Tracks (Out) Ahead for RailMark?

*Sigh*

I was really hoping this would work out. I really was.

Despite my reservations when we first learned that RailMark was selected to be the new operator of the Algoma Central Railway passenger service, I was cautiously optimistic. There were lots of little red flags, but I really wanted it to succeed. Now, just in advance of a city council meeting next week to discuss the subject, things appear to be flaming out in spectacular fashion, and I wish I could say I was surprised.

To recap the history of the last few months for those not closely following the news out of Sault Ste. Marie: On March 31, the last possible day before CN was officially slated to end the service, the official announcement of the funding extension and new operator was finally made, although rumours had been swirling around before that. In the interim, CN agreed to operate the service until the end of April so that RailMark could get prepared to take over. Which happened, but the transition was a rough one with a gap in service of for several days at the beginning of May, with the first northbound train departing on May 7 with only a single passenger as no one even knew if the train would even be running. (Strike one.)

From this rough start however, the passenger service has been operating under RailMark for the last month and a half approximately, but more warning rumblings have occurred. As part of their takeover agreement, RailMark was to have also taken up the operation of the Agawa Canyon Tour Train, but at the beginning of June CN announced that they would again be operating the tour train this summer, citing RailMark’s complete failure to do anything to market or promote this operation. (Strike two.)

[Edit – June 22: watching today’s city council meeting clarified a few things for me. The Canyon Tour Train and regular passenger service are covered under separate agreements, but it makes sense for them to ideally fall under the same operator. Due to the logistics and time frames involved (the tour season starts tomorrow) CN had agreed to operate the tour train for this season at least. This actually makes a lot of sense and is not necessarily a black mark if it’s as simple as all that, but just on top of the other little bumps in the road, and the way it was reported by SooToday, definitely seemed like RailMark was out of that one. Part of the problem in figuring out what’s going on is a limited number of news sources reporting on any details, and an apparent lack of any clarifying information from RailMark’s side of things.]

All of this over the last month has been building up to a city council meeting now scheduled for this Monday to discuss the proposed funding agreement with RailMark (as the city has been appointed the executor of the federal subsidy for the passenger service). The city is understandably concerned that RailMark has the financial wherewithal to pull off this operation, and put forth two major conditions: that RailMark secure appropriate insurance, and be able to obtain a line of credit. So far, there has been no indication of RailMark being able to obtain such a line of credit, and now the passenger working group, which lobbied so hard over the last year for the preservation of the service, is now recommending that the city no longer enter into the funding agreement with RailMark. (Strike three.)

Now, it appears that an unspecified incident in Hearst has prevented the southbound train from operating on Friday as scheduled, stranding dozens of passengers, mainly tourists and no train to the Sault is being expected at this point until Tuesday! (Bloody hell, what’s the count at now?)

From the article:

Al Errington, owner operator of Errington’s Wilderness Islands Resort and member of the Algoma Passenger Rail Committee has a pretty good idea of why it didn’t arrive.

In fact, it’s not expected to be running at all before Tuesday.

“Maybe not even then,” says Errington. “Right now a crew is towing it to Hawk Junction behind a freight train.”

“There was an infraction,” he says. “I don’t know anything about these things or how they work. Only that it meant the train couldn’t leave Hearst.”

18 guests of Errington Wilderness Resort were supposed to be on the train on Friday.

The article states that as many as 54 people were evacuated by float plane after being stranded by the railway. This is just downright embarrassing at this point. (Now I’m really curious as to what in the world exactly happened in Hearst on Friday morning.) This is really just compounded by being a singular case of bad timing, but still illustrates some teething issues.

So, with RailMark having lost the Canyon Tour Train (the service that would have actually made money), and the whole funding agreement with the city up in the air still, and now a spectacular incident on the eve of the city council meeting about the agreement, will the city keep going with RailMark or say “enough is enough”?

Unfortunately, what happens at that point is entirely unclear. I’ve not seen a lot of RailMark’s side of the story in the news articles, although for his part president Allen Brown has suggested that part of the issue in not being able to secure a line of credit (one of the city’s preconditions) is the bankers being concerned about not having a signed agreement with the city yet. A chicken/egg problem. If the city does give RailMark the boot, some have suggested that it would fall back on CN to maintain operation with the subsidy, but CN has stated they have no intention of getting back into the passenger operation. And RailMark as an operator was selected by CN, not the city or region (as CN owns the actual railroad), so the logistics of trying to find another operator are … murky, to say the least. What a mess.

Some more cynical minds have suggested this was CN’s agenda all along: pass off the operation to someone that would cock it up and then when it fails be able to happily wipe their hands of the whole thing without being the “bad guy” in the room. I’d like to think I’m not quite that cynical, but any of my other friends that have previously heard of RailMark through inside contacts in shortlines and operations in Southern Ontario pretty much instantly said “Well, that’s just a matter of time. Kiss that service good-bye.” when we heard RailMark would be the new operator. Their reputation locally by anyone professing to be “in the know” is somewhat of a joke. I just hope the Sault to Hearst passenger service isn’t the punch line.

I guess we’ll see what happens following the city council meeting on Monday…

Update: It seems that there was indeed an allegation of a rules violation and a formal Transport Canada investigation (during which the crew would have been barred from operating a train thus causing the disruption over the weekend) but the crew was ultimately cleared of doing anything wrong.

2 thoughts on “Tracks (Out) Ahead for RailMark?

  1. Sadly, I don’t think you’re being overly cynical at all. I’ve been following this (admittedly from a distance) and have come to the conclusion that CN want’s nothing at all to do with passenger rail – including passenger trains running on their tracks, so they “awarded” the train service to Railmark knowing there was a good likelihood Railmark would fail.

    • Well, my following is kind of from a distance as well.

      To be completely fair, RailMark has been operating the service for almost two months now entirely on their own cost. And from what I can tell, the terms (from the Federal Government) for the funding would have the operator submit monthly expenses for reimbursement, so it’s not like they could “take the money and run”, as an even more cynical friend suggested early on.

      I think RailMark is showing themselves to be serious about this, but you can’t deny there’s been a couple of bumps on the road in the transition. Hopefully this is just teething issues and it all stabilizes out. It’s also difficult to find information on any other current RailMark operations, just a few other sold or shut down operations, mostly short-distance dinner trains. Of course these can shut down for any number of reasons and a tourist/dinner train will be more sensitive to economic conditions than anything else, although the most notable previous RailMark operation is the Columbia Star Dinner train due to the apparently complicated issues around it’s demise, and some ruffled feathers and bad blood left behind in Columbus as a result.

      Despite everything, I’m still cautiously optimistic that something can still work out here.

      As far as CN goes, they’ve been quite clear they want nothing more to do with operating the passenger train themselves. They might prefer to have it out of their hair althogether, but obviously would not suggest so publicly even if that is true.

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