RailRunner Existence In Question

As passenger rail projects across the country become targets for budget-cutters, the next service that could be on the chopping block is New Mexico's RailRunner commuter line. Newly inaugurated Republican Gov. Susana Martinez says she is taking a hard look at the trains, as reported by the Santa Fe New Mexican:

Rail Runner faces new scrutiny

"'Had I been governor, I would not have supported the Rail Runner as it exists today,' [new Republican governor Susana] Martinez said during the campaign. 'However, we now have the train and must look at ways to make the Rail Runner a more self-sustaining operation that is less draining on the taxpayers, or try to sell it to a private operator.'"

"The state spent more than $400 million building the train, which had been years in the works. It started service in the Albuquerque corridor in 2006 before beginning rides from Santa Fe to Belen in 2008. Recently, ridership has declined, something supporters say is attributable to a decrease in the number of trains on Saturday and higher weekend fares."

Related Story: Rail Runner Express ridership dips

If RailRunner can achieve 50% farebox recovery, then it would be doing a good job. Anything higher than that is unrealistic.

"Sell it to a private operator"? Um, yeah, OK.

Another neo-conservative Republican is inaugurated and another passenger train is under attack.

Looks like I'd better get my first ride planned before they start gutting and/or privatizing this into oblivion.

In other news Kay Baily Hutchison is retiring...

Maybe she finally realized that her relatively moderate views are no longer appreciated or workable in today's GOP/TP.

Spokker said:

If RailRunner can achieve 50% farebox recovery, then it would be doing a good job. Anything higher than that is unrealistic.

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RailRunner's performance is actually very low for commuter rail. On average in this country in 2009 commuter rail achieved a 47.96% fare box recovery rate. RailRunner only hit 14%, which is actually worse than the national average for buses, which are typically worse than rail. So I'm not sure just what's wrong, although I guess that the fares are too low among other issues.

It is interesting to note however that the Governor is looking at the train as a way of helping cut the loses to the state. I say it's interesting, seeing as how in 2009 the State of New Mexico provided exactly $0.00 in funding to the train. The bulk of the funding for this train came from the Fed. Now I have no idea if the Federal monies are expected to expire in the near future, but if they're not expiring, cutting this train will do nothing to help the state's budget woes.

But to the public getting rid of the train makes it look like she is doing something usefull when it fact she is not.

AlanB said:

Now I have no idea if the Federal monies are expected to expire in the near future, but if they're not expiring, cutting this train will do nothing to help the state's budget woes.

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As with HSR funding myopically rejected by Republicans in other states, I think it's safe to say that California stands ready and willing to accept redirected federal dollars and put them to good transit use.

The fare for any Albuquerque city bus is $1. Not bad. I knew it is too cheap and I'm still wondering when they'll increase the fare.

AlanB said:

...It is interesting to note however that the Governor is looking at the train as a way of helping cut the loses to the state. I say it's interesting, seeing as how in 2009 the State of New Mexico provided exactly $0.00 in funding to the train. The bulk of the funding for this train came from the Fed. Now I have no idea if the Federal monies are expected to expire in the near future, but if they're not expiring, cutting this train will do nothing to help the state's budget woes.

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That would have been true if revenue were meeting expectation. Unfortunately, it is not.

The plan for RailRunner was to have 25% of the operation paid from fares and fees, 25% from federal congestion mitigation and air quality (CMAQ) grants, and 50% from a 1/8% sales tax. The fare box revenue is coming in well below the 25% projection (now about 10% and dropping), and the sales tax revenue is also not meeting projections. The federal CMAQ grant is fixed, so the deficit has to be made up from another source. That source is the state. The state is faced with a multi-million dollar contribution to keep RailRunner operating when the expectation was that fares, the CMAQ grant, and the sales tax would do the trick.

PRR 60 said:

AlanB said:

...It is interesting to note however that the Governor is looking at the train as a way of helping cut the loses to the state. I say it's interesting, seeing as how in 2009 the State of New Mexico provided exactly $0.00 in funding to the train. The bulk of the funding for this train came from the Fed. Now I have no idea if the Federal monies are expected to expire in the near future, but if they're not expiring, cutting this train will do nothing to help the state's budget woes.

Click to expand...

That would have been true if revenue were meeting expectation. Unfortunately, it is not.

The plan for RailRunner was to have 25% of the operation paid from fares and fees, 25% from federal congestion mitigation and air quality (CMAQ) grants, and 50% from a 1/8% sales tax. The fare box revenue is coming in well below the 25% projection (now about 10% and dropping), and the sales tax revenue is also not meeting projections. The federal CMAQ grant is fixed, so the deficit has to be made up from another source. That source is the state. The state is faced with a multi-million dollar contribution to keep RailRunner operating when the expectation was that fares, the CMAQ grant, and the sales tax would do the trick.

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Bill,

May I ask your source, because according to the National Transit Database, zero state dollars of any type were used in 2009. Only fares, Federal funds, and other sources which typically include things like interest, rent of building, ads, etc., paid for the train.

AlanB said:

Bill,

May I ask your source, because according to the National Transit Database, zero state dollars of any type were used in 2009. Only fares, Federal funds, and other sources which typically include things like interest, rent of building, ads, etc., paid for the train.

Click to expand...

It comes from the Mid Region Council of Governments of New Mexico and was also stated by a Rail Runner spokesperson in a TV interview. Here is the info from the MRCOG:

...For fiscal year 2009, fares cover about 14% of the operating costs. Fees paid by BNSF and Amtrak cover another 7%. The voter-approved tax for Rail Runner operations (0.125% adder to the Gross receipts tax in Rail Runner counties) contributes another 54%, and Federal Congestion Mitigation Air Quality funds from the New Mexico Department of Transportation cover the remaining 25%, which is approximately $5 million per year.

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MRCOG

The Gross Receipts Tax is the New Mexico version of a sales tax. The rate is variable by county.

PRR 60 said:

AlanB said:

...It is interesting to note however that the Governor is looking at the train as a way of helping cut the loses to the state. I say it's interesting, seeing as how in 2009 the State of New Mexico provided exactly $0.00 in funding to the train. The bulk of the funding for this train came from the Fed. Now I have no idea if the Federal monies are expected to expire in the near future, but if they're not expiring, cutting this train will do nothing to help the state's budget woes.

Click to expand...

That would have been true if revenue were meeting expectation. Unfortunately, it is not.

The plan for RailRunner was to have 25% of the operation paid from fares and fees, 25% from federal congestion mitigation and air quality (CMAQ) grants, and 50% from a 1/8% sales tax. The fare box revenue is coming in well below the 25% projection (now about 10% and dropping), and the sales tax revenue is also not meeting projections. The federal CMAQ grant is fixed, so the deficit has to be made up from another source. That source is the state. The state is faced with a multi-million dollar contribution to keep RailRunner operating when the expectation was that fares, the CMAQ grant, and the sales tax would do the trick.

Click to expand...

PRR 60 said:

AlanB said:

Bill,

May I ask your source, because according to the National Transit Database, zero state dollars of any type were used in 2009. Only fares, Federal funds, and other sources which typically include things like interest, rent of building, ads, etc., paid for the train.

Click to expand...

It comes from the Mid Region Council of Governments of New Mexico and was also stated by a Rail Runner spokesperson in a TV interview. Here is the info from the MRCOG:

...For fiscal year 2009, fares cover about 14% of the operating costs. Fees paid by BNSF and Amtrak cover another 7%. The voter-approved tax for Rail Runner operations (0.125% adder to the Gross receipts tax in Rail Runner counties) contributes another 54%, and Federal Congestion Mitigation Air Quality funds from the New Mexico Department of Transportation cover the remaining 25%, which is approximately $5 million per year.

Click to expand...

MRCOG

The Gross Receipts Tax is the New Mexico version of a sales tax. The rate is variable by county.

Click to expand...

I think you're proving yourself wrong here.

You said the original plan was to cover it 25% from fares and fees, 25% from CMAQ, and 50% from the sales tax.

According to the quote you provided, fares cover 14% and Amtrak/BNSF fees (I'm assuming trackage rights and other fees) cover 7%. That's 21%. The sales tax, according to the quote, covers 54%, and CMAQ covers 25%.

So, the sales tax is covering the 4% that the fares and fees are falling short. You can argue that the sales tax is "state money," but it was approved by voters to be dedicated to RailRunner, so there's really nothing wrong there.

Or am I missing something?

It may be that rail is just not viable on this corridor. It wouldn't be a bad idea to pull the plug.

It would be a shame, though. From the outside looking in, it appears to be a nice starter service with slick trains. It's average speed is around 42-43 MPH as scheduled, which puts it in line with most services I've seen.

Might NM also be facing an issue in that CMAQ grants are typically only good for a limited time (3 years I believe), after which time it is expected that fares or local/state funds will replace the CMAQ funds?

Trogdor said:

PRR 60 said:

AlanB said:

Bill,

May I ask your source, because according to the National Transit Database, zero state dollars of any type were used in 2009. Only fares, Federal funds, and other sources which typically include things like interest, rent of building, ads, etc., paid for the train.

Click to expand...

It comes from the Mid Region Council of Governments of New Mexico and was also stated by a Rail Runner spokesperson in a TV interview. Here is the info from the MRCOG:

...For fiscal year 2009, fares cover about 14% of the operating costs. Fees paid by BNSF and Amtrak cover another 7%. The voter-approved tax for Rail Runner operations (0.125% adder to the Gross receipts tax in Rail Runner counties) contributes another 54%, and Federal Congestion Mitigation Air Quality funds from the New Mexico Department of Transportation cover the remaining 25%, which is approximately $5 million per year.

Click to expand...

MRCOG

The Gross Receipts Tax is the New Mexico version of a sales tax. The rate is variable by county.

Click to expand...

I think you're proving yourself wrong here.

You said the original plan was to cover it 25% from fares and fees, 25% from CMAQ, and 50% from the sales tax.

According to the quote you provided, fares cover 14% and Amtrak/BNSF fees (I'm assuming trackage rights and other fees) cover 7%. That's 21%. The sales tax, according to the quote, covers 54%, and CMAQ covers 25%.

So, the sales tax is covering the 4% that the fares and fees are falling short. You can argue that the sales tax is "state money," but it was approved by voters to be dedicated to RailRunner, so there's really nothing wrong there.

Or am I missing something?

Click to expand...

The purpose of my link and the quote from the link was to provide Alan with authoritative information concerning local and state funding of Rail Runner operation. Since the quoted statistics are from 2009 and the reported financial problems are related to ridership and revenue issues now, I don't think the data proves or disproves anything in that regard.

AlanB said:

Spokker said:

If RailRunner can achieve 50% farebox recovery, then it would be doing a good job. Anything higher than that is unrealistic.

Click to expand...

RailRunner's performance is actually very low for commuter rail. On average in this country in 2009 commuter rail achieved a 47.96% fare box recovery rate. RailRunner only hit 14%, which is actually worse than the national average for buses, which are typically worse than rail. So I'm not sure just what's wrong, although I guess that the fares are too low among other issues.

It is interesting to note however that the Governor is looking at the train as a way of helping cut the loses to the state. I say it's interesting, seeing as how in 2009 the State of New Mexico provided exactly $0.00 in funding to the train. The bulk of the funding for this train came from the Fed. Now I have no idea if the Federal monies are expected to expire in the near future, but if they're not expiring, cutting this train will do nothing to help the state's budget woes.

Click to expand...

Sounds good if you're in front of a mike....might get a few Tea Partyers on board the kill the train train...

Teh development of the Railrunner was a wonder to behold. I cannot think of any public transportation system anywhere else in the US that was put together so fast. It appeared that all obstacles dissapeared almost by magic. Considering the usual trials and travails that go with getting ANYTHING like this going, the suspicious minded were left thinking tha the fix was in with all the agencies involved. In addition, there equipment was all or almost all bought new.

How did this manage to happen? Given the population of the area and the low fares, the low farebox recovery is no surprise.

At about the same time, the Music City Star in Nashville was getting under way. Watching both these happen at the same time, and being similar in length, the contrast with what was done in Nashville. was striking. Almost everything for Nashville was bought used or done on the basis of as cheap as possible without destroying funcionality. In fact, their major cost was upgrading 30 miles of ex Tennessee Central track from 25 mph to 60 mph.

Fares adn ridership per train appear to be similar.

Well I assume that selling the RailRunner privately will mean selling the I-25 corridor to a private buyer. Oh, that would be a toll authority required to meet the same financial results........Hmmm........

No private company would take the train unless it also came packaged with the I25 corridor as a tollway. Then you really would have a case of the roads subsidizing the trains! Tolls would have to be higher accordingly to compensate for the approximately 5 million $ cost that taxes and fares do not cover. Imagine the screaming in NM if that scenario ever came to pass.

$1,000,000,000 (One billion dollars) have been spent on rehabbing a 16 mile stretch of I-40 that runs through the City of Albuquerque in the past 10 years. This is not a brand new highway, it is not a new alternative. It is an existing highway. A highway that bypasses the local businesses/Downtown, etc. It allow cross country travelers to zip through our fair city much faster. To date, not one cent of the cost of rehabbing, maintaining, patrolling, etc., of this 16 miles has been recouped by the City, State, or Federal Gov't. Essentially a 0% return on the "fare box". 100% subsidized - it will NEVER pay for itself. When it was originally built in the late 1950's, it divided neighborhoods and siphoned commerce from the commercial areas of the city, most still have not recovered fully 50+ years later.

By contrast, the entire 100 mile corridor of the NM Rail Runner Express regional passenger train cost a paltry $400,000,000 (Four hundred million dollars). It was a completely new and alternative route between 2 of New Mexico's most important cities: the State Capital in Santa Fe, and the largest city, Albuquerque, which has the state's only International Airport. Prior to the Rail Runner, there was essentially only one road connecting the two cities - I-25. I-25 has increasingly more traffic, and more accidents, and more closures due to both accidents and weather. Literally one road. With no frontage road. If an accident closed I-25, you were stuck.

Despite the Great Recession, many small and local businesses have weathered the recession in and around the Rail Runner route which doesn't bypass the commercial centers of the communities it passes through. This benefits the state economically, as local businesses pay higher taxes and reinvest locally, whereas the national chains on the interstate exits pay less taxes (in some cases no taxes), and send profits back to corporate headquarters out of state.

The economic rewards (increased investments/increase tax collection/tourism) that the NM Rail Runner Express brings to local and state coffers is sadly, never added to the balance sheet. Neither are the social benefits factored in. Many people don't have cars or choose not to drive or cannot drive due to visual, or physical conditions, or age -too young or too old. It also give both businesses and employees a greater area with which to connect. People who may not be able to afford to live in Santa Fe can now affordably commute from more reasonably priced housing in Albuquerque or Rio Rancho or Los Lunas, etc.

As for the fare box revenue, the cost of a round trip ticket between ABQ and SFe only just was increased to $9 on May 21, 2012 - still ridiculously low. But given that the 'user fee' for the same route on I-25 is STILL $0, I guess the train fare is maybe too high!! I look forward to the day when I-25 becomes a more self-sustaining operation that is less draining on the taxpayers" and or is sold " to a private operator.'" I think a $9 round trip toll on I-25 (and I-40 for that matter) is totally reasonable!

I think that in addition to a fare increase there should be a serious look at the cost structure. If it is anything like the process of development of the system, economy seemed to be barely considered. We are not going to change the way the road system is costed, so we are simply spinning our wheels when we get onto that. The only option is to see what can be done to the expense of operating the system. And: Reducing train frequency is NOT the way to go.

George Harris said:

I think that in addition to a fare increase there should be a serious look at the cost structure. If it is anything like the process of development of the system, economy seemed to be barely considered. We are not going to change the way the road system is costed, so we are simply spinning our wheels when we get onto that. The only option is to see what can be done to the expense of operating the system. And: Reducing train frequency is NOT the way to go.

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This is true, but there is certainly room for politicians to be a lot less gung-ho about throwing money at expanding the highway system. One thing that would certainly fall in this vein would be for a state to announce an intent "focus on fixing broken highways rather than building new ones" (i.e. replacing 60-year-old bridges with structural issues sooner rather than later). Especially in the Northeast (where a substantial number of highway segments predate the IHS and a few major bridges and tunnels are starting to creep up on 90 years old), this would actually make sense from a long-term budget control perspective (i.e. dealing with problems sooner rather than later). In the meantime, while the state's highway funding gets tied up "batting cleanup", you'd have a convenient "breather" where a serious discussion can be had about what to focus on in the future.

As to the RailRunner specifically, I'll say this: As a rule, a decent CR figure is necessary to justify a project. No, it doesn't need to be 100% (or even necessarily 50%), but something languishing in the low teens after multiple years of operation is a bad sign as a rule. I'm not sure what's "wrong" there, but something does seem "off" in the operation by that figure.

Anderson said:

As to the RailRunner specifically, I'll say this: As a rule, a decent CR figure is necessary to justify a project. No, it doesn't need to be 100% (or even necessarily 50%), but something languishing in the low teens after multiple years of operation is a bad sign as a rule. I'm not sure what's "wrong" there, but something does seem "off" in the operation by that figure.

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Well their biggest issue is quite simply fares that are too low for the distance.

For example, the OTOL gang is going to be in the Albuquerque area come July. I just brought a day pass that allows me unlimited rides for the full length from Santa Fe down to Belen of 96 miles for $10, which is up from $8 last month. A one way fare is $10 (used to be $8) to go 96 miles.

By comparison, the LIRR Bridgehampton stop is 95.8 miles from Penn Station. First, there is no such thing as a day pass that allows for unlimited rides. The one way, off peak fare from Penn to Bridgehampton is $18.25; it's $25 if you're traveling in a peak direction.

AlanB said:

Anderson said:

As to the RailRunner specifically, I'll say this: As a rule, a decent CR figure is necessary to justify a project. No, it doesn't need to be 100% (or even necessarily 50%), but something languishing in the low teens after multiple years of operation is a bad sign as a rule. I'm not sure what's "wrong" there, but something does seem "off" in the operation by that figure.

Click to expand...

Well their biggest issue is quite simply fares that are too low for the distance.

For example, the OTOL gang is going to be in the Albuquerque area come July. I just brought a day pass that allows me unlimited rides for the full length from Santa Fe down to Belen of 96 miles for $10, which is up from $8 last month. A one way fare is $10 (used to be $8) to go 96 miles.

By comparison, the LIRR Bridgehampton stop is 95.8 miles from Penn Station. First, there is no such thing as a day pass that allows for unlimited rides. The one way, off peak fare from Penn to Bridgehampton is $18.25; it's $25 if you're traveling in a peak direction.

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Do I understand that a day pass is the same as a one-way fare? That is simply nuts. A day pass equal to twice the one way fare is the Caltrain practice, and is fairly reasonable. Caltrain does not do round trip tickets. Given the difference in locations, I would not consider a Railrunner fare around half those in the New York area to be excessively low.

George Harris said:

Do I understand that a day pass is the same as a one-way fare? That is simply nuts. A day pass equal to twice the one way fare is the Caltrain practice, and is fairly reasonable. Caltrain does not do round trip tickets. Given the difference in locations, I would not consider a Railrunner fare around half those in the New York area to be excessively low.

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Well if one buys the day pass in advance, then yes, it is the same cost as a one way ticket for all 6 zones. If you buy it on the day of travel, then the day pass costs a whole buck more than the one way fare. :lol:

So for our group, we'll ride from ABQ to Santa Fe, have lunch, ride all the way to Belen, and then ride back to ABQ; all for $10 each.

And while perhaps comparing to NY isn't exactly fair, they are still under priced by comparison to say Salt Lake City. They charge $5.10 to go about 40 miles on their commuter rail system; so in theory when the extension south opens soon, they'll be charging at least $10.20 to go about 86 miles. RailRunner is charging $10 to go close to 97 miles. Granted few people probably ride the entire line from one end to the other, most are riding to either Santa Fe or Albuquerque.