission has given them $25,000 to cover expenses, they don't feel pressure to put "asses in the seats." Perhaps the train will be a sellout, but it won't be because of proper advance publicity.

EASTGATE DEPOT IS A "PERMANENT DEPOT"

While the V&T Commission refers to the planned depot on Dump Road / Eastgate Siding to be "interim," Millard appears to let the cat out of the bag when he refers to the Dump Road Depot as "permanent." This tends to support the V&T Commission's claims to have "shelved" plans to run all the way through the canyon and back to the Drako Way location they spent well over $1 million to acquire.

I repeat myself when I say, the main problem with the Commission is they change their minds every month. There is no plan. There is no budget. There's is just a fly-by-the-seat-of-the-pants effort to build a railroad as the pork comes in from the Federal government.

A little furthe into the discussion Millard repeats the Kevin Ray claim by saying "the commission is too big and bulky" to plan operational details. Millard also refers to a Railfest Committee, which should be a public body with public meetings. I have yet to see any notice or agenda from this group tasked with spending at least $25,000.

IS THIS A BUS OR A TRAIN?

Millard goes on to say that the CCCVP will sit between the Commission and the Grays. He notes that in the meeting packet are two agreements, one with each party, to lease the track from the Commission and get the Grays Virginia and Truckee Railroad to operation a train.

He then does something pretty weird, in my view. He refers to the tranportation mode at Railfest 2009 as a "bus." He explains this analogy is an effort to get away from "train syndrome."

Huh? He explains that this is like calling a bus company for a Rotary trip where the bus company sets a fixed price for the trip and is not responsible for selling tickets. He explains that the CCCVP will sell tickets. He then gets back into train-talk and explains, "this is the unknown ground of how we're going to try to run this train in the future."

Ask yourself, would a private business run this way? Would they commit to an operation of a train when it's "unknown ground?" Perhaps the CCCVP can build us a nuclear reactor on some "unknown ground."

WE COULD HAVE SOME LOSSES

After further explaining that the CCCVP is responsible for marketing the train, Millard explains that beyond the opening weekend "we could have some losses and we don't know what those are going to be, but we have obligated ourselves for twelve weekends." He goes on to do the math, that each weekend costs about $4000 so the total obligation is $48,000. He explains that the CCCVB is on the hook for this money.

I will make another post about the math and break-even points. See it here...

At this point the CCCVP got into the details of the contracts. Commission Lackey Kevin Ray was on-hand to answer questions. Molly Walt kicked it off with some questions about item #9. She asked about the $2 million insurance requirement called for by the re-con commission.

Dwight Millard answered that "we learned something" in the process of researching this. It turns out the CCCVP had been purchasing insurance on an event-by-event basis. In looking into the railroad event insurance question, Millard announced that all events were insured by a "pool" and that all previous expenditures for event-by-event insurance were unnecessary. I could have told them that, but hey, it's only tax money, right?

THE GREATEST OPPORTUNITY!

Kevin Ray gave a speech about how the Commission has spent millions of dollars of local, state and federal money to build a track and it shouldn't be left unused. He said the CCCVP has the greatest opportunity to make a go of it. I would note that all the money the Commission spent on an operator selection process seems to have been wasted. I would also note that the thousands the Commission spent for Ken Dorr and Attorney Michael Rowe to fail to negotiate with the Grays Virgina and Truckee Railroad also seems to have gone down the drain.

They apparently could have simply selected the Convention and Visitor's Politburo as the operator from the start. Kevin predicts that people will arrive in Carson City from all corners of the earth to ride the train -- I sincerely hope he's right!

FUZZY MATH or INFLATION?

Kevin noted that the Virginia and Truckee Railroad has been running trains for 37 years. Hmmm.... they started in 1976, it must be 2012!

Then Stephen "Flip-Me-the-Bird" Lincoln asked, "what's going to happen next year." Kevin replied that he hoped the CCCVP had enough success this year that they could continue next year. He suggested that by next year there should be enough interest to run trains seven days a week. How nice of him to commit the V&T to abandoning their Virginia City to Gold Hill operation in Virginia City.

Molly Walt asked if there was an estimate of how much profit the CCCVP (Carson City Convention and Visitor's Profit-Buro) would reap if the trains sold out every weekend. I make estimates of *operating* profits excluding capital costs here. Kevin said, "I don't know." He did seem to think that 100 people per train was the break even point.

Millard mentioned that the train capacity was to be 140 people and the Virginia and Truckee Railroad was charging $4000 per run. I have updated a separate post trying to estimate the break-even point for the CCCVP.

First Kevin said that at 100 passengers they'd break even. My figures show that it might take at least 110 to break even just on operating costs. Kevin later says he thinks they can break even at 50 people, which is a mathematical impossibility. He then says it would be worth it even if the CCCVP spends a few hundred bucks per trip, because it will bring people into Carson City.

Of course he can say that, it bears repeating that the commission he works for is paying for $25,000 of the costs.

LET'S FILL THE HOTELS

Kevin then makes a claim that because people have been waiting fifteen years for a train to ride, they may not all come this year. This is counter-intuitive, usually things like this (think Aces ballpark in Reno) see their highest attendance when it's a novelty, then over the years attendance and ticket sales drop off to a normal level. Oh, well, no one ever claimed there was an economist in the room -- I stayed home to watch this on video.

Kevin did say that these trains would "fill the hotels." Again, if this were a private business the analysis would be much more rigorous. As it is, since we're in bailout nation, these government panels know they can depend on the taxpayer. They have nothing personally at risk.

Kevin makes a point that people throughout the US have been wanting to get the contract to operate the Re-con rails. The funny part, the CCCVP is truly being given a gift. Any private company that owns a railroad would expect a return on their investment for leasing out operational rights.

In the case of the Commission, they are going to let a buddy-buddy government commission (CCCVP) use the rails for free AND pay for maintenance. They will be letting the CCCVP keep any profits! I guarantee you if this had been offered to the Grays REAL Virginia and Truckee Railroad they would have jumped on the deal. That's just my not-so-humble opinion.

ASS-KISSING AND BUTTERING UP 101

One of the CCCVP members asked what a "deadhead train" was. Millard with a straight face said that's a term from the 1960's. He was so deadpan that I think they believed him. Basically the train has to run from Virginia City to Carson City EMPTY in the morning, pick up passengers, make a round trip and "deadhead" back to Virginia City at the end of the day after dropping passengers back in Carson City. Millard went on to tell (BS) the CCCVP that the reason the commission chose them to deal with "so many unknowns" should be taken as a compliment.

There was discussion that they would sell tickets on the deadhead runs whenever possible. They continue show show a total lack of realistic plans and expectations within 30 days of the first run. "Good enough for government."

Trying to make it easy for the CCCVP railroad experts, following Millards "bus" analogy, Kevin Ray makes a cruise ship analogy. He says that at times cruise ships need to make "repositioning" moves. He says that he has seen some good deals on repositioning cruises. Buses, cruise ships? This must all make sense to the railroad experts in Carson City.

In the discussion Millard mentions that their PR firm has almost guaranteed that every train would be full. So forgive me for belaboring the point, the CCCVP are being given the job because they are railroad marketing experts, and then need to hire an outside PR firm to do the job? But no advertising or publicity has taken place WITHIN 30 DAYS OF THE MAIDEN VOYAGE?

Ooooookkkkkkkkk...... I will repeat a mantra I learned a long time ago when dealing with the government, "I will bow down and recognize my superiors, I will not criticize my superiors, even though I paid for their antics. I will bow down..."

FINALLY SOMEONE STARTS TO MAKE SENSE

Molly Walt then identified the CCCVP's involvement in the project as a leap of faith. Actually she first said leap in faith, then said leap of faith. She is correct, for fifteen years the whole project has been a leap of faith.

Then she displays a leap of ignorance of the history of the project. I am not going to write ten pages of detailed history here, but she asks, "if we take this leap of faith and make a profit, what's to stop another company from trying to do it next year." In her ignorance, she is asking a smart question. She wants an option on next years business if this year works out well.

What she's apparently unaware of is the whole expensive operator selection process, the "business plans" submitted by Sierra Railroad, American Heritage (Durango and Silverton) and the Virginia and Truckee Railroad. She seems to be ignoring the failed expensive negotiations between the Commission and the Virginia and Truckee that lined the pockets of Ken Dorr and Mike Rowe. She is not aware everything that happened lo these many years before the V&T Commission abandoned their principles and gave Dwight Millard's other Commission the sweetheart deal of the century.

OFFERING THE SWEETHEART DEAL TO MULTIPLE PARTIES

Kevin Ray responded, "I don't see right now that the (V&T) Commission is looking to sign another deal right behind this one." Au Contraire! At the last V&T meeting it was clearly discussed that the CCCVP deal was just for this year and that for 2010 and 2011 the Commission was looking to Sierra or the Grays or a combination of the two.

MILLARD DROPS THE BOMB!

Thankfully Millard was honest enough to say that for 2010 and 2011 the Commission was considering working directly with the Grays or offering the concession to Sierra. Then he dropped a bomb. He said, "Running that train from here to there will never be profitable for anybody."

That deserves a new post...
Article in progress... ya'll come back now, ya'hear!

Let's the gov't subsidies begin!

2009-07-19T09:13:00.000-07:00

No. 31 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

A long time ago, in a galaxy far away ... actually it was the sixties. The last guy to run the Virginia and Truckee Railway, Gordon Sampson, was providing an Oral History for the University of Nevada Reno.

In this history, exhaustively titled Gordon A. Sampson: Memoirs of a Canadian Army Officer and Business Analyst—Manufacturing, Motion Pictures, the Virginia and Truckee Railroad, Financial Affairs of Western Nevada, the Washoe County Fair and Recreation Board, Sampson said:

It would appear that the railway should have been preserved as a tourist attraction. This has been done in other states and to the benefit of all concerned. But there is the other side of the picture. My answer to these inquiries is always the same, there would be no use of operating the "V & T" railway unless it was operated with its own equipment. To do so would require a large expenditure of money on the one and only remaining locomotive, No. 27. As to the equipment, the sole remaining coach, No. 18, would have to be torn down completely and rebuilt with steel concealed behind the old tongue-and-groove outer sides with the traditional canary yellow and green trim. That would take a large sum of money.

Yes, there have been several attempts made to bring the line back into operation, but it would only be through an annual state subsidy, apart from the initial capital expenditure. We also must remember our winter months when the tourist traffic materially drops, and we must also remember that a large percentage of our tourists arrive in Reno to gamble and not to drive automobiles to Carson City for a ride on an old-fashioned type railway as far as Virginia City. Personally, there is no one that regrets more than myself the fact that the railway has not been preserved in some shape or form.

Gordon Sampson said years ago what is coming true today. At the second July meeting of the Nevada Commission for the Reconstruction of the Virginia and Truckee Railway, the Commission approved $25,000 to be given to the Carson City Convention and Visitors Poliburo for operations of a train over the Railfest weekend, Aug 14-16, 2009. (I would provide a link to Railfest, but amazingly just 30 days away from the event they are not listed on any website or event calendar.)

To wrap up this post, unlike virtually all other government infrastructure projects, the Virginia and Truckee Reconstruction project has never been able to accurately project it's full costs. The costs continue to rise, starting with a construction budget of $10 million, now estimated to come close to $70 million. At the same time the original projections were that the railroad would reach an operating profit. As recently as two years ago the claim of operations profits were intact.

But now we are seeing the first instance of operational subsidies. "don't steal, the government hates competition!"

Renaming the V&T and Janice Ayres/ NNRF needs a history lesson

2009-07-16T23:55:00.000-07:00

No. 30 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

First, Janice Ayres, president of the Northern Nevada Railway Foundation, must not know her history. She says they have been asked for trademark reasons not to use the name Virginia and Truckee Railroad on their calendars.

She said she used it with permission (probably true) and wanted to use it because that was the name of the railroad featured in the calendar. The calendar from NNRF features photos of the original V&T RR from before 1950.

IN A HISTORICAL SENSE, VIRGINIA AND TRUCKEE RAILROAD AND RAILWAY ARE THE SAME THING

She's not aware, apparently, that the Virginia and Truckee Railroad became the Virginia and Truckee Railway. I believe this was in 1904 but don't quote me. So to put Virginia and Truckee Railway on a calendar would be perfectly well within the trademark owned by the Commission AND would represent the proper railroad, er, railway.

COMMISSION DISCUSSED RENAMING THE PROJECT

Check out this story from Karen Woodmansee of the Virginia City News:
http://www.virginiacitynews.com/link.asp?smenu=95&sdetail=1967&wpage=1

Someone brought up a comment on the Yahoo Group that discussed this project. The commenter was surprised/shocked that the government commission was considering changing the name of their boondoggle railroad reconstruction project.

Here is what I posted in response:

From the VirginiaandTruckee1976 Yahoo Group, which you should check out...

Just to be clear, it's the Commission's Virginia and Truckee Railway that talked about the name change. For those not up to speed on the trademark dispute, here's the scoop:

The Virginia and Truckee Railroad (the good guys) has owned the trademark to operate a railroad called the Virginia and Truckee Railroad since (don't quote me) the 1960's. They were sold this name by Grahame Hardy, famous railroad memorabilia seller and book publisher.

Bob Gray bought/acquired that trademark and if you look it up on USPTO.gov it's clearly for an operating railroad.

Now remember your history, the original Virginia and Truckee Railroad, incorporated in 1868, went into re-organization, I think it was in 1904. They renamed it the Virginia and Truckee Railway and operated as such until abandonment in 1950. For a photo, see http://www.livingsteam.com/virginia-and-truckee-railroad-history.html.

Now sometime later, Grahame Hardy's stepson, Joe Curtis registered the Virginia and Truckee Railway as a trademark for souvenier items like T-shirts, coffee cups, etc. Joe Curtis is the 800 lb gorilla in VC, owns the Mark Twain bookstore and lots of property, and is also the fire chief, and the building code inspector. He pulls a lot of weight up there and many people don't get along with him.

So Curtis is free to slap Virginia and Truckee Railway all over chachki's, t-shirts and bumper stickers. You can also look up his trademark at uspto.gov.

SO WHAT'S THE CONFLICT?

Curtis gave or sold his trademark to the government commission, the Nevada Commission for the Reconstruction of the Virginia and Truckee Railway. This happened in the last few years and the Gray's REAL V&TRR have been fighting it because the Curtis/Re-con commission trademark for Virginia and Truckee Railway does NOT extend to an operating railroad.

Who's to say what a court would decide, but under trademark law the commission likely can't run a railroad with a name so close to an existing trademarked railroad when their trademark is only for souveniers.

So the commission likely has three choices: fight the Grays in court over the use of the name, license the name from the Grays, or choose a different name.

Since the gov't has much deeper pockets than the Grays, I wouldn't be surprised if the Commission ignores the clear trademark precedent, beats them up in a long court process and wins in the end. They are above the law in so many ways, and have experience ignoring and flouting federal law. Why should a little trademark stop them? I hope I'm wrong.

OK, novel over.

(see you next month, MAYBE!)

Sierra Railroad Still in the Works

2009-07-16T16:23:00.000-07:00

No. 29 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

At the July 10 meeting, the Memo of Understanding between the Nevada Commission to Reconstruct the Virginia and Truckee Railway was on the agenda. Chris Hart and Robert Pinoli of Sierra Railroad were in attendance. They almost traveled a long way for nothing, because Chairman Dwight Millard started off the discussion as if he didn't have any real reason to put them on the agenda.

Turns out Dwight had a plan. He wanted to convince the Commissioners to hire Sierra as a consultant to tell them what to do with the railroad. I thought there had been years of work along these lines, starting with the 1994 study right through the same consultant helping the commission choose Sierra over the Grays a couple years ago. At that time, Sierra submitted a loose marketing plan. Since then Sierra has lost some favor with the Commission and the Grays appeared to be making inroads by virtue of them having equipment and shops in the area already. When the Commission needed train rides last year and this year, they went to the Gray's REAL Virginia and Truckee Railroad.

During the discussion the Commission asked Sierra about their experience with ADA-compliant cars. Sierra volunteered to send a car up that was compliant. They also agreed to work for the commission as a paid consultant. They still seem to be in play as the long-term operator for 2010 or 2011.

Wrapping up, the Sierra re-invention might have been a better idea BEFORE the former Commission Bob Hadfield diverted money from its intended purpose and then backfilled another $1 million to engineer a wye track and balloon track.

Millard: "I don't know if we're ever going to get to Drako, ever!"

2009-07-16T16:12:00.000-07:00

No. 28 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

I might flesh this out more I might not. Last month the Commission drastically cut back their operational plan by announcing plans to build a wye and a balloon track so they could run trains from DUMP ROAD down to the canyon and back, and maybe up the hill to Gold Hill. They announced they were shelving plans to build track through the Carson River canyon.

Millard just reinforced that by saying, "I don't know if we're ever going to get to Drako way, ever."

The Operating Committee Rises From the Ashes!

2009-07-16T16:00:00.001-07:00

No. 27 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

Like a Phoenix (pronounced Puh-hoo-nix), the long dead operating committee has risen from the ashes!

This is part of a series of posts on the first July meeting of the V&T Re-con Commission. I finished up the last post talking about how, on the heels of voting A THIRD TIME to sell the cars in Portola, John Tyson wants the Commission to buy two more cars!

I think Dwight Millard was either up to something or doesn't know his history. For once I miss Mayor Marv (gone from the commission) and Bob Hadfield (absent). If either of those characters had been there, they would not have let this happen.

For a brief history, the Commission has been schizophrenic for years. One half wants nothing to do with owning equipment or running operations. That half wants a private company to handle all the details so the Commission can focus on building track.

The other half of the Commission wants to play choo-choo, and years ago this other half was represented by the Operations Sub-Committee that was responsible for the acquisition of the #18 and the decrepit rusting bird-cages (complete with poop on the bottom of the cage) stored in Portola.

As a solution to the issue from the previous post, newly-appointed Chairman Dwight Millard put off the issue until next month.

He did this by appointing Ron Allen, John Tyson and Larry McPhereson to a subcommittee to gather information on acquiring more equipment. John Tyson will fly to Detroit to look these potential acquisitions over. Supposedly he's doing this on his own dime, though he commonly says how poor he is. At least this time they aren't buying equipment sight unseen, like they seem to have done with the #18.

To possibly paraphrase Einstein, if you keep doing the same thing and expect a different result, please check yourself into the loonie bin.

ALL PRAISE THE NEWLY REVIVED OPERATING COMMITTEE!! ALL HAIL!

Tyson Wants More Cars for $74,000!!!

2009-07-16T14:59:00.000-07:00

No. 26 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

COMMISSIONER JOHN TYSON WANTS MORE PASSENGER CARS!

Just on the heels of the Commission voting the THIRD TIME to get Ron Allen to get off his ass and sell the decrepit birdcages in Portola, John Tyson wants to take $50,000 from the Carson City Board of Realtors and add in another $24,000 from the Commission to purchase two historic Delaware and Lackawanna cars. The cars, according to John, are $17,000 each, plus $20,000 each to transport them from the east to Nevada.

This might make more sense, the cars are similar to the cars the Grays have (the recent acquisitions) and most of the cost will be paid by a private party. Sounds good so far, let's see where this one goes...

During the conversation, the price dropped. When Tyson first mentioned these cars, he said seventeen thousand each plus transport. Then he dropped the price to $15,000 each. What a deal!

A long discussion ensued where Janice Ayres of the Northern Nevada Railway Foundation stomped her feet saying that the donation was restricted and she doesn't want to get sued. Stephen Lincoln, saying he didn't speak for the Realtors Assocation, spoke for them and told the commission to do what they thought was right.

Then when it came time to vote on acquiring these cars, Janice Ayres piped up again and said the donated money wasn't just to buy a car, it was to buy a dinner car! They are scrambling just to run regular trains, the Dinner Train idea goes back to 1994 and has never been properly fleshed out. The Dinner Train was intended to run from Drako way, through the canyon and back to Drako without going all the way up the hill. Since the Commission has apparently abandoned the idea of building through the canyon for at least many years into the future, if they buy a dinner car it will be a stationary dinner car!

I wish to mention at this point that during this meeting, I think they must have served booze for lunch. Everyone was punchy after an all day meeting, and they KEPT FORGETTING TO TURN ON THEIR MICROPHONES! Much of this meeting was not recorded well by ACCTV, making it frustrating to turn up the volume. In addition, the podium was missing from the room so none of the audience comments came through clearly. More professionalism and concern for laying down a public record-- not! I should also mention, I didn't see the clerk-recorder there to make minutes. She may have been there but was never seen on camera. Dwight Millard was sitting in her seat.

THE ROAD TO HELL

Then Bonnie Weber asked what the hurry was to buy these cars. John Tyson, in typical Tyson-Allen fashion, said someone else might buy them first. These guys always like to invent demand when it suits them. John then said, "you know that old saying, the road to hell is paved with lost opportunity."

Actually, John, you really showed your ignorance there. "The road to hell is paved with good intentions." Maybe if the Commission understood the real "road to hell" saying they would run better? Probably not.

I'm going to continue this in the next newer post, this story really takes a twist here...

Dwight Millard "Numb" on cars stored in Portola

2009-07-16T14:14:00.000-07:00

No. 25 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

COMMISSION VOTES TO SELL CARS IN PORTOLA FOR THE THIRD TIME!!

As noted in the previous post, Ron Allen is on those cars in Portola like a bitin' hog!

Apparently during the all-day workshop, someone offered to pay the lease fees for the decrepit passenger cars stored in Portola, so the Commission could ignore it's two previous votes and avoid selling the cars after all.

Dwight Millard, in introducing the agenda item, said, "I'm numb on the issue, I don't care." What leadership! After previously pushing hard to get rid of the rusting natural outhouses, Ron Allen has succeeded in beating down Dwight Millard. Dwight has previously been strong on getting rid of the cars, even to the point of talking about scrapping them or "blowing them up."

Now our new Fearless Leader, Chairman Dwight Millard, has indicated "I'm numb on the issue, I don't care." When you wonder why I say the Commission changes it's mind every time it turns around, this is one example why.

Then it came up that some company called Timber Heritage had indicated their willingness to pay $2000 per car for a total of $10,000. Ken Dorr indicated that it was just an indication, not a solid offer. It does go to show how the Commission has overpaid for the cars, with $50,000 into them by now.

Then Ken Dorr said he told the Timber Heritage people that the Commission would have to follow a process of putting out an RFP and get a full vote of the Commission. It was funny, on camera you could see Mike Rowe give him a funny look, but not say anything.

If there was a need for an RFP, don't you think this would have been brought up during the TWO previous decisions to sell the cars? This is all covered in the previous post, so I will move on.

Then Commissioner Larry McPhereson asked if the cars were currently in a place where potential buyers could look at them, or it they should be moved to Reno. Ron Allen said something funny, in fact he almost told the truth. He said because they don't have a gang problem in Portola the cars were not likely to have grafitti on them. He did say that the occasional bum may sleep in them, but characterized that as a "no harm no foul" situation.

Now I don't want to be gross, but some of those bums that have slept in the cars have bared their bums and done their "morning duty" in the cars. On top of animal feces in the car, you have worse things to consider.

Then Ron Allen put the rest to another lie without realizing it. In response to Larry McPhereson's idea that the cars be moved to Reno, Ron Allen said it would be best to move them all the way to Carson City. First, he said, you would still have to pay rent in Reno.

SECOND, Ron said the cars would have to be trucked to Reno, because they can't run on the rails. But the cars came to Portola ON THE RAILS! So by inference, by doing nothing to maintain the cars over the last few years, they have degraded to the point where they can't run on the rails any more. Wasn't John Tyson just telling us two months ago that the car's trucks were in perfect shape?

Now Bonnie Weber pipes up. Two months ago she suggested that the cars could be used in a parade!!!!! Now she says it's time to move on. She said she was surprised that even the Gray's (REAL) Virginia and Truckee Railroad didn't want the cars.

Well, DUH! Considering that the Gray's just acquired two cars last year that were in much better shape from the National Railroad Museum in Green Bay, WI, and those cars have clerestory windows and open platforms, and those cars weren't filled with poor, the windows were intact and the seats were in good shape ...

Why on earth would the Gray's possible want cars that are too heavy, don't look right, and will cost $186,000 per car to refurb, at a minimum. I can't disclose the exact details but the cost of the two cars plus transport from Wisconsin plus refurbishing was significantly less than the $186,000 Ron Allen want to spend on just one of the cars in Portola. I'm just going to have to say it straight, Bonnie Weber has no clue!

So in the end, the Commission voted FOR THE THIRD TIME to get rid of all five cars stored in Portola.

Trust me, this isn't the end of it.

$186,000 to remodel ONE V&T car in Portola

2009-07-16T13:39:00.001-07:00

No. 24 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

RON ALLEN QUOTES 186,000 TO REMODEL A V&T BIRDCAGE TO ADA STANDARDS

At the July meeting one of the agenda items was the question of whether the V&T Re-con Commission needs to provide an ADA-compliant railroad car. The suggestion was made that one of the Commission's cars in Portola could be remodeled to ADA standards.

These cars are in horrible shape, as disussed on my previous post about "the wildlife condos."

So given that these cars are rusted shells that have been allowed to sit open to the elements for years, the quote Ron Allen gave to restore a car to ADA standards is a bit misleading. He said it would cost $186,000 to get a car up to the ADA standard. Let's consider that most of that money would be spent, as Ron Allen said, one "the other 40 seats." Even without making a Portola car ADA compliant, they'd be spending between $150,000 and $250,000.

Also, in the whole discussion, no one ever asked whether the locomotives they have available are capable of pulling an extra heavyweight car all the way to Virginia City. This type of discussion in a vacuum is typical.

Finally, didn't they just vote to sell these cars back in May? I predicted then that as long as Ron Allen remains in charge of the sale, the cars wouldn't be sold. As with the Hadfield-Dorr "diversion issue," often the full vote of the Commission is simply ignored by one or two members to suit their own purposes.

And you want the government to run health care? I hope the V&T Commission is not put in charge.

Now, back to the ADA-compliant railroad car. Ron Allen then brings up the idea that possibly for rides less than one and one half hours, no restroom is necessary.

Disabled or not, do you want to ride a train without a toilet? When the Commission ran their VIP special last year, the booze flowed freely and no restrooms were available on the train. The trip took so long that the train stopped at Haward Siding and BOTH men and women went to the bathroom "in the rough."

This is the kind of high-level thinking that keeps these projects on-track, efficient, consistent and cheap. These are the kind of people we want safeguarding our tax dollars!

New Interim Depot Site on DUMP ROAD!

2009-07-16T11:27:00.000-07:00

No. 23 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicle

COMMISSION CHANGES THEIR MIND AGAIN

In the last month or two a six-month old secret plan by Ken Dorr and Bob Hadfield was brought to light. The Commission spent almost $1.5 million dollars years ago to buy land for a terminal at Drako Way in Carson City.

Now they have a new plan, and Dwight Millard has said it centers on DUMP ROAD!

Now that they have publicly revealed their plan to run short term operations from east of Flint Drive down into the Canyon and back, and MAYBE up to Gold Hill, they want to put a "temporary depot" northeast of the Carson City dump. This is not the same as the temporary loading area they will use at Eastgate Siding for the Railfest festivities Aug 14-16.

By the Way, the Railroad Has No Reflections

2009-07-16T11:17:00.000-07:00

No. 22 -- VIRGINIA AND TRUCKEE RAILWAY -- Nevada Railroad Reconstruction Chronicles

THE RAILWAY HAS NO REFLECTIONS IN 2009

Last year the lobbyist group known as the Northern Nevada Railway Foundation ran an event called Railway Reflections. This year they won't.

Last year, as in years past, they were given an "annual payment" from the Commission for their fund-raising efforts. Never mind that net-net they have cost the Commission more than they have ever raised from private hands.

Last year in 2008 the Railway Reflections events we said to have a bright future. NNRF people claimed they could compete with Hot August Nights (HA!).

This year there is simply nothing going on. At least they will save the Commission from funding the fund-raisers.