The real story of the CHS Loop madness that I predict will play out in 2005 is how the CHS will have flushed down the toilet of Clear Creek County what could be in excess of 10 million dollars. Just how much economic pain will the merchants and citizens have to take for the incompetence of their state historical society before heads will roll in Denver?
Here is how I see it. CHS basically took a very well run business (GLRR) employing 60+ people and forced them out of business due to unreasonable demands based on greed and personal vendetta’s of key management personnel. I would estimate this was about a 2 -2.5 million dollar operation based on attendance etc. Assuming a 15% operating profit the Ashby’s just have had a 3.5 million dollar equity (NPV) wiped out. Now, they do own the operating equipment so that would reduce this somewhat. But everything else, all the goodwill, construction and track improvements, and 30+ years of operational knowledge and employee base, all wiped out from the Ashby’s equity. To be replaced by an unproven company (Railstar) whose profits (if any) will flow out from Colorado. Such a deal.
This is just the tip of the proverbial iceberg though. The real economic shock is coming for Georgetown next year when I will be surprised if CHS/ Railstar can draw even 50% of this years attendance (130,000+). No big deal you say. Think again. Based on the Colorado State Visitors Study (Longwoods report) each tourist will spend on average of $81.00/ day during their stay. I would think that an average stay of 1.5 days would be conservative. I just wonder then how many of the merchants will be able to sustain this potential loss of 8 -10 million dollars to the local economy because the CHS wanted to play with their own trains.
And for those who say that we will just have to wait and see, I have seen enough of the CHS devious and irrational behavior that 2005 will hopefully conclude with the CHS management heads rolling down Broadway in Denver. I guess I should remember that the history of railroading is filled with episodes of people who manipulated resources for their own interest, time will tell how this bunch will be judged.
